Created with Sketch.

16. May 2022 | Legislation

Compliance in supply chains

Dr Dieter Drohmann, Chemservice Group

The development of paint formulations is a creative and complex process involving a lot of know-how and knowledge. Therefore, the exact compositions of these mixtures are usually top secret and not disclosed. This results in considerable problems with registration and documentation obligations in complex supply chains.

How can compliance along complex supply chains be ensured?
Image source: WrightStudio -

According to the European REACH Regulation [1] and its counterparts KKDIK [2] in Turkey, UK REACH [3] in the UK and K-REACH in Korea [4], importers are obliged to register all imported substances unless the substances are exempted from this obligation. To be able to exempt importers from these registration obligations, the respective legislations provide that foreign manufacturers and formulators can appoint a so-called domestic Only Representative (OR), who registers the respective substances on behalf of the manufacturer/formulator, thus making the respective importers so-called downstream users.

For this purpose, the Only Representative must keep records of the respective importers as well as the quantities of substances imported annually, which leads to problems in complex and multi-level foreign supply chains, as indirect customers, suppliers and compositions of formulations are in many cases unknown. Compliance with the Only Representative’s record-keeping obligations would therefore only be possible through the disclosure of confidential business information (CBI ) in the supply chains, which in turn may violate competition law provisions if the Only Representative is a related/associated legal entity of the manufacturer/ formulator. Therefore, in these cases, neither the manufacturers/formulators (represented by the OR) nor the importers can fulfil their obligations without disclosing such confidential information and also risking the loss of business. The following is an example of a solution for EU REACH, which has been established for many years and is also used for UK-REACH, K-REACH and KKDIK.


What options does the EU importer have to ensure his REACH compliance and to prove this to the monitoring authorities? To this end, supply chain actors follow different approaches, which lead many EU importers to believe that they are indeed REACH-compliant and do not need to do anything further. However, most approaches are associated with several problems that make “watertight” proof of compliance impossible. The internet-based Chemservice Trustee system [5] has already been developed as a solution for REACH since 2008 and has since been used by leading companies in the chemical industry worldwide, including their downstream supply chains.

The aim of the model is to address all the problems and weaknesses of the different approaches and to provide the EU importer with immediate legally compliant documentation that puts him in the status of downstream user (DU) under REACH. For example, in the above system, an independent Only Representative acts as a trustee for non-EU manufacturers, formulators, distributors and importers and for their respective substances and formulations, in order to ensure confidentiality at all stages of the supply chains. For the exchange of relevant supplier, customer, product and quantity information between the participants in the supply chains and the trustee, a database-based system is used, which follows the supply chains in terms of information flow. The system creates unique, time- and quantity-limited confirmations for all participants in the supply chains and makes them available to the respective actors in the supply chain.

This is done for all product shipments that contain material from a non-EU manufacturer and are intended to be imported in whole or in part into the EU. Using a database, the trustee keeps track of, among other things, all information on suppliers, customers and importers, as well as relevant product information and quantities, and ultimately issues import certificates to EU importers for the covered imported products and quantities.

This ensures that all parties involved can continue their business without having to exchange confidential business information with each other. This enables all stakeholders to fulfil their REACH obligations. Figure 1 shows a schematic flow-chart of the process.


The presented system is an uncomplicated and simple procedure to ensure REACH compliance along the product flows, to avoid double registrations and thus to save resources. The entire control of coverage confirmations (e.g. verification of covered product quantities, validity of certificates, etc.) is carried out centrally and database-based, thus preventing accidental or even deliberate manipulations. The system is applicable even in the case of re-imported substances, where it is relevant that no more material is re-imported into the EU than was previously exported from the EU. Combinations of the different scenarios and multiple supply chains are also easy to implement. The administrative effort and costs are very low for all parties involved.

Due to the great demand to cover indirect imports, especially in multi-level as well as complex supply chains with imports to the UK and Turkey, and in the course of the registration obligations of chemicals in the respective countries, the system was also introduced in these REACH-like legislations. In Korea, a slightly modified model was introduced due to the legal requirements. The system was made possible because the respective REACH-related chemical control legislations implemented the institution of the Only Representative (OR). Without the “OR function”, indirect imports will not be adequately tracked.

Finally, it should be noted that this system will be made available to all Only Representatives in the EU, UK and Turkey, so that supply chains can be fully tracked and traced with a unified database-based system.


[1]         Regulation (EC) No 1907/2006 of the European Parliament and of the Council on the Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH)

[2]         Turkish Regulation on Registration, Evaluation, Authorisation and Restriction of Chemicals, 23rd of June 2017

[3]         Korean REACH: Act on Registration, Evaluation, etc. of Chemicals (Act No. 17326)

[4]         UK Registration, Evaluation, Authorisation & restriction of Chemicals (REACH)


EC Tech Report Functional Coatings


EC Tech Report Functional Coatings

A deep dive into major innovations in the field of FUNCTIONAL COATINGS!

The requirements imposed on modern coatings systems have increased significantly over the past decade, and you are certainly familiar with effects such as easy-to-clean, soft feel, and self-healing. However, these effects, too, can be developed even further, thanks to newly modified polymers, multifunctional additives, and nano-structures.

Dive into this new multimedia EC Tech Report and learn more about super-hydrophobic finishes that offer special easy-to-clean effects in clouding an antimicrobial effect; multifunctional additives that regulate several paint properties all at once, and further key innovations that have occurred in functional coatings over the last two years!

This could also be interesting for you!


You are currently not logged in

To leave a comment, please log in.

For continuously improving and optimizing our websites, we use cookies. By using our website, you agree to the usage of cookies. For more information, please visit our Privacy policy.