National Industrial Chemicals Notification and Assessment Scheme (NICNAS)


Bureaucrats 'hurting industry'

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Special Report on Plastics and Chemicals, Australian Financial Review, August 24, 1999

The chemicals industry says its regulatory authority is frustrating attempts to get new chemicals registered. The authority cites public safety, writes Barbara Biggs.

Australian companies say getting new chemicals approved is too slow, too expensive and costs overseas contracts because the companies cannot use the most up-to-date ingredients which would let them compete internationally.

The body governing chemical accreditation is so bogged down in bureaucracy, they say, that some companies import or manufacture offshore because chemicals, accredited for use overseas, cannot be used here.

The European inventory of safe industrial chemicals includes 110,000 products. When Australia's regulatory body, New Industrial Chemical Notification and Assessment Scheme (NICNAS) came into being in 1990, there were 38,000 on its list. Since then less tban 2,500 chemicals have been added. At this rate, it would take NICNAS 247 years to grow its inventory to a size equal to Europe's list.

Some Australian companies complain that, through compulsory annual registration fees of up to $7000, they have to fund the body, which hinders their ability to compete in international and local markets.

The managing director of Sydney-based Austin Chemical Company and former State Chamber of Commerce (NSW) president, Barry Alchin, says if other countries accept U.S or European chemical accreditation, so should Australia.

"If Europe has deemed the chemicals safe, what the hell else are we going to be concerned about in Australia," he says.

Alchin says many small companies producing items such as cosmetics, paint or printing ink, are manufacturing overseas. "They don't get the opportunity to make the end product here because the raw chemicals used are not accredited here," he says.

"Proctor and Gamble started to set up in Sydney before moving their manufacturing to Vietnam because of chemical restrictions. Companies like Samuel Taylor, Yardley and Revlon have closed their Australian operations. It costs us jobs, exports, and we're being denied the opportunity to add value to the original product."

Alchin says this is one significant reason Australia's manufacturing levels have declined in the past decade.

One company, Australian Leather Holdings, based in Perth, has been unable to compete in supplying furniture leather to Asia because chemicals used in the latest finishes, available in Europe, are not on the NICNAS inventory.

The company employs 250 workers and supplies $20 million worth of furniture leather to Asia, but the time lag in getting chemicals approved has cost it several lucrative contracts.

"The world leather industry is based in Europe and the US, so a lot of the breakthroughs in treatments and finishes come from there," says company director Kel Webster.

"We have a time lag of up to I2 months before the chemicals can be approved, which means we can't compete on a level playing field with the rest of the world. It means we lose the competitive edge, which is absolutely vital when technology is changing so fast."

Alchin says Workplace Relations Minister Peter Reith was horrified at the situation when they met in I997. "He held his head in his hands and shook his head," says Alchin. "He couldn't believe it was being allowed to happen."

Reith does not recall the meeting, but says he is concerned about increasing NICNAS efficiency. He says the key issue is for NlCNAS to increase its chemical inventory size quickly, without compromising health and safety.

"It's not just an economic issue," Reith says, "there are very serious health concerns involved."

He says the idea of Australia not having its own approval process for chemicals would put the industry out of step with other areas of legislation.

"Motor cars and drugs that come into this country, despite having approval overseas, have to go through safety checks and I don't think the community would be happy if chemicals were exempt from that procedure."

But according to Dupont Australia, many chemicals which the industry is putting forward for approval are safer than those on the market.

The company's regulatory affairs manager, Martin Mills, says Dupont has spent more than $500,000 and three years trying to introduce through NICNAS a solvent which has significant environmental benefits.

"In America, they're not allowed to use paints that are as toxic as most of ours are," Mills says. "The whole NICNAS scheme is biased against novel technology which can actually be less harmful than what is currently being used."

He says two out of three products the company planned to sell in Australia have been discarded because the cost and time to get approval could not be justified.

The Plastics and Chemicals Industry Association (PACIA), which represents large chemical companies such as Esso, says it has support from Reith in its lobbying of NICNAS to fast-track chemical accreditation. But PACIA still advocates mutual recognition of chemicals that have passed accreditation elsewhere.

"If they're allowed in Japan, the US and Europe, they should be allowed here without having to go through a duplicate assessment process," says PACIA's general manager, Ian Swann.

"NICNAS says other countries base their accreditation on different uses and conditions to those we have in Australia, but we don't agree. We think there is an equally wide range of uses both here and overseas."

The primary purpose of NICNAS, according to its director, Margaret Hartley, is to "make sure that industrial chemicals available in Australia are safe to use. But she maintains the use of chemicals overseas can be different to here.

"For example, a solvent used in Europe may be used in a setting where there is no or little exposure to workers, where in Australia it could be used differently, where workers can have significant exposure," Hartley says.

Although chemicals may be used differently, Hartley says NICNAS is committed to ensuring cooperation with other countries in assessing chemicals and exchanging information. "We provide a 40 per cent discount to companies that provide us with an overseas assessment because we're very aware that the cost and time involved is important to industry, Hartlev says.

"The industry says we have not met time frames (for assessments), but if the information is not provided (by companies) it slows down the process."

An industry body comprising representatives from the Australian Chamber of Commerce and Industry, PACIA, the Paint Manufacturers Federation and the Australian Chemical Specialty Association, has been effective in working with NICNAS to introduce several reforms in the past two years.

Recently, NICNAS established a new category, polymers of low concern, which allows benign chemicals to be fast-tracked through the system, avoiding the costly and time-consuming assessment required for more hazardous chemicals.

Another category, the early introduction permit, allows some chemicals to be used while being assessed. Permits for commercial trials are less restrictive. But to simply allow all new chemicals into the country, based on their overseas accreditation, would be virtually to deregulate the industry, says Hartley.

"NICNAS's views are that chemicals must be safe for our environment and for our people."

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