Socio-economic Analysis for Biocides
Socio-economic Analysis for Biocides
Regulatory decisions on biocidal active substances can have consequences extending beyond the manufacturers supporting them. Particular uses may be important to downstream industries, public health, animal health, environmental protection or the operation of essential processes and infrastructure.
Where these consequences are relevant to a decision under the Biocidal Products Regulation (BPR), socio-economic analysis (SEA) can provide structured evidence on the impacts associated with different regulatory outcomes.
This can be particularly important where an active substance meets the BPR’s exclusion criteria and continued approval depends on demonstrating that one of the applicable derogation conditions is satisfied. It can also be relevant when assessing alternatives, substitution and the practical consequences of changes to the availability of an active substance or biocidal product.
When is socio-economic evidence relevant under the BPR?
The BPR does not require a socio-economic analysis for every active substance or product decision.
However, some provisions explicitly require consideration of the consequences for society.
Under Article 5 of the EU BPR, active substances meeting specified exclusion criteria should in principle not be approved. Article 5(2) provides limited circumstances in which such a substance may nevertheless be approved.
One of those conditions is where:
not approving the active substance would have a disproportionate negative impact on society when compared with the risks to human health, animal health or the environment arising from use of the substance.
Assessing this condition requires evidence capable of explaining what would happen if the relevant uses of the substance were no longer available and how those consequences compare with the risks associated with continued use.
The availability of suitable and sufficient alternative substances or technologies is also a key consideration when determining whether an exclusion-criteria substance may be approved.
The legislation can be accessed directly here:
Understanding the regulatory question
A useful socio-economic assessment starts with the decision that the evidence needs to inform.
The question is not simply whether a biocidal active substance has economic value. Instead, the analysis should examine the consequences of the relevant regulatory outcomes.
Depending on the circumstances, this may require consideration of:
- which uses could continue and which could be lost;
- which sectors and users depend on those uses;
- what alternatives could realistically be adopted;
- how substitution would change costs, performance or operating practices;
- whether some functions could no longer be delivered;
- impacts on human health, animal health or the environment;
- impacts on businesses, supply chains and users; and
- wider consequences for society.
Establishing the regulatory question and the relevant uses at the outset helps determine the appropriate scope of the analysis.
Establishing what happens without the substance
A central part of socio-economic analysis is establishing a credible alternative scenario against which the consequences of continued use can be assessed.
For a biocidal active substance, this may involve examining what affected organisations would do if particular uses were no longer available.
Responses could include:
- switching to another biocidal active substance or product;
- adopting a non-chemical control or prevention method;
- changing processes or operating practices;
- increasing the frequency or intensity of alternative treatments;
- accepting reduced performance or shorter product life;
- changing suppliers or production locations;
- withdrawing particular products or services; or
- ceasing activities for which no suitable alternative is available.
Different sectors or uses may respond differently. A single assumed alternative may therefore not provide an adequate basis for assessing the impacts of non-approval.
The assessment should identify the most credible responses and explain the evidence supporting them.
The relationship between SEA and analysis of alternatives
Analysis of alternatives (AoA) and socio-economic analysis are closely connected but answer different questions.
An AoA considers whether alternative substances, technologies or methods could perform the required function and whether they are technically and economically feasible.
SEA considers the consequences associated with different regulatory outcomes.
Evidence about alternatives is therefore often a critical input to the socio-economic assessment. If a suitable alternative can be introduced readily and at limited additional cost, the consequences of non-approval may be relatively limited. Where alternatives have substantial technical limitations, require significant investment, create other impacts or are not available for particular uses, the consequences may be greater.
The analysis therefore needs to consider alternatives as they would actually be implemented rather than assuming that the existence of a possible substitute means that substitution is straightforward.
Related RPA page: Analysis of Alternatives for Biocidal Active Substances
ECHA’s recommended framework for analysis of alternatives is available here:
Identifying affected uses and sectors
Biocidal active substances can support multiple product types, uses and sectors. The impacts associated with a regulatory decision can therefore vary considerably between applications.
A robust assessment may need to establish:
- where and how the substance is used;
- the function provided by the biocidal treatment;
- volumes or scale of relevant uses;
- the sectors and supply chains involved;
- the importance of the function to users;
- the consequences of reduced efficacy or loss of the use;
- the availability of alternatives for each application; and
- whether particular uses have characteristics that make substitution more difficult.
Segmenting the analysis in this way can be important. An alternative that is feasible for one use should not automatically be assumed to be feasible for another.
Assessing costs and economic impacts
The economic consequences of substitution can extend beyond the purchase price of an alternative substance or product.
Relevant costs may include:
- reformulation and product development;
- changes to manufacturing processes;
- new equipment or infrastructure;
- testing, qualification and certification;
- changes in application rates or treatment frequency;
- additional labour or maintenance;
- increased energy, water or material use;
- reduced productivity or production capacity;
- changes in product performance or service life;
- supply-chain disruption;
- regulatory costs associated with changing products or processes; and
- transition costs and implementation time.
The appropriate level of quantification depends on the significance of the impact and the quality of the evidence available.
Where reliable monetary estimates cannot be developed, impacts can still be assessed qualitatively or using other quantitative measures. The important point is to make the evidence, assumptions and uncertainties transparent.
Assessing benefits and wider consequences
The benefits associated with a biocidal use can be wider than the commercial value of the product itself.
