REACH: PORTUGAL LEANING TOWARDS EUROPEAN COUNCIL'S

UNCLAS LISBON 001218 SIPDIS SIPDIS COMMERCE FOR DON WRIGHT, 4211/MAC/OEU E.O. 12958: N/A TAGS: ETRD BEXP PT SUBJECT: REACH: PORTUGAL LEANING TOWARDS EUROPEAN COUNCIL'S POSITION REF: USDOC 02311 ¶1. Summary: Portugal will lean towards the European Council,s position during the finalization process of the Registration, Evaluation, and Authorization of Chemicals (REACH) legislation rather than towards the European Parliament,s version which one official described as "difficult to implement" and "unfriendly to Small and Medium Enterprises (SMEs)." With regard to the REACH Implementation Projects (RIPS),the European Parliament is unlikely to make these documents available for public comments or revision. End Summary ¶2. POL/ECON Officer delivered reftel demarche on June 12 to Dr. Helena Cristina Horta, MFA Adviser on EU Internal Market, Scientific, Industrial and Technological Issues. Dr. Horta indicated that Portugal will lean towards the European Council's position during the finalization process of the REACH legislation rather than towards the European Parliament,s version which she described as "difficult to implement" and "unfriendly to SMEs." ¶3. The government is particularly concerned with REACH legislation's impact on SMEs which account for over 97% of the country's businesses and employ over 55% of the country's workforce. Portugal's economy depends heavily on the tile producing, mining, winery and cork industries which use a number of the substances on the proposed REACH registration list. It will be difficult for the manufacturers, exporters/importers and downstream users to shoulder the additional costs associated with and the manpower required for the registering of substances. The government is equally concerned with the protection of Intellectual Property Rights and will lobby for more stringent regulation during this round. According to Horta, Portuguese enterprises have already expressed their concerns about the protection of corporate data and the potential for loss or disclosure of other proprietary information. ¶4. The government supports the call for more environmentally-friendly substances. However, it believes that risks may arise from the use of substitutes and that the 5-year rule proposed by the European Parliament could result in the banning of selective substances that when used in smaller quantities are less "dangerous," and when combined with other substances or chemically processed, can lose their potentially hazardous qualities. Horta again insisted that SMEs would be greatly affected by this aspect of the proposal because the costs associated with substituting or banning substances could result in expensive upgrades and/or changes to current manufacturing processes. ¶5. Regarding the USG,s concerns about provisions addressing the REACH Implementation Projects (RIPS),Horta doubts that the documents will be made available for public comments or revision during the second reading. Hoffman