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The International Comparative Legal Guide to: Environment & 2019 16th Edition A practical cross-border insight into environment and climate change law

Published by Global Legal Group, with contributions from: Ambientalex - Studio Legale Associato LAVÍN Abogados & Consultores Atuguba & Associates Linklaters LLP Bär & Karrer Ltd. M.V. Kini Blake, Cassels & Graydon LLP Machado Meyer Advogados Borenius Attorneys Ltd Macías Gómez & Asociados Abogados S.A.S. Bowmans Maddocks Bryan Cave Leighton Paisner (Russia) LLP Noerr LLP Daud Silalahi & Lawencon Associates SIRIUS advokater David Desforges, Avocat à la Cour Snell & Wilmer L.L.P. Del Pozo & De la Cuadra United Kingdom Association Freshfields Bruckhaus Deringer LLP (UKELA) Gaastra attorneys at law URBAN FALATH GAŠPEREC BOŠANSKÝ Guyer & Regules Wistrand Law Firm Kanagawa Office Katende, Ssempebwa & Co. Advocates LAER Abogados, S.C. The International Comparative Legal Guide to: Environment & Climate Change Law 2019

General Chapters: 1 Future Horizons: The Next Generation of UK Environmental Law – Simon Tilling, United Kingdom Environmental Law Association (UKELA) 1

2 The as Guardians of the Environment – New Developments in Access to and Environmental Litigation – Jerzy Jendrośka & Moritz Reese, European Environmental Law Forum (EELF) 5 Contributing Editor Jonathan Isted, Freshfields 3 The Parent Trap: When is a Parent Company Liable for Environmental Harm Caused by a Bruckhaus Deringer LLP Foreign-Registered Subsidiary? – Jonathan Isted & Ian Jones, Freshfields Bruckhaus Deringer LLP 11

Sales Director 4 Overview of Trends in Environmental and Climate Change Law in Sub-Saharan Africa – Florjan Osmani Mandy Sherwin & Michael Vermaak, Bowmans 14 Account Director Oliver Smith Country Question and Answer Chapters: Sales Support Manager 5 Australia Maddocks: Michael Winram & Patrick Ibbotson 20 Toni Hayward

Editor 6 Belgium Linklaters LLP: Lieve Swartenbroux & Melissa Verplancke 29 Nicholas Catlin 7 Brazil Machado Meyer Advogados: Roberta Danelon Leonhardt & Daniela Stump 39 Senior Editors Caroline Collingwood 8 Canada Blake, Cassels & Graydon LLP: Jonathan W. Kahn & Anne-Catherine Boucher 44 Rachel Williams 9 Chile LAVÍN Abogados & Consultores: Julio Lavín Valdés & CEO Dror Levy Andrés Del Favero Braun 50

Group Consulting Editor 10 Colombia Macías Gómez & Asociados Abogados S.A.S.: Luis Fernando Macías Gómez 57 Alan Falach 11 SIRIUS advokater: Søren Stenderup Jensen & Aleksander Pilgaard 65 Publisher Rory Smith 12 England & Wales Freshfields Bruckhaus Deringer LLP: John Blain & Rachel Duffy 70 Published by 13 Finland Borenius Attorneys Ltd: Casper Herler & Henna Lusenius 89 Global Legal Group Ltd. 59 Tanner Street 14 France David Desforges, Avocat à la Cour 95 London SE1 3PL, UK Tel: +44 20 7367 0720 15 Germany Noerr LLP: Uwe M. Erling & Dr. Tim Uschkereit 106 Fax: +44 20 7407 5255 Email: [email protected] 16 Ghana Atuguba & Associates: Prof. Raymond A. Atuguba & Courage Asabagna 112 URL: www.glgroup.co.uk

GLG Cover Design 17 India M.V. Kini: Els Reynaers & Tavinder Sidhu 118 F&F Studio Design 18 Indonesia Daud Silalahi & Lawencon Associates: Kristianto P. H. Silalahi & GLG Cover Image Source Maurice J. R. Silalahi 126 iStockphoto 19 Italy Ambientalex - Studio Legale Associato: David Röttgen & Andrea Farì 132 Printed by Ashford Colour Press Ltd 20 Japan Kanagawa International Law Office: Hajime Kanagawa & Yoshiko Nakayama 139 February 2019 21 Mexico LAER Abogados, S.C.: Luis Alberto Esparza Romero & David Huerta Ruiz 148 Copyright © 2019 Global Legal Group Ltd. 22 Netherlands Gaastra attorneys at law: André H. Gaastra 155 All rights reserved No photocopying 23 Russia Bryan Cave Leighton Paisner (Russia) LLP: Vitaly Mozharowski & Tatiana Khovanskaya 162 ISBN 978-1-912509-55-3 ISSN 2045-9661 24 Slovakia URBAN FALATH GAŠPEREC BOŠANSKÝ: Marián Bošanský & Ján Falath 169

Strategic Partners 25 Spain Del Pozo & De la Cuadra: Covadonga del Pozo 176

26 Sweden Wistrand Law Firm: Rudolf Laurin 183

27 Switzerland Bär & Karrer Ltd.: Prof. Dr. Markus Schott 189

28 Uganda Katende, Ssempebwa & Co. Advocates: Fred Businge Kiiza & Edwin Buluma Wabwire 196

29 Uruguay Guyer & Regules: Anabela Aldaz Peraza & Betania Silvera Perdomo 203

30 USA Snell & Wilmer L.L.P.: Denise A. Dragoo 210

Further copies of this book and others in the series can be ordered from the publisher. Please call +44 20 7367 0720

Disclaimer This publication is for general information purposes only. It does not purport to provide comprehensive full legal or other advice. Global Legal Group Ltd. and the contributors accept no responsibility for losses that may arise from reliance upon information contained in this publication. This publication is intended to give an indication of legal issues upon which you may need advice. Full legal advice should be taken from a qualified professional when dealing with specific situations.

WWW.ICLG.COM EDITORIAL

Welcome to the sixteenth edition of The International Comparative Legal Guide to: Environment & Climate Change Law. This guide provides corporate and international practitioners with a comprehensive worldwide legal analysis of environment and climate change and . It is divided into two main sections: Four general chapters, which explore topical issues affecting this area of law, particularly from a multi-jurisdictional perspective. Country question and answer chapters. These provide a broad overview of common issues in environment and climate change laws and regulations in 26 . All chapters are written by leading environmental and industry specialists, and we are extremely grateful for their excellent contributions. Special thanks are reserved for the contributing editor Jonathan Isted of Freshfields Bruckhaus Deringer LLP for his invaluable assistance. Global Legal Group hopes that you find this guide practical and interesting. The International Comparative Legal Guide series is also available online at www.iclg.com.

Alan Falach LL.M. Group Consulting Editor Global Legal Group [email protected] Chapter 1

Future Horizons: The Next Generation of UK Environmental Law

United Kingdom Environmental Law Association (UKELA) Simon Tilling

Introduction named after the global hit series from the BBC’s excellent department, which elevated marine plastic to a level where politicians were scrambling to be the first to announce tough It is a privilege to author this introductory chapter to The International action on single-use plastics. With it came a reassessment of our Comparative Legal Guide to: Environment & Climate Change Law disposable society and questions over what happens to our society’s 2019, on behalf of the UK Environmental Law Association, known to waste: the era of ‘throw and forget’ is coming to an end. its members and friends as UKELA. It is also timely. In 2018 UKELA celebrated its 30th birthday. Of course, as with any big These issues and public concerns have been used to further the Brexit anniversaries, we took the opportunity to look back on all that the first agenda. For example, free from the EU’s common agricultural generation of UK environmental lawyers had achieved, from the policy, the £3 billion in subsidies that go to support UK agriculture UK’s ground-breaking Act 1990 onwards. could be used for environmental benefits, or in the words of Michael But more importantly, we have been looking forward, towards the Gove MP, the Secretary of State for Environment, Food and Rural challenges ahead for the next generation of environmental lawyers, Affairs (DEFRA), we can adopt a policy of ‘public money for public and indeed of UK environmental law itself. In this chapter I share goods’, using a approach. some perspectives gained from the vibrant debates and discussions Of course, there are others who argue Brexit provides an opportunity that have taken place this year, within UKELA and indeed between to row back on the ‘green tape’ from Brussels, and gives us more UKELA and others, including the UK Government. I do not claim in freedom to drive economic growth without what some see as this article to speak on behalf of UKELA: UKELA is far too broad a unnecessary . Certainly, regardless of one’s perspective, it church to have ‘a point of view’, and that is one of its great strengths. is possible to achieve the same objectives and high environmental No other organisation brings together the full spectrum of voices in standards of EU environmental law through different, potentially environmental law: regulators, campaigners, , , more ‘British’ methods. For some, though, there is concern that the consultants, academics, senior members of the , students and drive for international competitiveness and the willingness to sign the voices of tomorrow, and those from other professions who are free trade agreements will be to the detriment of environmental simply concerned to ensure the preservation and development of good protection, with environmental laws sacrificed as unduly restrictive law for the benefit of the environment. When we make our non-tariff barriers. The EU’s flagship chemicals regulation, the interventions into public debate, we have the ear of Government and REACH Regulation, is often-cited as anti-free trade, although after a Parliament, and our reputation as an impartial, objective voice on decade of significant investment, many in the chemicals industry matters of good environmental law is unparalleled. As the whole would much prefer to stay part of it. For environmentalists, REACH country wonders what will happen next for UK environmental is lauded as a landmark regime for incorporating the ‘polluter pays’ protection, UKELA as an organisation has never been so relevant, or and precautionary principles into chemicals regulation by making so vital. All I can seek to do here is to reflect on those excellent those who profit from chemicals pay for the costs of evaluating the debates and discussions throughout 2018, and to offer you my own potential hazards to human health and the environment, and there is perspective. strong opposition to rolling back those protections. Another example is the concern of environmentalists that the regimes for the protection

of habitats will be watered down in a desire to promote development, A Period of Change with the predominantly European laws often cited as a barrier to

progress by those who wish to obtain consents for new schemes. As I write this chapter at the beginning of December 2018, the UK Whatever a person’s point of view may be, it is undoubtedly the case Government’s deal with the EU-27 is facing Parliamentary scrutiny that the public is anticipating change. Whatever happens with Brexit and objection, with great uncertainty over what will happen next. itself, those conversations have started. The green genie is out of the To seek to address (and predict) political events in this chapter bottle. would be futile and foolish. But what we can say for sure is that this is a period of change. How the UK leaves the EU, or even if the UK leaves the EU, the idea of a so-called #GreenBrexit has started a The Devolution Agenda public discussion that will not be forgotten. The public is more engaged with, and energised about, than ever One of the loudest conversations is between UK Government and the before. Climate change, air quality and its impacts on public health, devolved administrations. The devolution settlements in the past 20 and loss of , have all been big issues in the UK public or so years were formulated when exiting the EU was low on the debate. However, the -changer was the Blue Planet II effect, agenda and on the fringes of political debate. At that time (as now)

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the European institutions set common environmental objectives for legal proceedings if necessary) where the authority considers that a the Member States, in many cases allowing the Member States to Minister of the Crown is not complying with environmental law” decide how best to achieve them, while always ensuring that the (section 16(1)(d)). The inserted section also requires this new Bill to common market was protected through common rules about the set down the environmental principles to which ministers of products placed on the market. Against that framework, it was Government must have regard in setting UK policy, and sub-section relatively uncontroversial to devolve the implementation of 16(2) goes as far as to set down a non-exhaustive list, including the environmental law to the devolved administrations. However, Brexit ‘polluter pays’ principle, the and the would open up the freedom to do much more with environmental law principle of . These principles mirror long- – a point championed by the UK Government – and this in turn established principles of EU -making, set down creates a (or some might say opportunity) for significant in the EU and often repeated in the recitals to EU divergence within the UK. Business and industry have naturally environment directives and regulations, but it is a somewhat unusual expressed concern over the potential for fragmentation of the UK’s step within English law to enshrine such principles in Acts of own common market and the question is causing more than Parliament. The fact that this amendment was inserted in the theoretical concern. Should deposit return schemes for plastic Withdrawal Bill during its passage in Parliament shows the strength bottles be coordinated by Westminster? Should Wales be allowed to of feeling within the UK over the protection of environmental law. ban chemicals it considers are harmful to insects? Should thresholds In parallel to the passage of the Withdrawal Bill, the UK Government for cadmium in electronics be a matter for Holyrood? was itself consulting on its own version of an Environmental Of course, the devolution impact of Brexit goes much further than Principles and Governance Bill, which the Government held up as just environmental law, but environmental law is a good illustration “the creation of a new, world-leading, statutory and independent of some of the issues that now have to be grappled with. environmental watchdog to hold government to account on our environmental ambitions and obligations once we have left the EU”. Much of what Parliament inserted into the Withdrawal Bill was and Principles already on the table in the consultation, and although Parliament has made this new body a statutory obligation, it has left a fair degree of One of the big debates of 2018 has been over how the Government freedom as to what exactly it will look like. and public institutions will be held to account for environmental 1 performance outside of the EU. Within the EU, Member States that UKELA’s response to the consultation was UKELA at its best: we do not meet EU environmental law can be held to account, through engaged with the 1,400-strong membership, including an hour-long complaints to the European Commission by concerned citizens and, debate of over 200 members at our annual conference in Canterbury, after a period of warning shots, through the ultimate sanction of a and brought together a thoughtful and well-reasoned response referral by the European Commission of non-compliant Member document. States to the of Justice of the . These At the time of writing, we await the Government’s draft mechanisms are flexible enough to tackle different forms of non- Environmental Principles and Governance Bill, which will fulfil the compliance, from a complete failure to implement a directive statutory obligations of section 16 and reflect the outcome of the through to a failure to meet targets set down at EU level. The Government’s consultation, but we are confident that UKELA’s possibility of significant fines exists but in most cases the political intervention will have influenced the drafting of this hugely pressure is enough to ensure prompt rectification of non- important legislative instrument and helped ensure that this conformities, and the UK has to a large extent been good at the watchdog has real teeth to protect our environmental interests. administrative tasks such as ensuring directives are implemented promptly and accurately. Where the UK has struggled more is The 25 Year Environment Plan around absolute targets for environmental protection. A good (and topical) example is compliance with the Ambient Air Quality One of the criticisms of the political world is that it works in short Directive, where the UK has consistently struggled to meet the limits electoral cycles that encourage short-term thinking, whereas the set for nitrogen dioxide, while at the same time the public awareness solutions for environmental concerns require long-term vision and of the health impacts of nitrogen dioxide has grown significantly. It clear and stable policies. To address this, and to build a case for a is undoubtedly true that there are no easy solutions to the air quality #GreenBrexit, the Government launched its 25 Year Environment issues in the UK’s cities, and that the various solutions require Plan for England at the start of 2018. The 25 Year Environment Plan weighing up competing policy objectives. However, such political seeks to deliver on the Government’s stated ambition for this issues did not stop the European Commission from referring the UK generation to be the first generation to leave the environment in a (along with France and Germany) to the Court of Justice in May better state than we found it. Yes, the Plan is light on detail, but that 2018 for failure to take sufficient action to reduce nitrogen dioxide was not necessarily a surprise. It is intended to be read as a exceedances in the shortest possible time. statement of intent, setting the direction of travel for future The potential departure from the EU raises the question of who holds Government policy and providing promises against which the Government to account for its environmental obligations, in the Government can be held to account. Importantly for business, the absence of the European Commission. Plan lays down a blueprint for policies and legislative interventions These concerns generated significant debate during the passage of that will follow. This allows businesses to consider how best to the European Union (Withdrawal) Bill through Parliament in the adapt and to make the most of opportunities. summer of 2018, and indeed led to a motion by parliamentarians to At the heart of the Plan is the Government’s promise not just to amend the Government’s Bill to address this very point. In what is arrest the decline of England’s natural resources but to enhance now section 16 of the European Union (Withdrawal) Act 2018, there them. The Plan makes it clear the Government wants to hold the is a requirement placed on the Secretary of State to bring forward gold standard in environmental protection and enhancement on the primary to set down “provisions for the establishment of a world stage, maintaining and, where necessary, increasing EU public authority with functions for taking, in circumstances provided environmental safeguards after exit from the EU. In making these for by or under the Bill, proportionate enforcement action (including commitments, the Government seeks to answer those who were

2 WWW.ICLG.COM ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 © Published and reproduced with kind permission by Global Legal Group Ltd, London UKELA Future Horizons concerned that Brexit would mean sacrificing environmental However, it is also acknowledged that a lot of hard thinking needs to protection for short-term economic gain. be done to solve these issues. The headline-grabbing initiatives, Implementation is, of course, of central importance to the Plan’s such as bans on plastic straws, or a ‘latte-levy’ tax on disposable success and it proposes to use clear metrics with annual reporting coffee cups, laudable as they may be, do not really go to the heart of against those metrics which – coupled with the statutory body the issue, which is that the current economic model is that it is independent of Government discussed above – is designed to ensure cheaper to produce and discard. The issues pervade the whole life- that the public can hold both this and subsequent Governments to cycle of an object, from poor design through to inadequate recycling account. To deliver on its ambitions, it will need strong action to options at the end of life. Does the market need to be corrected to follow the strong words.2 internalise the costs to the environment of the poor use of our resources and the damage it can do if released into the environment?

Currently policy thinking suggests that the answer is yes, and the The Climate Change Act 2008 options to achieve this include extended producer responsibility

schemes where those costs are factored into the price that consumers The promises in the 25 Year Environment Plan and the accountability must pay, which drives investment in more sustainable options to mechanisms expected in the forthcoming Environmental Principles obtain market advantage. and Governance Bill have echoes of another UK : Whatever comes forward in the new resources and waste strategy, one which was ground-breaking at the time, is still holding strong a the UK must be careful to incentivise the right behaviours and decade on, and which could provide some valuable lessons for regulate in an appropriate manner that facilitates innovation and dealing with the environmental issues of the future. drives change. We are good at legislating for yesterday’s mistakes, In 2008, Parliament passed the Climate Change Act and created the but the solutions of tomorrow may be radically different. We need Committee on Climate Change. The Act gives the Committee the task to allow the new ideas to come through and give them a ‘regulatory of holding the Government to account for implementing climate sandbox’ to play in, so that the UK can foster the ideas which not policy and for producing future recommendations in annual reports. only can provide solutions to the problems that face the world, but The Climate Change Act was seen as ambitious by many. The Act also nurture and grow the green economy that is one of the pillars of makes it the responsibility of the Secretary of State for the the UK’s industrial strategy. Environment to ensure that the net carbon account for the six Kyoto Greenhouse Gases is less than 80% of 1990 levels by the year 2050. Private Sector Action The UK was under no requirement by either EU regulations or international law to produce such a stretching pledge to mitigate In an article about the future of the UK legal regimes for environmental climate change: it did so due to a cross-party campaign of protection, it might be thought odd to include a line or two about Parliamentarians worried about short-termism in politics which private sector voluntary action. However, to solve the environmental caught the imagination of many and, ultimately, received Government issues faced by the next generation of environmental professionals will support. Some might say, an example of Parliament acting as a require all parts of society to play their roles, and some parts of the supreme power and taking control. private sector are already showing leadership. In 2018 UKELA has The Act has the ambition of ensuring that the UK becomes a leading been considering the important role that investment policies based on low-carbon economy in the future. It has created ‘micro goals’ in the environmental, social and governance (“ESG”) factors can play in shape of five-year carbon budgets which must be achieved in order to influencing corporate behaviour and driving change. Such policies go stay on target for an 80% reduction in carbon emissions by 2050. far beyond platitudes and green-wash, and indeed beyond concepts of The Act has been a success in helping to shape policy for low- corporate social responsibility. Rather, the logic of ESG is that only carbon and , and the UK has met its previous those businesses that combine strong governance with sound strategies carbon budgets and is on course to reach the 2022 budget. There are for resource use, environmental impact, labour relations and a of course concerns that there are more difficult challenges ahead and multitude of other considerations will truly retain and grow value. the Climate Change Act does not have the answers: it is only a Those businesses which only pay lip service to such factors (or worse) mechanism to ensure accountability, a tool to influence policy- are exposed to significant , such as stranded assets due to abrupt makers, not one that sets the policies. Nevertheless, the Climate changes in climate change policy, for example. The game-changing Change Act has been regarded as a ‘triumph’ by many, including concept of ESG is that investments based on ESG principles are Lord Deben, the current Head of the Committee on Climate Change, beneficial for both the environment and the return on investment: it is and provides an example of how UK environmental law might no longer seen as a choice between the two. operate outside of the EU. Strong ESG policies also protect against the rise of shareholder activism and a growing trend to hold large international parent Innovation companies to account for the actions and inactions of their subsidiaries around the world.3 On the subject of facilitating change, but allowing others to come up with the answers, we now turn to the role of regulation and Conclusion incentives in environmental law. At the time of writing, England is anticipating a new resources and waste strategy, promised in the 25 During the year of our 30th anniversary, UKELA has looked at what Year Environment Plan. There is strong support in both the EU and has been achieved in the past 30 years and the lessons we can learn the UK for a drive to a circular economy, with the Earth’s resources from those achievements. We discovered that we have good reasons used again and again, rather than lost to landfill, or dispersed into to be optimistic. Yes, some may argue our successes were the easy the environment. There are good economic reasons for a circular ones, the ‘low-hanging fruit’, and that the enormous challenges of economy, but since Blue Planet II shone the spotlight on marine the next 30 years are going to be much more difficult. Yes, we are plastics, there is also a groundswell of public opinion for change. faced with tackling climate change, population growth and a

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growing middle class in emerging economies, and the huge decline in biodiversity, to name just a handful of issues. But if you listen to Simon Tilling the enthusiasm and ambition of our younger voices, as we did with Burges Salmon our members in 2018, you will find much cause for hope. One Glass Wharf Bristol, BS2 0ZX This is a period of change like no other for those who are United Kingdom environmental lawyers, and we have the opportunity to shape the future. We must seize that opportunity. Some of us are optimistic, Tel: +44 117 902 7794 Email: [email protected] others have doubts, but there is one thing that is beyond doubt: it has URL: www.burges-salmon.com never been a more exciting time to be involved in environmental law.

Simon Tilling is Vice-Chair of the UK Environmental Law Association Endnotes and a partner in Burges Salmon’s market-leading environmental law team. His practice encompasses the full breadth of environmental law, 1. https://www.ukela.org/content/page/6683/UKELA%20 from chemicals regulation to contamination claims. Simon is qualified EPG%20consultation%20reponse%2031.7.18.pdf in England, Wales, Scotland and the Republic of Ireland and his experience encompasses UK, EU and international environmental law. 2. https://www.burges-salmon.com/news-and-insight/legal- He is recommended in , where he has been described as updates/the-25-year-environment-plan/ “extremely bright and a very skilled ” and he is nominated for The 3. For further discussion, please see chapter 3 – The Parent Legal 500’s “Real (outside London) of the year 2019” for Trap: When is a Parent Company Liable for Environmental his environmental work. Simon’s work with UKELA includes promoting Harm Caused by a Foreign-Registered Subsidiary? by the organisation’s international networks and he chaired the 30th Jonathan Isted and Ian Jones of Freshfields Bruckhaus anniversary conference in Canterbury, UK, in the summer of 2018. Deringer LLP.

