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Best Practices for REACH Compliance Management for Electronics OEMs

The regulation referred to as REACH (Registration, Evaluation and Authorization of Chemicals), came into effect in European Union Member States in June of 2007. The intent of REACH is to regulate chemicals that can cause cancer and other diseases.

REACH applies to thousands of chemicals (substances) that are used or present in electrical equipment. REACH also applies to mixtures or solutions of substances (preparations), and end products (articles). Substances of Very High Concern (SVHCs), are the most hazardous and harmful substances and are highly regulated. Products containing SVHCs may not receive authorization if a safer alternative exists.

REACH affects all organizations that export, manufacture, or use chemicals. Early planning and good communications are urgently needed to avoid disruptions in the supply chain. Parts and equipment manufacturers will be affected by unexpected withdrawal of substances from their suppliers due to REACH.

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Compliance with REACH will require manufacturers to have more detailed knowledge of the substances they use or are present in their products. The burden of compliance falls not just on large OEMs that export to the EU. Small and medium enterprises (SMEs) also share the burden of compliance, even if they do not directly export to the EU. Large OEMs are responding to REACH by developing compliance standards of their own and asking their suppliers for chemical composition data on products.

Complying with RoHS, which regulated just 6 substances and related compounds, was a difficult enough task. REACH regulates more than 30,000 substances. Making the task even more difficult are changes to the SVHC list. On January 13, 2010, the European Chemicals Agency added 14 chemical substances to the Candidate List of SVHC for authorization, bringing the total to 29 substances. The ECA promises to revise the SVHC list twice a year. The task of collecting detailed information about which substances are contained in products will be extensive and ongoing.

The Challenges of REACH Compliance for Electronics OEMs
Data Collection
The biggest challenge for electronics OEMs in managing REACH compliance is to discover the chemical composition of all components and materials used in their products. With full knowledge of the chemicals used, OEMs can create a compliance plan that will work short and long-term. However, collecting chemical substance information from suppliers is a tedious and resource-intensive job. It takes numerous phone calls or e-mails; suppliers often do not understand aspects of regulations such as SVHCs; and suppliers sometimes demand a rationale for sharing information.

Ask for full-disclosure substance data whenever possible. When the SVHC list changes, for example, you don’t have to ask for more data in the future if you have full disclosure data already. If full-disclosure data is not available from a supplier, at the very least, try to obtain a non-use SVHC statement or certificate. Ideally, suppliers should inform you about their use of SVHC when it exceeds 0.1% in concentration. In reality, it is risky not to pursue this data and to rely only on suppliers to provide notification.

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Data Validation and Consolidation
The second challenge begins after chemical substance data starts to arrive from suppliers. The data may not be clean and it needs to be validated. Here are some common problems: (1) the chemical substance name does not match the CAS number; (2) the CAS number is incomplete or missing; (3) two different substances use the same CAS number; (4) different suppliers refer to identical substances with different names and different CAS numbers. In Figure 1,
SIO2 is correlated to two different CAS numbers. In this case, and in all others where data cleansing and consolidation has not taken place, it is not possible generate an accurate rollup of the total weight of chemicals used in the product. Resolving these issues is necessary before conducting substance analysis for REACH compliance.

Figure 1: Correction of CAS number for SiO2 is necessary

Establishment of Chemical Substance Database
The third challenge is to establish an enterprise-level chemical substance database covering all components used to build the products. A software system is necessary to manage the enterprise-level chemical substance database. The system needs to be able to roll up substance data from homogeneous materials. In order to help identify problem areas, the software system should be able to calculate substance data at the component, assembly, and product level. The system will also enable proper reporting on particular substances (such as SVHC or CMR substances) at the product level or even across different products.

A chemical substance database covering potentially thousands of components is complex and far beyond the limits of a spreadsheet application like Excel. Moreover, entering the data by hand is impractical and will introduce errors. Requesting that suppliers send chemical substance data in a common format that your software is able to import directly is also not feasible in reality. Finding a proper way of entering the chemical substance data to the software system is a challenge.

