On August 25, 2014, the Republic of China’s (Taiwan) Environmental Protection Administration (EPA) released a draft “Regulation of Chemical Substance Registration and Management” (Regulation).[1] The Regulation was developed to implement amendments to Taiwan’s Toxic Chemical Substances Control Act (TCSCA),[2] which were adopted last November and require registration of both new and existing chemicals in Taiwan. With comments on the draft Regulation due October 28, 2014, and several EPA / stakeholder meetings planned between now and then, the regulation is scheduled to take effect on December 11, 2014 (Article 34). This memorandum provides an overview of the draft Regulation and highlights key points of interest to industry.

I. Scope of New Substances and Existing Substances

To develop the necessary framework for implementing the amendments to TCSCA, over the past several years Taiwan’s Council of Labor Affairs (CLA) and its successor, the Ministry of Labor (MOL), have organized an Existing Chemical Substances Nomination (ECN) program that included two supplementary nomination periods (SECN). Based on notifications submitted by industry, MOL compiled a draft National Existing Chemical Substance Inventory (NECSI).[3] The draft NECSI currently includes approximately 79,000 substances that were manufactured in or imported into Taiwan between January 1, 1993 and December 31, 2011.

Under the previous guidance, substances manufactured in or imported into Taiwan after December 31, 2011 were ineligible for nomination to the NECSI. Article 16 of the draft Regulation (and its corresponding explanation), however, explicitly provides that any substances manufactured or imported before the Regulation becomes effective (i.e., December 11, 2014) will be deemed existing chemicals if and when the Taiwanese authority reviews submitted evidence of their manufacture or import. Such substances would benefit from the reduced notification requirements applicable to existing chemical substances. A detailed description of this “late” nomination process was not provided in the draft Regulation but is expected to appear in a subsequent implementation document.

Curiously, the draft Regulation defines “impurities” and “incidental reaction products,” but does not explicitly exempt these types of substances from the requirements. Nor is there an explicit exemption covering substances regulated under other Taiwanese laws, such as the Act Governing Food Sanitation and Safety. Accordingly, one could interpret the Regulation as applying to food contact materials and other substances subject to other laws.

II. Registrant and Representative

Article 2 requires both registrants and representatives of registrants to be natural persons, companies, organizations, etc., located in Taiwan. Thus, while it would appear that overseas exporters cannot act as registrants, Appendix 5 to the Regulation suggests otherwise. Appendix 5, which sets forth the requirements for “Phase 1” registration of existing chemicals, provides that if the registrant is a “representative,” then the full company name, country and company address of the “principal” must be provided. This suggests that foreign exporters can appoint local representatives to serve as registrants. Further clarification should be sought from the Taiwanese authority.

III. Registration of New Chemicals

Pursuant to TCSCA, a “new” substance must be registered with the authority 90 days prior to manufacture in or import into Taiwan. The draft Regulation sets forth three types of registrations: (1) Standard Registration; (2) Simplified Registration; and (3) Small Quantity Registration. A Standard Registration requires a complete set of data, including:

By contrast, a Simplified Registration requires items (1) through (5), while a Small Quantity Registration only requires items (1) and (2).

The type of registration required for a new substance is determined by the annual volume, the intended use of the substance, and the substance’s chemical properties. The following types of substances qualify for reduced requirements:

(1) substances manufactured or imported for Scientific Research and Development (SRD), or Product and Process Orientated Research and Development (PPORD) (Article 5);

(2) on-site isolated intermediates, i.e., intermediates produced and consumed at the same plant site (Article 6);

(3) polymers that meet the OECD “polymer” definition (Article 6); and

(4) polymers of low concern (PLC), which must be confirmed by the authority prior to registration (Article 7).[5]

On the other hand, substances that are carcinogenic, mutagenic, reproductive toxicants (CMRs) are subject to the most onerous requirements. These substances require a complete data set for Standard Registration, regardless of their annual volume (Article 8). The table below illustrates the applicability of each registration category.

Table 1. Registration Categories

Substances registered using Standard Registrations and PLCs registered using Small Quantity Registrations will be added to the NECSI five years after the registration is granted or when requested by the registrant prior to that time (Article 15). Simplified Registrations and Small Quantity Registrations (except for PLCs) do not result in NECSI listings. These approvals are valid for two years (Article 13) and may be renewed three months prior to expiration (Article 14).

To minimize potential commercial disruption as companies prepare for compliance with the new requirements, the draft Regulation provides a grace period for new substances that are imported or manufactured by December 31, 2015. A one-time Small Quantity Registration (non-renewable) can be submitted for these new substances regardless of their annual production volume (Article 17). This will provide companies two years to develop test data and prepare the dossiers for more demanding registration categories.

IV. Registration of Existing Chemicals

Under the draft Regulation, existing substances whose average production volume is 100 kg or more in the last three years must undergo “Phase 1 Registration” from September 1, 2015 to March 31, 2016. If manufacture or import is not continuous over the previous three years, the substance must be registered if the highest volume in any of those three years meets or exceeds 100 kg (Article 18). Further, should any person manufacture or import an existing chemical substance with an annual volume of 100 kg or greater for the first time after March 31, 2016, it must submit a Phase 1 Registration within a period to be determined by the authority (Article 19).

The authority will then announce, tier by tier, the list of substances, their tonnage bands, and the deadlines for registrants to complete the Standard Registration (Article 20). While the draft Regulation does not describe the Standard Registration process in detail, it does identify four tonnage bands with different data requirements. The draft Regulation also leaves open the requirements for existing chemicals whose production volumes are less than 100 kg per year.

Table 2. Tonnage Bands for Existing Chemicals

V. Data Sharing

To prevent duplicative testing, registrants of both new and existing substances can make submissions for the same substance (Article 11 and Article 21). Any cost related to registration (e.g., testing and registration fees) can be apportioned between the registrants upon negotiation. The draft Regulation provides no further details as to the mechanics of data sharing.

VI. Confidential Business Information

Registrants may apply for protection of confidential business information (CBI). The application can be made upon registration of a new or existing chemical, or three to six months prior to applying for listing of a new substance on the NECSI. If a request is approved, the confidentiality period will be limited to five years, but registrants may apply for a one-time extension for an additional five years. An application for extension must be made three months prior to the expiration of the first confidentiality period.

To date, only a small percentage of chemicals on the NECSI have been granted confidential status. Accordingly, it is not clear how frequently and on what basis CBI claims will, in practice, be granted.

VII. Registration Fees

Taiwan EPA published a separate proposal on registration fees, which are presented in the following table.[6] Note that certain Taiwanese companies that meet the criteria set forth in the Small and Medium Enterprise Development Statute would be eligible for a 25% discount from these fees.

Table 3: Registration Fees

VIII. Trial Notification Platform

In conjunction with publication of the draft Regulation, in September 2014 Taiwan EPA released a trial version of a platform for notifying chemicals under the Regulation, referred to as the Chemical Information System and Tool (CHEMIST). CHEMIST is currently available only in Chinese,[8] although an English interface is available.

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For questions or more information, please contact Thomas Berger (202.434.4285; berger@khlaw.com) or Chen Hu (86.21.6335.1000; hu@khlaw.com).

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