The United Kingdom Environmental Law Association (UKELA) is the UK forum which aims to make better law for the environment and to improve understanding and awareness of environmental law. We were established in 1988 and will be celebrating our 30th anniversary in 2018. UKELA is a registered charity and a limited company. Our charitable objects include promoting, for the benefit of the public generally, the enhancement and conservation of the environment in the UK and advancing the education of the public in all matters relating to the development, teaching, application and relating to the environment. We encourage collaboration between those interested in environmental law, as well as advising and commenting on relevant issues. Membership of UKELA is open to all and we offer a range of entry points to suit all pockets. We offer a comprehensive events programme throughout the year and across the UK on a range of hot topics. Each summer, we organise the leading conference in environmental law – join us in June 2019 in Sheffield for two days of debate and discussion with experts in the field. For information about membership and our other activities please visit www.ukela.org. You will be guaranteed a warm welcome.

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The Courts as Guardians of the Environment – New Developments in Access to Justice and Jerzy Jendrośka Environmental Litigation

European Environmental Law Forum (EELF) Moritz Reese

Introduction 1 The as a Motor of Access to Justice in Environmental Around the globe, and in Europe in particular, we are witnessing a Matters dynamic development towards wider judicial protection of environmental laws and resources. Whereas in the past court review was mostly confined to vested individual interests and matters of Roots of the Convention and its provisions on access to subjective concern, we now see a continuing trend towards public justice interest litigation and judicial enforcement – including that of merely “objective” environmental laws – with non-governmental The need for legal guarantees of public involvement is increasingly organisations (NGOs) playing an ever stronger role as litigators and being reflected in international environmental law and in the number trustees of the environment. This development comes as a reaction of instruments adopted after 1990 which have mentioned the necessity to the fact that most of the important global and collective of assuring access to information and public participation in environmental “goods” – such as a stable climate, biodiversity, environmental decision-making. The key role in this respect has no genetic resources, and ambient air quality – are doubt been played by Principle 10 of the Rio Declaration. increasingly being jeopardised and, at the same time, particularly prone to a deficit and disregard for enforcement. The extension of Although the Rio Declaration belongs to the instruments of so-called judicial control to objective environmental law and the widening of “” (i.e. having no binding legal force but merely constituting court access – especially to NGOs – can thus be deemed a key factor recommendations or political declarations), Principle 10 is commonly for the effective protection of collective environmental goods and considered to be significant as a clear global expression of the the respective environmental laws. To date, these developments are developing concepts of the role of the public in relation to the still progressing, with a lot of open questions as to how far they will environment. Soon after its adoption, it was acknowledged as an go and what consequences they entail for developers, investors, international benchmark against which the compatibility of national litigators, NGOs, administrations and . standards could be compared, and as a forecast of the creation of new This contribution provides an overview of the state of play, chiefly procedural rights which could be granted to individuals through from a European perspective. Europe has positioned itself as a international law and exercised at the national and possibly frontrunner in terms of procedural environmental rights through the international level. adoption of the so-called Aarhus Convention (United Nations Contrary to access to information and public participation, as far as Economic Commission for Europe (UNECE) Convention on Access global regimes are concerned, the strongest support for access to to Information, Public Participation in Decision-making and Access justice in environmental matters was, for a long time, to be found in to Justice in Environmental Matters). This Convention was adopted regimes rather than in multilateral environmental as early as 1998 and entered into force in October 2001. The agreements. Thus, access to justice in environmental matters was Convention has a compliance mechanism which has some distinctive traced back to such generally recognised principles as the right to be features differentiating it from the compliance mechanisms of other heard and to appeal decisions, as is guaranteed by human rights international environmental agreements. The Compliance Committee conventions. The developments in national legislation were not is composed of independent experts serving in a personal capacity and immediately followed at the international level and access to the procedure can, and usually is, triggered by communications from – as compared to public participation and access the public. Although it is not a court, its opinions provide an to information – was relatively rarely addressed in international authoritative interpretation of the provisions of the Convention. environmental law outside the context of liability regimes and assuring The process of developing access to environmental justice is still equivalent access to justice in the transboundary context. ongoing and far from being completed, as explained in section 1 The third pillar of the Aarhus Convention appears to be the most under- below, where we also provide some insight into global development developed in terms of the clarity and precision of the legal scheme beyond the Aarhus process. In the second section we look at the envisaged therein. This stems largely from the fact that – as opposed state of affairs in the EU, where the Court of Justice of the European to the two other pillars of the Convention – it covers an area in which Union (CJEU) has strongly moved to open its doors in the light of very few prior provisions existed to address environment-specific the Aarhus Convention. Thirdly, we take a look at the recent surge in environmental litigation and at attempts in specific to issues, within a plethora of diverse and longstanding traditional refer States and polluters to court for breach of environmental approaches in domestic legislation concerning general access to responsibilities. justice. This pillar was thus effectively constructed on the spot (i.e.

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during the negotiations) out of scarce, fragmented elements and amid Access to Justice in Environmental Matters” adopted in 2010 in intense debates reflecting totally opposite views as to its content, scope Bali, Indonesia by the United Nations Environment Programme and legal nature. The eventual construction of this pillar, in particular Governing Council, Global Ministerial Environment Forum (Bali of paragraphs 2 and 3 of Article 9, provides a basis for many Guidelines). They are considered “an important milestone in interpretations which increasingly interfere with the traditional international standard-setting and the establishment of good approaches used in the respective legislation of almost all parties. This practices related to application of Principle 10”.4 has resulted in an increasing number of legal disputes concerning the The Bali Guidelines include a number of provisions (Guidelines 15– way this pillar is implemented, both at the national and at the EU level. 26) related to access to environmental justice. They are very similar The scope of the Convention’s third pillar on access to justice to the above-described provisions of Article 9 of the Aarhus essentially addresses three issues: Convention and include all the respective elements of access to the ■ review procedures relating to access to information (Article environmental justice legal framework. They are, however, only 9.1); guidelines and have no binding legal force. ■ review procedures relating to access to public participation It must be noted that there is no consensus in the international under Article 6 (and possibly other provisions) of the community that human rights obligations specific to the environment Convention (Article 9.2); and have been established in any globally applicable, binding instrument ■ review procedures for public review of acts and omissions of or as a matter of customary international law. In other regions, private persons or public authorities concerning national law however, there are some initiatives aimed at following the example relating to the environment (Article 9.3). of UNECE and developing their own legal instruments to implement Moreover, Article 9.4 obliges parties to the Convention to provide, Principle 10. within the review procedures, for adequate and effective remedies, Recently (in March 2018), the Regional Agreement on Access to including injunctive relief. Furthermore, the procedures shall be Information, Public Participation and Justice in Environmental fair, equitable, timely and not prohibitively expensive. Matters in Latin America and the Caribbean (the Escazú Agreement) Article 9.5 regulates practicalities, such as the obligation to provide was adopted. The Agreement has not yet entered into force but most the public with sufficient information on access to administrative of the LAC countries have moved quickly to ratify it. Compared to and procedures. the Aarhus Convention, the Escazú Agreement provides much more specific norms of considerable importance for public interest litigation in relation to environmental issues (for example, a Implementation in the UNECE region dynamic burden of and clear reference to the precautionary principle). Without any detailed analysis, it may be noted that while The cases in front of the Aarhus Compliance Committee showed a the Aarhus Convention provides generally clear, legally binding number of problems, in particular with regard to for NGOs international norms, the provisions of the Escazú Agreement, and the scope of review in countries which have a system of judicial especially those related to access to justice, leave a large measure of review based on infringements of rights (for example, cases discretion to the State Parties concerning their implementation. ACC/31/Germany, ACC/48/Austria or ACC/50/Czech Republic).

In some instances, the respective requirements of the Aarhus Convention seem to call for fundamental changes of certain well- 2 Access to Justice in EU Law – the CJEU established arrangements concerning standing. In countries with a Opens its Doors Ever Wider system (i.e. the UK and Ireland), the biggest challenge seems to be related to the issue of costs, in particular related to the obligation to pay the costs of the winning party. Quite common in EU legislation on environmental standing and the struggle many countries are prolonged judicial procedures which do not with the “Schutznorm” approach meet the requirement of timeliness. Other problems relate to minimum standards applicable to access-to-justice procedures and In the European Union, the Arhus Convention has triggered far- remedies in Article 9, paragraph 4, of the Convention, including fair reaching advancements towards wider access to justice – and equitable procedures, injunctive relief and costs. particularly as regards environmental NGOs (ENGOs). On the side of the Community, the Convention was essentially transposed through Directive 2003/35 amending Directive 87/337/EEC on the Global reception of the Aarhus Convention and assessment of the effects of certain public and private projects on the developments beyond the UNECE region environment. According to that amendment to the EIA Directive (now codified as Directive 2011/92/EU), Member States are obliged The role of the Aarhus Convention is well recognised in the to ensure “that in accordance with the relevant national legal academic literature of this field. It is described as “the first system, members of the public concerned (a) having a sufficient multinational environmental agreement that focuses exclusively on interest, or alternatively (b) maintaining the impairment of a right, obligations of the nations to their citizens and nongovernmental where administrative of a Member State requires this organizations”,1 and the first binding international instrument as a precondition, have access to a review procedure before a court attempting to comprehensively and exclusively address issues of (…) to challenge the substantive or procedural of decisions, citizens’ environmental rights. Furthermore, it is considered to be a acts or omissions subject to the public participation provisions of “driving force for environmental democracy” in Europe2 and “at the this Directive”. Moreover, it is provided that “what constitutes a forefront” of developing the legal framework in this respect sufficient interest and impairment of a right shall be determined by worldwide.3 the Member States, consistently with the objective of giving the Globally, significant impetus for implementing Principle X and the public concerned wide access to justice” and “to that end, the further development of citizens’ environmental rights was provided interest of any non-governmental organization meeting the by the “Guidelines for the Development of National Legislation on requirements referred to in Article 1(2) shall be deemed sufficient Access to Information, Public Participation in Decision-making and for the purpose of point (a)” and furthermore “such Organizations

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Since the time limit for raising objectives in the Industrial Emission Directive 2010/75/EU (IE Directive) extending administrative procedure is rather short in Germany (usually four the above-referenced access to justice to permit decisions covered weeks from the publication of the project plans), this preclusion rule by this Directive. often strongly limits the possibilities of ENGOs to thoroughly When these provisions were adopted in 2003, they met with assess the environmental impacts and legality of a permit decision, considerable reluctance among national governments and courts to and it thus posed a great practical barrier to effective judicial review. give the public concerned wide access to justice. Most States, In its ruling in this case (C-137/14 of 15 October 2015), the Court instead, tried to maintain their traditional limitations on public followed the Commission’s complaint and held that the German interest litigation as far as – seemingly – possible by proclaiming a preclusion rules are not compatible with Article 11 of the EIA very narrow interpretation. Of course, this was not accepted by the Directive and Article 25 of the IE Directive – yet another victory for NGOs, and as a consequence, it was eventually in the hands of the access to justice and public interest litigation. CJEU to clarify the intention of both the Convention and the Another ground-breaking victory for ENGO action was celebrated implementing norms of the EIA Directive. It is not a coincidence in the famous case of the Slovakian Brown Bear (C-240/09). In this that most of the leading cases in this matter have been raised in case, the court was asked if Member States were to grant NGOs Germany. The country is widely known for its strong traditional standing also with regard to decisions that are not subject to bias against public interest litigation and a stringent observance of environmental impact assessment – such as those regarding species the so-called “Schutznormtheorie” (protective norm approach), protection under the EU Habitat Directive – and thus not covered by according to which standing is only granted to applicants who can the above-mentioned European norms on NGO action. In its ruling, reasonably claim the violation of a law that is protecting their the CJEU clarified that these EIA-related EU norms transpose the individual interest. With its reluctance to overcome this Aarhus Convention only partially, and that it remains the “subservient” tradition on the one hand and its active environmental responsibility of the Member States to implement the Convention in NGOs (ENGOs) and judiciary on the other, Germany has indeed other fields of environmental decision-making through national served as a major instigator of a remarkable yet continuing series of legislation. Moreover, the Court indicated that all EU leading cases by which the CJEU has rejected almost all essential environmental laws must be applied in conformity with the Aarhus containments the country has tried to uphold against NGO action Convention. With regard to Article 9(3) of the Convention, this and public interest litigation. implies, according to the court, an obligation of the national courts to interpret the national procedural rules, as far as possible, in a way that allows NGOs standing with regard to all (national) Landmark decisions towards wide court access for ENGOs environmental norms flowing from European law. However, the CJEU did not go further to conclude that conflicting national The first of these landmark decisions concerned the applicability of procedural laws are effectively overruled by EU law and thus to be the protective rights doctrine to ENGO action. As a first attempt to waived by the national courts if they find no room for compliant transpose Directive 2003/35, Germany adopted in 2006 its first interpretation. To that extent, the court left the interpretation of edition of a “Law on actions in environmental matters” Article 9(3) to the discretion of the Member States. (Umweltrechtsbehelfsgesetz). With this Act, NGO action was introduced with regard to all permit decisions subject to environmental impact assessment as demanded by the Directive. On our way to actio popularis? – The Protect However, far-reaching restrictions on standing and scope of review were maintained and, most notably, this included the subjective This “last resort” of the national legislators was eventually rights doctrine. This means that NGOs could effectively only bring conquered in the latest path-breaking CJEU judgment on an action if – and as far as – individual rights are affected, and they environmental standing, which was handed down in the Austrian were not permitted standing with regard to “objective” Protect Case in December 2017. In this case, the referring Austrian environmental laws. ENGOs had to wait until 2011 for this Court had asked the CJEU whether it follows from its previous fundamental restriction to be turned down by the CJEU in its that NGOs must be able to contest before a court a famous Trianel judgment (C-115/09). The German law needed to decision granting a permit for a water use that may be contrary to the be revised accordingly – but, again, major restrictions on ENGOs’ obligation to prevent the deterioration of the of bodies of water court access continued. Two years later, the CJEU had to clarify in as set out in Article 4 of the EU’s Water Framework Directive. Altrip (C-72/11) that Germany could not limit standing on EIA Again, this concerns a decision outside the scope of the EIA and IE issues to cases in which no environmental impact assessment was Directives, i.e. the areas where EU law explicitly provides court carried out at all, while not extending it to cases in which such an access to ENGOs. In its judgment, the deciding Chamber gave up assessment was carried out but was irregular. As to the the cautious position of the Brown Bear judgment, and eventually consequences of such procedural defects, the Court declared, attributed direct effect to its wide interpretation of Article 9(3) of the however, that the national court may uphold the administrative Aarhus Convention as a measure for access to justice in relation to decision if it is conceivable, having regard to the circumstances of the (implementation of) EU environmental law. The Court based this the case, that the contested decision would not have been different result on the fundamental right to judicial protection as provided in without the procedural defect invoked by the applicant. Article 47 of the of Fundamental Rights of the European By that time, the EU Commission had also filed an infringement Union. It found that this – directly applicable – right was breached procedure against Germany. In addition to the points decided in by any national procedural law that hinders adequate implementation Trianel and Altrip, the Commission turned against another of Article 9(3) of the Aarhus Convention. What remains unclear, important and long-standing national restriction to access to justice, however, is whether the wider standing derived from the court’s the so-called “preclusion” rules. These regulations restrict the right interpretation is strictly limited to ENGOs or whether and to what to bring action, and also the scope of the court review, to only those extent it must also be applied to individual “members of the public objections that were already raised within the time limit set during concerned” in the meaning of Article 9(3) and 2(5) of the Aarhus Convention. The judgment does not explicitly address this question

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but it contains some indications that the court may well include 3 Climate Change Litigation in the EU: the qualified individuals in the scope of this Article. Urgenda Legacy With this question, amongst others, the play will now go back to Germany, as in April 2018 the German Federal Administrative Court referred several questions to the ECJ regarding, in particular, The global surge of climate litigation reaching Europe – the the implications of the above Protect judgment. The underlying Urgenda case case concerned, again, the implementation of water quality standards under EU water law. The German Court asked, i.a., While access to justice in environmental litigation in Europe is whether not only ENGOs but individuals, too, must be able to mostly linked to proceedings, proceedings instigate judicial review with regard to the implementation of these can also play an important role. Arguably inspired by developments water quality standards despite the fact that they do not protect in the United States of America and Australia, climate change individual interests. The German Court took the view that this is not litigation in the EU is witnessing an increasing reliance on law. the case and that both the Aarhus Convention and EU law do not The Urgenda case can be seen as the landmark case in this field. As preclude national legislators from confining individual standing to this case has been extensively covered in academic literature, it laws protecting individual interests and – respectively – to needs little introduction here. In short, the The Hague District Court applicants who reasonably claim that such a norm was breached. (the Netherlands) on 24 June 2015 upheld the claim of an NGO Furthermore, the German Federal Administrative Court held that the called Urgenda against the Dutch State and ordered the latter to take courts may limit the scope of review to whether the contested additional measures to ensure that the Netherlands will reach the decision is in compliance with the protective norm(s) on which the target of lowering its greenhouse gas emissions by 25% by 2020 in applicant’s standing is based, and that the judicial scrutiny does not comparison to its 1990 emissions (ECLI:NL:RBDHA:2015:7145). need to extend to further applicable laws that merely serve the This judgment was confirmed in appeal on 9 October 2018 public interest. (ECLI:NL:GHDHA:2018:2591). Whether the judgment will also It is now in the hands of the CJEU to take a (further) fundamental be confirmed in cassation remains to be seen. decision which goes to the heart of the national judicial systems: The Urgenda case is facilitated by the fact that, under Dutch tort whether to establish in the entire EU a fully-fledged actio popularis law, environmental organisations can bring proceedings to protect with regard to all environmental laws, or to preserve the subjective the interests of third parties, including future generations, under rights approach with regard to individual applicants and confine the Article 3:305 a-b of the Dutch Civil Code. From a substantive assertion of “objective” laws to ENGOs. It is self-evident that this perspective, this case rests on the claim that the Dutch State is decision is going to be of tremendous relevance for the national breaching its duty of care to comply with the greenhouse gas judicial systems, investors and relevant administrations, and – emissions reduction target for the Netherlands associated with the above all – for the effectiveness of environmental law. international commitment made under the to keep Besides this, there are two further grand bastions of “judicial calm” global warming well below 2 degrees Celsius, thereby impairing the that have not been taken by the Aarhus movement. The above right to life (Article 2, European Convention on Human Rights) and openings for ENGO action and public interest litigation have, so far, the right to respect for family and private life (Article 8, European only been discussed with regard to land-use related decisions and Convention on Human Rights). procedures. However, the principles established by the Aarhus Whether from a substantive perspective this judgment will indeed Convention and CJEU are also applicable to the wide lead to better performance by the Netherlands in the fight against field of product- and substance-related regulation, including the climate change is unclear. Three years have passed since the date of various registration, certification and authorisation regimes. As a the first degree judgment and no substantive melioration can be consequence, we should expect this field to become subject to NGO seen. The Dutch legislator is discussing the adoption of a Climate action as well. The second bastion concerns administrative acts of Act, but its content is programmatic in nature and hence it has yet to the EU itself, e.g. authorisation of and chemicals or be translated into concrete actions and results. The Urgenda case genetically modified organism (GMO) products. In this regard, certainly has strong symbolic value. It inspires NGOs to undertake access to the General Court and the CJEU is strictly limited by similar actions at national level, as discussed in the next section, and Article 263(4) of the Treaty on the Functioning of the European at EU level, as discussed in the following section. Yet, it also has a Union (TFEU) to applicants who are individually and directly negative connotation. It shows that public law is failing to address concerned by the contested act. In a long line of judgments, the this major inter-generational challenge. CJEU has always interpreted this provision very strictly and – according to its “Plaumann doctrine” – allowed standing only to applicants alleging a direct breach of their vested individual rights. The legacy of Urgenda at national level: Milieudefensie, It appears that this strict interpretation is not compatible with what RWE and Plan B the court has decided in the above-reported judgments. Consequently, the Plaumann doctrine is subject to growing With the Urgenda case as a source of (legal) inspiration, other criticism, and it has been impugned as incompatible with the Aarhus NGOs have started tort law-based proceedings to protect the Convention by the Aarhus Compliance Committee. Only recently, environment in the Member States of the EU. With more cases the Plaumann doctrine has been challenged, again, by a complaint pending or in preparation (for an overview see www.eufje.org), from several families who claim that insufficient and unlawful EU three cases reached a diametrically opposite outcome to the one seen climate policies are jeopardising their fundamental rights to health in Urgenda, thereby highlighting the difficulties characterising tort and , as further discussed in the next section. law-based environmental litigation.

