by Daniel Frykholm, Reuters

Sweden will this week propose a global ban on a chemical which may cause liver damage and is used by a number of industries including semiconductor makers, the country's Environment Ministry said on Tuesday.

PFOS, or perfluorooctane sulfonate, has been investigated as a potentially hazardous chemical by several countries because it does not biodegrade in the environment, posing a potential health risk to both animals and humans.

"Very high rates of PFOS have been found in polar bears, polar foxes, eagles and seals. Low doses ... have in animal studies shown effects on the liver and disturbances of reproductive capabilities," the ministry said in a statement.

The chemical, or related substances that degrade into it, has been used in products ranging from flame retardants to paint thinners and glue. But usage dropped after U.S. conglomerate 3M <MMM.N> discovered its water and stain repellents were degrading into PFOS.

But it is still a part of making semiconductors, used in high-tech equipment such as cellphones and computers, as well as when treating some metals and in making photographic paper.

Sweden said the semiconductor industry should get a waiver for five years in order to develop viable options to PFOS.

"An immediate phase-out of PFOS-related substances would likely have serious consequences for the semiconductor industry and its competitiveness," the Swedish Chemicals Inspectorate said in a research paper prepared for the ministry.

German chipmaker Infineon <IFXGn.DE> said the European semiconductor industry used 43 kg of PFOS each year and had no alternative, but argued that it posed no threat to the environment or to workers thanks to minimal leaks.

"We assume that if there is a ban an exception will be made for the semiconductor industry," Infineon spokesman Reiner Schoenrock told Reuters.

Sweden said it would propose a ban to the United Nations under the Stockholm Convention to eliminate so-called persistent organic pollutants.It also filed a national ban on PFOS to the European Commission, which will review the legislation before it can come into effect. Britain also has a ban pending approval by the EU.

"My hope is that more EU countries will go ahead with national bans and that this will pressure the Commission into an EU-wide ban," Environment Minister Lena Sommestad said.