As the dust settles on this month’s attempted military coup in Turkey the question is will it have any impact on the country’s soon to be adopted chemicals regulation, KKDIK?
Dr Yaprak Yuzak Kucukvar, Turkey manager for REACH Global Services (RGS), a Brussels based consultancy, says “As far as we know, it is business as usual at the MoEU and the Ministry of Economy.”
Focus is firmly on the unravelling political situation. But with just months before Turkey adopts KKDIK, many in the chemicals industry remain largely oblivious to, and unprepared for, the deluge of complex and costly measures that are under way and that may drive some of the smaller players out of business.
The new law mirrors the EU REACH law and is expected to come into force in the fourth quarter of this year, according to the Ministry of Environment and Urbanisation (MoEU). It is the final stage in Turkey’s efforts to align its chemical regulatory system with that of the EU, following accession negotiations that began in 2005.
A draft version of KKDIK, which stands for chemicals registration, evaluation, authorisation and restriction in Turkish, has been available for some time. Turkey’s large chemical firms, such as the petrochemicals company Petkim and oil refinery Tupras, are armed with hundreds of substances already registered with EU REACH and know what to expect from the Turkish version of the law.
Yet an overwhelming majority of companies – 83%, according to government statistics – are micro-sized manufacturers, most of which are either unaware of the changes that are in the pipeline or, at best, confused about how to tackle them.
While EU REACH concerns only those which export to the EU, the KKDIK will bear upon the entire domestic industry, including non-Turkish companies exporting chemical raw materials to Turkey, as well as multinationals with local subsidiaries.
“Some people in the industry, who have experienced the EU REACH journey, have familiarity with the issues that they may face during compliance, but others still don’t know what to expect,” said Dr Yuzak Kucukvar. RGS is acting as an only representative for companies, including Petkim and Tupras, for their EU REACH registrations.
Multinationals, such as BASF and Dow Chemicals, with operations in Turkey will be in a similar position, but would not comment on their preparations for KKDIK for confidentiality reasons.
Melih Babayigit, founder of CRAD consultancy, said only 10% of industry players truly understood and were ready for the new legislation.
The current draft law has an initial registration deadline, for existing substances, of 31 December 2018. This is for substances manufactured or imported in volumes of over one tonne. Registration will be a mandatory requirement as the “no data, no market” rule is incorporated in KKDIK, in the same way as in the EU.
However, the registration deadline is almost certain to be pushed back: Dr Yuzak Kucukvar said she does not foresee the final deadline, once the law is passed, to be any earlier than 2020.
This is because the law has already been delayed by a year, after elections last November plunged the country into political turmoil, triggering several rounds of ministerial changes. Industry observers say any further delays to the current timeline would prompt an amendment of the draft, causing even more of a setback.
“If there are more delays, we will need an amendment as the current draft legislation contains certain dates which will have to be changed,” said Mr Babayigit.
Carbon copy of EU law
Turkey, whose chemicals output was $38bn in 2014, according to the statistics institute TUIK, is one of a number of non-EU countries introducing local versions of REACH as part of efforts to establish a globalised system of chemicals registration.
Turkey’s geographical proximity to the Middle East’s rich oil-based resources makes it an ideal base for chemicals manufacturing, and trade between east and west. Some 60% of Turkey’s chemical products include imported raw materials, mixed and then re-distributed in Turkey or exported. Plastics and rubber are top sellers, but Turkey is also a leader in some lesser known boron compounds and rose-based chemicals.
Turkey’s chemical exports totalled $14bn in 2015, according to data compiled by the Ministry of Science, Industry and Technology this year. The EU was its biggest export market, at $5.3bn.
By harmonising its chemical laws with those of the EU, Turkey hopes to increase its exports to the region, bring in more investment after years of underinvestment due to environmental concerns, and produce some of the high value-added raw materials, at home, rather than having to import them.
To meet these ends, the Turkish KKDIK law is essentially a clone of the EU REACH. Yet there are some minor differences.
For starters, Turkey incorporated the EU’s classification, labelling and packaging Regulation (CLP, which translates into Turkish as SEA) before REACH; the reverse of the case in the EU, where REACH was implemented first.
Another key difference is that unlike the EU, which has a phased implementation under REACH, with registration windows for substances, determined by the tonnage produced or imported as well as the hazards presented by them, Turkey has one registration deadline for all substances.
Although there will be preregistration, which will not change the registration deadline of substances in KKDIK, late preregistration is still under consideration in Turkey.