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First of all, in the Netherlands, an environmental association called Milieudefensie initiated two actions based on tort law against the The legacy of Urgenda at EU level: German Farmers’ Complaint to the CJEU State for failure to protect human health at several locations. The argumentation scheme of the plaintiff in this case resembles that used in the Urgenda case in many aspects. This notwithstanding, despite it The Urgenda case has not only been a source of inspiration for being undisputed that the Netherlands is not complying with EU proceedings at national level; it has also served as an example for standards on air quality, the The Hague District Court ruled in starting proceedings at EU level. In May 2018, Mr. Carvalho and 36 December 2017 that Milieudefensie did not provide enough other claimants lodged a case challenging the lawfulness of several to support the claim that a specific damage was caused by the State’s legislative acts of the EU in the field of climate change, namely the failure to comply with air quality thresholds (ECLI:NL:RBDHA: 2018 amendments to the ETS Directive, the Effort Sharing 2017:15380). It therefore dismissed the claim. Regulation, and the , Land-Use Change and (LULUCF) Regulation. A different outcome might be obtained by a Peruvian farmer who brought a before the Higher Regional Court of Essen, The relevance of the Urgenda case for these proceedings is evident in Germany (Landgericht Essen [Essen District Court], Lliuya v RWE the two main pillars of this action. First, Carvalho and others rely on AG, 15 December 2016 – No 2 O 285/15). In contrast to the Urgenda the provisions on non-contractual liability of the Union (Articles 268 case, the Peruvian claimant targets a private party, the energy concern and 340 TFEU) to seek an requiring the Union to set deeper RWE. The claimant’s main argument is that RWE knowingly emissions reduction targets at the level required by international law. contributes to climate change, resulting in the melting of a glacier in Second, and as indicated above, they rely on human rights in order to Peru, which puts the claimant’s house at risk of flooding. As in the broaden the standing requirements in force under the action for Milieudefensie case, the national court of first instance ruled against annulment of binding EU acts (Article 263 TFEU). the claimant and held that the causal linkage between RWE’s Both pillars can, independently from one another, potentially greenhouse gas emissions and the damage threatening the claimant revolutionise the field of environmental litigation at EU level. It is was not (sufficiently) proven. The importance of establishing a causal difficult to predict how the CJEU will rule on each of these pillars. link was confirmed in appeal (Oberlandesgericht Hamm, 30.11.2017 The pillar based on non-contractual liability of the Union is a – 5 U 15/17). However, the appeal court overruled the decision of the novelty in climate law, and, more generally, non-contractual liability court of first instance and ordered the plaintiff to provide further is an action not extensively discussed in academic literature. The evidence in order to sufficiently establish the alleged causal linkages. pillar based on the broad interpretation of the standing requirements The case is still pending, and it remains to be seen whether the under Article 263 TFEU will face the traditionally restrictive claimant is going to succeed. approach by the CJEU in this area, as discussed in section 2 above. Finally, in the Plan B case in the United Kingdom (Royal Courts of Still, (environmental) lawyers have been putting pressure on the Justice, Plan B and Others v Secretary of State for Business, Energy Court to change its approach for years. The possibility cannot be and Industrial Strategy, [2018] EWHC 1892 (Admin)), still a ruled out that the importance of climate change will make the Court Member State at the moment of writing this contribution, reliance change its approach, once and for all. on tort law to protect the environment was rejected. The main claim of the applicants was that the UK government should go beyond the Endnotes targets stipulated under the Climate Change Act 2008 in order to meet its Paris Agreement target. The national court dismissed all 1. S. Kravchenko, ‘The Aarhus Convention and Innovations in grounds of appeal because, among other reasons, the has Compliance with Multilateral Environmental Agreements wide discretion to assess the advantages and disadvantages of any Compliance Mechanisms’, Yearbook of European particular course of action and the statutory Climate Change Environmental Law, Oxford University Press, Volume 7, 2007. Committee had advised that it is not yet necessary to amend the 80% 2. J. Wates, ‘The Aarhus Convention: a Driving Force for target in force today. Environmental Democracy’, JEEPL, Volume 2, Number 1. In each of these cases, an appeal has been launched. Further 3. J. Ebbeson, ‘Public participation’, (in) The Oxford Handbook of developments are thus awaited. It is, in any case, already possible to International Environmental Law, D. Bodansky, J. Brunnee and recognise an initial trend. First of all, the legacy of Urgenda at E. Hey, Oxford University Press, 2007, p. 686. national level has been quite unsuccessful so far. This picture, 4. S. Stec, ‘Developing standards for Procedural Environmental however, might be less negative than it appears at first glance. rights through Practice’, (in) Procedural Environmental Rights: Indeed although, until Urgenda, the main hurdle for initiating this Principle X in Theory and Pratice, J. Jendrośka and M. (eds), European Environmental Law Series, Intersentia, p. 5. kind of case came from standing requirements, obstacles now come from other elements of the tort-law doctrine, such as causation and the burden of proof. The initial hurdle (standing) seems to have Acknowledgment been overcome, at least in certain Member States. Accordingly, we This contribution is co-authored by Dr. Lorenzo Squintani, Assistant can speak of a development in the judicial practice concerning this Professor and Senior Lecturer in European and Economic Law at kind of action. the University of Groningen (the Netherlands) and member of the managing board of the European Environmental Law Forum.

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Jerzy Jendrośka Moritz Reese Jendrośka Jerzmański Bar and Partners Helmholtz Centre for Environmental Pl. Solny 16 Research – UFZ 50-062 Wrocław Permoserstraße 15 Poland Leipzig 04318 Germany Tel: +48 713 410 234 Email: [email protected] Tel: +49 341 235 1987 URL: www.jjb.com.pl Email: [email protected] URL: www.ufz.de

Jerzy Jendrośka Ph.D. is a Managing Partner at Jendrośka Jerzmański Dr. iur. Moritz Reese is senior researcher at the Department for Bar and Partners Environmental Lawyers (JJB), and Adjunct Professor Environmental & Planning Law at the Helmholtz Centre for and Director of European Environmental Law Post-Graduate Studies at Environmental Research (UFZ) and head of the UFZ Research Group Opole University. on International and European Environmental Law. He is currently also the chairman of the managing board of the European Environmental He obtained his from Wrocław University and his Ph.D. Law Forum, editor-in-chief of the Journal for European Environmental from the Institute of Law at the Polish Academy of Sciences. He also & Planning Law, a member of the editorial board of the German Journal received a Diploma in International Law from the Vienna University for Environmental Law, a member of the European Water Law Network, Summer School. a co-speaker of the Governance Division of the Center for Advanced Jerzy served as an arbitrator at the Permanent Court of Arbitrage in The Water Research (CAWR). Moritz has worked in the field of Hague, a member of the Implementation Committee of the Espoo environmental and planning law for more than 20 years, i.a. as a policy Convention, and a member of the Aarhus Compliance Committee. consultant for the German Advisory Council on the Environment. In Poland he served as Vice-Chair of the State GMO Commission, a member of the National EIA Commission in Poland, and a member of the State Environmental Protection Council. Jerzy has been involved in drafting environmental legislation in Poland and in other countries in the EU, Eastern and South-Eastern Europe, the South Caucasus, Central Asia and Latin America.

The authors contribute to this Guide in their honorary capacity as members of the advisory and managing boards of the European Environmental Law Forum (EELF). The EELF is a non-profit network of environmental law scholars and practitioners from across the continent aiming to support intellectual exchange on the development and implementation of international, European and national environmental law in Europe. The EELF serves as an organisational platform to facilitate, i.a., an Annual European conference. For further information please visit www.eelf.info.

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The Parent Trap: When is a Parent Company Liable for Environmental Harm Caused by a Jonathan Isted Foreign-Registered Subsidiary?

Freshfields Bruckhaus Deringer LLP Ian Jones

Under English law, in order to show that a defendant owes a duty of Caparo test. It found that parent company liability could arise care to a claimant, the claimant must establish three key factors: that where that company took direct responsibility for devising a the harm caused by the negligent act or omission was reasonably material health and safety policy, the adequacy of which was the foreseeable; that there was sufficient proximity between the parties; subject of the claim, or where it controlled the operations giving rise and that it would be fair, just and reasonable to impose liability on to the claim. The degree of control that Vedanta exercised over the defendant (known as the “Caparo test”).1 Applying this KCM suggested an assumption of responsibility by Vedanta: it had principle, there are circumstances under which a parent company an 80% majority shareholding in KCM, and there was evidence that could be held directly liable for the loss and damage suffered by the board had been involved in the direct management of third parties as a results of the acts or omissions of a subsidiary.2 subsidiaries including KCM. Recently, we have seen a trend developing through which claimant The Vedanta story isn’t over yet, however – in March 2018, the groups have sought to take advantage of this principle, by seeking to Supreme Court granted KCM and Vedanta leave to appeal the decision hold UK-domiciled parent companies responsible for the acts or of the Court of Appeal, and that appeal is currently outstanding. omissions of a foreign subsidiary, in order to have their claims heard before the English courts. In the last 18 months alone, the English Okpabi v Royal Dutch Shell PLC: The mere existence of Court of Appeal has considered three cases dealing with parent group policies does not indicate sufficient control over a company liability for acts primarily associated with foreign- subsidiary to establish a duty of care by a parent4 registered subsidiaries. These cases, all involving allegations of environmental harm, provide further guidance on when a parent In Okpabi, claimants in Nigeria brought claims against Royal company could owe a duty of care to those affected by the activities Dutch Shell (RDS, a UK-incorporated parent) and SPDC (a of a foreign subsidiary. This developing area of law is of importance subsidiary of RDS) arising out of an alleged breach of duty of care to all businesses with an impact on the environment and, in to the claimants in respect of and environmental damage particular, businesses in the manufacturing and resource industries. caused by oil leaks from pipelines and associated infrastructure It is worth noting that each of these three cases (discussed further operated by SPDC. below) concerned applications for claims to be struck out at the At first instance, the found that on the facts of the case, jurisdictional stage, on the basis that the claimants had no arguable RDS did not owe the claimants a duty of care. The Court of Appeal case that a duty of care existed. Thus, even where in the first case confirmed this decision, dismissing the claimants’ appeal. The discussed below (Vedanta) the Court held that a duty of care could Court considered that the evidence did not demonstrate (either in exist, whether or not such duty actually existed (and whether it was individual documents or cumulatively) a sufficient degree of control breached) will be a matter to be determined at . by RDS of SPDC’s operations in Nigeria, such as would be needed to establish the required degree of proximity to support a claim that Lungowe v Vedanta Resources PLC: The degree of control RDS owed a direct duty of care to the claimants. exercised by the parent company suggested an assumption In contrast to the Lungowe case, where the degree of control of responsibility for the acts of its subsidiary3 exercised by the parent company suggested an assumption of responsibility for the acts of its subsidiary, the evidence in Okpabi In the Lungowe case, Zambian citizens made allegations of personal suggested a more remote nexus between the parent and subsidiary: it injury, damage to property, and loss of income, amenity and enjoyment was made clear that the issuing of mandatory policies, standards and of land due to pollution and environmental damage caused by toxic manuals which applied to SPDC were not sufficient to establish a discharges from a copper mine operated by a Zambian company, duty of care in favour of any person or class of persons affected by KCM. Vedanta, an English company, was the holding company for a those policies. These policies did not indicate control; that control group of base metal and mining companies, including KCM. remained with SPDC which was responsible for its own operations. Vedanta and KCM applied for a declaration that the English court SPDC operated its pipeline pursuant to a joint venture with three did not have jurisdiction to try the Zambian claimants’ action – this other parties (including the Nigeria National Petroleum Corporation, application was refused by the High Court at first instance, and the which held the majority shareholding in the venture), which meant Court of Appeal dismissed KCM and Vedanta’s appeals against that that SPDC (and, by extension, its parent, RDS) had a more limited decision. In doing so, the Court of Appeal relied heavily on the capacity to avoid the breaches alleged by the claimants.

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UPLC imposed various requirements on its subsidiaries in relation AAA & Others v Unilever PLC and Unilever Tea Kenya to risk preparedness and planning, the relevant operating procedures Limited: No duty of care is owed by the parent where the were developed and implemented at subsidiary level. subsidiary retains day-to-day responsibility for its operations, in the absence of additional steps by the parent The Court of Appeal identified two broad scenarios which might to exert operational control give rise to parent company liability, depending on the facts of a particular case: (i) where the parent has in substance taken over the Most recently, the Court of Appeal considered claims against two management of the relevant activity of the subsidiary in place of (or Unilever group companies, concerning alleged liability in jointly with) the subsidiary's own management; or (ii) where the for acts of violence committed by third parties against employees and parent has given relevant advice to the subsidiary about how it local residents on a Kenyan tea plantation during large-scale civil should manage a particular risk. disorder following the 2007 Kenyan presidential election. The The Court of Appeal’s judgment provides additional clarity claimants had alleged that the UK-registered parent company regarding the difficulties to be faced by claimants seeking to bring Unilever PLC (UPLC) and its Kenyan-registered subsidiary, proceedings in the English Courts against a UK-registered company Unilever Tea Kenya Limited (UTKL), were each liable to UTKL for activities occurring abroad and primarily relating to a foreign- employees and their families for a failure to adopt adequate registered subsidiary. However, the Unilever judgment (and those safeguards to protect them from the ethnic violence that erupted in in Lungowe and Okpabi) leaves open the possibility that UK- Kenya following the 2007 presidential elections. registered companies may still be found liable in negligence in In March 2017, the High Court struck both claims out because they English proceedings for acts occurring overseas. This will depend were, in its assessment, “bound to fail”:5 under English law, the on whether there is a duty of care, as the Court of Appeal found to claimants were required to demonstrate a “good arguable claim” in be the case in Lungowe. As each of these judgments demonstrates, order to establish jurisdiction for the English courts to hear the the degree of control exercised by the UK-registered parent is likely claims, and the High Court decided that the claims did not meet the to have significant importance in any such proceedings. Where it is necessary threshold; and, additionally, that the events at issue were possible to demonstrate that the UK parent has assumed a sufficient not sufficiently foreseeable, such that it was not “fair, just and degree of responsibility for the actions of its subsidiary, this will reasonable” to impose the alleged duty of care on the defendants. typically support a finding that a duty of care is owed. In July 2018, the Court of Appeal upheld the High Court’s decision While it will remain attractive for many businesses to conduct their to strike out the claims against Unilever, albeit on different foreign operations using UK-registered companies, it is particularly grounds.6 The Court of Appeal found that the at first instance important, in light of these recent decisions, to balance this against had been correct in her conclusion that UPLC did not owe the the increased risk of litigation that it may bring, particularly in the claimants a duty of care in negligence and that the claimants were manufacturing, extractive and other resource-based industries, and therefore unable to demonstrate a properly arguable case. The High to conduct appropriate risk audits and adopt other measures in Court had therefore been entitled to strike out the claims against effective mitigation. While group-level operating procedures and UPLC and UTKL on this preliminary issue without progressing to guidelines instigated by a group parent company may well be trial. However, in dismissing the Claimants’ appeal, the Court of necessary and appropriate features of an effective and responsible Appeal formulated its decision on different grounds. It held that the business, these should be combined with regular “heat mapping” of evidence relied upon by the Claimants failed to disclose a level of potential environmental, health and safety and human rights risks control by UPLC over UTKL’s operations that was sufficient to and the adoption of appropriate safeguards. Parent companies warrant the imposition of a duty of care. Crucially, as in Okpabi, the should ensure that such policies are applicable to all group relationship did not have sufficient proximity. companies, as opposed to specific subsidiaries. In addition, the A key point arising from the Unilever decision is the Court of responsibility for effecting these policies should be at subsidiary Appeal’s distinction between a parent company with a group-wide level, which will reduce the risk of a duty of care arising. system of mandatory policies in place to ensure that proper controls were adopted by its subsidiaries, and circumstances where a parent Endnotes company sought to exert control and influence directly over the relevant subsidiary. Accordingly, where a subsidiary retains day-to- 1. Caparo Industries PLC v Dickman [1990] 2 AC 605. day responsibility for its operations, the existence of group-level 2. Chandler v Cape PLC [2012] EWCA Civ 525. policies is not, in itself, sufficient to establish a duty of care owed by 3. Lungowe v Vedanta Resources PLC [2017] EWCA Civ 1528. the parent company to those affected by the relevant activities. Additional steps to exert operational control directly over the 4. Okpabi v Royal Dutch Shell PLC [2018] EWCA Civ 191. subsidiary would be required before a duty of care could exist. On 5. AAA and others v Unilever PLC and Unilever Tea Kenya the evidence before it, the Court of Appeal in the Unilever case Limited [2017] EWHC 371. concluded that the parent company, UPLC, did not have superior 6. AAA & Others v Unilever PLC and Unilever Tea Kenya knowledge or expertise in relation to the security risks. While Limited [2018] EWCA Civ 1532.

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Jonathan Isted Ian Jones Freshfields Bruckhaus Deringer LLP Freshfields Bruckhaus Deringer LLP 65 Fleet Street 65 Fleet Street London, EC4Y 1HS London, EC4Y 1HS United Kingdom United Kingdom

Tel: +44 20 7832 7320 Tel: +44 20 7427 3943 Fax: +44 20 7108 7320 Fax: +44 20 7108 3943 Email: [email protected] Email: [email protected] URL: www.freshfields.com URL: www.freshfields.com

Jonathan Isted is a partner in Freshfields Bruckhaus Deringer’s Ian Jones is a senior associate in Freshfields Bruckhaus Deringer’s Environment, Products and Regulatory (EPR) group. He specialises Environment, Products and Regulatory (EPR) group. He specialises in high-profile group claims in the environmental, health and safety in group claims, multi-jurisdictional litigation and other complex and human rights sectors. disputes, with a particular focus on environmental and litigation. Ian also provides environmental, product safety and other Jonathan has defended cases in the nuclear, extractive, energy, regulatory advice to clients, including those in the energy, consumer consumer, retail and construction sectors, amongst others. He has products and healthcare sectors. also handled a range of high-profile regulatory and judicial review claims in the energy and sectors.

Freshfields Bruckhaus Deringer is a global law firm – we combine the knowledge, experience and energy of the whole firm to solve our clients’ most complex challenges, wherever and whenever they arise. In the last year we’ve helped clients do business in over 200 legal jurisdictions, including the world’s most challenging legal environments. Our Environment, Product and Regulatory group has more than 50 lawyers around the world ready to advise you on how EU and international legislation, global conventions and national laws could affect your business. We can help you deliver infrastructure projects, and manage your industrial risk from regulatory intervention across the world. We can also help you resolve disputes with other parties, and manage your environmental, planning and regulatory risk in corporate and finance transactions.

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Overview of Trends in Environmental and Climate Mandy Sherwin Change Law in Sub-Saharan Africa

Bowmans Michael Vermaak

Introduction First, the big picture

Optimism about the economic future of the continent continues to Regional co-operation among many of the SSA countries is regulated fuel interest in the business opportunities Africa has to offer. As through their participation in inter-governmental bodies, such as the with any region around the world, doing business in African East African Community (EAC), the Economic Community of countries, whether in the form of financing or direct involvement in West African States (ECOWAS), and the Southern African mining, energy, infrastructure or other developments, requires an Development Community (SADC). In total, 35 SSA countries understanding of country-specific environmental laws and belong to one of these three Regional Bodies, with Tanzania being compliance requirements. the only country belonging to two, namely the EAC and the SADC. There has also been a growth in recent years of the need for The membership of each of the Regional Bodies is shown in the multijurisdictional and cross-border environmental and other table below.i regulatory advice within Africa. As outlined in this chapter, the complexities of the sub-Saharan African (SSA) inter-jurisdictional EAC SADC ECOWAS environmental legal landscape should be recognised (as should the risk that some of the freely available online legislation resources are Burundi Angola Benin not necessarily always reliable or up to date). Kenya Botswana Burkina Faso A good place to start is to consider the progress regional inter- Democratic Republic governmental bodies are making in environmental and climate Rwanda Cabo Verde change matters, and to outline some environmental law trends based of Congo on a review of selected SSA countries. An analysis of this kind Eswatini (formerly South Sudan Côte d’Ivoire indicates the levels of development and maturity of environmental Swaziland) regulation in many SSA jurisdictions and reveals some similarities, but also certain distinct differences, in the approaches of the SSA Tanzania Lesotho Gambia jurisdictions. Uganda Madagascar Ghana For the purposes of this chapter, we have only mentioned selected Malawi Guinea national legislation applicable in Kenya, South Africa, Tanzania and Uganda. While we have also looked into environmental and climate Mauritius Guinea Bissau change related regulatory developments in other jurisdictions, including Nigeria, Cameroon, Mozambique, Angola and Republic Mozambique Liberia of Congo, along with a number of other jurisdictions, we do not Namibia Mali address the developments in these countries specifically in this chapter. Seychelles Niger The SSA countries we considered have already developed and are South Africa Nigeria implementing comprehensive laws for the regulation and protection Tanzania Senegal of the environment and, in some respects, for the mitigation of climate change. As would be expected, however, there is limited Zambia Sierra Leone alignment evident in the laws from jurisdiction to jurisdiction. This Zimbabwe Togo is why, when contemplating a project or development in a particular jurisdiction, it is always necessary to obtain sound local law advice as any given country will have its unique features. While the EAC, ECOWAS and SADC have differing purposes and are regulated by separate founding treaties, achieving and furthering economic, social and political stability within their Member States can be broadly described as an overarching goal of these Regional Bodies. The goals of these Regional Bodies include protecting the environment and, more recently, considering the impacts of climate

14 WWW.ICLG.COM ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 © Published and reproduced with kind permission by Global Legal Group Ltd, London Bowmans Overview – Sub-Saharan Africa change. Each of the Regional Bodies has adopted founding treaties strategies and programmes at national and regional levels that, among other things, seek to ensure the protection of the and establish appropriate institutions to protect, preserve and environment. enhance the environment, control erosion, , desertification, locusts and other pests’ (article 39).iv In turn, the treaty obligations that the Regional Bodies impose on their members are translated into country-specific regulatory Article 30 further provides that ‘Member States undertake, individually and collectively, to take every appropriate step requirements around environmental protection. As forms the focus to prohibit the importation, transiting, dumping and burying of this chapter, these include environmental impact assessment of hazardous and toxic in their respective territories’. (EIA) processes, waste-related regulatory controls and the recent What’s more, ‘They further undertake to adopt all necessary attention being given across SSA broadly on mechanisms to address measures to establish a regional dump-watch to prevent the the practicalities of imposing climate change legislation or policy – importation, transiting, dumping and burying of hazardous a key global issue – at a country-specific level. and toxic wastes in the region’. Here are some of the results of our analysis of the environmental These treaties provide the broad framework for environmental protection and climate change mitigation approaches at a regional protection within Member States. At a practical level, when it and country-specific level in the selected SSA countries. comes to protecting the environment, it is up to members themselves to further the objectives of the Regional Bodies, including by adopting legislation at a country-specific level. Environmental Protection Imposed at a Regional Level Country-Specific Environmental Protection

The founding treaties of each organisation require Member States to protect the environment as part of the broader drive to further their Environmental protection is indeed addressed in countries throughout purposes. SSA and, in many of the jurisdictions we have considered, not only are ■ The East African Community Treaty, which became environmental laws highly developed and diverse, but they are also effective in 2000, specifically provides at Article 5, item 3(c), keeping pace with certain global environmental regulatory trends as that the Community must ensure ‘the promotion of well as addressing country-specific environmental concerns. sustainable utilisation of the natural resources of the Partner To name a few, and among other SSA jurisdictions, environmental States and the taking of measures that would effectively rights are directly enshrined in the of Angola (2010), ii protect the of the Partner States’. Cameroon (1996), Democratic Republic of Congo (2005), Kenya Chapter 19 of the EAC Treaty also provides for the ‘Co- (2010), Mozambique (1990), Nigeria (1999), Rwanda (2003), operation in Environment and Natural Resources Management’ Republic of Congo (2015), South Africa (1996), Uganda (1995), and between Member States, with certain obligations being Zimbabwe (2013). Tanzania, despite being a member of two imposed on Member States in terms of Chapter 19. These Regional Bodies, is the only country in our key sample group whose include obligations to: does not expressly provide for environmental rights. (i) ‘develop special environmental management strategies This may be due the Tanzanian Constitution being the oldest of all in to manage fragile , terrestrial and marine the countries reviewed, dating from 1977, before environmental resources, noxious emissions and toxic and hazardous protection became such a key global focus point and before any of the chemicals’ (article 112(1)(b)); three Regional Bodies were established and adopted founding (ii) ‘adopt environmentally sound management techniques treaties. for the control of land degradation, such as erosion, desertification and encroachment’ (article The approaches to environmental legislative protection in 112(2)(e)); and jurisdictions around SSA are multifaceted and the results of the (iii) to prevent illegal trade and movement in toxic analysis we have undertaken unavoidably need to be restricted for chemicals, substances and hazardous wastes, members purposes of this chapter. In the key jurisdictions considered, as would must ‘co-operate and adopt common positions against be expected, environmental protection is directly regulated in terms of illegal dumping of toxic chemicals, substances and at a national level, and national EIA, waste and climate hazardous wastes within the Community from either a change laws form the focus of our analysis in this chapter. We have Partner State or any third party’ (article 113(1)). not covered state or provincial; municipal or local government; or ■ Similarly, the Southern African Development Community other tiers of legislation, nor have we specifically addressed water, air Treaty, originally adopted in 1992, and subsequently pollution related or other environmental legislation in all jurisdictions, amended, requires Member States to co-operate ‘to foster other than to generally mention some examples below. regional development and integration on the basis of Over-arching national environmental statutes are commonly balance, and mutual benefit’ in a number of areas. Among them are , land and agriculture, trade, supported in SSA jurisdictions by other sector-specific or industry, finance, investment and mining, and natural environmental medium-specific (such as air, water and biota) statutes, resources and the environment (article 213 (a), (c) and (f)).iii or through regulations under the over-arching environmental statutes. Sector-specific laws, ensuring that the environment is protected when ■ Finally, Chapter VI (Co-operation in Environment and Natural Resources) of the ECOWAS Revised Treaty, activities such as and mining are undertaken, are adopted in 1993, provides that ‘Member States undertake to frequently found across SSA countries, and many SSA jurisdictions protect, preserve and enhance the natural environment of the also have statutes or regulations addressing impacts on or utilisation region and co-operate in the event of natural disasters’. It of water, air or biological resources, as well as other specific goes further, saying that ‘To this end, they shall adopt policies, environment-related considerations.

