Reform Initiatives

NICNAS Registration

Since 1 September 2004, legislation under the Industrial Chemicals
(Notification and Assessment) Amendment (Low Regulatory Concern
Chemicals) Act 2004 (the LRCC Act) has required all importers and
manufacturers of industrial chemicals for commercial purposes (including
those who introduce chemicals valued at between $1 and $499,999) in
Australia to register with NICNAS. The Registration Year continues to run
from 1 September to 31 August the following year.

The rollout of the new NICNAS Registration regime commenced early in the
2004-05 year with the mail out of letters to over 16,000 companies whose
names were obtained from data held by the Australia Taxation Office (ATO)
and/or the Australian Customs Service and/or NICNAS.

As a direct result of the mail out and the subsequent period of interaction,
4505 companies were listed in the Register of Industrial Chemical
Introducers at 30 June 2005. This represents a 477 per cent increase
in registered companies from 2003-04, an increase resulting directly from
the introduction of the Tier 1 Registration level under the LRCC Act.

Table 3 provides the numbers of registrants at each of the three NICNAS
Registration Tier levels in 2004-05, while Figure 3 shows the number
of registrants by level over the seven years that NICNAS has been operating
the company registration system.

Table 3 Number of registrants by Tier level in 2004-05

TIER
LEVEL VALUE OF INDUSTRIAL
CHEMICALS INTRODUCED
NUMBER OF
COMPANIES
REGISTERED
PROPORTION OF
ALL NICNAS
REGISTRATIONS
(AS PERCENTAGE)

Tier 1 between $1 and $4,999,999 3492 77.5%

Tier 2 between $500,000 and $5,000,000 729 16.2%

Tier 3 more than $5,000,000 284 6.3%

Total 4505

(Click to enlarge)

One spin-off from the intensive rollout of the Tier 1 Registration awareness
program was a marked (29.3 per cent compared to 2003-04) increase in the
number of Tier 2 and Tier 3 registrants. NICNAS's enhanced compliance
audit program (reported in the Compliance section of this report) also
contributed to this increase.

Following the initial mail out, NICNAS provided an industry training program
in each capital city for small to medium enterprises who had registered at
Tier 1. Training for customs brokers who assist industry in both the import
and export of materials including industrial chemicals, was also conducted.

As part of the introduction of Tier 1 Registration, NICNAS used a call centre
facility to handle anticipated follow-up enquiries. These, and the number of
written enquiries, are detailed in Figure 4.

(click to enlarge)

Seven letters to the Minister and 44 letters of complaint to the Director,
NICNAS were received in relation to the introduction of Tier 1 Registration.
Most of this correspondence related to the costs associated with
registration at Tier 1 ($353).

Late in the year, a Registration Performance Survey was initiated
to measure the performance of NICNAS's implementation of Tier 1
Registration. Four hundred organisations which had little or no previous
contact with NICNAS prior to 2004-05, were surveyed. For the purposes
of this survey, industry contact with NICNAS was defined as registering as
a Tier 1 organisation and/or clarifying registration related issues in the period
1 July 2004 to 30 June 2005.

One hundred and forty organisations responded to the survey:
• 26 per cent of respondents indicated they had further contact
   with NICNAS since the initial mail-out informing them of their potential
   need for registration
• only 16 per cent of respondents had used the website, however
   58 per cent indicated a desire to complete NICNAS Registration
   online with a further 24 per cent uncertain, and
• 93 per cent of respondents were satisfied that NICNAS had
   fulfilled its obligations under the NICNAS Service Charter.

Overall, the survey gave positive feedback about the professionalism with
which NICNAS staff interacted with industry clients. The survey responses
also provided useful suggestions for further improvement, which will be
implemented by NICNAS in the coming year.

Further details of NICNAS's Registration compliance program and audits
of companies registered with NICNAS, are given in the Compliance section
of this report.

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Implementation of other initiatives for chemicals
of low regulatory concern

The LRCC Act came into effect on 9 August 2004, introducing a variety
of measures aimed at providing more options for introducers of new
industrial chemicals while including safeguards to maintain health and
environmental standards. The specific measures implemented during
2004-05 are detailed below with a scorecard of the LRCC implementation
timetable detailed at Appendix 07.

A new range of exemptions

New LRCC exemptions introduced in 2004-05 include:
• a transhipment exemption for chemicals off-loaded and unopened
   at an Australian port or airport for a short period (30 days) and kept
   in control of Customs before leaving Australia
• an increase in the volume to 100 kg per year (formerly 10 kg per year)
   for the exemption of low risk chemicals
• an exemption for non-hazardous cosmetic ingredients introduced
   in products at one (1) per cent or less, and
• an increase in the volume to 100 kg per year (formerly 50 kg per year)
   for the exemption of chemicals introduced for research, development
   and analysis.

