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Small businesses throughout Europealso will have a particularly hard time, accord-ing to nearly all studies. One study notes, “Theheaviest burden will be on SMEs [small andmedium-sized enterprises] which cannot con-sistently fulfill the REACH requirements andso it is predicted that most of them may facefinancial troubles, may be taken over by biggerones, or even shut down.”
REACH’s impact isn’t going to fall only onEurope, because the United States and othernations are inextricably linked to the EU econ-omy through trade. The United States exportsmore than $20 billion in chemical productsand invests more than $4 billion in the EUchemical and related industry sectors annually.In addition, U.S. firms export more than $400billion in products containing chemicals, someof which may fall under the scope of REACHregulations. The United States also importsmore than $40 billion of chemicals from Eu-rope each year.
The U.S. government mission to the EU haspointed out that REACH is expected to ad-versely affect tens of billions of dollars of tradein chemicals and products. Affected sectorswill probably include textiles, pharmaceuticals,electronics, automobiles, and advanced materi-als. According to the European Commission’s
3. Institute for Prospective Technological Studies (IPTS),Implementation of REACH in the New Member States(Brussels: European Commission, 2005), http://europa.eu.int/comm/enterprise/reach/docs/reach/ipts_summary.pdf.4. Ibid., 91.5. Gary Litman, “Comments on the EU CommissionConsultation Document Concerning the Registration,Evaluation, Authorization, and Restrictions of Chemicals(REACH),” U.S. Chamber of Commerce, Washington,DC, July 9, 2003.
own study, users of specialty chemicals likelywill suffer serious repercussions.
REACH also promises to have protection-ist effects that likely will trigger World TradeOrganization (WTO) disputes. In a presenta-tion to the EU Parliament in January 2005,Marco Bronckers, chair of the WTO and inter-national trade law professor at the Law Uni-versity of Lieden, detailed many of REACH’strade-related problems. For example, he notedthat under international trade agreements,regulations must be “not more trade restrictivethan necessary to fulfill a legitimate objective,taking account of the risks non-fulfillmentwould create.”
REACH’s volume-focusedrequirements are likely to violate this WTOrequirement. Because low-risk substances willbe regulated under REACH simply becauseof their high volume, the regulations may bedeemed arbitrary.
Most of the claims made about REACH’sbenefits involve speculative comments sprin-kled throughout various studies. Those specu-lations have taken on the character of gossip;they gain credibility simply by being repeated,and some are embellished in subsequent re-iterations. A review of underlying data findseither that references are lacking or that the
6. Ibid.7. Marco Bronckers, paper presented before the Euro-pean Parliament, Joint Public Hearing,
A WTO Perspec-tive: Imported Products,
January 19, 2004, http://www.europarl.eu.int/meetdocs/2004_2009/documents/DV/ Bronckers/bronckersen.pdf.