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To illustrate this, we include a few examples in the table below:

The main national environmental legislation includes, among a range of other laws, the Environmental Management and Co-ordination Act of 1999 and its Regulations, which include the Environmental (Impact Assessment and Audit) Regulations, 2002. Environmental aspects such as water quality and waste are addressed through regulations promulgated in terms of this Act; namely, the Environmental Management and Co-ordination (Water Quality) Regulations, 2006, and the Kenya Waste Management Regulations, 2006, respectively. Water use is also regulated in Kenya through the Water Act, 2002. Various other regulations have been promulgated in terms of the Environmental Management and Co-ordination Act, which include regulations addressing aspects such as air quality, , noise and biodiversity protections. The Kenyan mining industry is regulated by the Mining Act (No. 12 of 2016), which itself also includes certain environmental protection provisions.

The National Environmental Management Act 107 of 1998 is the principal environmental . Aligned with it are a number of so-called ‘specific environmental management Acts’, which address areas such as waste, air quality and water use, among others. Examples include the National Environmental Management: Waste Act 59 of 2008, the National Environmental Management: Air Quality Act 39 of 2004, and the National Water Act 36 of 1998. These statutes are all South Africa supported by a wide range of regulations, including relating to EIAs. Other legislation that deals with environmental issues includes the and Petroleum Resources Development Act 28 of 2002, which focuses on mineral prospecting and mining, and oil and gas exploration and production (although environmental controls in these and other sectors are now principally addressed under the National Environmental Management Act and specific environmental management Acts).

The Environmental Management Act, 2004, the Environmental Management Act, Regulations, 2004, and the Environmental Impact Assessment and Audit Regulations, 2005, are among the key national laws dealing with environmental matters. The Solid Waste Management Regulations, 2009 and Environmental Management ( Control and Management) Regulations, 2009, both published in terms of the Environmental Management Act, 2004, regulate the management of solid Tanzania and hazardous wastes. Other legislation also addresses environmental media, and, for example, water is regulated in terms of the Water Supply and Sanitation Act, 2009, and the Management Act, 2009, while air quality is regulated in terms of the Environmental Management (Air Quality Standards) Regulations, 2007, published in terms of the Environmental Management Act, 2004. Mining is regulated under the Mining Act, 2010.

The National Environment Act, 1995 and Environmental Impact Assessment Regulations, 1998, published thereunder, are certain of the primary laws dealing with environmental protections and the EIA process in Uganda. Separate laws have been adopted regulating waste- and mining-related activities. For example, waste management is addressed in terms of the Uganda National Environment (Waste Management) Regulations, 1999, published in terms of the National Environment Act, 1995, and mining activities are regulated in terms of the Mining Act, 2003. Other aspects of environmental protection are also regulated through specific legislation, such as the Water Act, 1997.

Through laws, such as those mentioned above, a range of permits, All SSA countries specifically considered in this chapter have some licences and authorisations are likely to be required across these form of EIA legislation in place which contains mandatory SSA countries for undertaking activities or developments that may requirements as to the EIA procedure to be followed in specified significantly impact on the environment. instances. Although the specific requirements of each jurisdiction Although we have not covered anything other than selected national clearly would have to be properly considered in any country where legislation in this chapter, the importance of the state, provincial, a development or activity is planned, the types of projects or municipal and local government level of laws and controls cannot be developments that frequently require an EIA include: ignored in undertaking any development or activity. For example, in ■ mining and related activities; South Africa, the Constitution provides that the ‘environment’ is an ■ urban development activities; area of concurrent national and provincial legislative competence, ■ construction of telecommunication services (such as towers while some of the more specific environment-related considerations, and masts); including , potable water supply systems and domestic ■ forestry-related activities; wastewater and sewage disposal systems, are within the executive and ■ construction of power stations; and administrative authority of municipalities (local government). Authorisations, licences or permits are therefore typically required ■ construction of pipelines (including for the transport of substances such as oil and gas). under municipal legislation in South Africa for activities such as the storage of flammable substances or dangerous goods, the discharge of While each jurisdiction we considered has legislation requiring that effluent into municipal sewers and undertaking listed scheduled trades. an EIA be conducted in certain circumstances, the EIA process Permits are also required under South African provincial legislation, varies from jurisdiction to jurisdiction. For example, while all EIA- such as for activities that impact protected animal or plant species. related legislation in the SSA countries reviewed calls for public participation, the scope and timing of public consultation differs

from country to country. Typically, in addition to the laws which Environmental Impact Assessment deal with environmental protection through the EIA process, some

of the SSA countries have, or are still in the process of forming, Around the world, one mechanism that is widely used for achieving policies and guidelines to refine their EIA processes. environmental protection is to require some form of EIA and the

issuing of an authorisation before certain types of regulated activities or developments may proceed. In this way, the possible Waste Management and Control

environmental and social impacts of developments come to the attention of decision-makers and the public before they may be As briefly set out in the table above, the storage, handling, authorised. Legislation establishing such EIA procedures within a transporting, treatment and disposal of hazardous wastes are jurisdiction provides a key indicator of a country’s regulatory regulated by specific legislative provisions in the various SSA instruments and controls to ensure protection of the environment. countries considered for purposes of this chapter.

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In many of the countries considered for this chapter, the laws require EAC Climate Change Master-Plan and the Climate Change Strategy certificates, approvals or authorisations to be granted for the as a framework for adapting to and mitigating climate change.viii transport, handling and storage of hazardous wastes. In addition, ECOWAS has established a Scientific and Technical Consultative there are often requirements for disposing of hazardous wastes in Group on Climate Change that has met twice since February 2017, accordance with certain provisions (for example, at specific most recently in September 2018.ix At the most recent meeting, hazardous waste disposal facilities), and for certificates confirming ECOWAS was still at the stage of identifying the dynamics to better the correct disposal of hazardous wastes to be issued to the guide the fight against climate change. generators of the waste. At a regional level, frameworks and guidelines are therefore being Membership of the EAC and ECOWAS also goes hand-in-hand developed or are available as a baseline. At this stage, Kenya is one with obligations in respect of the management of hazardous wastes. of the few of the sample group countries with Regional Body In light of this, and the country-specific legislation in place, it is membership that has progressed beyond the policy, action plan and worth noting that the majority of Member States of the SADC, EAC strategy phases, and already has climate change legislation in place. and ECOWAS have ratified the Basel Convention on the Control of Our research indicates, however, that there has been some progress Transboundary Movements of Hazardous Wastes and their Disposal on the development of climate change legislation in Angola, (the Basel Convention). In addition, various non-member Cameroon, Republic of Congo, Nigeria, Mozambique, South countries, such as the Republic of Congo and Cameroon, have also Africa, Tanzania and Uganda. For the most part, though, indications ratified the Basel Convention. are that these countries are still largely at the stage of integration Another framework that has implications for hazardous waste into national development plans and the development of climate management is the Bamako Convention of 1998. It was adopted by change policies, or developing draft legislation. South Africa, the Organisation of African Unity (the predecessor to the African which has a Climate Change Bill and Carbon Tax Bill, also already Union). The Bamako Convention has been ratified by 27 African has regulations under the National Environmental Management: Air countries, including Angola, Botswana, Republic of Congo, Quality Act 39 of 2004 which require greenhouse gas reporting, Cameroon, Côte d’Ivoire, Uganda, Tanzania and Mozambique. The declare certain greenhouse gases as ‘priority air ’, and require pollution prevention plans to be submitted in respect of Bamako Convention sought to prohibit the import of hazardous certain production processes. wastes, including nuclear wastes, into African countries. In order to achieve this, signatories must fulfil: Here are some of the steps countries are taking towards the (i) the obligation to ‘take appropriate legal, administrative and legislative regulation of climate change: other measures within the area under their jurisdiction to prohibit the import of all hazardous wastes, for any reason, Legislation regulating climate change has been into Africa from non-Contracting Parties’. Going further, the passed, in the form of the Climate Change Act (No. Bamako Convention states that ‘Such import shall be deemed 11 of 2016). This Act seeks to provide for a illegal and a criminal act’ (article 4(1)); and Kenya regulatory framework for an enhanced response to climate change and to establish mechanisms and (ii) the obligation to ‘adopt legal, administrative and other measures to achieve low-carbon climate appropriate measures to control all carriers from non- development. Parties, and prohibit the dumping at sea of hazardous wastes, including their incineration at sea and their disposal in the In addition to greenhouse gas regulations already in seabed and sub-seabed’ (article 4(2)).v place under the National Environmental Management: Air Quality Act 39 of 2004, the country is in the process of developing a range of specific climate change legislation and, in 2018, a Climate Change Climate Change Bill was published for comment. A

revised draft of the Bill is expected during 2019 and, South Africa SSA is seen as being particularly vulnerable to the impacts of in its present form, the Bill seeks to provide for an climate change, with anticipated higher land and ocean temperatures integrated response to climate change. The implementation of a proposed Carbon Tax Bill, resulting in more , droughts and intense weather events. At a intended to impose a tax on greenhouse gas regional level, climate change is a relatively new focus area and the emissions, has been delayed since initially being three Regional Bodies are implementing various policies, or proposed in 2010 and is now expected to be programmes. implemented in 2019. The SADC, together with the EAC and the Common Market for The Tanzanian Parliament voted in April 2018 to Eastern and Southern Africa (COMESA), is facilitating the Tanzania ratify the Paris Agreement and followed through implementation of a Tripartite Programme on Climate Change with ratification in May 2018. Adaptation and Mitigation.vi This programme seeks to address the Both countries have passed that address impact of climate change in the SADC, EAC and COMESA regions. climate change. Cameroon has passed a to Republic of reduce emissions due to deforestation and address In addition, all SADC Member States are party to the United Congo and degradation, sustainable management and Nations Framework Convention on Climate Change and the Ramsar Cameroon conservation of .x It has also passed a decree Convention on Wetlands, which includes resolutions dealing with setting out how to protect the atmosphere generally. climate change and its impacts, adaptation and mitigation measures.

The SADC has not adopted any additional protocols or treaties directly addressing the impact and mitigation of climate change in Conclusion the SADC region; however, a regional climate change programme is vii being finalised. Protecting the environment and mitigating the impacts of climate In addition to its involvement in the Tripartite Programme on change is a focus area of many SSA governments, through their Climate Change Adaptation and Mitigation, the EAC has developed membership of Regional Bodies and through measures imposed by a Climate Change Policy to assist Member States in addressing a range of legislation in the SSA jurisdictions. Environmental climate change in their region. Member States can also rely on the matters and impacts of activities and developments are strictly

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regulated in the SSA countries we have considered. There is also viii. https://www.eac.int/environment/climate-change/eac- current regional, and in some instances country-specific, impetus on climate-change-policy-framework. addressing climate change through regulatory mechanisms. As ix. http://www.ecowas.int/ecowas-strategizes-to-curb-effects- anticipated economic growth and development proceeds in future of-climate-change-in-the-region/. years and the impacts, both positive and negative, become more x. Law No. 94-01 of 20 January 1994 to lay down Forestry, manifest, one must expect the environmental and climate change Wildlife and Fisheries Regulations (EN) and Prime Ministerial laws in SSA countries to be further developed and adapted as Decree No. 103/CAB/PM regarding the creation, organization appropriate. SSA is no different from any other region: keeping a and operation of the Steering Committee for activities to finger on the pulse of current laws and policy, and also on the reduce emissions from deforestation, degradation, sustainable anticipated future direction and revisions to policy and laws, will be management and conservation of forests (REDD+). a key factor in doing business in SSA countries and managing compliance risks. Acknowledgment

The authors would like to acknowledge the contributions of Njau Endnotes Mukuha and Angela Mukora in Bowmans’ Kenya office, Daniel

Gantungo in Bowmans’ Uganda office, and Evarist Kameja in i. See https://www.eac.int/overview-of-eac, https://www.sadc. Bowmans’ Tanzania office for their assistance in verifying applicable int/member-states/, and http://www.ecowas.int/member-states/. environmental legislation in their respective jurisdictions. However, ii. As extracted from http://eacj.org/?page_id=33. should there be any inadvertent errors or omissions in the research as iii. As extracted from https://www.sadc.int/documents-public reflected in this chapter, these would remain the responsibility of the ations/sadc-treaty/. authors. iv. As extracted from http://www.ecowas.int/ecowas-law/treaties/. v. As extracted from https://www.informea.org/en/treaties/ Disclaimer bamako/text. vi. https://www.sadc.int/sadc-secretariat/directorates/office- This chapter is intended to provide a selective overview of certain deputy-executive-secretary-regional-integration/food- regional and national laws and trends in certain jurisdictions based agriculture-natural-resources/tripartite-programme-climate- on research undertaken into selected legislation in those jurisdictions. change-adaptation-and-mitigatio/. It is not intended as and should not be relied upon as legal advice. vii. https://www.sadc.int/themes/meteorology-climate/climate- Full and specific legal advice by appropriate professional counsel change-adaptation/. should be sought where required.

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Mandy Sherwin Michael Vermaak Bowmans Bowmans 11 Alice Lane 11 Alice Lane Sandton 2146 Sandton 2146 Johannesburg Johannesburg South Africa South Africa

Tel: +27 11 669 9687 Tel: +27 11 669 9328 Email: [email protected] Email: [email protected] URL: www.bowmanslaw.com URL: www.bowmanslaw.com

Mandy Sherwin is an associate in our Johannesburg office Corporate Michael Vermaak is a partner in Bowmans’ Johannesburg office Department and is part of the Public Law and Regulatory team. Mandy Corporate Department and is part of the Public Law and Regulatory has experience assisting in the advising of clients in environmental law, team. He has specialised in environmental law and and regulatory matters across a range of other sectors. regulatory matters for over 20 years and also advises on broader Mandy assists in the provision of advice to various clients of the firm, regulatory issues across a range of other sectors. Michael has including national and international mining and industrial clients, extensive experience in environmental and other regulatory advice in a financial institutions and private companies. Recently, Mandy has been transactional and project finance context, with a particular recent focus heavily involved in assisting in the advising of lenders and developers on advising lenders and developers under the South African Renewable under the African Renewable Energy Independent Power Producer Energy Independent Power Producer Procurement Programme. He Procurement Programme. Mandy has an LL.B. from the University of also represents clients in administrative appeals and in relation to KwaZulu-Natal, a Certificate of Competency in Prospecting and Mining enforcement action by the environmental authorities, and advises on Law from the Mandela Institute, University of Witwatersrand, and was pollution and contamination liabilities, transactions involving transfer of admitted as both an attorney and a Notary Public in 2017. ownership or an interest in polluted or contaminated land, and mitigation of risks and liabilities. He routinely advises on all aspects of environmental permitting, licensing and authorisation requirements associated with new and existing operations, as well as corporate, director and shareholder environmental and compliance risk and management. Michael’s clients include national and international mining and industrial companies, financial institutions, power utilities, as well as environmental and engineering consultancies. He also has extensive experience working closely with environmental assessment practitioners, environmental scientists and engineers on impact- and process-related regulatory issues, liabilities and risks. Michael has been individually recognised by Chambers Global (Environmental Law) in 2016, 2017 and 2018, and Bowmans’ Environmental Practice has been ranked in Band 1 for the past four consecutive years (2015 to 2018).

Bowmans is a leading African law firm. Its track record of providing domestic and cross-border legal services in the fields of , banking and finance law and , spans over a century. With 400 specialised lawyers, Bowmans is differentiated by its independence and the quality of legal services it provides. The firm delivers integrated legal services to clients throughout Africa from six offices (Cape Town, Dar es Salaam, Durban, Johannesburg, Kampala and Nairobi) in four countries (Kenya, South Africa, Tanzania and Uganda). Bowmans works closely with leading Nigerian firm, Udo Udoma & Belo-Osagie, and Mozambique-based boutique firm, Taciana Peão Lopes & Advogados Associados. It also has strong relationships with other leading law firms across the rest of Africa and is a representative of Lex Mundi, a global association with more than 160 independent law firms across the globe. Clients include corporates, multinationals and state-owned enterprises across a range of industry sectors, as well as financial institutions and governments.

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Maddocks Patrick Ibbotson

1 Environmental Policy and its 1.2 What approach do such agencies/bodies take to the Enforcement enforcement of environmental law?

The approach taken varies between and within jurisdictions. 1.1 What is the basis of environmental policy in your Typically, agencies take a risk-based approach to the enforcement of jurisdiction and which agencies/bodies administer environmental law. Because of limited resources, they will usually and enforce environmental law? enforce more serious offences through the courts and issue penalty notices for offences with minor consequences. Environmental law is based both on common law principles (in particular negligence and nuisance) and legislation. Increasingly, Many environmental laws have ‘open standing’ provisions, which legislation is influenced by or implements international treaties. allow any person to bring enforcement proceedings in a civil Governments have adopted ESD principles and implemented them jurisdiction to ensure compliance with those laws. For example, an to various degrees. individual that seeks orders from a court to rectify development on neighbouring land if it is carried out in breach of conditions. There are three tiers of government – Commonwealth, State or Similarly, environmental groups can seek civil orders against Territory (State) and Local. The Commonwealth also asserts policy offences of environmental law. positions through controls on grants and revenues. The Constitution gives the Commonwealth Government limited jurisdiction in environmental issues, typically: external affairs 1.3 To what extent are public authorities required to provide environment-related information to interested (international treaties); Commonwealth land; some aspects of persons (including members of the public)? heritage; aspects of water; and matters that affect aboriginal peoples. The Commonwealth has the power to legislate in respect There are very extensive public disclosure requirements. There is a of trading and financial corporations and could use this power to wealth of information available to the public either online or on increase the scope of its environmental regulation. To date, it has request. generally not done so. Typically: The Commonwealth Government can implement policies in cooperation with the States and Territories. For example, the ■ Approval processes for new developments will include some Commonwealth has established a number of new bilateral form of public notification. Major developments may need to exhibit detailed environmental assessments. agreements between itself and the State and Territories which allow the Commonwealth to ‘accredit’ particular State/Territory ■ Material pollution incidents are required to be reported and environmental assessment and approval processes. the reports can be publicly available. ■ There are registers kept of environmental approvals. State legislation is the predominant form of environmental legislation. There are eight State or Territory Governments. In each ■ There are registers or publicly available records relating to contaminated land. State, there is legislation relating to all relevant environmental aspects (pollution, waste, contaminated land, threatened species, ■ Approvals may impose obligations on the approval holder to heritage, planning, etc.) and to all economic sectors (mining, make certain information available to the public or the local community. agriculture, infrastructure, manufacturing, etc.), as well as an Environment Protection Authority (EPA). The Commonwealth Government also has publicly available records of greenhouse gas emissions through the National Local Councils are established under State legislation and are Greenhouse Gas and Energy Reporting Scheme and of other responsible for administering local government areas. Typically, the emissions through the National Pollution Inventory. members of the Council are elected by people who live in the local government area. Generally, local government powers relate to In all jurisdictions, there is also legislation that entitles any person to local land use planning, development controls, local roads and seek access to information under the control of the Government, traffic control, building regulations, community waste management, typically with a presumption in favour of granting access to minor pollution incidents or nuisances and public health. information.

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2 Environmental Permits The nature of appeal rights varies for different approvals and jurisdictions.

2.1 When is an environmental permit required, and may 2.3 Is it necessary to conduct environmental audits or environmental permits be transferred from one environmental impact assessments for particularly person to another? polluting industries or other installations/projects?

