German Chemical Producers Want Brexit Plan

31.01.2019 -

With the Mar. 29 deadline for the UK’s exit from the EU rapidly approaching, Europe’s chemical producers are growing increasingly nervous about a “no-deal” UK exit.

Commenting on the updated contingency plans published by the EU Commission this week, the German chemical industry association VCI criticized the ongoing lack of any consideration of chemicals in the regulatory body’s plans to protect business and industry from the devastating consequences of an unregulated withdrawal. 

In a statement, the association’s general manager, Utz Tillmann, called on the Commission to find industry-specific solutions for chemicals, the biggest contributor to the EU economy.

“The chemical and pharmaceutical sectors and their customers would be hardest hit by a no-deal Brexit,” Tillmann stressed. In particular, he said, a collapse of the supply chain would have repercussions reaching far beyond the industry’s own activities.

In the event of a hard Brexit, Tillmann said, chemicals registered under REACH in the UK for distribution in the remaining 27 member states could no longer be sold there without further regulatory measures. To avoid this, the association has urged that registrations of chemicals by UK-based companies should be temporarily recognized in the EU.

VCI also fears problems with products clearing customs. With the UK abruptly outside the Union, Tillmann said “chaotic situations” could arise at the border, putting pressure on the rest of the supply chain or endangering it altogether. He appealed to the EU and German governments to make contingency plans for a future regulation of exports and duties before the British exit.

Globally, the UK is the German chemical industry’s eighth largest trading partner.  In VCI’s estimate, German chemical producer sold goods worth €10.2 billion in the country in 2018 and drew chemical products worth €5.8 billion from there.