International Regulations and the American Supply Chain

By Freddie Pierce
The American environmental movement recently suffered a setback when a combination of industry resistance and internal squabbling prevented them from e...

The American environmental movement recently suffered a setback when a combination of industry resistance and internal squabbling prevented them from enacting meaningful regulation of toxic chemicals. As a result, American businesses have to adapt to far more stringent regulations abroad than they can afford to at home.

The FDA has chosen not to regulate  bisphenol-A, a food packaging agent, and the decades-old Toxic Substances Control Act will not be undergoing any major revisions. That's not at all the case in Europe, where REACH (Registration, Evaluation, Authorization and Restriction of Chemicals) keeps companies on their toes.

Any business with a supply chain that touches on the European continent has to comply with very strict ordinances that include new chemical bans every year. Given the failure of concordant American legislation, Europeans may become wary of American products without heavy oversight from supply chain managers operating abroad.

If American companies don't learn to adapt to a global marketplace with a higher curve for how products can be legally produced and distributed to consumers, U.S. manufacturing may end up becoming a boogie man for the discriminating international shopper, in the same way that low regulation in China translates to trepidation in the American marketplace.

In other words, Americans may not want to buy Chinese milk now, but there may come a time when Europeans don't want to buy American baby bottles to carry it in.

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