There are many approval requirements in each jurisdiction. There Typically, these requirements arise in the following ways: may also be a need to obtain both State and Commonwealth ■ when seeking approval for a new development; approvals. The following are typical: ■ as a condition of an approval; Australia ■ by regulatory order during the operation of the development; Planning approval e.g. ‘development New development consent’ ■ as an order of a court consequent upon prosecution; ■ by a voluntary scheme; or Mining Exploration or Mining Lease or similar ■ by industry or activity-specific legislation. Pollution or specified Environment Protection Licences, Water New developments polluting activities Pollution Licences For all new developments, other than the most minor, an environmental assessment is carried out to obtain planning Authorisations for transport and disposal Waste and sometimes for generation approval. The level of detail required will vary with the jurisdiction, the nature of the activities and the risks presented by the activities. Licences to store or use above certain Hazardous substances For major industrial facilities, major infrastructure, large-scale quantities or in certain situations chemical storage, large generation facilities and mines, a very detailed environmental assessment will normally be required. Threatened species Licences to damage, disturb or take Typically, applications and assessments are publicly available. Licences for extraction and use and to Approval conditions Water use establish works to extract water The conditions of an approval may require management plans, Radiation Licences for certain devices assessments, environmental audits and reporting. Many environmental licences and permits will require periodic review and Licences for keeping, use, maintenance reporting of compliance. Ozone and disposing of prescribed ozone-depleting substances Orders Typically, regulatory authorities can order that an operator of a Aboriginal objects or Licences to disturb or enter areas facility conduct audits or a review. A court can also do this if a person is prosecuted and found guilty of a pollution offence. Specific licences for entry, use or to Specific locations disturb 2.4 What enforcement powers do environmental regulators have in connection with the violation of permits? In most jurisdictions, environmental licences are required for specified industrial activities such as chemical industries, large-scale There are very broad enforcement powers across each jurisdiction. crushing or grinding works, certain mining, extractive industry and related activities, heavy industrial or manufacturing uses, intensive Environmental regulators can: agriculture, and waste facilities. ■ investigate; It is very common for multiple approvals to be required. ■ demand information; Typically, the benefit of planning approval can be relied on by any ■ serve infringement notices; person carrying out the approved development on the land to which ■ prosecute; the approval requires – they do not need to be transferred. ■ suspend approvals; Most other environmental approvals are personal to the holder. These ■ cancel approvals; can usually be transferred with the consent of the relevant agency. ■ impose new approval conditions; However, the agency is not required to consent. In some jurisdictions, ■ serve investigation, clean-up or abatement orders; the agency could refuse consent because, for example, the transferee ■ serve orders requiring works; or its directors are not a fit and proper person to hold the licence. ■ obtain court orders requiring compliance, response, auditing; and 2.2 What rights are there to appeal against the decision of ■ claim against bonds or other security provided. an environmental regulator not to grant an environmental permit or in respect of the conditions contained in an environmental permit? 3 Waste

An applicant for an approval usually has a right of appeal to a court or administrative . Typically, appeals may be: 3.1 How is waste defined and do certain categories of ■ merits appeals; or waste involve additional duties or controls? ■ (i.e. judicial review) appeals. Typically, waste is very broadly defined to include any discarded,

ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 WWW.ICLG.COM 21 © Published and reproduced with kind permission by Global Legal Group Ltd, London 22 Australia handling anddisposal. controls mayincluderestraintsongeneration,storage,transport, Certain typesofwastedohavesignificantadditionalcontrols. The ■ ■ ■ ■ basis ofeithersomeorallof: Waste classificationprocessesor categoriesarealsodefinedonthe it isintendedtobe(orcanbe)reprocessed,re-usedorrecycled. waste unlesstheyhavetransferredownershiptoanotherperson. commit anoffence. The producerofwastewillbetheowner causing theincidentandpersonwhoisownerofwaste relating totheunlawfuldisposalorescapeofwaste.Bothperson Protection oftheEnvironment Operations Act In NewSouth Wales (NSW),forexample,s115 ands116 ofthe generator andtransportercease. waste islawfullydisposedatafacility, theliabilityof incident occursbeforewasteislawfullydisposedof.However, once receivers ofthewastecanhavesomeliabilityforifan the producers(oftencalledgenerators),consignors,transportersor generator onceithasbeenlawfullydisposedof. Typically, eachof Generally, therearenosuperfundactswhichlinkwastebacktothe 3.3 example, asfill. the wasteisdemonstratedtobeinertandsuitableused,for for on-sitedisposalofwasteonthesitewhereitisproducedunless and safetycontrolsthatapply. There willbeveryfewopportunities the wasteandrisks. There willbebothenvironmentalcontrols and typesofwasteallowedtobestoredwilldependonthelocation, pending itstreatmentoroff-site disposaloritsreuse. The volumes Typically, wasteproducedon-sitecan bestoredon-sitetemporarily, the waste,aswellpersondisposingofit,willbeheldliable. that harmsorislikelytoharmtheenvironment.Often,ownerof In alljurisdictions,itisanoffence todisposeofwasteinamanner ■ ■ ■ presented. Controlsareimposedby: These controlsvarywithlocation,industrytypeandtherisks 3.2 rejected, unwanted,surplusorabandonedsubstance,whethernot Maddocks © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM liability fortheproducerofwaste. The commonlawprinciplesofnegligence mayalsoapplytocreate legislation asaconsignorofthewaste. producer ofthewastemayretain liabilityundertransportsafety Where theincidentoccursintransportofwaste,then This ispossiblewithproperlydocumentedtransferdocuments. the contentofwaste. the physicalcharacteristicsofwaste;and the riskspresentedbywaste; the sourceofwaste; produced? bankrupt/disappears)? community concernsandpressures. specific legislativerequirements;and licences tostoreordisposeofwaste; approvals/licences –inparticular, planningapprovalsand another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore the transferee/ultimatedisposergoes

1997 createoffences

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

4.1 commitments aremadetocertaincollectionandrecyclingtargets. be membersofanapprovedco-regulatoryarrangement,and the scheme,liableparties(importersandlocalmanufacturers)must consumers canreturnitemstodesignatedfreedrop-off points.Under recycling schemewhichiscurrentlybeingimplementedwhere Policy. Underthispolicy, thereisanationaltelevisionandcomputer The CommonwealthandStateshaveagreedtoaNational Waste of packagingwaste. packaging covenant,whichisavoluntaryschemeforthereduction industry participantsdonotsignuptoandcomplywiththenational that requirewastereductioninitiatives. These canbeimposedifthe For packagingwaste,therearesomeindustrywastereductionplans There aresomevoluntarywastetake-backschemes. 3.4 ■ ■ ■ ■ ■ ■ Other liabilitiesinclude: ■ ■ ■ ■ The offence provisionsfallintooneoffourtypes: imposed. Where anaturalpersoncommitsanoffence, gaoltermscanalsobe be followedtodetermineanappropriatepenaltyinthecircumstances. maximum penalty, butsetoutintheirjudgmentsprinciplesthatwill an offence continues. Typically, thecourtsdonotimpose each separateoffence. Further, penaltiescanbeimposedforeachday most jurisdictionsfortheworstoffences exceeding$1millionfor Maximum penaltiescanbesevere,withthemaximumin for themostseriouscases,imprisonment. environmental laws.Penaltiesincluderemediationorders,finesand, There arebothcivilandcriminalpenaltiesforbreachof and plastics). include co-regulatoryschemesformercury(containinglamps,tyres the ‘ReturnandEarn’ schemeinNSW. Otherinitiativesproposed Some Stateshavealsointroducedcontainerdepositschemes,suchas 4 regarding thetake-backandrecoveryoftheirwaste? what defencesaretypicallyavailable? common lawclaimsfordamages. contribution toenvironmentalfunds; and publication ofoffence; compensation; clean-up orresponseorders; infringement orpenaltynotices; other deliberation. offences requiringproofofintent, negligence,recklessnessor or inothercircumstancessetoutthelegislation;and exercised duediligenceandreasonableprecautions qualified strictliability–adefenceisavailableiftheperson because ofanhonestandreasonablemistakefact; –adefenceisavailableiftheoffence occurred found tohavebreachedtherequirement; absolute liability–thereisnodefenceifthedefendant Liabilities breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa To whatextentdowasteproducershaveobligations

Australia

Maddocks Australia

When assets are purchased, normally the liability for the past 4.2 Can an operator be liable for environmental damage actions of the seller stays with the seller. However, in an asset sale, notwithstanding that the polluting activity is operated if the assets acquired include land that is contaminated, then the within permit limits? people who might be liable for the contamination and ordered to clean it up include the owner and occupier of the land at the time that The purpose of some licences is to specifically permit certain types regulatory action is taken. As a result, an order might be served on of pollution. For example, an environment protection licence in the purchaser of the assets in respect of the contamination that was NSW may specifically permit the pollution of water by specified caused prior to the acquisition, but which persisted after the substances at specified points up to specified limits. However, there acquisition. remain risks, such as:

■ the pollution might breach other legislation or another Australia approval – for example, a planning approval; 4.5 To what extent may lenders be liable for environmental wrongdoing and/or remediation costs? ■ the circumstances giving rise to the pollution might constitute a breach. For example, if there is a failure to operate in a proper manner; or Generally, lenders are not liable for environmental harm. However, lenders may be at risk if they are: ■ the circumstances of the incident may fall outside the specified controls in the licence. ■ concerned in the management of the defaulting company; It should not be assumed that the fact that a licence is held will be a ■ directly involved in decisions that cause a pollution incident; defence for a claim for damages under the common law principles ■ aiding, abetting, counselling or procuring the offence; of negligence or nuisance. ■ a ‘shadow director’ – being (in loose terms) a person whose instructions the directors follow; 4.3 Can directors and officers of corporations attract ■ in occupation of land on which or from which a pollution personal liabilities for environmental wrongdoing, and incident occurs; and to what extent may they get insurance or rely on other ■ in control of or an owner of plant, equipment or substances indemnity protection in respect of such liabilities? involved in a pollution incident. Particular care needs to be taken in NSW and Victoria. In all jurisdictions, there are provisions that have the effect that directors and some other officers or managers are personally liable for some offences committed by the corporation. 5 Contaminated Land Generally, a defence is available if the director can demonstrate that they exercised to prevent the commission of the 5.1 What is the approach to liability for contamination offence by the corporation. In some instances, the due diligence (including historic contamination) of soil or defence has multiple other elements beyond the mere exercise of ? due diligence, including, for example, establishing that the director was not in a position to control or influence the relevant conduct of Contaminated land is generally regulated by State legislation. the corporation. Most legislation adopts a ‘polluter pays’ principle but this might be A company can indemnify its directors. However, the usefulness of read as a ‘government pays last’ principle. The range of people who the indemnity may be limited in circumstances where there is also a may be liable for contaminated land varies from State to State, but finding that the director has not acted in good faith within the includes: meaning of s199A(2) of the Corporations Act 2001. Further, the traditional common law position has been that an indemnity against ■ the person responsible for the contamination; a criminal sanction is not enforceable (that proposition may be ■ the person who carried out activities on the land of a sort that doubtful for strict and absolute liability offences). are likely to cause the contamination; ■ the occupier of the land; 4.4 What are the different implications from an ■ the owner of the land; environmental liability perspective of a share sale on ■ a person who exacerbates the risk from the contamination; the one hand and an asset purchase on the other? and ■ certain public authorities (as a last resort). A company remains liable for its acts and omissions regardless of There is a National Environment Protection Measure on contaminated what happens to its shares or assets. When shares are acquired, the land that seeks to provide a consistent framework for assessing liability usually stays with the acquired company. The acquired contaminated land and making management decisions. company may still be prosecuted, sued or incur orders in the future for those pre-acquisition acts. Contaminated land issues also need to be considered in the process of obtaining planning approval for new developments. This can There are (limited) circumstances in some States where the seller result in requirements for environmental assessments to be carried could remain liable for the performance of the clean-up obligations, out before approvals are granted and possibly for remediation to be even after the sale. For example, in circumstances where a clean-up order has been served on the polluting company, this is subsequently carried out either prior to the approval or as a condition of the sold as part of a scheme to avoid compliance. approval. A further exception is for offences occurring prior to a sale. If a pollution incident occurs and then the polluting company’s shares 5.2 How is liability allocated where more than one person are sold, the seller and the people who were directors, officers and is responsible for the contamination? managers of the polluting company remain potentially exposed to prosecution on the basis of the derivative liability provisions The rules for apportioning liability are different amongst the States discussed in question 4.3 above. and Territories. However, as a general proposition, an order can be

ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 WWW.ICLG.COM 23 © Published and reproduced with kind permission by Global Legal Group Ltd, London 24 Australia the costsofrespondingtoandmitigating theimpactsofincidents. Generally, relevantgovernmentagencies’ rightswillbelimitedto 5.5 criminal liabilityforoffences thatmayhavecausedthecontamination. Of courseasageneralrule,thepollutercannotcontractoutofany should obtainanindemnityfromthepurchaseraswell. still bepotentiallyliableunderlegislationand,tomanagethat, obtain areleasefromthepurchaser. However, thepolluterwould as betweenthepartiestocontract,forexample,apollutercould these withtheconsentofallparties.Itispossibletoobtainreleases In respectofcontractualliabilities,itispossibletoagreenovate contractually. Generally, apollutercannottransfertheriskofliability responsible forthecontamination. portion ofthecostscarryingoutorderfromeachperson responsible forthecontaminationofland,theymayrecovera In someStates,ifapersoncarriesoutremediationorderbutisnot 5.4 might, inlimitedcircumstances,haverightstoappealonthemerits. remediation proposedaspartofanewdevelopment,objectors the groundsofirrationalityorwantjurisdiction.Incontext rights toobtainreviewofadministrativedecisions,forexample,on which the‘agreement’ ismadeandimplemented. There maybe The rightsofathird-partychallengewilldependonthecontextin parties toit–nototherauthorities. into an‘agreement’ withaperson,theagreementonlybinds health ortheenvironment. To theextentthatanauthoritydoesenter the originalinformationwasincompleteorthereisarisktohuman additional workifthelandusechanges,thereisnewinformation, Territory but,forexample,anauthoritymaywellbeabletorequire The powersoftheauthoritiesaredifferent ineachStateand Generally, yes. 5.3 served ononeperson(usuallythemostresponsibleor Maddocks © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM canapportionliabilitybetweenpartiesaswell. carrying onactivitiesthelandorapublicauthority. responsible forthecontamination,ownerofland,person example, inNSW, theEPA canserveordersoneithertheperson person whomayhavecontributedtotheneedremediate.For owner oroccupier)andtheyhavearighttorecovercostsagainst can athirdpartychallengetheagreement? public assets,e.g.rivers? contaminated landliabilitytoapurchaser? possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma Does apersonhaveprivaterightofactiontoseek regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis

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7.1 to beproduced. In someStates,voluntaryenvironmentalauditscannotberequired ■ ■ ■ ■ ■ ■ ■ ■ ■ Environmental regulatorshaveverybroadinvestigativepowersto: 6.1 obligations todisclose contaminationandasbestos. to disclosecontaminationandasbestos. InsomeStates,thereare The obligationsaredifferent ineachState,butgenerallyitisprudent Transfer ofland 7.3 ■ ■ ■ ■ ■ affirmative obligationwillarise if: The legislativepositionisdifferent ineachState.Generally, the 7.2 health risksorariskofpropertydamage. prudent tonotifyadjoininglandownersoroccupiersifthereare Normally, notificationmustbemadetotheregulator. Itmaybe ■ ■ ■ The obligationisdifferent ineachState,butthetriggersaretypically: 7 6 conduct siteinspections,interviewemployees,etc.? takeover transactions? contamination? parties? require notificationofincident. require responsestoquestions;and interview employees; require theproductionofdocuments; carry outmonitoringandassessment; seize offending articlesorotherevidence; inspect premises,plantandequipment; take samples,photographsandvideos; enter premises; new developmentisproposedontheland. there isanorder;or there isarisktothesafetyofpeople(inparticularworkers); there isoff-site migration; resources; there isevidenceofimpactongroundwaterorsurfacewater guidelines orregulations. when contaminationexceedscertainlevelsassetoutin in circumstancessetoutapprovalconditions;and that haveaprescribedlevelofmaterialityorsignificance; pollution incidents(includingsoilorgroundwaterpollution) Reporting /DisclosureObligations Powers ofRegulators environmental regulatororpotentiallyaffectedthird migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe require productionofdocuments,takesamples, What powersdoenvironmentalregulatorshaveto prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto To whatextentisitnecessarytodisclose have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson Australia

Maddocks Australia

Take-overs 8.3 Can a person who holds shares in a company be held There is not an express obligation to notify environmental liabilities liable for breaches of environmental law and/or upon the sale of shares. pollution caused by the company, and can a parent Misleading conduct company be sued in its national court for pollution caused by a foreign subsidiary/affiliate? In all transactions, there is a possibility that statements about the site conditions or other environmental aspects may be misleading or deceptive, resulting in potential offences and claims for compensation Generally, the ‘corporate veil’ operates to shield shareholders from or damages. Silence about a state of affairs may also constitute a liability, so a shareholder in that capacity is not liable for the misrepresentation. environmental liabilities of the company. A parent company generally is not liable for the environmental Australia liabilities of its subsidiary unless: 8 General ■ the parent company has such a level of control over the management of the subsidiary that the subsidiary company is properly an agent of the parent company; 8.1 Is it possible to use an environmental indemnity to limit exposure for actual or potential environment- ■ where the corporate structure perpetrates a ; related liabilities, and does making a payment to ■ if there is insolvent trading; or another person under an indemnity in respect of a ■ if the parent company is in fact a shadow director. matter (e.g. remediation) discharge the indemnifier’s potential liability for that matter? 8.4 Are there any laws to protect “whistle-blowers” who An indemnity will not operate to remove the primary liability. What report environmental violations/matters? an indemnity does is enable the indemnified party to recover the amount of the primary liability once it is incurred. There are limited protections in some jurisdictions, mostly relating The traditional view is that an indemnity against fines would not be to public sector workers. enforceable. Typically, EPAs will keep confidential the identity of a person who The payment of an amount under an indemnity would not relieve the provides them with information on an environmental incident. paying party from liability except from liability under the indemnity There are some protections for whistleblowers in companies under itself and then to the extent of the payment only and subject to the the Corporations Act 2001 (Cth), though this is limited in relation to terms of the indemnity. environmental obligations.

8.2 Is it possible to shelter environmental liabilities off 8.5 Are group or “class” actions available for pursuing balance sheet, and can a company be dissolved in environmental claims, and are penal or exemplary order to escape environmental liabilities? damages available?

The Corporations Act 2001 (Cth) and Australian accounting There are provisions for ‘class actions’ or ‘representative actions’. standards establish requirements for financial records and reports. These are generally in the Federal Court of Australia or the Supreme Environmental liabilities that are either actual or contingent liabilities Court of Victoria. In other jurisdictions, these forms of proceedings within the meaning of relevant accounting, auditing and reporting are less well established. standards need to be dealt with in accordance with those standards. The Federal Court has limited jurisdiction in environmental matters. Section 299(1)(f) of the Corporations Act 2001 requires reporting There are ‘open standing’ provisions in many environmental statutes ‘subject to any particular and significant environmental regulation’ which permit any person to bring an action to restrain breaches of the to address environmental performance in corporations’ annual relevant legislation. These provisions often facilitate ‘public interest Directors’ Reports. litigation’, where not-for-profit environmental organisations or There are situations in which a company could be dissolved to avoid action groups can bring matters before the courts. environmental liabilities and this has occurred. However: Exemplary or punitive damages can be awarded by the courts for ■ liabilities are usually referrable to the date of the relevant nuisance or negligence. These are extremely unusual. They are environmental harm. As a result, directors and managers of generally not available in claims for . The practice is corporations may remain liable for offences committed by not the same as in the USA. the company prior to its dissolution; ■ there are anti-avoidance provisions in some environmental legislation (notably the CLM Act in NSW) that would have 8.6 Do individuals or public interest groups benefit from the result that directors and holding companies may be liable any exemption from liability to pay costs when if companies are wound up as part of a scheme to avoid pursuing environmental litigation? compliance; ■ where a company holds an environment protection licence, There are very limited circumstances in which individuals and there may be restrictions on surrendering the licence and the public interest groups benefit from any exemption from liability to licence may prevent the dissolution of the company; and pay costs when pursuing environmental litigation. ■ there are provisions requiring directors to certify solvency The general rule is that costs follow the event and the unsuccessful before voluntary winding up occurs. party will be ordered to pay the reasonable costs of the successful party. The mere categorisation of litigation as having been brought in the public interest is, on its own, not sufficient to justify departure from the usual order that costs should follow the event.

ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 WWW.ICLG.COM 25 © Published and reproduced with kind permission by Global Legal Group Ltd, London 26 Australia powers todefeatthelitigationoncehascommenced. Government hasamendedlegislationorotherwiseusedlegislative An exampleofwhereacostsorderhasbeenmadeincludethe party ofthebenefitacostsorder. enough. The courtsarenotusuallywillingtodepriveasuccessful Establishing oneofthesespecialcircumstanceswillgenerallynotbe ■ ■ ■ ■ of specialcircumstancesinclude: party needstoestablishthatspecialcircumstancesapply. Examples through reverseauctionsorothercompetitivetenderingprocesses. Australian carboncreditunits(ACCUs)onthebasisofleastcost, crediting andpurchasingthoseemissionsreductionsintheformof to provideanincentiveforlow-costemissionsreductionsby The ERFisadministeredbytheCleanEnergy Regulatorandseeks reductions. purchasing emissionsreductions,andsafeguarding below 2000levelsby2020creditingemissionsreductions, The aimoftheERFistoreduce Australia’s emissionsfivepercent Government’s Direct Action Plan. Emissions ReductionFund(ERF),thecentrepieceofFederal Amendment Bill2014,whichgavelegislativeeffect tothe the Australian ParliamentpassedtheCarbonFarmingInitiative replaced itwiththe‘Direct Action Plan’.On24November2014, carbon pricingschemeunderthe On 17July2014,theFederalGovernmentrepealedexisting 9.1 To succeedinjustifyingadeparturefromtheusualcostsorder, a Maddocks © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM the land. credits bystoringcarbonorreducing greenhousegasemissionson Farming Initiative,whichpermits landmanagerstoearncarbon Under thescheme,therewillbe anexpansionoftheCarbon abatement hasoccurred. the ERFwillonlyoccuronceit hasbeenprovedthatgenuine organisations tosecurefinance toundertakeprojects,paymentfrom While long-termcontractsforabatementwillbeavailabletoassist when theemissionssavingshavebeenindependentlyverified. priced abatement. The ERF will onlypurchaseemissionsabatement be allocatedthroughareverseauction,startingwiththelowest tenders foremissionsabatementbeyondbaselinelevels.Fundswill It isproposedthroughtheERFthatGovernmentwillcallfor baseline levels. reduce theiremissionsintensitybelow‘business-as-usual’ or The ERFwillpurchasecarbonabatementfrombusinessesthat 9 environmental law. future administrationofstatutoryprovisionsrelatingto resolved significantissuesinrelationtotheinterpretationand The basisofthechallengeisarguable andhasraised interest intheoutcomeoflitigation. concern suchthatitcantrulybesaidthereispublic A significantnumberofmembersthepublicshare habitat ofendangeredspecies. ensure obediencetoenvironmentallawandpreservethe The pursuitofthelitigationwasmotivatedbydesireto to determinetheirrights. individuals whoareunabletotakeactionontheirownbehalf Where thematterlitigatedraisedquestionsconcerning market developingthere? andClimateChange your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation

Clean Energy Act 2011 ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 and

emissions. monitoring. Industrygroupsalsovoluntarilymonitorgreenhousegas Occasionally, licencestopollutewillincludeconditionsthatrequire monitor andreportgreenhousegasemissions. fall withintheGreenhouseGasReductionSchemearerequiredto buy andsellelectricity, tomeetcertainbenchmarks.Organisations that requires individualelectricityretailersandcertainotherpartieswho Scheme establishesState-widegreenhousegasreductiontargets, and Greenhouse GasReductionScheme. The GreenhouseGasReduction and the gas emissions.Forexample,inNSW, the legislation inrelationtothemonitoringandreportingofgreenhouse In additiontotheCommonwealthscheme,eachStatehasitsown every year. threshold mustregisterandthenreportgreenhousegasemissions Corporations thatmeetaNationalGreenhouseandEnergy Reporting and managementofsecurityNGERdata. monitoring complianceandenforceexternalaudits,publishing National GreenhouseandEnergy Register, receivingreports, and deregistrationofcorporationsforreporting,managementthe Reporting Scheme(NGER). This schemeallowsfortheregistration In 2007, Australia introducedtheNationalGreenhouseandEnergy 9.2 Asbestos hasbeen asignificantissuein Australia fora number of 10.1 Policy Frameworksinplacetoachievenet-zeroemissionsby2050. policies; forexample,NSW and Victoria haveClimateChange States and Territories have implementedtheirownclimatechange landfill gas. cleaning upwastecoalminegas,powerstationsand Reduction Fund,includingenergy efficiency, landsectorabatement, Certain keyactivitieswillhavesupportfromtheEmissions levels, financialpenaltiesmaybeincurred. Energy ReportingScheme). Where companiesemitabovebaseline measured usingdatareportedundertheNationalGreenhouseand operate atbaselinelevels(bothactualandemissionsare emissions. Onthisbasis,therearenopenaltiesforcontinuingto Plan istoprovideincentivescompanieswhoreducetheir below theirbaselinelevels. The centralgoaloftheDirect Action of carbonabatementfrombusinessesthatreducetheiremissions The mainmechanismforachievingthisgoalisthroughthepurchase by 2020. committed toreducecarbonpollutionbyfivepercentof2000levels Amendment totheKyotoProtocol. The FederalGovernmenthas In 2016, Australia alsoratifiedtheParis Agreement andtheDoha continues tobereducecarbonemissions. regulation; however, theprimaryobjectiveofDirect Action 2011 markedashiftintheoverallpolicyapproachtoclimatechange The repealofthecarbonpricingschemeunder 9.3 10 to monitorandreportgreenhousegasemissions? jurisdiction? regulation inyourjurisdiction? in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned What istheexperienceofasbestos litigationinyour What istheoverallpolicyapproachtoclimatechange Electricity Supply(General)Regulation2001 Asbestos Electricity Supply Act 1995 Clean Energy Act Australia establisha

Maddocks Australia decades. There has been a large volume of asbestos-related On 1 January 2018, the People’s Republic of China (China) litigation. A number of specialist or specialist court lists introduced import restrictions on recyclables. The effect of these have been established to manage these cases; for example, in NSW restrictions has been to substantially close the China market to the Diseases Tribunal. These typically have procedures that Australian processors of recyclables. are designed to deal with the particular difficulties of these claims. As a result, Australian processors of recyclables have had to try and Asbestos continues to attract significant media and policy attention. find other markets to sell their processed recyclables. The of recyclables into the international market resulting from China 10.2 What are the duties of owners/occupiers of premises ceasing its purchase of recyclables has meant a significant reduction in relation to asbestos on-site? in the price for certain processed material in the international market. This collapse in the processed recyclables market has affected In each State, there are laws that seek to protect people from the processors of recyclables and local councils alike. Each recyclables Australia hazards of asbestos. These typically require identification of processing is different, and each affected party has had to asbestos materials, labelling, risk assessment, control measures (e.g. consider how their contract responds to this market change. asbestos management plans) and in some circumstances, health Another significant change in the waste industry in 2018 is the monitoring. introduction in NSW, the Australian Capital Territory and Queensland People who work with asbestos products need training, and, in some of container deposit schemes (joining existing schemes in South instances, also an accreditation certification. Australia and the Northern Territory), whereby eligible empty containers are able to be exchanged for a 10 cent refund. Each scheme In some jurisdictions, for example, Queensland, an asbestos audit is different, and will have different legal implications for suppliers, must be provided to the purchaser in respect of the sale of certain processors, local councils and consumers. Western Australia has property. announced that it will introduce a container deposit scheme in 2020, and a model framework is being considered in Tasmania. 11 Environmental Insurance Liabilities The response to and regulation of impacts of per- and poly- fluoroalkyl substances (PFAS) in fire-fighting foam continues to be an important issue. Three class-actions have been commenced 11.1 What types of environmental insurance are available against the Commonwealth in different locations in Australia in the market, and how big a role does environmental risks insurance play in your jurisdiction? claiming that the Commonwealth’s use of an Aqueous Film Forming Foam containing PFAS at defence bases, which has contaminated surrounding land, was negligent and is a continuing nuisance. The Environmental insurance plays a limited role in Australia. Various claims are that the contamination has resulted in economic loss of insurance policies are available in Australia. However, the market residential land owners and businesses surrounding defence sites. in Australia is not well-developed.

11.2 What is the environmental insurance claims experience in your jurisdiction?

As far as we are aware, claims have been limited.

12 Updates

12.1 Please provide, in no more than 300 words, a summary of any new cases, trends and developments in environment law in your jurisdiction.

There have been a number of significant legal changes affecting the waste industry in 2018.

ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 WWW.ICLG.COM 27 © Published and reproduced with kind permission by Global Legal Group Ltd, London Maddocks Australia

Michael Winram Patrick Ibbotson Maddocks Maddocks Level 27, 123 Pitt Street Level 27, 123 Pitt Street Sydney NSW 2000 Sydney NSW 2000 Australia Australia

Tel: +61 2 9291 6228 Tel: +61 2 9291 6169 Email: [email protected] Email: [email protected] URL: www.maddocks.com.au URL: www.maddocks.com.au

Australia Michael has a particular focus on administrative law, development Patrick is an internationally recognised expert in development and approvals, the regulation and remediation of contaminated land, the environmental law, having practised in the field since 1988. He is removal and handling of hazardous materials and waste and compliance particularly well regarded for his focus on delivering innovative efficient with legislative and regulatory requirements for government clients. and practical solutions to clients in this rapidly evolving area of law. Michael has advised all levels of government, including the Patrick has worked extensively with infrastructure and redevelopment Commonwealth Government, State Government agencies and Local projects, disposal and management of former industrial sites, Councils as well as private sector clients spanning a broad range of remediation and compliance issues, dispute resolution, land access, sectors including healthcare, infrastructure, education and technology. local government issues and planning law, climate change and environmental law. Michael is a leading planning and environment lawyer, having been recognised by Best Lawyers in 2019. Patrick works with Commonwealth, State and local government agencies and Australian and international private sector corporations. His experience acting for both the public and private sector brings his clients an unparalleled understanding of the multiple perspectives that are often necessary to efficiently resolve and manage infrastructure, development and environmental issues. Patrick is recognised by The Legal 500 Asia Pacific, Chambers Asia- Pacific, Best Lawyers Australia and Doyle’s Guide in the category of Planning & Environment.

Maddocks provides premium legal services to corporations, businesses and governments throughout Australia and internationally. We advise clients across education, government, infrastructure, healthcare and technology sectors, from our Canberra, Melbourne and Sydney offices. We’re committed to our clients. In fact, our brand and market reputation reflects this focus. Our service is based on a deep understanding of our clients’ legal requirements in the context of their business objectives. We’re highly regarded for exceptional, practical legal services that genuinely add value. We work collaboratively with our clients to build strong, sustainable relationships – our longest is now more than 100 years old. Our lawyers aim to deliver consistently high standards of service, and we understand the importance of accessibility, responsiveness and transparency. Working with us, you’ll enjoy open communication, meaning well-scoped, appropriately resourced and effectively managed matters.

28 WWW.ICLG.COM ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 © Published and reproduced with kind permission by Global Legal Group Ltd, London Chapter 6 Belgium Lieve Swartenbroux

Linklaters LLP Melissa Verplancke

1 Environmental Policy and its of activities). In the Flemish region, the authorities can impose administrative lump-sum penalty payments (e.g. per day, per Enforcement infringement, or per measure) in case of failure to implement the administrative measures on time. These administrative lump-sum penalty payments are capped at EUR 1 million or EUR 100,000 1.1 What is the basis of environmental policy in your jurisdiction and which agencies/bodies administer depending on whether these were imposed by regional or by local and enforce environmental law? supervisory authorities. Both criminal (imprisonment and/or fines) and administrative Belgium is organised as a federal state. Most of the environmental sanctions (fines and, in the Flemish region, also deprivation of law is a matter for the Flemish, Walloon and Brussels Capital regions. benefits) can be imposed in case of environmental infringement. In The federal state retained only a relatively small field of competences, principle, imprisonment could range from a few days to 15 years for i.e., product standards, protection against ionising radiation and the most serious offences, and criminal fines could amount to permits for offshore activities. The protection of the environment currently EUR 160 million for the most serious offences committed (such as soil, air, water, noise), the granting of permits, waste by legal entities. In addition, criminal courts can impose repair management, climate change, , etc. have been measures or order the site to be closed. Currently, administrative devolved to the regions. Each of the regions therefore adopts its own fines can amount to EUR 2 million. As a rule, any non-compliance environmental legislation. Although there is a tendency to codify the with environmental legislation, regulations or permits will first be environmental legislation into one single environmental code in the referred to the public attorney and will only give rise to three regions (e.g. the Flemish Decree on general environmental administrative fines in cases where no criminal prosecution is policy provisions, the Walloon Environmental Code or the Brussels initiated. In the Flemish region, certain infringements deemed less Code on the inspection, prevention, determination and sanctioning of serious are exclusively subject to administrative sanctions. environmental offences, and environmental liability), most of the Criminal prosecution of environmental offences will depend on the regional environmental legislation is still scattered over various seriousness of the offence committed. Criminal courts mostly distinct pieces of legislation. For certain matters, cooperation impose fines and rarely hand out actual prison sentences. In the agreements are entered into between the federal state and the regions, Flemish region, a five-year environmental enforcement programme such as those relating to the so-called Seveso installations or the has been adopted that will, in the future, also encompass the management of soil contamination generated by underground fuel enforcement of land and town planning regulations. tanks. An increasing part of the environmental legislation is sourced in European Union environmental law through directly applicable 1.3 To what extent are public authorities required to regulations (such as REACH or the waste shipment regulation) or provide environment-related information to interested national implementation of directives (such as the Industrial persons (including members of the public)? Emissions Directive or the EU Emissions Trading System Directive). The administrative organisation of the implementation and Access to public information in general is a fundamental right enforcement of environmental law consists of either an environmental enshrined in the Belgian Constitution. In addition, the European regional department (the Walloon environmental department), directives on public access to environmental information have been environmental agencies (the Brussels Environmental Management transposed into national law, resulting in legislation at both the Institute) or a combination of both (the Flemish environmental federal and regional levels imposing upon a wide range of authorities department together with agencies such as the Flemish Public Waste an obligation of active and passive disclosure of environmental Agency). Local authorities also have certain specific powers relating information. Exceptions to the passive disclosure obligations are to to environmental matters (permits and enforcement). be construed restrictively. The public also has a right to participate in public consultations on plans and programmes, as well as on environmental or single permit applications. 1.2 What approach do such agencies/bodies take to the enforcement of environmental law?

The environmental authorities have supervisory powers and can impose administrative measures (such as warnings, but also closing

ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 WWW.ICLG.COM 29 © Published and reproduced with kind permission by Global Legal Group Ltd, London 30 Belgium permit canbeappliedfor. also entailapublicconsultation,before theenvironmentalorsingle environmental impactassessment mustbecarriedout,whichwill regions. Forlistedactivitiesthat are particularlypolluting,aprior plans, programmesandprojectshave beentransposedinthethree The Europeandirectivesonenvironmentalimpactassessmentfor 2.3 against thepermitdecisionstobeadmissible. procedure forthesinglepermit,inordersubsequentappeals objections duringthepublicconsultationphaseinapplication Flemish region,itisinprinciplerequiredthatthirdpartiesfile administrative andjudicialappealagainstpermitdecisions.Inthe protection oftheenvironmentcan,undercertainconditions,alsofile Third parties,includingnot-for-profit organisations forthe (regional) CouncilforPermitDisputesintheFlemishregion. permit decisionsinthe Walloon andBrusselsCapitalregion,the before ajudicialreviewbody, i.e.,the(federal)CouncilofStatefor strict timelimitsbyanappeal(includingsummaryproceedings) Permit decisionsonadministrativeappealcanbechallengedwithin are providedforinitiatingsuchappeal. case forlarge projectsintheFlemishregion).Stricttimelimits decision hasbeenissuedbytheregionalauthorities(whichis environmental authority, exceptincaseswheretheinitialpermit the permitcanfileanadministrativeappealwithhigher burdensome environmentalconditions,thepersonapplyingfor In caseofrefusalanenvironmentalorsinglepermit, 2.2 have agreedtothesubstitutionoftheirdebtor. imposed bythesinglepermitunlessenvironmentalauthorities region, thecurrentoperatorwillremainliableforcharges notified ofthetransferenvironmentalpermit.InFlemish conditions, aslongtheenvironmentalauthoritieshavenotbeen damage duetonon-compliancewiththeenvironmentaloperating the currentoperatorwillbejointlyliablewithnewfor notification oftheenvironmentalauthorities.In Walloon region, transferred fromthecurrentoperatortoanewoperator, upon In thethreeregions,environmentalorsinglepermitcanbe environmental andbuildingpermit. certain projectsrequireasinglepermit,coveringboththe as wellthepermitforretailactivities.In Walloon region, environmental, building,allotmentandnatureconservationpermit permit isreplacedbyasinglecoveringtheformer an environmentalpermit.IntheFlemishregion, have animpactonhumanhealthandtheenvironmentaresubjectto In thethreeregions,specificallylistedactivitiesthatarelikelyto 2.1 Linklaters LLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 2 person toanother? polluting industriesorotherinstallations/projects? contained inanenvironmentalpermit? Environmental Permits environmental permitsbetransferredfromone Is itnecessarytoconductenvironmentalauditsor What rightsaretheretoappealagainstthedecisionof When isanenvironmentalpermitrequired,andmay environmental impactassessmentsforparticularly environmental permitorinrespectoftheconditions an environmentalregulatornottogrant

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

such collectionandprocessing. collection andprocessingofsuchwaste,tocollectivelyorganise FostPlus) arecreatedbythepersonslegallyresponsiblefor (“WEEE”) orpackagingwaste,sectororganisations (e.g.Recupel; containing waste.Forcertaincategoriesofwaste,suchaselectronic used batteries,end-of-lifevehicles,medicalwasteorasbestos special wastecategorycontainsamongothersoil,usedtyres, industrial wasteingeneral,hazardousandspecialwaste. The Additional obligationsapplytospecificcategoriesofwaste,suchas and end-of-wastestatus. also implementedtheEuropeanprovisionsrelatingtoby-products discards orintendsisrequiredtodiscard. The threeregionshave the threeregionsasanysubstanceorobjectwhichholder As intheEuropean Waste FrameworkDirective,wasteisdefinedin 3.1 entities, aprisonsentenceisconvertedintofine. the Flemishregion,deprivationofbenefits. With respecttolegal alternatively toadministrativesanctionsconsistingofafineand,in that canbesubjecttocriminalsanctions(prisonsentenceorfine) compliance withthepermitconditionsisanenvironmentaloffence case ofunsatisfactoryactionbytheoperator. Furthermore,non- administrative measures(suchasanordertoceasetheoperation)in Environmental authoritiescanissuenoticeletters,followedby 2.4 themselves orhand itovertodulyauthorised, registeredor Waste producershavetheobligationtoeithertreattheirownwaste 3.4 of thewasteorbycurrentpreviousholders. costs forwastemanagementaretobebornebytheinitialproducer Waste legislationinthethreeregionsexplicitlyprovidesthat 3.3 the environment. measures reasonablyrequiredtopreventharmhumanhealthand allowed withoutaspecificpermit,providedtheoperatortakesall site storageofwasteawaitingcollectionbyanaccreditedpartyis the sitewhereitwasgenerated.However, short-termtemporaryon- environmental orsinglepermit,evenifthewastewillbetreatedon definitive storageordisposalofwasteissubjecttoaprior permit, notificationoraccreditationforreceivingsuchwaste. The waste itselfortohanditoverapersonthathastherequired In general,theproducerofwastehasobligationeithertotreatits 3.2 3 waste involveadditionaldutiesorcontrols? have inconnectionwiththeviolationofpermits? regarding thetake-backandrecovery oftheirwaste? bankrupt/disappears)? and/or disposeofitonthesitewherewasproduced? Waste How iswastedefinedanddocertaincategoriesof What enforcementpowersdoenvironmentalregulators To whatextentdowasteproducers haveobligations the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin To whatextentisaproducerofwasteallowedtostore Belgium

injunction toceaseoperationsortheremovalofillegalwaste. measures imposedbytheenvironmentalauthorities,suchasan Breaches ofenvironmentallawcanalsogiverisetoadministrative establish thatthedefectisduetofaultybehaviour. from theguardianofsuchdefectivegood,withoutneedto by defectivegoods(suchaspollutedland)canalsoberecovered liable withouttheneedforproofoffaultybehaviour. Lossescaused exceeds theso-called“normalneighbourhoodnuisance”willbe emissions fromitsfacility. Also, thepersoncausing nuisancethat environmental orsinglepermitforrecentsoilpollutioncausedby producer oftoxicwasteortheoperatorafacilitysubjecttoan behaviour, such as theliabilityofoperatoranuclearplant, provided forinspecificlawswhichdonotrequiretheproofoffaulty Civil lawliabilitycanalsobebasedonastrictregime link betweensuchbehaviouranditsloss. recently causedorwhenthepermitwascompliedwith)causal proving thefaultybehaviour(inparticular, whenthelosswasnot burden ofproofrestsonthevictim,whomighthavedifficulties in specific rulesandconditionswiththegeneraldutyofcare. The both. Faultybehaviourcanconsistofnon-compliancewithboth the existenceofafaultybehaviour, itslossandacausallinkbetween of thepersonhavingcausedlossifthatthirdpartycanestablish environmental lawsorpermits,caninvokethecivillawtortliability First, thirdpartieshavingsuffered alossduetobreachof 4.1 Linklaters LLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 value wasexceeded. with thisenvironmentaldutyofcare, evenifnoenvironmentallimit conditions. They canthereforebeliablefornothavingcomplied mere compliancewiththeenvironmental orsinglepermit any risks,dangersorlossescaused bytheactivity, inadditionto must complywiththegeneralobligation toavoid,reduceormitigate Operators ofactivitiessubjecttoanenvironmentalorsinglepermit 4.2 collection andmanagementofthepackagingwaste. responsible forintroducingpackagingintothemarketasregards tyres, electronicwaste,batteries,etc.). The sameappliestopersons their economiclife(theextendedproducerresponsibilityfor, e.g., collect andprocesswastegeneratedbytheseproductsattheendof Producers ofspecificproductsmayhavethelegalobligationto not haveanobligationtotakebackthewastetheygenerated. accredited personsthatcanreceivethiswaste. Waste producersdo such claimoraction. all conditionsfortheliabilityarepresenttodefenditselfagainst nature oftheliabilityinvolved,operatorshouldverifywhether Depending onthelegalbasisofanyclaimoraction,aswell European EnvironmentalLiabilityDirective. and naturalhabitats,basedonthenationalimplementationof remedy damagecausedtothewater, thesoilorprotectedspecies activities willberesponsible Finally, underspecificconditionsoperatorsofcertainlisted imposed upontheoperator. Environmental offences canentailcriminaloradministrativefines © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 4 what defencesaretypicallyavailable? within permitlimits? Liabilities breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage vis-à-vis theauthoritiestopreventor

cannot becoveredbyinsurance. can beexcludedfromcover. Criminalsanctions,suchasfines, can inprinciplebecovered,butspecificcasesofgrossnegligence corporation; however, fraudwillnotbecovered.Grossnegligence Civil lawliabilityofdirectorsandofficers canbeinsuredbythe committed themostseriousfault. establish whetheritwastheindividualorlegalentitythat accomplices togetherwiththecompany, withouttheneedto criminally liableeitherontheirownorasco-offenders or offences committedafterthatdate,directorsandofficers canbeheld the company, foroffences committeduntil29July2018.For officer wilfullyandknowinglycommittedtheoffence, togetherwith alone iftheycommittedthemostseriousfaultor, ifthedirectoror can alsobeheldcriminallyliableforenvironmentaloffences, either fault whensuchoccursinausualway. The directororofficer will onlybetriggeredincaseoffraud,grossnegligence,orminor or officer isanemployeeofthecorporation,theircivillawliability à-vis thirdpartiesforlossescausedbythisbehaviour. Ifthedirector performance oftheirfunction,thecompanywillbejointlyliable general dutyofcare. When thedirectororofficer actsinthe compliance withspecificlegalorregulatoryprovisionsthe vis thirdpartiesforanyfaultybehaviourconsistingofnon- In principle,adirectororofficer ofacorporationcanbeliable 4.3 obligations donotapplyintheevent ofasharesale. the databaserelatingtocondition ofthesoil. These soil environmental permitmusthandover tothetransfereeanextractof from 1January2019thetransferor ofaplotlandoran can alsobeassumedbythetransferee. Inthe Walloon region,as contamination, coveredbyafinancialguarantee. These obligations transferor providetheagencywithanundertakingtocleanup are required,theclosingmustbepostponedandmayrequirethat have beencarriedouton-site.Iffurthersurveysorsoilremediation specific listedactivities,likelytocausesoilcontamination,areor agency andtoatleastperformasoilsurveypriorclosingif over tothetransfereeasoilcertificateissuedbyenvironmental an environmentalpermitforriskactivities)theobligationtohand the transferorofaplotland(andinBrusselsCapitalregion, legislation intheFlemishandBrusselsCapitalregion,imposingon Moreover, anassetsaletriggerstransferobligationsunderthesoil the operatorremainssameentity. notification oftransferisnotrequiredintheeventasharesale,as permit-granting authoritiesofthetransferpermit.Such single permit,thenewandpreviousoperatorsmustnotify In anassetdealrelatingtoactivitiessubjectenvironmentalor are notdiscontinued. environment (suchassoilcontamination)ifthepreviousactivities previous andthenewoperatorwithrespecttocertainimpactson operator. However, itmayprovedifficult todistinguishbetweenthe purchase, thepastliabilitiesremain,inprinciple,withprevious liabilities, includingthoserelatingtoprevioussites.Inanasset In asharesale,thepurchaserbuyscompanywithallits 4.4 indemnity protectioninrespectofsuchliabilities? the onehandandanassetpurchaseonother? to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman WWW.ICLG.COM Belgium

vis-à- vis-

31 Belgium 32 Belgium remediation, eveniftheydidnotcausethecontamination. among others,thepersonsthatmustperformsurveysand in thespecificpiecesoflegislationonsoilcontaminationthatidentify, the onehand,legalsurveyandclean-upobligationsarecontained civil liabilityforthecostsandlossescausedbysoilcontamination.On obligation toperformsoilsurveysandremedialactivities),the A distinction ismadebetweentheregulatoryframework(i.e.,legal 5.1 indispensable orusefulmanner. they participatewillinglyandknowinglyintheseoffences inan offences, lenderscouldbedeemedco-offenders oraccomplicesif extended liability. As regardscriminalliabilityforenvironmental meetings oftheboarddirectorasanobserver, doesnotentailsuch borrower topresentacandidatefordirectorshiporattendthe the lenderofdecisionsmadebyborrower, ortherightfor facto liability forlossescausedbytheborroweriftheybehaveasa caused bytheborrower. However, lenderscouldincurcivillaw Lenders are,inprinciple,notliableforenvironmentaldamage 4.5 Linklaters LLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM performance ofsoilsurveys,which aredifferent inthethreeregions. The soillegislationprovidesforvarious triggeringfactorsforthe cleaned upassoonthesestandards areexceeded. standards andposesathreat,whereas newcontaminationmustbe 2007) willneedtobecleanedupwhenitcumulativelyexceedscertain the ownerofland.Historiccontamination(causedpriorto30 April listed activity, totheuser, andultimatelytotheownerof theland. and soilremediationiscascadeddown,startingfromtheoperatorofa In theFlemishregion,responsibilityforperformingsoilsurveys responsibility forperformingsoilsurveysandremediation. generated. These specificpiecesoflegislationdealwiththelegal applying toanycontamination,independentfromthetimeitwas The threeregionshaveadoptedspecificsoilcontaminationlegislation, contamination legislationorinthegeneralliabilityrules. liability forsoilcontaminationisdealtwitheitherinthespecific order toimposesurveysandremediation.Ontheotherhand,civillaw Environmental agencieswillonlyturntotheseidentifiedpersonsin responsibility toperform surveysandremediation. The legislationalsoprovidesforspecific exemptionsfromthelegal the operator, ortheholdersofrights performs theseobligations,thepersonthatcausedcontamination, remediation fall,indescendingorder, uponthepersonthatvoluntarily In the Walloon region,thelegalobligationstoperformsoilsurveys and remediation method(riskmanagementorclean-up)mayvary. contamination; thepersonholdingrights and treatment(thecurrentoperatororthepersonhavingcaused contamination, thepersonhavinglegalresponsibilityforsurvey mixed ororphancontamination.Dependingonthenatureof In theBrusselsCapitalregion,adistinctionismadebetweensingle, specific standardsareexceeded. assessment. Newcontaminationmustbecleanedupassoon have tobecleanedupifitposesaseriousthreat,basedonrisk Historic soilcontamination(predating29October1995)willonly 5 directororofficer oftheborrower. The merefactofinforming environmental wrongdoingand/orremediationcosts? groundwater? Contaminated Land What istheapproachtoliabilityforcontamination To whatextentmaylendersbeliablefor (including historiccontamination)ofsoilor in rem onthelandandeventually in rem) aswellthe

