The final phase of European law designed to eradicate testing on animals of chemicals used in the cosmetics industry is set to be delayed for as long as four years because it is thought that alternative ways of testing the safety of ingredients' will not be ready in time.

Cosmetics and testing experts predict the European commission will announce shortly that it is unable to introduce the third phase of the European cosmetics directive, as planned in 2013. This directive would have banned the sale in Europe of any cosmetics tested on animals anywhere in the world.

Neil Parish MP, chair of the associate parliamentary group for animal welfare, said "sufficient" replacement safety tests would not be available until 2017.

However, Parish accuses the cosmetics industry of deliberately delaying the development of alternative methods. "For too long the cosmetics industry has dragged its feet when it comes to developing alternatives to animal testing, and here they are again trying to stall legislation to improve the welfare of animals."

Parish is demanding an end to "needless animal testing purely for the commercial gain of industry".

Michael Balls, a professor and former head of the commission's European Centre for the Validation of Alternative Methods, also criticises the handling of the issue. "The whole thing is a way of looking for reasons for a delay. The EC is trying to make a delay look like a scientific issue."

Sabine Lecrenier, head of the cosmetics and medical devices unit of the commission's Directorate General for Health & Consumers, has already informed members of the European parliament's environment committee that it is "unlikely enough scientific progress" will have been made on alternatives by 2013. A commission assessment of alternative methods is due to report in early 2011, and a final decision will follow soon afterwards. A clause letting the commission delay the ban will then be invoked.

Europe's two biggest cosmetics bodies – the European Cosmetics Association (Colipa), and the European Federation for Cosmetic Ingredients – say the full ban will probably be delayed because, according to Colipa, "top scientists confirm that although phenomenal progress has been made, a full set of alternative tests to cover all areas of consumer safety will almost certainly not be available by 2013".

There are 10,000 cosmetic ingredients on the commission's permitted list, but new ingredients are still being tested on animals outside Europe and then used within the EU. It is also thought that some new ingredients are still being tested on animals in Europe for use in household products or food and then subsequently used in cosmetic products.

The delay to the European cosmetics directive comes just as another complex set of EU legislation, which mandates the re-testing of tens of thousands of chemicals, begins to be enforced.

The EU regulation Reach (registration, evaluation, authorisation and restriction of chemicals) was the commission's response to safety questions raised over many chemicals used regularly in household and industry products. The commission estimates that a minimum of 8m extra animals will be used in these tests, although some observers put that figure as high as 54m.

Experts now question how Reach can possibly be compatible with a Europe-wide ban on animal testing of cosmetic products and ingredients. Balls said: "I think the general public has the impression that the cosmetics directive banned the testing of all ingredients [the first phase came in 2004]. So most people believe that when you buy a cosmetic it won't have any chemicals in it that have been tested on animals. But I just don't think that's true, and I think it is incredibly misleading."

The professor said he hoped for a "chorus of objections" if chemicals tested under Reach were then used in cosmetics labelled, "This product does not contain chemicals which have been tested on animals".

Cosmetic industry representatives say Reach will not affect the bans already in place on ingredient and product testing.

However, the US mining company Rio Tinto confirmed to the Guardian that sodium borate, an ingredient used in products made by Boots, Avon and some cruelty-free firms including Burt's Bees, and Lush, had recently been subjected to animal tests in compliance with Reach.

Rio Tinto said: "We avoid animal testing whenever possible. But when we're required by regulation to do animal testing, we do it to ensure human and environmental safety."

Mark Constantine, managing director of Lush, said: "The confirmation that … sodium borate has been tested on animals by the borate SIEF [the Substance Information Exchange Forum, which collates data for registration of chemicals from European suppliers] confirms our worst fears about Reach. We're investigating the situation, and have removed it from one product and are working on the others."

Lush says it does not buy products from suppliers who carry out animal testing on their own products. Burt's Bees adheres to the "Leaping Bunny" accreditation scheme of the Coalition for Consumer Information on Cosmetics.

Christopher Flowers, director-general of the Cosmetics, Toiletries and Perfumery Association, argues, like other cosmetics bodies, that ingredients tested on animals under Reach will be eligible for use in cosmetics because Reach and the cosmetics directive are separate pieces of legislation.

But the courts could take a different view. In 2005, in a case brought against the cosmetics directive, the French attorney general ruled: "It seems clear that the ban on animal tests applies equally to tests performed for … complying with other legislation, in so far as substances that have been the subject of such tests may not be used as, or in, cosmetic products."

Flowers said: "When people expect, or try, to bridge the two [pieces of legislation] to produce a consistent course of action, the lack of joined-up thinking out there in the wide world starts to show up."

• This article was amended on 1 January 2011. One of the bullet points in the standfirst of the website version of the article referred to the pharmaceutical industry. This article is specifically about the cosmetics industry. This has been corrected.