The extent of industry use of these exemptions will be measured when
mandatory annual reporting becomes operational on 28 September 2005.

AICS amendments

The Director, NICNAS can now put the particulars of a chemical, including
any conditions to which it is subject, on AICS, making these conditions
enforceable under the Act. Furthermore, applicants of new industrial
chemicals under an assessment certificate may now request that the
chemical be added to AICS immediately after the assessment certificate
is received from NICNAS. In 2004-05, 16 chemicals were immediately
added to the AICS under this new provision.

Audited self-assessment of non-hazardous chemicals

Interim arrangements for the audited self-assessment of Polymers of
Low Concern (SAPLCs) were extended to other non-hazardous chemicals,
including an audited self-assessed assessment certificate for non-hazardous
chemicals and polymers notified as a standard or limited notification.
New fees for self-assessment applications were introduced in December
2004 with a 40 per cent reduction in fees operating in all self-assessment
categories. Further, self-assessed PLCs now have a 28-day completion
timeframe compared with the 90-day time period previously.

In 2004-05 a total of 52 PLC self-assessment applications were received
by NICNAS, of which six were not accepted for self-assessment, and the
applicant withdrew another. The successful application of 39 SAPLCs
represented savings to industry of $49,000 in application fees alone.
Two standard certificate self-assessment applications were submitted
to NICNAS, however they were not accepted as they failed to meet the
criteria. Further savings occur with the reduced assessment timeframe,
with industry's time to market enhanced by two thirds.
Electronic templates for notifiers

By developing electronic templates for use by industry, NICNAS passed
savings of about $55,000 directly to industry for 2004-05. Self-assessment
templates and guidance material developed for PLCs and non-hazardous
chemicals as part of the LRCC reform initiative are now available on the
NICNAS website. Rebates are available to applicants who submit their
notification of a new chemical electronically using these templates. During
the year, 43 STD and LTD notifications were submitted using the electronic
template, leading to significant timesaving in NICNAS's assessment
process.

Existing Chemicals Program Review

NICNAS's Existing Chemicals Program is being reviewed to enhance its
flexibility and responsiveness to the needs and concerns of all stakeholders.
The review was initially deferred to allow development of a community
right-to-know charter with the CEF to guide NICNAS's review processes.
The review recommenced in December 2004 when the NICNAS
Community Engagement Charter was complete.

The 10-member Existing Chemicals Program Review Steering Committee
(RSC) includes representatives from the community, worker safety, industry
and government, and has a role to set a framework for the review and
oversees its activities. Details of the committee are given at Appendix 02.
It included three technical working groups to deal with specific aspects
of the review. The groups meet sequentially with the following tasks:
• Group 1:            detection and identification of hazards,
                             risks and concerns
• Group 2:            processes to address detected/identified hazards,
                             risks and concerns
• Group 3:            development of regulatory framework to ensure best
                             practice regulation of existing chemicals, including
                             national implementation of NICNAS guidance and
                             advice on safe use, elimination and risk reduction.

Focusing on the communication of chemical concerns to NICNAS and
mechanisms available to the various stakeholders, Group 1 met three times
and delivered its report - which included recommendations to the RSC
and issues for consideration by the other groups - in May 2005. Group 2
is focusing on how NICNAS can best respond to chemical concerns
raised by stakeholders.

The review is expected to be completed in March 2006 and will be fully
implemented in 2006-07.

New definitions

Definitions have been updated to accommodate amendments and maintain
consistency with other legislation. Notably, the definition of 'cosmetic'
was amended to align it with the definition of 'cosmetic product' in the
Trade Practices (Consumer Product Information Standards) (Cosmetic)
Regulations 1991.

Permit amendments

The LRCC Act provides for new permit categories for low hazard and low
risk chemicals, including a controlled use permit for chemicals used in
a highly controlled environment. Technical working parties began developing
low hazard and low risk criteria to give effect to the new range of permits
in 2005-06. Permits can be renewed at a reduced price provided the
circumstances of introduction and use are maintained. The global restriction
on low volume (LVC) permits was also removed, allowing two or more
companies to import the same chemical under permit, and a total of 30
LVC permit amendments were issued in 2004-05, five of which were joint
permits issued to two or more companies.

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Science Forum

Science Forum III The Practice of Human Health Risk Assessment in
Australia was held in Canberra in July 2004. Established as part of the
response to the Chemicals and Plastics Action Agenda call for enhanced
mechanisms for best practice risk assessment, the Forum focuses on
the human health risk assessment of chemicals.

Approximately 100 people (including 30 NICNAS staff) attended
the Forum, which was sponsored by the Population Health Division
within the DoHA.

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