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

de

common faultybehaviourthatcausedthecontamination. whether distinctfaultsconcurredortherewasonlyone liability willeitherbe by contaminationforwhichmorethanonepersonisliable,this As regardsthecivilliabilityregimeforlossescausedtothirdparties the environmentalagency. parties willeitherbedeterminedbasedoncivilliabilityrulesorby The allocationforpaymentofthecostsclean-upbetween authorities canimposeajointclean-upuponallpersonsconcerned. for thatcontamination.Inthelattersituation,environmental obligation, ormorethanonepersonhasthelegalclean-upobligation distinct persons:eitheronlyonepersonhasthelegalclean-up Two situationscanoccurwherecontaminationwascausedby 5.2 estimated costsofsuchclean-up. provides afinancialguarantee to theauthoritiescovering a thirdparty(suchaspurchaser oftheland),providedlatter up contaminatedlandcanundercertain circumstancesbeshiftedto owner/occupier. However, ingeneralthelegalobligation toclean on theregion,inmostcases notliewiththeprevious The legalobligationstocleanupthecontaminationwill,depending clause inasaleagreement). representations andwarranties,indemnificationor“holdharmless” can bebasedonanextra-contractualoracontractualbasis(specific established andtheclaimisnottime-barred.Suchcompensation by thelatter, providedtheconditionsforcivilliabilityare owner oroccupierforcostsassociatedwithcontaminationcaused A personcan,inprinciple,claimcompensationfromaprevious 5.4 remediation oruponitsowninitiative. the remediationplanuponrequestofpersoncarryingout Walloon region). The relevantenvironmentalagencycanmodify (although thirdpartiescannotfileanadministrativeappealinthe by thirdpartiesthroughanadministrativeorjudicialreviewappeal decisions canbechallengedbythepersonfilingplan,aswell by theenvironmentalagencyoradministrationincharge. Such In eachofthethreeregions,remediationplanmustbeapproved 5.3 contained inthesoillegislation. the generalcivilliabilityrulesoronspecific parties havingsuffered alosscanalsoclaimcompensationbasedon polluter liableforthecostscausedbycontamination. Third liability rulesthatmayapplyundercertainconditions,renderingthe addition, thesoilcontaminationlegislationcontainsspecificstrict under generalcivilliabilitylawtorecoverthecoststhereof.In carried outtheremedialactivitiescanturntopersonthatisliable In thethreeregions,personhavingperformedsurveysand is responsibleforthecontamination? contaminated landliabilitytoapurchaser? can athirdpartychallengetheagreement? How isliabilityallocatedwheremorethanoneperson possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis in solidumorjointandseveral,dependingon

Belgium

compensation forenvironmentaldamagetocollectivegoods. of theCivilCodehas,todate,notbeenusedprovideforruleson compensation tothepublicauthorities.Further, theongoingreform operator. However, nocaselawprecedentsareavailablegranting protected species,naturalhabitats,waterbodiesandlandfromthe costs ofmeasurestheyundertooktopreventorrepairdamage Directive, theauthoritiescan,undercertainconditions,recover under thenationalimplementationofEnvironmentalLiability can provethatthepollutercausedspecificpollution.Inaddition, for civilliabilityaremet;thisimplies, polluter foranydamagetoapublicasset,providedtheconditions The publicauthoritiescanclaimmonetarycompensationfromthe 5.5 Linklaters LLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 (known as“VlaremII”). cause pollution,underthegeneral environmentalregulations Directive –“IED”)or, ingeneral,ofaccidentalemissions thatcould Directive (“IPPC”)(nowreplaced bytheEUIndustrialEmissions (previous) EUIntegratedPollutionPreventionandControl environmental conditionsapplicabletoactivitiesfallingunderthe environmental liabilityrulesandincaseofnon-compliancewith duty incaseof(threatening)environmentaldamageunderthe contamination. However, theoperatorhasageneralnotification soil contaminationrulesincaseofanincidentthatcaused the Flemishregion,suchnotificationisonlymandatoryunder affected thirdparties,including inthecaseofoff-site migration.In contamination mustinformtheenvironmentalauthoritiesand In the Walloon andBrusselsCapitalregions,anypersondiscovering 7.1 visual means. assistance ofthepoliceforceorexternalexpertsanduseaudio- premises, installationsorvehicles. They canalsorequirethe impose measurestosafeguardtheevidence,e.g.bysealing samples, aswellvehiclesorshipsandtheircargo. They can site personnelandtoinvestigateobjects,includingtherighttake (including accesstoelectronicdatabases);andtherightinterview powers, suchas:accesstothepremises;information The environmentalinspectionserviceshavebroadinvestigation 6.1 parties. contractual protectionfromitspurchaseragainstclaimsofthird depending ontheeconomicsofasale,pollutermightobtain Civil lawliability © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 6 7 conduct siteinspections,interviewemployees,etc.? public assets,e.g.rivers? parties? Powers ofRegulators Reporting /DisclosureObligations polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe What powersdoenvironmentalregulatorshaveto environmental regulatororpotentiallyaffectedthird require productionofdocuments,takesamples, vis-à-vis thirdpartiescannotbeshifted,but inter alia , thattheauthorities

accurately assessthevalueoftarget. the purchaserwithsufficient informationforthelattertobeable Also, undergeneralcivillaw, thesellerhasanobligationtoprovide to theclosingoftransaction. financial guaranteeinfavouroftheenvironmentalauthorities,prior provide anundertakingtotreatthecontamination,backedbya obligation toperformsoilsurveysand,iftreatmentisrequired, land onwhichriskactivitieshavetakenplace,givesrisetothe addition, intheFlemishandBrusselsCapitalregions,transferof the obligationtohandoverasoilcertificatetransferee.In and corporaterestructuringsuchasmerger anddemerger) triggers broad senseincluding,amongothers,thegrantingofrights In thethreeregions,transferofland(whichisdescribedina 7.3 applications forbuilding,environmentalorsinglepermits. indications ofsignificantsoilcontamination,orpriortocertain activity, orduringtheoperationofcertainactivities,whenthereare transferring land,startingorceasingtheoperationofalistedrisk events triggeringanobligationtoinvestigatetheland,suchaswhen The soillegislationinthethreeregionsprovidesforaseriesof 7.2 must issueareport onthestatementofassets andliabilities, liabilities thatarenotyetcovered bysuchprovision. The auditor time foranyoff-balance sheetliabilities,suchasenvironmental assets andliabilities,includingprovisions thatmustbemadeat and liquidatethecompany, thelattermustestablishastatementof environmental liabilityisnotsoeasy. Priortodecidingdissolve Dissolving acompanymerely with theaimofavoidingany risk ofexposureinthefuture. in itsaccountsforanyenvironmentalliabilitythatentailsarealistic According toaccountingrules,acompanymustregisterprovisions 8.2 indemnifier. the authoritiesorthirdpartiesclaimcompensationdirectlyfrom will thereforenotreleasetheindemnifierfromanyliability, should Any paymentmadebytheindemnifiertoindemnifiedperson environmental authoritiesorthirdpartiesclaimingcompensation. between partiestothecontractandcannotbeinvokedagainst limit theclaimsofpurchaser. They are,however, onlyvalid Contractual indemnitiesrelatingtoenvironmentalliabilitiescan 8.1 8 takeover transactions? contamination? order toescapeenvironmentalliabilities? potential liabilityforthatmatter? General prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto To whatextentisitnecessarytodisclose have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- Is itpossibletouseanenvironmentalindemnity WWW.ICLG.COM

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33 Belgium 34 Belgium first-demand bankguarantee. clean upthatpollution,backedbyafinancialguaranteesuchas transferor ortransferee surveys andifrequired,toapriorexplicitundertakingbythe Flemish andBrusselsCapitalregions,tothepriorperformingofsoil Also, thetransferofaplotpollutedlandwillbesubject,in which noconsignmentwasmade. could beheldliableforanyliabilitythathasnotbeensettledor liquidation (orsufficient fundswillbeconsigned). The liquidator explain howthesewillbepaidpriortothedissolutionand class actioncanbe initiatedincaseofbreachesenvironmental law. suffered byconsumersincaseofbreachspecificlegislations. No The EconomicLawCodeprovides foraclassactionincaseofharm 8.5 committed withinthelegalentityinwhichtheyareemployed. against theiremployersincaseofreportingenvironmentalissues There isnogenerallawthatoffers protectiontowhistle-blowers 8.4 pollution generatedbythisforeignsubsidiary. by aBelgiancourtforbreachesofenvironmentallawcommittedor foreign subsidiaryhavebeenfinedororderedtopaycompensation offences. NoprecedentisknownwhereBelgianshareholdersofa both incivillawmattersand,undercertainconditions,forcriminal offences theythemselvescommittedoutsideBelgium;thisapplies In principle,Belgianshareholderscanbesuedinacourtfor subsidiary. committed anoffence asa(co-)offender oraccomplice ofthe established thattheshareholderitselfadoptedfaultybehaviouror criminal lawforactscommittedbyitssubsidiary, provideditcanbe The shareholdermayalsobehelddirectlyliableundercivilor latter. court ontheoperator, andthatwerenotpaidorimplementedbythe out certainmeasuresthatwereimposedbytheadministrationor controlling shareholdersshallbeboundtopaythefinesandcarry liquidation, judicialreorganisation orbankruptcyofanoperator, its In addition,the Walloon EnvironmentCodeprovidesthatafter applied onlyinextremecircumstances. personality (anddecision-makingpowers). This caselawhasbeen the shareholderstotallydisregardedsubsidiary’s ownlegal shareholders behavedasthe“master”ofsubsidiary, i.e.,when shareholders couldbeliablefortheirsubsidiariesprovidedthe certain caselawhasacceptedthatinexceptionalcircumstances are notliablefortheactsoromissionsofsubsidiary. However, of thesubsidiaryandshareholdersentailsthat Under generalBelgiancompanylaw, theseparatelegalpersonality 8.3 Linklaters LLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM debts company inacomplete,faithfulandaccuratemanner. Ifnotall indicating whetherthisstatementreflectsthesituationof vis-à-vis thirdpartieshaveyetbeenpaid,theboardshould damages available? report environmentalviolations/matters? caused byaforeignsubsidiary/affiliate? environmental claims,andare penal orexemplary Are groupor“class”actionsavailableforpursuing Are thereanylawstoprotect“whistle-blowers”who liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent vis-à-vis theenvironmentalauthoritiesto

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Reserve). to decreasethesurplus(e.g.backloading;futureMarketStability allowances beingavailable,severalmeasuresweretakenatEUlevel Since themarketwasnotfunctioningproperlyduetotoomany at EUleveldecreaseseachyear. allowances throughauctions. The totalcapofallowancesavailable for free,coveringpartoftheiremissions,and/ormustobtainthese Operators subjecttotheEUETSwilleitherbegrantedallowances claim isdismissed. these costs,includingtheproceduralcostsindemnity, whentheir the costsoflegalproceedings. As anyotherparty, theyshouldpay Individuals orpublicinterestgroupsarenotexemptedfrompaying 8.6 programmes atboth thefederalandregionallevels. A political The nationalclimatechangepolicy consistsofactionsand 9.3 requirements regardinggreenhousegasemissions. within theEUETS,therearenospecificmonitoringorreporting environmental regulationsapplicabletogreenhousegasinstallations Apart fromthemonitoringandreportingobligationsimposedby 9.2 period. As of2013,theEUETShasbeenharmonisedatlevel. approval bytheCommissionandthatcoveredaspecifictrading granted basedonnationalallocationplansthatweresubjectto as totheaviationsector. Initially, theemission allowances were energy-intensive industriesandtheenergy generationsector, aswell trade” systemapplicabletoemittersofgreenhousegasesfrom EU Emissions Trading System (“EUETS”),whichisa“capand Only oneemissionstradingschemeisoperationalinBelgium,the 9.1 certain actionsonthedefendantandcanimposean“ the frameworkofsuchproceedings,courtcanimpose/prohibit by equivalent(inmoney),incivilliabilityproceedings.However, in obtain compensationofitsentire(directandindirect)loss,inkindor with environmentallawsbytheoperatororfromsoilpollutioncan damages. A victimthathassuffered damagesfromnon-compliance Belgian lawdoesnotknowtheconceptofexemplaryorpunitive relating toenvironmentalprotection. provided theymeetcertainconditionsinrespectoftheiractivities with thecourtincaseof(threatof)seriousenvironmentalbreaches, Not-for-profit organisations caninitiatecease-and-desistproceedings the victimifhedoesnotcomplywithcourtorder. or asalumpsumpernon-compliance)thatthedefendantmustpay a lump-sumpenaltypayment(e.g.aslumpsumperdayofdefault 9 pursuing environmentallitigation? regulation inyourjurisdiction? to monitorandreportgreenhousegasemissions? market developingthere? Emissions Trading andClimateChange any exemptionfromliabilitytopaycostswhen Do individualsorpublicinterestgroupsbenefitfrom What istheoverallpolicyapproach toclimatechange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation

Belgium astreinte

”, i.e.

person liable;i.e.,inmostcases,theemployer. beneficiaries waivetheirrighttoclaimcompensationfromthe diseases ortheirheirs.Oneoftheseconditionsisthatthe under certainconditions,compensatepersonssuffering fromthese occupational diseases. A governmentalsocialsecurityfundcan, Mesothelioma andasbestosiscontractedduetoexposureatworkare property canentailthedissolutionofasaleorleaseagreement. to decideonthequestionwhetherpresenceofasbestosina neighbouring propertyhasalsobeengranted.Somecourtshad asbestos-containing materialstobedischarged ontothe paid bytheneighbourhavingperformedillegalworkscausing pay damagestothirdpartiesinsuchsituation.Compensationbe performed inbreachofthesafetystandards,aswellorderedto removal havebeenheldcriminallyliablebecauseofworks asbestos andmesothelioma.Contractorsincharge ofasbestos knowledge theproducershouldhavehadoflinkbetween measures topreventtheasbestosexposure,notwithstanding the producerfailedinitsdutyofcarebynottakingsufficient safety facility. The courtheldthattheclaimwasnottime-barred,and environmental exposureduetotheirlivingneartheproduction as aformerstaff memberoftheasbestosproductionfacilityandby that hadbeenexposedtoasbestosdustbroughthomebyherspouse producer topaycompensationfortheillnessanddeathofaperson asbestos. A 2017courtdecisioninappealorderedaformerasbestos There islimitedcaselawavailableonvariousaspectsrelatedto 10.1 Linklaters LLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 exposed toasbestos. Suchemployeesmustalso bemedically safety. The employermustalsokeep aregisterofemployeesthatare notify therelevantadministrationin charge ofoccupationalhealth and to asbestos,theemployermustperform ariskassessmentandmust accredited contractors.Priortoany worksentailingariskofexposure building. Removalworksofasbestos canonlybeperformedby plan mustbesharedwithcontractors carryingoutworksinthe the asbestosisinabadcondition. The inventoryandmanagement contains preventionmeasuresaswelltobetakenwhen containing materials. This planrequiresregularinspectionsand to theextentpossible,exposureofemployeesasbestos- asbestos ispresent,anmanagementplanaimingatlimiting, building. Employersmustestablishanasbestosinventoryand,if and safetylegislation,regardlessofwhethertheemployerowns site are,asarule,imposedupontheemployer, baseduponthehealth materials mustbeestablished. The dutiesinrelationtoasbestoson- of thesematerialsmustbemonitored,andaplanformanaging asbestos-containing materials. Therefore, thepresenceandcondition was bannedin1998and2001.However, manybuildingsstillcontain The useandputtingonthemarketofasbestos-containingapplications 10.2 buildings) andadaptation(e.g.incaseofflooding). mitigation (e.g.greenhousegasemissionsfromtransportand allowances). The regionshavedrawnupregionalplansrelatingto energy efficiency, andallocationofproceedsauctions in greenhousegasesnon-EUETSsectors,renewableenergy, federal andregionallevels,ofthenationaltargets for2020(reduction agreement hasbeenconcludedonburden-sharing,betweenthe © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 10 jurisdiction? in relationtoasbestoson-site? What istheexperienceofasbestoslitigationinyour What arethedutiesofowners/occupierspremises Asbestos

provided. plan, specificfinancialsupportforremovalmayalsohavetobe governmental buildingsby2034and2040. According totheaction remove asbestos-containingmaterialslikelytoposeariskfrom building likelytocontainasbestos,aswelltheobligation inventory atanysale(probablyasofend2021,early2022)a to preventdamagethirdparties,andthepresenceofanasbestos inter alia 2040”). To thateffect, draftlegislationisbeingprepared imposing, they (may)releaseasbestosfibres(“AsbestosSafeFlemishRegion asbestos-containing materialswhichareinsuchaconditionthat abatement actionplaninordertoacceleratetheremoval,by2040,of In 2018,theFlemishregionalgovernmentadoptedanasbestos receive adequatetraining. relating totherisks,safetyandpreventionmeasures. They mustalso employer mustprovideaccurateinformationtotheseemployees examined priortoandatregularintervalsduringsuchexposure. The environmental insuranceisusedinanacquisitioncontext. compared totherisksfromoperations.Fromtimetime, In theBelgianmarket,environmentalinsurancecoverageisstilllow a soilremediationbudgetincaseoflarge clean-upprojects. assessment costs.Coveragecanalsobeprovidedfortheexceedingof third-party bodilyinjuryandpropertydamage,defence can extendtomitigationcosts,on-siteandoff-site clean-upcosts, damage, directorimmaterialloss,andbiodiversitydamage.Coverage insurance cancoversuddenaccidentalorgradualenvironmental information andsometimesonanenvironmentalaudit.Environmental specific activitiesandrisksposedbytheoperator, basedondetailed environmental riskinsurancewillbetailor-made, dependingonthe risk byavoluntaryenvironmentalinsurancecontract.Such addition, operatorsofactivitieslikelytocausepollutioncancoversuch treatment installations,servicestations,ormaritimeoiltransport.In coverage, suchastheoperationofnuclearinstallations,waste Several typesofactivitiesaresubjecttomandatoryinsurance 11.1 Flemish region, covering theformerenvironmental, building, In 2018,thenewsinglepermithas becomefullyoperationalinthe 12.1 by asuddenincident,noclaimcouldbemadeagainsttheinsurer. operator. The courtdecidedthatsince thepollutionwasnotcaused (which wasnotatailor-made environmentalriskinsurance)ofthe service stationwascoveredbytheordinarycivilliabilityinsurance whether soilcontaminationcausedbytheoperationofapetrol rare. Onecourtdecisionrelatestothequestion,amongothers,of Published caselawrelatingtoenvironmentalinsuranceclaimsis 11.2 11 12 risks insuranceplayinyourjurisdiction? in environmentlawyourjurisdiction. experience inyourjurisdiction? in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable summary ofanynewcases,trends anddevelopments Please provide,innomorethan 300words,a What istheenvironmentalinsuranceclaims , thedutyforamanagerofbuildingcontainingasbestos Environmental InsuranceLiabilities Updates

