In an increasingly regulated world, sourcing chemicals globally comes with significant compliance risks. Procurement and supply chain managers must navigate a patchwork of regulations – REACH, TSCA, OSHA, GHS, etc. – and the stakes for non-compliance have never been higher. As we head through 2025, this article highlights the top compliance “gaps” in global chemical supply chains that
companies need to watch and close. These are the areas where lapses commonly occur, potentially leading to fines, shipment delays, or worse – business interruptions.

Gap 1: Incomplete REACH Compliance and Documentation

The Situation: REACH in the EU remains one of the most demanding chemical regulations. Yet many companies sourcing from or selling into Europe still struggle with registration and documentation requirements. A common gap is assuming a supplier has REACH covered when, in fact, a specific use or volume isn’t registered. The European Chemicals Agency (ECHA) has been ramping up enforcement – a recent compliance project found 18% of checked consumer products were non-compliant with REACH rules.

Why It’s Risky: If your product contains a substance not properly REACH-registered or above allowed limits, it can be barred from the EU market. Non-compliance might only be discovered at customs or during an audit, causing shipments to be blocked. Moreover, REACH’s Candidate List of SVHC (Substances of Very High Concern) is updated regularly (six new substances were added in January 2025 alone). Many companies have a gap in monitoring these updates – meaning they might continue using a chemical that suddenly requires notification or replacement.

Mitigation: Conduct regular audits of your chemical portfolio for REACH status. Ensure all substances >1 tonne/year are registered (either by your supplier or via an Only Representative). Implement a process to monitor SVHC list updates – e.g., every 6 months review new additions and check if they are in your supply chain. Don’t assume your suppliers will alert you; proactive checking is key. Also, maintain proper documentation (Safety Data Sheets, declarations) in case authorities ask for proof of compliance. With the anticipated “REACH Recast” coming by late 2025 introducing even stricter rules (like periodic registration renewals), this gap must be closed through vigilance and possibly digital tools
to track compliance status.

Gap 2: Supplier Data Gaps and Lack of Transparency

The Situation: In global supply chains, companies often rely on suppliers for chemical composition data, hazard info, or regulatory certificates. A big compliance gap occurs when suppliers don’t fully disclose substance information, leaving importers or downstream users in the dark. For example, a formulator might not know that a raw material contains 0.2% of a regulated impurity – until it’s flagged by authorities. Supplier data gaps can also mean missing or outdated SDSs, or no insight into whether a substance is on a country’s inventory list.

Why It’s Risky: Lack of visibility equals lack of compliance. Under regulations like REACH and OSHA Hazard Communication, you are responsible for knowing and communicating chemical hazards. If a supplier withholds ingredient info (claiming trade secret without proper justification) or simply doesn’t have data, you may inadvertently violate rules. For instance, failing to report an SVHC above 0.1% in an article because your supplier never told you could result in penalties. Similarly, if the supplier’s SDS is not GHS-compliant or in local language, you’re at fault when distributing those chemicals.

Mitigation: Push for full material disclosures and robust supplier due diligence. Many companies are now requiring suppliers to provide comprehensive compositional data or at least confirm absence/ presence of certain regulated substances. Supplier onboarding should include a compliance checklist: Do they provide up-to-date SDS in required formats? Are they willing to disclose to the extent needed for you to meet your obligations? Utilizing NDAs or regulatory data-sharing platforms can help protect IP while enabling compliance information flow. The key is not to accept blind spots. As Acquis Compliance notes, REACH forces companies to examine supply chains more closely than ever – treat this as a feature, not a burden, by building transparency with your suppliers.

Gap 3: Global Labeling and Safety Information Inconsistencies

The Situation: Shipping chemicals across borders means complying with varying hazard communication standards. While GHS (Globally Harmonized System) provides a framework, in reality each jurisdiction (EU, US, China, etc.) has its own implementation. A frequent gap is when labels or Safety Data Sheets aren’t fully compliant for the destination market – e.g., a drum labeled for US OSHA is shipped into the EU without the required CLP pictograms and EU Poison Center notifications, or an SDS in English is sent to a country that requires the local language.

Why It’s Risky: Mislabeling or providing improper documentation is a tangible violation that inspectors readily catch. It can lead to fines and seizure of goods. Beyond legal risk, it’s a safety issue – workers might not understand hazards if info is in the wrong language or format. For example, China has specific chemical labeling rules; an imported chemical with only EU CLP labeling could be held up or penalized upon entry. We’ve seen increased enforcement globally on hazard communication – e.g., Turkey and other jurisdictions doing thorough SDS/label checks at customs.

Mitigation: Localize your compliance. For any market you operate in or ship to, ensure you know the exact SDS and label requirements. Work with suppliers to get region-specific SDS (many large suppliers can provide, say, a REACH-compliant SDS vs. a US-compliant SDS). If you’re repackaging or labeling inhouse, invest in software or services that maintain compliance in multiple jurisdictions. Essentially, treat hazard communication as part of the product. Conduct periodic label/SDS gap analyses for each target market.

Gap 4: Not Monitoring Restricted Substances and New Regulations

The Situation: Chemical regulations are not static. They evolve – new substances get restricted, allowable limits change, entirely new rules emerge (e.g., PFAS bans, new RoHS substances, etc.). A major compliance gap is failing to monitor and react to these changes. Companies may have been compliant last year, but now are out of compliance because they didn’t realize a chemical in their product was added to a prohibited list or a reporting requirement kicked in.

