Explanatory note on changes to UK REACH fe…

Introduction

1. This note follows on from previous stakeholder engagement held between 14 August and 16 September 2024 and recent briefing sessions to explain the changes we are making to the current UK REACH fees from 1 April 2025. It sets out and explains those changes and we encourage trade associations to draw on this information to make their members aware of both the changes we are making and the reason for those changes.

Summary of the changes we plan to make

2. A summary of our policy proposals are set out below (note that under this review we do not intend to introduce any new fee types, and the mandatory SME discounts provision will continue to apply although we can decide on the level of discount). In all cases the proposed new fee levels take account of the actual work carried out by Defra, HSE and the EA in relation to the regulatory activities for which the fees are charged and have been modelled accordingly. We will keep the fee levels under review to ensure the fees structure remains sustainable.
3. Summary of our proposed changes to the current fees (a full set of fee tables showing the current fees and the new fees that will apply from 1 April 2025 are attached)

• Registration fee: to apply a flat standard fee of £2,222 in the case of large companies (for both full registrations and intermediate registrations, covering both transitional and non-transitional registrations). This will mean a fee reduction for all large companies bar those submitting an individual or joint registration for substances in the range of 1 to 10 tonnes). This fee covers both the costs of work done by HSE to process registrations and those relating to the asset value and life of the REACH IT system including depreciation and maintenance costs as required under MPM.

• Authorisation fee: to increase the current authorisation fees to ensure we recover costs for the work undertaken by HSE and EA in processing these applications. There are currently three types of charges relating to applications for authorisations:
  • Base authorisation fee (to increase by £10,460 in the case of the standard fee, from £47,229 to £57,689).
  • Additional fee per substance (currently calculated at 20% of the base authorisation fee. The same 20% calculation will apply to the new standard base fee of £57,689).
  • Additional fee per use (currently calculated at 90% of the base authorisation fee. The same 90% calculation will apply to the new standard base fee of £57,689).

We are retaining the current SME discounts for authorisation base fee levels which are, for medium, small and micro businesses, respectively 25%, 55% and 90%. These will be applied to the new proposed standard fee figure.

• PPORD (Product and Process Oriented Research and Development) fee: to increase fees from £475 to £751 for the standard fee in the case of a PPORD notification to ensure we recover costs for the work undertaken by HSE and EA in processing these applications.

• Other current UK REACH fee types that we are changing:
• Tonnage band updates: to apply a flat standard fee of £2,222 in the case of large companies in line with the actual full costs for the work being done by HSE and associated REACH IT system costs. This will reduce charges for tonnage band updates for most categories (bar companies submitting a joint submission for a tonnage band update from 1-10 tonnes to 10-100 tonnes); and
• Change of identity/legal personality (update): to reduce fees for processing these requests by £1,134 from £1,424 to £290 to reflect the actual full costs for the work being done by HSE.

4. Although some large companies (those submitting an individual or joint registration for substances in the range of 1 to 10 tonnes) will be negatively affected as a result of paying a higher standard registration fee than previously, the overall expected impact is still beneficial to industry, with an expected total reduction of costs of £40m across the 6-year cost recovery period (25/26 – 30/31). In addition, the cost of registration is expected to reduce for 92% of firms, with all SMEs receiving discounted fees and no fees being charged for grandfathered registrations.

Guidance and Next Steps

5. Information and guidance about the current UK REACH fees is published on the HSE website here. This will be amended, including to replace the current fee levels with the new ones. This information will go live from 1 April 2025 which is the date from when the new fee charges will apply.
6. Ahead of that date we will continue to engage with stakeholders to make them aware of the changes that are being made. This will include a banner on both the HSE webpage and an update to the REACH Service blue banner that will flag up that the current fees will be changing. In addition, HSE plan to publish a REACH e-bulletin on 1 April.
7. There will be no change to the current HSE invoicing and fee collection process.
8. We will continue to engage with yourselves and your members and monitor the impacts on chemical businesses and supply chains after the new charges come into effect. This, in turn, will help inform a future reviews of UK REACH fees and charges.

A table showing current fees and proposed new fees that will apply from 1 April 2025 is available to view on the right hand side of this page.