What are Substances of Very High Concern (SVHC) under the EU Green Deal framework?

SVHCs are chemical substances identified under the REACH Regulation (EC) No 1907/2006 as having serious effects on human health or the environment, such as carcinogenicity or persistence. Under the EU Green Deal, managing SVHCs is critical to achieving safer chemicals and sustainable industry, with these substances proposed for authorization to restrict their use and promote safer alternatives.

How does the REACH Regulation relate to SVHCs and the EU Green Deal objectives?

REACH Regulation (EC) No 1907/2006 requires companies to identify and manage SVHCs by submitting them to the Candidate List and eventually the Authorization List, ensuring their use is controlled or phased out. This aligns with the EU Green Deal’s goal to minimize hazardous chemicals in products by 2030, supporting the Chemicals Strategy for Sustainability (ESPR) and circular economy initiatives.

Why must compliance managers be familiar with SVHCs in the context of the Corporate Sustainability Reporting Directive (CSRD)?

Under the CSRD (Directive 2022/2464), companies must disclose information on environmental risks, including the use of SVHCs, to enhance transparency and accountability. Compliance managers need to track SVHC presence in products and supply chains to meet reporting obligations and avoid legal penalties starting from the 2024 reporting year.

What legal implications do SVHCs have for companies under the EU’s Carbon Border Adjustment Mechanism (CBAM)?

While CBAM primarily targets carbon emissions, companies using SVHCs in production may face indirect scrutiny as the EU Green Deal integrates chemical safety with climate goals. Non-compliance with SVHC restrictions under REACH can lead to trade barriers or penalties, affecting companies’ eligibility under CBAM starting from its phased implementation in 2023.

How does the Corporate Sustainability Due Diligence Directive (CSDDD) impact the management of SVHCs?

The CSDDD (proposed directive) requires companies to identify, prevent, and mitigate adverse human rights and environmental impacts, including those from SVHCs in their value chains. Compliance managers must ensure due diligence processes address SVHC risks to avoid liability and support the EU Green Deal’s ambition for sustainable and responsible corporate behavior by 2024-2025.

What is Substances of Very High Concern (SVHC)? | EU Green Deal Glossary

Substances of Very High Concern (SVHC) are chemical substances identified under Regulation (EC) No 1907/2006 (the REACH Regulation) that meet specific criteria making them candidates for inclusion in Annex XIV of REACH, which subjects them to authorization before they can be used or placed on the EU market.

The Substances of Very High Concern (SVHC) designation is a cornerstone of the European Union’s chemical safety framework and plays a critical role in the EU Green Deal by ensuring that hazardous chemicals are progressively replaced by safer alternatives. SVHCs are substances that have serious effects on human health or the environment, such as carcinogenicity, mutagenicity, reproductive toxicity, persistence, bioaccumulation, or endocrine disruption.

Regulatory Context of SVHC under the EU Green Deal

The concept of SVHC originates from the REACH Regulation, which requires the European Chemicals Agency (ECHA) to maintain a Candidate List of SVHCs. Substances on this list are proposed for eventual inclusion in Annex XIV, meaning they require authorization for use within the EU.

Beyond REACH, the SVHC designation influences compliance obligations under several EU Green Deal-related regulations:

Carbon Border Adjustment Mechanism (CBAM) (Regulation (EU) 2023/956): SVHCs in imported products may trigger additional reporting or compliance requirements to avoid carbon leakage and ensure sustainable supply chains.
Ecodesign for Sustainable Products Regulation (ESPR) (Proposal COM/2022/142 final): SVHC presence affects product design requirements, pushing manufacturers to eliminate hazardous substances to meet sustainability criteria.
Corporate Sustainability Reporting Directive (CSRD) (Directive (EU) 2022/2464): Companies must disclose information on hazardous substances, including SVHCs, in their supply chains to enhance transparency and accountability.
Corporate Sustainability Due Diligence Directive (CSDDD) (Proposal COM/2022/71 final): Due diligence obligations require companies to identify and mitigate risks related to SVHCs in their operations and value chains.