Current example: PFAS (per- and polyfluoroalkyl substances) regulations are tightening worldwide. The EU is considering a broad ban, some US states have reporting or bans, etc. Many supply chains haven’t mapped where PFAS are present (often in processing aids, surfactants, lubricants). Similarly, California’s Prop 65 adds chemicals every year that require warning labels on products in that state. If
you’re not watching, you can get caught off guard.

Why It’s Risky: The regulatory landscape can make an otherwise well-run supply chain non-compliant essentially overnight. For instance, if your product contains a flame retardant that gets classified as an SVHC or pops up on a new state’s toxic law, you might suddenly face sales restrictions or labeling requirements. Non-compliance here often leads to product recalls or forced market withdrawal. Recall
that product recalls due to non-compliance cost on average $11 million (often due to hazardous substance issues). And beyond direct cost, it’s reputational damage and supply disruption.

Mitigation: Implement a compliance tracking system. This could mean assigning a regulatory intelligence role or using compliance software that flags when laws change or new substances are listed. Subscribe to regulatory update newsletters (ECHA news, EPA updates, etc.) or databases. When a change is on the horizon (like the upcoming EU REACH revision or new OSHA standards), conduct
impact assessments – which products or processes of ours does this affect? Also, consider “design for compliance”: actively work to phase out chemicals known to be under regulatory scrutiny (e.g., many companies are preemptively removing certain PFAS or phthalates). Being proactive can save scrambling later.

Gap 5: Insufficient Supplier Audits and Oversight

The Situation: Especially in high-risk or developing markets, companies may source chemicals from suppliers that do not follow stringent compliance or ethical standards. A glaring gap is failing to audit or vet these suppliers for regulatory adherence. Perhaps a supplier provides a needed raw material cheaply, but are they, for example, properly handling waste and providing accurate documentation? If not, you could be indirectly complicit in violations (think environmental dumping, or falsified certs).

Additionally, even reputable suppliers can make mistakes. Without oversight, you might not catch that a supplier’s process changed and now an impurity is present that triggers a regulatory issue.

Why It’s Risky: In global supply chains, the adage “trust but verify” applies. If a supplier in another country mislabels a shipment or exports something illegal, your company often bears the liability in the importing country as the “responsible party”. There have been cases of companies unknowingly importing chemicals that were supposed to be restricted or had misdeclared contents – resulting in
fines and seizure. Moreover, under laws like EU due diligence or even public pressure, using suppliers with poor compliance (or poor human rights/environment records) can hurt business.

Mitigation: Strengthen your supplier qualification and audit program. For any critical or high-risk market suppliers, perform on-site or third-party audits focusing on regulatory compliance: Do they have necessary licenses? Are they accurately testing and certifying product content? Ensure contractual agreements include compliance clauses and the right to audit. Technology can help too – some companies use blockchain or tracing systems to ensure chain-of-custody for regulated substances. The key is to not assume – actively engage with suppliers to verify that what they say on paper (SDS, CoA) matches reality. As a part of this, hold training or joint reviews with suppliers on compliance topics; sometimes they simply might not be fully aware of the end-market rules you need to meet.

Gap 6: Overlooking Local Regulations in New Markets

The Situation: When expanding to new regions or sourcing from a new country, companies sometimes focus on the big international regs but miss local chemical regulations. For example, importing chemicals into South Korea requires compliance with K-REACH (similar to EU REACH but separate). Turkey has KKDIK, China has its own inventory and import rules, etc. A gap arises if companies treat
compliance as “one size fits all” and assume REACH or TSCA compliance covers them globally.

Why It’s Risky: Each jurisdiction has nuances. Missing a required registration or notification in one country can stop your business there. Authorities worldwide are becoming less lenient to foreign companies – if you want to play in their market, you must follow their rules. Ignorance is not a defense. Additionally, trade regulations (like export controls or sanctions on certain chemicals in certain countries) can pose huge risks if overlooked. For instance, exporting a controlled precursor to a country without a proper license can lead to severe penalties.

Mitigation: Whenever entering a new market – either to sell or to source – do a regulatory landscape assessment. Identify all relevant local laws (product registration, labeling, chemical inventory listing, etc.). Engage local compliance experts or consultants if needed. For sourcing, consider requiring that suppliers in that country assist or provide info for compliance (e.g., a Chinese supplier helping you with China’s MRSL or providing Chinese SDS if you re-export within China). Essentially, localize your compliance strategy for every region in your supply chain.

Staying ahead of these compliance gaps requires a proactive, informed approach. The cost of noncompliance – in fines, recalls, and lost market access – far exceeds the investment in robust compliance management. In 2025, make it a priority to shore up these areas: ensure your global chemical sourcing isn’t just cost-effective and efficient, but airtight in safety and regulatory adherence. Your license to operate depends on it.

Key Takeaways

• REACH and Global Regs: Continually update and audit compliance with major regulations like REACH. Many companies fall behind on registrations or SVHC tracking – gaps that can block market access. Implement regular reviews to keep current with changing chemical lists and forthcoming rules (e.g., REACH revision).
• Transparency is Mandatory: Lack of full material disclosure from suppliers is a ticking time bomb. Close the gap by demanding detailed composition data and compliance certificates. Supplier data gaps on restricted substances or hazards can lead to inadvertent violations – trust but verify.
• Hazard Communication Worldwide: Ensure labels and SDS meet local requirements for every market. A common compliance gap is shipping with incorrect or untranslated hazard info, which regulators readily catch. Tailor hazard communication to each jurisdiction to avoid fines and safety issues.
• Monitor Emerging Restrictions: Today’s compliant chemical could be tomorrow’s banned substance. Companies must actively monitor new regulations (PFAS bans, Prop 65 additions, etc.) and adapt. Not tracking regulatory changes is a major compliance gap that can result in costly recalls or forced reformulations.