This clause requires one or both parties to comply with REACH (Registration, Evaluation, Authorisation and Restriction of Chemicals), which is the European Union's regulatory framework governing the production, importation, and use of chemical substances. The clause typically obligates the supplier or manufacturer to ensure that any chemical products, materials, or goods containing regulated substances meet REACH requirements, including proper registration, safety data sheets, and restrictions on hazardous substances. This matters because non-compliance can result in significant fines, product seizures, and legal liability—particularly if chemicals are being supplied into EU markets or if the contract involves manufacturing, importing, or distributing chemical-containing products.
The clause serves as a risk allocation mechanism, clarifying which party bears responsibility for chemical safety compliance and potential regulatory violations. If you're purchasing chemical products or materials with chemical components, this clause protects you by ensuring the supplier warrants compliance. Conversely, if you're the supplier, this clause creates an obligation that requires you to maintain compliance documentation and potentially indemnify the buyer for regulatory failures.
If you are a buyer, ensure the clause explicitly requires the supplier to maintain current REACH registrations, provide up-to-date safety data sheets (SDS), and warrant that all substances comply with current restrictions and authorizations. Include audit rights allowing you to verify compliance documentation. If you are a supplier, clarify the scope of your obligations (e.g., do they apply only to EU sales, or globally?) and ensure you have adequate insurance and indemnification caps. Consider adding a mechanism for passing through increased compliance costs if regulations change materially during the contract term.
Frequently Asked Questions
What does this clause mean in simple terms?
This clause requires one or both parties to comply with REACH (Registration, Evaluation, Authorisation and Restriction of Chemicals), which is the European Union's regulatory framework governing the production, importation, and use of chemical substances.
Why should I care about this clause?
The clause typically obligates the supplier or manufacturer to ensure that any chemical products, materials, or goods containing regulated substances meet REACH requirements, including proper registration, safety data sheets, and restrictions on hazardous substances.
What are my options?
This matters because non-compliance can result in significant fines, product seizures, and legal liability—particularly if chemicals are being supplied into EU markets or if the contract involves manufacturing, importing, or distributing chemical-containing products.
How does this affect small businesses?
The clause serves as a risk allocation mechanism, clarifying which party bears responsibility for chemical safety compliance and potential regulatory violations.