Limited Resources
Most electronics OEMs have no one devoted to or specializing in chemical management. Most likely, the task of REACH compliance will go either to component engineering or the quality group. Designers of products have little need to know the chemical substances used in the components, though they do need to know whether the components they select are REACH-compliant. With limited resources and budget, most companies can only afford to have a few people be responsible for this task and cannot afford to spend several hundreds of thousands of dollars on REACH compliance modules available with ERP or PLM upgrades. Finding a way of implementing REACH compliance management in a limited budget with limited resources is another challenge that most companies have to face.

Best Practices of Compliance Management in REACH
Scrub your BOMs
Most BOMs are dirty. Dirty BOMs contain inaccurate manufacturer names and part numbers. Before calling suppliers for chemical substance data, it’s best to start by cleaning up the dirty BOMs stored in the ERP or PLM. You may have done this several years ago while requesting RoHS data from suppliers. If not, now is the time to scrub your BOMs by validating the manufacturer names, manufacturer part numbers and part description on all components in the BOMs. It will save a tremendous amount of time in getting data from your suppliers.

Collect full-disclosure chemical substance info from suppliers whenever possible
In order to be REACH-compliant, you need to know the chemical substance composition of the components in your products. This means collecting full-disclosure chemical substance data from your suppliers. If you are an “Article Producer” and only care about REACH SVHC compliance, you should still collect full-disclosure chemical substance data on all parts from suppliers whenever possible. Collecting REACH SVHC certificates from suppliers can only get you through compliance for 6 months to a year. New substances will be added to the SVHC Candidate list regularly. Collect full-disclosure chemical substance information from suppliers whenever possible so you don’t need to recollect the certificates from the same suppliers when the SVHC Candidate list changes. This is the most critical step in compliance management.

It is highly recommended, if financially viable, to outsource the data collection to a 3rd-party solution provider. By tapping into the component chemical substance database established by a 3rd-party solution provider, you may find that data collection is actually cheaper, faster, and more accurate than doing it in-house. In our experience with electronics manufacturers, a typical BOM of 1000 parts will have more than 60% coverage in full-disclosure chemical substance data in our component database. This means the effort of data collection has been reduced to 40%. The challenge of recollecting data from the same suppliers when regulations change has also been reduced. Outsourcing data collection enables your component or quality engineers to focus on their core competencies of completing the product with quality, instead of dealing with mismatched or incorrect part numbers, CAS numbers, substance names, etc.

Figure 2: Import of full-disclosure substance data of a component after data validation

Select the proper software tool to help manage REACH compliance
Once you start collecting chemical substance data from suppliers, a software tool is necessary to help manage collection activities, establish the internal chemical substance database, and analyze the substances used in your products. The tool needs to tell you what has been collected and what has not, and should be able to report the aggregated weight of a substance in a product based on the projected annual shipment to the EU or customers in another region. The tool should also report on any SVHC substance contained in components used in your product in order to communicate with your suppliers for replacements and to alert your customers to proper usage scenarios. You may need to notify the ECHA on the use of SVHC substances in your products if they account for more than 0.1% of the product weight when more than 1 tonne is shipped to the EU per year. The tool should also be capable of scanning all components for substances in the categories of CMR (Carcinogenic, Mutagenic or Reprotoxic), PBT (Persistent, Bioaccumulative and Toxic) or vPvB (very persistent, very bioaccumulative) for possible violation of SVHCs in the future.

Enter chemical substance data in the software tool to establish an internal chemical substance database
In the process of collecting and validating chemical substance data from the components used in your products, you need to establish an internal chemical substance database by entering the substance data to the software tool. Be aware of these issues:

Data Format: Suppliers can provide chemical substance data in various formats, including pdf, Excel, html, XML and IPC-1752 forms. These formats need to be consolidated into one standard format in order to import them to the software tool. If you have outsourced the data collection job to a 3rd-party data provider, ask them to provide a common format that can be imported to the software tool.

