HUNDREDS of small engineering companies across Scotland are in danger of trading illegally because they are running out of time to meet new European regulations on quality control coming into force in the summer.
Geoff Crowley, managing director of anti-corrosion specialist Highland Galvanizers, fears his business could be put in jeopardy as only a handful of his customers have the CE (Conformité Européenne) accreditation required for all fabricated steelwork from 1 July.
Qualifying for the CE standard usually takes about six months, so for many small makers of construction and engineering steelwork, time is running out.
“Highland has about 2,000 customers across Scotland, and we estimate that fewer than 50 are either prepared now, or will be by the deadline,” he said.
“We believe there are perhaps 1,000 businesses which will potentially be trading illegally after that date. The issue will be that, increasingly, their customers will demand CE qualified suppliers and unqualified companies will quickly find business drying up – and their employees out of work.”
Crowley estimates that as many as 17,000 jobs could be at risk unless companies act soon to meet the regulations.
CE marking was introduced in 1988 as a consumer protection device to ensure that all manufactured goods are made to the same standards across the EU. Items such as electronics and toys have had CE marks for many years. It was due to be applied to steelwork in July last year, but the deadline was extended after lobbying by the German industry.
To qualify, manufacturers must have a formal factory production control system in place which checks and documents the quality of welding work, staff training and other features of product safety. This must be assessed by one of seven UK certification groups currently approved by the EC.
The cost of compliancy can be as high as £30,000, but more typically falls in the £3,000-5,000 range. But with relatively few assessors and even fewer consultants specialising in this field, Crowley is predicting huge backlogs when the majority of firms wake up to the new requirements.
“They are running out of time, and running out of capacity to an extent in terms of auditors who can give this certification, and the advisors who can help them through the process,” he said.
In Scotland, local authority Trading Standards officers will be responsible for enforcing CE mark requirements. Penalties for supplying non-compliant goods could include heavy fines and three months in jail for company bosses.
But the biggest threat, Crowley said, is the loss of custom. “If Scotland doesn’t start taking this issue seriously, it is likely that Scottish businesses will be at a severe disadvantage and English companies will start picking up work in Scotland,” he said. “Engineering in Scotland could be dealt a major blow.”