Depending on the substance and application, biocidal functions may contribute to outcomes such as:
- controlling infectious or harmful organisms;
- maintaining hygiene;
- protecting human or animal health;
- protecting materials, products or infrastructure;
- preventing deterioration;
- extending the useful life of products or assets;
- maintaining industrial processes;
- reducing waste or replacement requirements; or
- supporting environmental protection.
These outcomes should not simply be asserted. The assessment needs to establish the relationship between the biocidal use and the benefit being claimed and consider what would happen under the relevant alternative scenario.
Where possible, impacts should be quantified using appropriate evidence. Where quantification is not possible or proportionate, their significance can still be assessed transparently using qualitative evidence.
Evidence from industry and downstream users
Much of the information needed to understand the consequences of a regulatory decision may sit with organisations using biocidal products rather than with the active substance manufacturer.
Industry and stakeholder engagement can therefore be an important part of socio-economic analysis.
Evidence from downstream users can help establish:
- why particular biocidal functions are required;
- current patterns of use;
- technical and performance requirements;
- alternatives already tested or considered;
- reasons why alternatives have or have not been adopted;
- implementation timescales;
- additional costs;
- impacts on production and operations; and
- the consequences if particular uses were no longer available.
Evidence gathering should be structured so that information from different respondents can be assessed consistently.
Where industry estimates are used, the assumptions and underlying evidence should be examined rather than accepting them at face value.
Comparing societal impacts and risks
Article 5(2)(c) requires consideration of whether the negative impact on society arising from non-approval would be disproportionate when compared with the risks associated with continued use.
Socio-economic evidence therefore forms part of a wider regulatory assessment. It does not replace the scientific assessment of risks to human health, animal health or the environment.
A useful analysis needs to present the consequences of the available regulatory options clearly enough for the decision-maker to understand:
- the nature and scale of the societal impacts;
- which groups bear those impacts;
- the significance of affected uses;
- what alternatives are realistically available;
- the costs and consequences of adopting those alternatives;
- the risks associated with continued use; and
- the important uncertainties affecting the comparison.
The evidence should be proportionate to the decision and transparent about areas where information is incomplete.
Socio-economic evidence in consultations
Where an active substance potentially meets the criteria for substitution or the exclusion criteria, regulators may seek information from third parties on alternatives and, where relevant, the conditions for derogation.
ECHA consultations can request evidence concerning the societal consequences of non-approval as well as the availability of suitable alternatives.
ECHA – Consultations on potential candidates for substitution and derogation conditions
Evidence submitted through these processes is more useful where it identifies the relevant uses and provides supporting information on the nature and scale of the impacts rather than making general statements about the importance of a substance.
SEA and active substance approval or renewal
Socio-economic questions can arise during both approval and renewal where the regulatory properties of an active substance trigger consideration of the BPR’s derogation provisions.
Renewal may be particularly important where new scientific evidence, changes in classification or developments in the availability of alternatives alter the regulatory context since the previous approval.
Early assessment can help identify:
- whether socio-economic evidence may be needed;
- which uses are likely to be most important;
- where evidence is already available;
- which downstream sectors need to be engaged;
- what information on alternatives is required; and
- where significant evidence gaps remain.
Related RPA page: Active Substance Approval and Renewal
Socio-economic considerations in product authorisation
Socio-economic and practical considerations can also arise at product level.
For example, comparative assessment under Article 23 considers whether an alternative authorised biocidal product or non-chemical control or prevention method presents a significantly lower overall risk, is sufficiently effective and presents no other significant economic or practical disadvantages.
Article 19 also contains provisions allowing certain products to be authorised in specified circumstances where non-authorisation would result in disproportionate negative impacts for society when compared with the risks arising from use.
The evidence required will depend on the particular regulatory provision and decision concerned. A full socio-economic analysis will not necessarily be appropriate in every case.
Related RPA page: Biocidal Product Authorisation and Market Access
Developing a proportionate socio-economic analysis
There is no single analytical approach appropriate to every biocides decision.
The scope should reflect the regulatory question, the importance of the affected uses, the likely scale of impacts and the evidence available.
A proportionate assessment will normally involve:
- defining the regulatory decision and relevant uses;
- establishing the scenario against which impacts will be assessed;
- identifying realistic alternatives and responses;
- identifying affected sectors and stakeholders;
- assessing costs and other negative impacts;
- assessing benefits and wider societal consequences;
- considering the distribution of impacts;
- comparing the relevant regulatory outcomes;
- testing key assumptions and uncertainties; and
- presenting conclusions that can be traced back to the underlying evidence.
More complex or consequential decisions may justify detailed quantitative analysis. In other cases, a carefully evidenced qualitative or semi-quantitative assessment may provide the information required.
How RPA contributes to socio-economic analysis for biocides
RPA’s socio-economic work combines economic analysis with an understanding of the scientific and regulatory context in which the evidence will be used.
Our work can include:
- defining the scope and analytical framework;
- developing credible alternative and non-use scenarios;
- identifying affected uses, sectors and supply chains;
- designing and undertaking industry evidence gathering;
- analysing the costs and consequences of regulatory options;
- assessing the feasibility and implications of alternatives;
- examining health, environmental and wider societal impacts;
- developing quantitative and qualitative evidence;
- testing assumptions and uncertainty; and
- integrating socio-economic evidence with regulatory and scientific analysis.
The objective is to provide evidence that is relevant to the specific regulatory decision and sufficiently transparent for the underlying assumptions and conclusions to be understood.
Official guidance and legislation
EUR-Lex – Regulation (EU) No 528/2012
ECHA – Consultations on potential candidates for substitution and derogation conditions
ECHA – Analysis of alternatives to biocidal active substances: recommended framework guidance