Consolidated Substance Master:
Entering substance data into the software tool can reveal several potentially difficult issues:

  1. Some substances have a different CAS number but have the same substance name because they actually are the same substance. See Figure 3, an illustration from the SVHC Candidate List. CAS number 7789-12-0 and CAS number 10588-01-9 are both Sodium Dichromate. When a part contains substance 7789-12-0 and substance 10588-01-9, the software tool will need to be able to recognize that these two are actually the same and aggregate them properly.
  2. Some substances have different CAS numbers and different substance names, but are in the same group of restricted substances. See Figure 4, again from the SVHC Candidate List. Note that HBCDD could have 2 different CAS numbers: 25637-99-4 or 3194-55-6, an alias CAS number. HBCDD could also have 3 isomeric series: alpha-HBCDD (134237-51-7), beta-HBCDD (134237-50-6), and gamma-HBCDD (134237-52-8). When parts contain any of these substances, the software tool will need to be able to recognize that these actually belong to the same group and aggregate them properly.
  3. The software tool should maintain a consolidated substance master that covers all alias substances provided by suppliers and all isomeric series of substances. In reality, it is almost impossible for any software tool to cover all possible substances with their aliases and isomeric relatives. A good way to solve this issue is to make sure the software tool has a substance master that covers almost all substances provided by suppliers and can handle substance aliases and isomeric series. Most important, the tool should receive updates whenever a new substance provided by the supplier is not covered in the substance master. If you have outsourced the data to a 3rd-party data solution provider, make sure they will work with the software vendor so that both will maintain the same substance master and both will update their substance master whenever a new substance is identified.
  4. Almost all software vendors claim to be able to import substance data in IPC-1752 format, but this format has limitations. IPC-1752’s substance master is based on JIG specifications, so only about 300 substances are covered. Substances beyond JIG will be tagged as either Supplier Specific or Requester Specific. You will almost certainly see suppliers submit substance data and tag it Supplier Specific. If you are working with a data vendor to perform data collection, make sure to ask that they consolidate the substances so that all Supplier Specific substances or Requester Specific substances be grouped so that they can be aggregated in the software.
  5. One recommendation is to find a 3rd-party solution provider that both collects data and provides the software tool. This is the preferred solution because the substance master for both the data service and the software tool are the same and synched for updates and aliases. This eliminates the issue of consolidated substances and substance maintenance, and reduces management of two vendors (or more) to one.


Figure 3: Substance aliasing between 7789-12-0 and 10588-01-9


Figure 4: Substance grouping of 5 CAS numbers

Make sound decision on change of parts or change of suppliers based on REACH compliance performance
Should you discover that components used in your BOMs contain certain regulated substances (from SVHC, CMR, PBT or vPvB), communicate with your suppliers for replacements. If the supplier fails to provide a plan for replacement, you may need to consider changing the suppliers. Based on the analysis from the tool, you should be able to make such decision quickly in order to avoid any disruption in businesses.

Compliance with REACH demands thorough and accurate data and an efficient way to analyze and manage the data. Companies throughout the supply chain will be feeling the impact of REACH and need to develop strategies to ensure that disruptions are minimized. These strategies include:

  1. Clean the data you already have by scrubbing your BOMs.
  2. Collect full-disclosure chemical data for all your components if it is available. A third-party solution provider may save you time and money.
  3. Find a software tool to manage REACH compliance, including reporting on data collection, and chemical analysis at the component, subassembly, and product level.
  4. Be rigorous in finding replacements for problem components.

Applying these strategies will help prevent product delays, redesigns, and supply chain disruptions. favicon

Larry Yen is president and CEO of GreenSoft Technology, Inc., a data services provider and developer of software solutions for environmental compliance regulations such as RoHS and REACH.

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