European Union chiefs are to re-examine laws covering industrial waste as Budapest battles to contain a deadly flood of toxic sludge, officials said yesterday.

As Hungarian police arrested the managing director of the company at the centre of the disaster and engineers put the finishing touches to a new dam around a reservoir of chemical residue, the EU said its executive head is meeting with Hungarian Prime Minister Viktor Orban today.

Jose Manuel Barroso will use a long-planned but “timely” visit to “take stock” on action to stem the pollution, said European Commission spokesman Olivier Bailly, but as yet, there were no plans for him to visit the site.

The containing walls of the reservoir in Ajka, 160 kilometres west of Budapest, broke a week ago, sending a toxic mudslide down on nearby villages and into several rivers with the pollution eventually ending up in the Danube.

Five anti-pollution experts from partner EU states were to join late yesterday disaster relief management operations for the worst-ever chemical accident in which eight people died and 150 were injured.

Brussels is not ruling out new European anti-pollution legislation for the industrial sector.

“The subject could come up on Thursday” during talks in Luxembourg between EU environment ministers, one EU source said.

“If we see that the legislation needs to be changed, we should go into that direction,” said another commission spokesman.

Regulators said that Mal Hungarian Aluminium Production and Trade Company secured authorisation for storage of toxic waste in 2006 under an EU law that stipulates companies must use best practice techniques.

But the second spokesman underlined that the factory underwent an inspection by national supervisors before the accident, “so we have to assess what went wrong.”

The World Wildlife Federation says the relevant legislation is insufficient and is demanding strict application of a separate European law, also adopted in 2006 following a chemical disaster in Romania, and which specifically targets mining waste.

The problem, according to the WWF, is that implementation of this second regulation is not obligatory until 2012.

“There are loopholes in the legislation,” Brussels-based WWF expert Sergey Moroz said, claiming that had the updated regulations been applied already, the Hungarian disaster “would not have happened”.

A top Hungarian government official yesterday warned that the reservoir’s owners could face fines of up to €73 million.

However, the commission also indicated that any Hungarian request for cash help in this instance may fail.