alerts & publications
China Unveils New Rule on Hazardous Chemical UseDecember 18, 2012
The Chinese government recently issued a new rule, “Measure for the Environmental Management Registration of Hazardous Chemicals,” requiring certain companies that produce, use, import or export certain hazardous chemicals to obtain governmental approval prior to their use. The rule takes effect on March 1, 2013.
Since 2009, China has regulated companies that import or export chemicals on the “List of toxic chemicals severely restricted to be imported into or exported from the People’s Republic of China,” requiring them to register with the Chemical Registration Centre (“CRC”) of the Ministry of Environmental Protection (“MEP”) and apply for relevant registration certificates or custom clearance notifications.
The new rule requires companies to submit an administration registration to local environmental protection authorities, who in turn will issue a registration certificate valid for three years. The hazardous chemicals being regulated are generally considered to be extremely or highly toxic and include those chemicals listed in the Catalog of Hazardous Chemicals, which are classified into two categories: general hazardous chemicals and priority hazardous chemicals (“PHCs”). More stringent requirements will apply to the registration of PHCs.
The registration application form includes information about the company and its operations, the names, volumes, and uses of the hazardous chemicals, material safety data sheets, environmental risk management measures, details regarding pollutant transfer and hazardous waste disposal. Along with the registration application form, an applicant will also need to submit a governmental approval letter for an environmental impact assessment, an emergency response plan, and an environment monitoring report. Where PHCs are manufactured or used, an environmental risk assessment must also be prepared and submitted.
Registrations are generally approved at the city level except where PHCs are to be manufactured or used; these registrations are reviewed and approved at the provincial level with heightened scrutiny. Where both general hazardous chemicals and PHCs are to be manufactured or used, the PHCs registration requirements will apply.
Companies currently manufacturing hazardous chemicals, or using hazardous chemicals to manufacture products before the new measure enters into force, will be required to obtain an environmental administration registration within three years of the March deadline. For new or enlarged operations, the registration is to be submitted prior to issuance of an acceptance certificate by the government.
The list of PHCs has not been finalized, but is expected to include chemicals that are not easily degradable, are bio accumulative, can cause serious harm to the environment or to human health after long-term exposure, are toxic to aquatic environments, and chemicals subject to any international environmental conventions.
Ongoing obligations will include public reporting and record-keeping requirements. Companies will be required to publish an annual hazardous chemical environmental administration report, which is to include the names of hazardous chemicals, hazardous properties, pollutant and accident-handling information and disposal measures for pollutants, and must make this report available to the public. Companies using or manufacturing PHCs will also be required to submit a PHC and pollutant release and transfer form and an environmental risk management plan to environmental protection authorities at the county level before 31st January of each calendar year. A file must be maintained by the company regarding hazardous chemicals manufactured or used, including type, volume, customers and suppliers, pollutant discharge and environmental monitoring information. Companies using or manufacturing PHCs will also need to conduct environmental monitoring of PHCs. Companies that fail to submit the environmental administration registration and comply with other requirements will be fined up to RMB30,000 (about USD$5,000).
 Note that the term “pollutant” used here and elsewhere in this Client Alert most closely matches the meaning of the original Chinese term.
This memorandum is a summary for general information and discussion only and may be considered an advertisement for certain purposes. It is not a full analysis of the matters presented, may not be relied upon as legal advice, and does not purport to represent the views of our clients or the Firm. Eric Rothenberg, an O'Melveny partner licensed to practice law in New York and Missouri, Qiang Li, an O'Melveny partner licensed to practice law in New York, Robert Nicksin, an O'Melveny counsel licensed to practice law in California, and Alan Bao, an O'Melveny associate licensed to practice law in California, contributed to the content of this newsletter. The views expressed in this newsletter are the views of the authors except as otherwise noted.
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