Other modifications may relate to the REACH annexes that deal with guidelines and exemptions for specific substances and mixtures, due to the different way certain substances are classified and grouped together in Turkey.
But many in the industry say a word-for-word translation of REACH into Turkish, without considering the local character of the industry and difficulties on the ground, has led to doubts about the industry’s ability to comply with the law. A full REACH-type registration dossier is required in Turkish, creating a significant burden on a sector reeling from slower economic growth and overwhelmed by a dizzying array of EU as well as local chemicals regulations.
“Only 30% of small- and medium-sized firms are able to make the necessary investments to comply with the new laws and achieve higher environmental standards,” said the Ministry of Science, Industry and Technology in a report this year.
Osman Sahit Kanuni, general manager of Deteks Kimya, a small chemicals manufacturer, said it would take three years to accumulate the funds it needs for the new laws, from revenues.
“Half of the SMEs will not have the funds to pay for this and given that industry controls are not stringent in Turkey, it may result in unfair competition. Certainly, the sector will undergo a transformation and there may be closures and mergers,” Mr Kanuni told Chemical Watch.
International companies with businesses in Turkey will need to mobilise local subsidiaries or assign Turkish only representatives, to scrutinise the national specifications and continuously monitor various processes and sub-processes to keep track of their substances, all in Turkish.
A topic that causes the most discomfort for the industry is a high-priced EU data pool on substances that will have to somehow be imported into Turkey for KKDIK compliance.
As the EU registrations are based on the “one substance, one registration” principle, Turkish manufacturers have submitted their registrations jointly with other EU companies producing the same substances, either by becoming a member of a European consortium, or by purchasing a “letter of access” for joint submission rights. In rare cases, Turkish companies have created their own data for substances not commonly available in Europe.
The process of collecting information from tests on chemicals, to ascertain their hazard properties, is exceedingly time consuming and costly. Some Turkish firms have had to pay up to hundreds of thousands of euros to purchase data on a single substance. They balk at having to re-purchase the same data for KKDIK.
However, the KKDIK Regulation currently makes no provision for recycled EU data. Moreover, data is owned by companies – typically European chemical heavyweights – and cannot be transferred to a non-EU jurisdiction such as Turkey. Product particulars are highly confidential and often digitally encrypted, making Turkish translations highly unlikely, if not impossible.
“Many companies will have to register the same substance for a second time. This is very costly,” said Mustafa Bagan, general secretary of the Turkish Chemical Manufacturers Association.
As in the EU, KKDIK says data sharing is to take place through substance information exchange forums (Siefs) but little detail or guidance have been provided on the operation or the practicalities of this.
“This is creating a major problem for the industry,” said one industry observer. “We want this issue to be clarified as soon as possible.”
The MoEU, which is designated as the competent authority under KKDIK, is believed to be planning discussions with Echa on data sharing. A meeting had been scheduled in Turkey, earlier this year, but was put off due to a string of terrorist attacks, according to several industry sources. Another meeting is not on the agenda for now.
The difficulty regarding data submissions is compounded by a severe shortage of locally trained technical and legal experts, able to regenerate and manage complicated data sheets in Turkish.
“There is hardly anyone who has the expertise to negotiate, draft and implement, and to manage a consortium agreement,” said Dr Yuzak Kucukvar, adding that ultimately most of the work on data collection, registration and compliance services would have to be rendered by experienced multiskilled consultants.
Even the ministry is short on staff to implement the law. Industry sources say there are only ten people, within the MoEU, dedicated to the new chemicals regulations, compared with the roughly 600 staff at Echa dealing with REACH.
This makes Turkey a breeding ground for chemical consultancies. There are already ten only representatives – a legal entity created under the EU law – which act both for Turkish firms registering substances for REACH and foreign companies which will need to comply with KKDIK.
Question of enforcement
Many firms say the government needs to provide a stronger infrastructure, including a much bigger pool of chemical process safety experts, if it wants them to comply with the new requirements.
The ministry said it was working on training. “As the competent authority, we have organised seminars to educate the sector about their responsibilities in places where there is a high concentration of chemicals companies,” it said in a statement to Chemical Watch.
It has also set up an online chemicals help desk to address any compliance problems. Questions can be logged through its website.
Yet, many feel these measures will not be enough and say they do not expect strong enforcement. They mention Turkey’s large informal economy as one reason why compliance checks could be challenging, leaving those who comply with the law at a disadvantage.