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April 13, 2011

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Major accident hazards – A serious mandate

Caroline May and David Beckenham consider what impact the proposed new Seveso Directive could have on operators of high-risk facilities.

Potentially one of the most dangerous industries in the world, the chemicals sector has experienced a number of high-profile plant explosions over the years. Chief among these, the disaster at Seveso, Italy in 1976 left an indelible mark on Europe’s regulatory landscape, with the Directive that bears its name once again driving the need for integrated international regulatory action and uniform enforcement.

First implemented in Europe in 1982, the Seveso Directive had the aim of preventing major accidents involving large quantities of dangerous substances. Now known as Seveso II, following amendments made in 1996, the Directive is implemented in the UK by the Control of Major Accident Hazards Regulations 1999 (COMAH). 

Under Seveso II, duty-holders (i.e. those with control of an establishment) are subject to varying degrees of control based on the perceived risk posed by their operations and the substances they hold. Substances are categorised under Seveso II according to the nature of the hazards associated with the substance (e.g. toxic, very toxic, oxidising, explosive, flammable, highly flammable, etc).

Operators of all establishments where dangerous substances are present must notify their activities to the Competent Authorities (CAs) – i.e. HSE and/or the Environment Agency – and establish a major-accident prevention policy. Operators of high-risk facilities (e.g. those producing large quantities of dangerous substances) are subject to stricter obligations and are additionally required to produce a safety report and put in place a safety management system and an internal emergency plan.

Since 2000, the number of major accidents involving dangerous substances has fallen by some 20 per cent in Europe. Nevertheless, in December last year the European Commission (EC) issued proposals to amend Seveso II, with the following objectives: (i) to set even stricter inspection standards; (ii) to allow greater public involvement in determining the location of establishments; and (iii) to align Seveso II with new European hazardous-substances classification legislation. The proposals are set to come into force from 1 June 2015.

Summarised below are the key proposals under Seveso III, and their potential impact. 

Proposal 1: Alignment of the hazardous-substances classification systems

In January 2009, the EU Regulation on the Classification, Labelling and Packaging of Substances and Mixtures Regulation (the CLP Regulation) came into the force. Over a transitional period, ending in 2015, suppliers of chemical products will be required to change the classification, labelling and packaging of their substances to bring them into line with the UN’s new Globally Harmonised System. The aim of the system is to have, worldwide, the same criteria for classifying chemicals according to their health, environmental and physical hazards, and the same hazard communication requirements for labelling and safety data sheets.

The CLP Regulation introduces three new toxicity categories, which do not currently correspond with Seveso II. The new toxicity categories are also divided into three exposure routes – oral, dermal and inhalation.

The practical effect: As there will be only one set of categories, this will enable common labelling of substances globally.

Proposal 2: Inclusion of new technologies and/or sectors

Seveso III will exempt underground gas-storage activities from regulation under the regime, thereby excluding new technologies such as Carbon Capture and Storage (CCS).  In the UK, the HSE is deferring the inclusion of CCS until the risk profile associated with such technology is better understood, so that consideration can then be given to control by an appropriate regulatory regime.

The practical effect: Those organisations involved in the development of CCS technologies will still be required to comply with general regulatory requirements, such as those under the Health and Safety at Work, etc. Act 1974, but they will not need to comply with Seveso III.

Proposal 3: Extension of the notification requirements

Operators are currently required to notify the CA prior to the construction or start-up of new establishments, so that the Authority can assess the safety of each establishment. Seveso III would extend the notification requirements to ensure that information is included about neighbouring establishments and the potential cumulative impacts of their operations.

Operators will be required to assess the consequences of a major incident and how it would impact its locality, irrespective of whether Seveso III covers neighbouring establishments (the so-called “domino effect”). In addition, operators are required to update their notifications at least every five years and to send a copy to the CA (without delay) once the review has been completed.