Why Compliance Managers Must Understand SVHC

Compliance managers need precise knowledge of SVHC because:

Legal Obligations: Companies manufacturing, importing, or using SVHCs must notify ECHA and comply with authorization requirements, or risk prohibitions.
Supply Chain Impact: SVHCs affect product formulation, procurement, and customer acceptance, especially under the ESPR and CBAM.
Reporting Requirements: Under CSRD, accurate disclosure of SVHC presence is mandatory, impacting corporate sustainability ratings and investor relations.
Risk Management: Failure to identify SVHCs can lead to regulatory fines, reputational damage, and forced product recalls.

Legal Consequences of Misunderstanding or Misapplying SVHC

Misclassification or failure to comply with SVHC-related obligations can result in severe penalties:

Under REACH, non-compliance with authorization requirements can lead to fines up to 5% of global annual turnover and product bans.
Incorrect or missing notifications to ECHA may trigger enforcement actions and reputational harm.
Under CSRD, inaccurate sustainability reporting can lead to sanctions and loss of investor confidence.
Non-compliance with CSDDD due diligence obligations may expose companies to civil liability claims and operational restrictions.

Appearance of SVHC in EU Green Deal Regulations
Regulation	Reference	Role of SVHC	Key Deadline	Penalty
REACH Regulation	Regulation (EC) No 1907/2006	Defines SVHC, Candidate List, Authorization process	Ongoing updates; Authorization deadlines vary per substance	Up to 5% of global turnover for non-compliance
Carbon Border Adjustment Mechanism (CBAM)	Regulation (EU) 2023/956	Requires reporting of embedded emissions including SVHC-related impacts	Effective from 1 October 2023	Fines up to 4% of turnover for false declarations
Ecodesign for Sustainable Products Regulation (ESPR)	Proposal COM/2022/142 final	Restricts use of SVHC in product design	Expected application from 2024	Market access denial for non-compliant products
Corporate Sustainability Reporting Directive (CSRD)	Directive (EU) 2022/2464	Mandates disclosure of SVHC presence in supply chains	Reporting from fiscal year 2024	Sanctions vary by Member State, reputational risk
Corporate Sustainability Due Diligence Directive (CSDDD)	Proposal COM/2022/71 final	Requires risk assessment and mitigation of SVHC-related harms	Expected enforcement from 2025	Civil liability and fines up to 5% of turnover

Truth Anchor: The REACH Regulation (EC) No 1907/2006 mandates that substances meeting criteria such as carcinogenicity, mutagenicity, reproductive toxicity, persistence, bioaccumulation, or endocrine disruption are identified as SVHCs and added to the Candidate List, which as of June 2024 includes over 240 substances. Failure to comply with authorization requirements can result in fines reaching 5% of global annual turnover under EU enforcement regimes.

Frequently Asked Questions about Substances of Very High Concern (SVHC)

What criteria qualify a substance as an SVHC under REACH?

A substance qualifies as an SVHC if it is carcinogenic, mutagenic, toxic for reproduction (CMR), persistent, bioaccumulative and toxic (PBT), very persistent and very bioaccumulative (vPvB), or has endocrine-disrupting properties as defined in REACH Regulation (EC) No 1907/2006, Article 57.

How does the SVHC designation affect my company’s product compliance?

If your products contain SVHCs above 0.1% weight by weight, you must notify ECHA, communicate information to customers, and possibly apply for authorization. Non-compliance risks product bans and significant fines as per REACH and related EU Green Deal regulations.

Are imported products subject to SVHC regulations?

Yes. Imports into the EU containing SVHCs must comply with the same notification and authorization requirements as products manufactured within the EU. Additionally, under CBAM Regulation (EU) 2023/956, SVHC presence may influence carbon pricing and reporting obligations.

Ready to ensure your products comply with SVHC requirements? Use our SVHC Compliance Checker Tool to identify regulated substances in your supply chain and receive tailored guidance on authorization and reporting obligations. Clicking this tool will analyze your product composition data against the latest Candidate List and provide actionable next steps to avoid penalties.