The practical effect: This will assist the CAs in their assessment of the impacts of a major incident occurring at a Seveso III establishment. The key aim is for operators to exchange information with their neighbours, including those that fall outside the scope of Seveso III. In industrial areas, where there could be a number of neighbouring establishments, the sharing of information could become quite complicated. Issues of commercial confidentiality and security will also need to be considered.

Proposal 4: Reviewing Major Accident Prevention Policies (MAPPs)

Operators of establishments are currently required to take measures to ensure that risks arising from their operations are assessed and suitable control measures implemented. In order to demonstrate that such measures have been taken, Seveso III makes it clear that all establishments are required to have a MAPP, which should be proportionate to the hazards posed by their operations. Seveso III also proposes that a MAPP should be available in writing, sent to the CA, and updated at least once every five years.

The practical effect: Operators will need to ensure the implementation of a MAPP to ensure that a five-yearly review takes place and any updates are conveyed to the CA.

Proposal 5: Encouraging public participation in safety-related decisions

Further changes are proposed to get the public more involved in decisions affecting safety. The proposed changes seek to extend the information publicly available for all establishments to include operators’ details (i.e. name, address and activities); information about major-accident hazards; the results of inspections carried out; and where further information can be obtained.

For upper-tier establishments there are additional requirements, e.g. provision of a summary of the major-accident scenarios; provision of key information from the external emergency plan; and, where appropriate, provision of information regarding trans-boundary impacts. This information should be supplied to a central database at EU level and kept online, permanently available to the public. The database is currently being developed by the Major Accident Hazards Bureau (a technical and scientific support unit within the EC). It also extends to information about neighbouring establishments relating to domino effects.

There are new rules regarding confidentiality, with greater emphasis placed on openness and transparency while providing for non-disclosure of information in justified cases – for example, where confidentiality is required for security reasons. In relation to emergency planning for upper-tier establishments, there are new proposed requirements for public consultation on external emergency plans to enable public consultation. The means by which this consultation should take place will be left for Member States to determine.

The practical effect: The proposals for greater public involvement are likely to be welcomed by the UK Government under its localism agenda. Whether greater public involvement slows down the planning/
permitting processes remains to be seen but operators will need robust and carefully-managed communications strategies to ensure that consultation processes do not delay project schedules. 

Other proposals

A number of other proposals is contained in Seveso III, including:

  • a clearer separation of responsibilities between operators and the CA in relation to the review, testing and updating of internal and external emergency plans; 
  • a requirement that the CA draws up emergency plans within 12 months of receipt of the necessary information from the operator. This is required in order to avoid significant delays in the completion of emergency plans (which is the responsibility of the CAs);
  • Member States will be required to submit reports on major accidents to the EC within 12 months of them occurring. This is to avoid lengthy delays and will assist prevention of future accidents through earlier analysis, allowing for safety learnings to be disseminated more quickly; and
  • changes to the information on management systems and organisational factors to be covered in the safety report. The main changes suggested are: the removal of references to the MAPP; clarification that the safety management system should be proportionate; and that internationally recognised systems such as ISO and OHSAS should be taken into account. References to safety culture should also be included.

Next steps

There will be further discussion and negotiation at EC level before a final decision is taken on Seveso III. Enabling legislation will then be required in Member States. This is likely to take some time but, as a matter of practicality, businesses will be keen to ensure that the current regime is aligned with the CLP Regulation before the end of 2015 (i.e. the transitional period).

Conclusion

Seveso III allows for a global information system of hazard classification and labelling to be introduced. It is also an opportunity to encourage operators to share information on risk assessment and to ensure that the trend towards decline in major incidents involving such establishments continues. There will also be greater public participation in these issues.

If Seveso III is adopted, health and safety professionals will need to assist operators in ensuring that the CA is provided with the required information within the timescales proposed. They will also need to ensure that information that needs to be provided for the public is not alarmist and gives an accurate reflection of the risks and controls in place to reduce, or control such risks.
Robust, effective and efficient communication strategies will be a key element in implementing the new regulatory regime in order to avoid delays and unnecessary challenges.

Caroline May is a partner and David Beckenham is an associate in the environment, safety and planning department at law firm Norton.

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