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35 Belgium 36 Belgium Linklaters LLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM adopted in2018thatwillenterintoforceon1January2019,and In the Walloon region,newlegislationonsoilcontaminationhasbeen substantial newrulesonlandplanning. contamination by2036. The Flemishparliamentalsoadoptedvarious surveys, tostepuptheefforts tocleanupallhistoricsoil legislation andintroducinganewtriggeringfactorformandatorysoil The Flemishparliamentalsoadoptedabillmodifyingthesoil administrative finesfornon-compliancewithlandplanningrules. including anadministrativeenforcementregimethrough enforcement havealsobeenadaptedtothisnewintegratedpermit, (regional) CouncilforPermitDisputes. The rulesonenvironmental Minister ofEnvironmentandajudicialreviewprocedurewiththe including thegrantingofpermitforlarge projectsbytheFlemish period. The permitapplicationrulesarealsosignificantlymodified, time, whereastheexistingenvironmentalpermithasalimitedvalidity permit forlarge retailsites. This permitisgrantedforanindefinite allotment andaspecificnatureconservationpermit,aswellthe to helpourclientsnavigateimportantbusinesschallengessuccessfully. commitment toexcellenceensurethehigheststandardsofqualityandservice acrossallourrelationships.We teamworkandagility bringdiscipline, and to helpclientspursueopportunitiesandmanageriskacrossemerging developedmarketsaroundtheworld.Ourglobalapproach Linklaters isaleadinggloballawfirm,supportingclientsinachievingtheirstrategies wherevertheydobusiness.We expertiseandresources useour compliance issues. courts onpost-acquisitionclaims,appealsagainstpermitsandnon- Constitutional CourtandCouncilofState,administrativecriminal Lieve assistsclientsinlegalproceedingsbeforethecivilcourts, wind turbinesandoffshore windfarms),andnuclearsafetycontrol. regulatory andpermitissues,energyfromrenewablesources(onshore planning. Lievealsospecialisesinenergylaw, coveringgeneral contamination, emissionstrading,wastemanagementandland various regulatoryandliabilityissuesrelatedtopermits,soil estate transactions.Herpractice,however, dealstoalargeextentwith and publiclawteamcontinuouslyadvisesonmajorcorporatereal law, includinglandplanning.Underherleadership,theenvironmental Lieve hasbeenaPartnersince1991andspecialisesinenvironmental URL: Email: Tel: Belgium 1000 Brussels Brederodestraat 13 Linklaters LLP Lieve Swartenbroux www.linklaters.com [email protected] +32 25019411 ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

policy planisbeingprepared. in theFlemishlandplanningcode,anddraftspatial instruments consistingofspatialpolicyplanshavebeenintroduced asbestos isexpected. As regardslandplanning,newplanning rules regardingthemanagementandacceleratedremovalof 2018/410 onEUETS.IntheFlemishregion,adoptionof waste (amongothers,Directive2018/851)aswell In 2019,theregionswillneedtotransposenewEUdirectiveson adoption oflandplanninginstruments. programmes orplansthatmighthaveanimportantimpactonthe regarding theneedforstrategicenvironmentalassessment In 2018,theEuropeanCourtofJusticehasissuedtwodecisions adopted in2017thatwillenterintoforceon20 April 2019. In theBrusselsCapitalregion,anewlandplanningcodewas land (wherebythetransferofisdefinedinabroadsense). introduces soilinformationobligationsintheeventofatransfer real estatetransactions. the LinklatersRealEstateGroup,Melissaisalsoinvolvedinvarious public andadministrativelaw, includingpublicprocurement. As partof specifically environmentallawandtownplanning,isspecialisedin of experience.Shehasexperienceinrealestatelaw, andmore Melissa isan Associate intheLinklatersBrusselsoffice withsixyears URL: Email: Tel: Belgium 1000 Brussels Brederodestraat 13 Linklaters LLP Melissa Verplancke www.linklaters.com [email protected] +32 25019411 Belgium

Chapter 7 Brazil Roberta Danelon Leonhardt

Machado Meyer Advogados Daniela Stump

1 Environmental Policy and its In addition, the public may investigate any complaints from the public regarding non-compliance. Enforcement

1.3 To what extent are public authorities required to 1.1 What is the basis of environmental policy in your provide environment-related information to interested jurisdiction and which agencies/bodies administer persons (including members of the public)? and enforce environmental law? According to Federal Law No. 10,650/2003, the public authorities The purpose of the Environmental National Policy (Federal Law shall grant public access to any environment-related information, No. 6,938/1981) is the preservation, improvement and recovery of especially regarding: ; environmental policies; the environmental quality, in order to ensure socio-economic plans and programmes; accidents, risk and emergency situations; development, the interests of national security and the protection of discharge of wastewater, atmospheric emissions and generation of human rights. waste; toxic and hazardous substances; biological diversity; and The Federal Constitution sets forth the duty to preserve the genetically modified organisms (GMOs). Exceptions are made for environment for future generations and sets out criminal and confidential information. administrative sanctions, both for individual and legal entities, as well as the obligation to repair environmental damage. 2 Environmental Permits The competent licensing authority enforces the environmental law and, in case of an omission, the other environmental authorities may step in. 2.1 When is an environmental permit required, and may environmental permits be transferred from one The federal environmental agency, the Brazilian Institute for person to another? Environment and Natural Renewable Resources (IBAMA), has jurisdiction for licensing depending on the locality and the Pursuant to the National Environmental Policy, the construction, characteristics of the enterprise (i.e. nuclear power plants, installation, expansion and operation of any establishment or hydroelectric power plan, among others). The municipal activity that uses environmental resources, deemed as polluting or environmental agencies have jurisdiction to enterprises and potentially polluting, or that could possibly cause any kind of activities with a local impact, while the state environmental agencies environmental damage, is subject to a prior licensing proceeding. have general jurisdiction over the environmental licensing proceedings of enterprises and activities that are not covered by federal or The environmental licence may be transferred from one titleholder municipal agencies. In addition, the public prosecutors monitor to another at any time, provided the successor fulfils the licensing compliance with the environmental legislation, as well as seek the requirements. recovery, repair and compensation of any environmental damage. 2.2 What rights are there to appeal against the decision of 1.2 What approach do such agencies/bodies take to the an environmental regulator not to grant an enforcement of environmental law? environmental permit or in respect of the conditions contained in an environmental permit?

The licensing environmental agencies periodically perform site All administrative decisions – including the decision on the granting inspections to verify unauthorised vegetation removals, intervention of an environmental licence – may be challenged by means of an in protected areas (i.e. permanent preservation areas), potentially Administrative Appeal. The environmental authorities may foresee polluting enterprises, among others, and in case any environmental different procedures for challenging the denial of an environmental damage and/or non-compliance is identified, the agency may licence. impose administrative sanctions, such as warnings, fines and embargoes, and also ensure the recovery of the environmental A Judicial Lawsuit may also be filed seeking the annulment of an damages. In addition, such authorities may communicate any illegal administrative decision. suspicion of environmental to the and Public ’s Offices.

ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 WWW.ICLG.COM 37 © Published and reproduced with kind permission by Global Legal Group Ltd, London 38 Brazil penalties. activities beyondthosewhichare permitted,itmaybesubjectto by theenvironmentalauthority. Incasethecompanycarriesoutany To theextentthatstorageordisposalofitswasteisdulylicensed 3.2 storage andexportation. additional authorisationsmayberequiredfortheirtransportation, (such asinflammability, corrosivity, reactivityandtoxicity).Some public healthorenvironmentalqualityduetocertaincharacteristics controls. Itisalsodefinedaswasteinvolvingsubstantialrisksto Hazardous wasteisacategoryofsubjecttosomeadditional activities insociety, whosefinaldisposalisrequired. waste isamaterialorsubstancediscardedasresultofhuman 12,305/2010), thedefinitionofwasteisverybroad.Inanutshell, Pursuant totheNationalSolid Waste Policy(FederalLawNo. 3.1 damages caused. administrative sanctions,besidestheobligationtoredressany deemed pollutingorpotentiallyissubjecttocriminaland The absenceofenvironmentallicencesforenterprisesoractivities environmental licensing. risks oriffalseand/ormissinginformationwasprovidedduringthe cancelled incaseofsuperveningsevereenvironmentalorhealth conditions setforthinthelicences.Inaddition,licencemightbe case ofabreachenvironmentalrulesoranythetechnical The environmentalauthoritiescansuspendorcancelthepermitin 2.4 task involvingamultidisciplinaryteamandsignificantexpenditure. Report ofEnvironmentalImpact(EIA/RIMA):atime-consuming study referredtoasanEnvironmentalImpact Assessment andrelated environment aresubjecttothepreparationofadetailedtechnical The projectscapableofcausingsignificantimpacttothe complex evaluationscontemplatingmultidisciplinaryaspects. on that,entrepreneursmayberequiredtoconductsimplifiedor according tothepotentialenvironmentalimpacts,and,depending the installation. The comprehensivenessofthestudiesvaries caused bysuchactivities,aswelltheconditionsoflocation their intendedactivitiesandenvironmentalimpactsthatmaybe prepare technicalstudiesdemonstratingthemaincharacteristicsof In ordertosupportenvironmentallicensing,entrepreneursmust 2.3 Machado MeyerAdvogados © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 3 polluting industriesorotherinstallations/projects? produced? waste involveadditionaldutiesorcontrols? permits? Waste regulators haveinconnectionwiththeviolationof and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore How iswastedefinedanddocertaincategoriesof What enforcementpowersdoenvironmental Is itnecessarytoconductenvironmentalauditsor environmental impactassessmentsforparticularly

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environmental licencestotheadoptionofreverselogisticsmeasures. states, suchasSãoPaulo,havealreadyconditionedtheissuanceof mentioning thatthesubjectiscurrentlyinfocusBrazilandsome implemented jointlyorindividuallybycompanies.Itisworth other destinations. The reverselogisticssystemsmaybe at theirreuseintheindustrialcycleorotherproductivecycles, means toenablethecollectionandrecoveryofsolidresidues,aimed logistics systems(take-backsystems),actions,proceduresandthe provides thatsomeindustrialsectorsshallimplementreverse public services. With regardtosharedresponsibility, thelaw importers, distributorsandretailers,consumerstheoperatorsof for thelife-cycleofproducts,whichincludesmanufacturers, The NationalSolid Waste Policysetsforththesharedresponsibility 3.4 severally responsibleforenvironmentalrecovery. producer canbeconsideredanindirectpolluter, itmaybejointlyand affected byitsactivity(whichisthestrictliability). As thewaste repair thedamagescausedtoenvironmentandthirdparties, Policy, thepolluterisobliged,independentlyoffault,toindemnifyor of liabilityfordamages.PursuanttotheNationalEnvironmental and groundwater, mayleadtotheimpositionofpenaltiesirrespective disposal ofsolidwaste,asapotentialsourcecontaminationsoil According totheNationalSolid Waste Policy, theinadequate 3.3 ■ ■ environmental lawsand/orpermits,asfollows: There arethreetypesofliabilitythatmayariseduetobreach 4.1 4 regarding thetake-backandrecoveryoftheirwaste? bankrupt/disappears)? what defencesaretypicallyavailable? seeking annulmentoftheinfraction notice. administrative defence. Also, itispossible tofileanaction infraction notices.Inthiscase,the violatorhastopresentan administrative penaltiesthatare imposedbymeansof administrative violationorinfraction.Perpetratorsmayface restoration oftheenvironmentisdeemedtobean pertaining totheusage,enjoyment,support,protectionand 6,514/2008, anyactionoromissionthatinfringeslegalrules Administrative liability: According toFederalDecreeNo. proceeding (appeal). case, thepollutershalldefendhim/herselfinajudicial environment, usuallythroughapubliccivilaction.Inthis authorised bylawmayfileclaimsfortherecoveryof obligation toredresstheenvironmentaldamage. The entities damage causedandtheagent’s conductsuffices totriggerthe demonstration ofacause-effect relationshipbetweenthe (strict liabilityorirrespectiveoffault),meaningthat that environmentalcivilliabilityisofanobjectivenature Civil liability: The NationalEnvironmentalPolicysetsforth Liabilities To whatextentdowasteproducershaveobligations the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa

Brazil

to thepaymentofanamountregardingenvironmentalliabilities. market, whichcanassist/protectacompanyorpersonwhensubject insurances, therearespecificenvironmentalinsurancetypesinthe criminal liability. However, besidesthecommoncivilliability There isnoinsuranceorindemnitythatcouldprotectapersonfrom rights; (b)fines;and(c)renderingofservicestothecommunity. on legalentities,theotherhand,are:(a)temporaryinterdictionof temporary interdictionofrights;and(iii)fines. The sanctionsimposed sanctions: (i)custodialsentence–imprisonmentorconfinement;(ii) Individual transgressorsaresubjecttothefollowingcriminal attributable totheirconductoromission. damage ifandonlytotheextentitcanbeprovedthatcrimeis only beprosecutedandconvictedforhavingcausedenvironmental subject tocriminalsanctions.However, theseindividualswould officer, administrator, director, manageroragentwouldalsobe Upon theoccurrenceofanenvironmentalviolation,alegalentity’s 4.3 damage, evenwhenoperatingwithinpermitlimits. activities oftheoperator, itmaybeheldliablefortheenvironmental If thereisacause-effect relationshipbetweenthedamageand 4.2 Machado MeyerAdvogados ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 polluters ifagivenfinancedprojectcausesenvironmentaldamage. “indirect polluter”iswhetherlendersmaybeconsideredasindirect The questionthatisfrequentlyraisedduetothewidedefinitionof 4.5 acquired asset. In thesecondcase,buyeronlyassumesliabilityrelatedto a whole. environmental liabilityarisingfromtheoperationofcompanyas successor’s liability. Inthefirstcase,successorassumes a sharesaleandanassetpurchaseismainlyassociatedwiththe From anenvironmentalliabilityperspective,thedifference between 4.4 ■ activities thatcaused environmentaldegradation. However, the there isnodefinitionofthelimits oftheindirectcontributionfor occurrence ofanenvironmentaldamage andcausalityrelationship), environmental civilsphere(i.e.,author –directorindirectpolluter the indispensableconditionsfor responsibilitytowardsthe degradation. Inotherwords,even though thereisnoquestionabout of anindirectcontributionforactivity thatcausedenvironmental In Brazil,therehasstillbeennodeepanalysisrelatedtothedefinition © Published and reproduced with kind permission byGlobal Legal Group Ltd,London indemnity protectioninrespectofsuchliabilities? within permitlimits? environmental wrongdoingand/orremediationcosts? the onehandandanassetpurchaseonother? to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage To whatextentmaylendersbeliablefor environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman shall defendhim/herselfinajudicialproceeding(appeal). on theverificationoffaultorintent.Inthiscase,plaintiff offences consideredascrimes. The criminalliabilitydepends whether anindividualoralegalentity, whichcommitscertain environmental criminalliabilityappliestoeveryperson, Criminal liability:PursuanttoFederalLawNo.9,605/1998,

5.2 its rightofrecourseagainstthepollutingparties. order toprotecttheinterestsofnewowner, whichmayexercise contamination requirestheadoptionofcontractualmechanismsin buyer ofjointandseveralliabilitytoremedyanyexisting damages, evenifitdidnotcausedirectly. The assumptionbythe buyer willassumeresponsibilityforrepairingtheenvironmental remediation. Incaseofpurchaseacontaminatedproperty, the benefited fromaspecificareacanbeheldresponsibleforits the groundandgroundwater. Anyone whohascontributedor joint andseveral,includingfordamagescausedbycontaminationof The responsibilityforenvironmentaldamagesinthecivilsphereis 5.1 the righttodemand monetarycompensationforaesthetic damages Public authoritiesandespeciallythe PublicProsecutor’s Office have 5.5 public authorities. contractual clausesarenotenforceableagainstthirdparties,mainly even thoughthisisimportantforstrengtheningtherightofrecourse, prior damagescausedbytheformerownerorpossessor. However, Those whoacquireacontaminatedareamayseekcompensationfor 5.4 applicable law. by theenvironmentalagencyifitisnotincompliancewith public prosecutors,mayquestiontheremediationprocessapproved there isaclearjustification.Interestedthirdparties,includingthe The regulatormayadditionallyrequirearemediationprogrammeif 5.3 actually causedtheenvironmentaldamage. polluting partywillhavearightofrecourseagainstthethat economic situation)toredressthedamagescaused. The sued requirements tobesued,orsimplytheonewithhealthiest may chooseoneoutofallthepollutingparties(thatmeetslegal Since liabilityisofajointandseveralnature,theaggrievedparty lender hasbeenheldliableforanyenvironmentaldamage. and thereisnoprecedentthatcouldbesingledoutwhereaprivate National EnvironmentalPolicyissilentinrelationtoprivatelenders 5 is responsibleforthecontamination? groundwater? public assets,e.g.rivers? contaminated landliabilitytoapurchaser? can athirdpartychallengetheagreement? Contaminated Land How isliabilityallocatedwheremorethanoneperson (including historiccontamination)ofsoilor What istheapproachtoliabilityforcontamination polluter, monetarydamages foraestheticharmsto Does thegovernmenthaveauthority toobtainfroma possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis WWW.ICLG.COM

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39 Brazil 40 Brazil in Brazil,order toidentifypotentialliabilities andrequired performance ofduediligenceintransactions isacommonpractice environmental liabilitiesamong private contractingparties,the Although thereisnolegalprovision onthemandatorydisclosureof 7.3 conduction ofmonitoringcampaignsmayalsoberequired. management ofsuchliability, submissionofperiodicreportsand contamination. Incaseofconfirmedcontamination,however, the aiming atevaluatingtheexistenceofpollutionorsuspected generally requiretheconductionofenvironmentalinvestigations and publicindividuals. As aconsequence,licensingauthorities environmental qualityandconditionsismandatoryforbothprivate Pursuant totheEnvironmentalNationalPolicy, themonitoringof 7.2 environmental accidents(e.g.,mining,oilandgas,amongothers). relating tospecificactivitiesmayapply, notablyincaseof avoid liabilitiesandpreventpollutionfromspreading.Exceptions events isrecommendedtotakeplaceassoonpossible,inorder any case,disclosureofcontaminationandotherenvironmental order toincreaseprotectionandcontrolovercontaminatedareas.In enacted fortheStateofSãoPaulohasrecentlybeenmodified,in confirmatory andremediationprocesses.Inparticular, theregulation the competentenvironmentalandhealthbodiescanmonitor notification upondiscoveryofcontamination,evenifsuspected,so The legislationinforceforsomestatesrequiresimmediate 7.1 environmental agenciesandinterviewemployeesunderacivilinquiry. prosecutors mayalsorequireinformationfromentrepreneurs, conditions withthelegalstandards. Additionally, thepublic collection ofsamplestoverifythecomplianceenvironmental require technicalassessmentsfromentrepreneursorthe Environmental agencieshavethepowertoconductsiteinspections, 6.1 Machado MeyerAdvogados © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM or thepopulationsuffered fromcollectivemoraldamages. compensation mayberequiredonlywhenthedamageisirreversible to repairit,returningititsoriginalsituationandthatmonetary important tostatethatforanyenvironmentaldamage,thepriorityis environmental damageundercurrentlegislation.However, itis to publicproperties,asthiskindofdamageisalsoconsidered 7 6 conduct siteinspections,interviewemployees,etc.? takeover transactions? contamination? parties? Reporting /DisclosureObligations Powers ofRegulators prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto To whatextentisitnecessarytodisclose have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe What powersdoenvironmentalregulatorshaveto environmental regulatororpotentiallyaffectedthird require productionofdocuments,takesamples,

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

ultimately incurredby A shouldbedealtwithandpaidbyB. B, since,betweenthem,thecontractprovidedthatliability claims. Nonetheless, A couldafterwardsseekindemnificationfrom contractual provisionwouldnotshield A frompublicauthorities’ may seekthewholereparation/compensationfrom A. The referred party (e.g.forremediatingacontaminatedarea),publicauthorities the environmentalliabilitytoB,incase A isdeemedbylawasaliable involving A andB,despitetheexistenceofaspecificclauseallocating contractual provisions. Therefore, forexample,inacontract contracting parties. Thus publicauthoritiesarenotboundbysuch liability allocationclausesmayonlygoverntherelationbetween As percontractualprovisions,basedonBrazilianlaw, environmental damage. might seektherightofrecourseagainstparty(ies)thatcaused be soughtagainstanyofthem,individually. The aggrievedindividual entity canbedeemedliable,thewholereparation/compensation the otherhand,setforththat,incasemorethanonepersonorlegal or compensatingthedamage.Jointandseveralliabilitystandards,on or intent),suchpersonlegalentitymaybeheldliableforrepairing enterprise isrelatedtoanenvironmentaldamage(irrespectiveoffault several liabilitystandards. Therefore, incaseone’s activityor Brazilian civilenvironmentalliabilityisbasedonstrict,jointand 8.1 Brazil, shareholderscanbeliablefor breachesofenvironmentallaw. Due totheapplicationofpiercing ofthecorporateveiltheoryin 8.3 authorities. environmental liabilitiesmayhaveitslegalityquestionedbythe without theproperdecommissioningandresolutionofexistent must becarriedout. Therefore, theabruptdissolutionofacompany laws andregulationsdescribinghowthedeactivationofacompany been tighteninginthisdirection. The StateofSãoPaulohasrecent procedures inordertolegallyceasetheiractivities.Legislationhas potentially pollutantenterprisesmustbesubjecttodeactivation As perthedissolutionofacompany, wemusthighlightthat contingency inthebalancesheet. liability ofthecorporation,itshouldbeconsideredatleastasa In theory, consideringthatenvironmentalissuesmaybedeemeda 8.2 and inrespectoftheparties’ rightofrecourse. issues whichhavearisen,inconsiderationoftheregulationforce contractually allocatetheresponsibilitybetweenthemselvesforany mitigation measures. As aresultofthisprocedure,thepartiescan 8 potential liabilityforthatmatter? caused byaforeignsubsidiary/affiliate? order toescapeenvironmentalliabilities? General matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- Is itpossibletouseanenvironmentalindemnity company besuedinitsnational courtforpollution pollution causedbythecompany, andcanaparent liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff Brazil

Punitive damages(penalorexemplary)arenotapplicableinBrazil. for suchpurpose. Popular Actions arenotapplicable.Individualactionsmustbeused consequence ofanenvironmentaldamage,PublicCivil Actions and Regarding damagestoindividualsorgroupofindividuals,asa environment. Such actionsmustexclusivelybeaimedattherecoveryof persecution fromtheemployerduetoprovidedinformation. employees thatprovidelicitinformationshallnotbesubjectto On theotherhand,incasesofcorporate“whistle-blowing”policies, when dealingwithananonymouscontribution. the stateenvironmentalagencyprovidesforconfidentialprocedures the institutionalregulations.InStateofSãoPaulo,forexample, blower. The specificformsofidentityprotectionvaryaccordingto anonymous tipsinBrazilmustprotecttheidentityofwhistle- Public institutionsthatprovideawhistle-blowingmechanismfor 8.4 Machado MeyerAdvogados ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 judicial assistancemaybegranted andthecostsmaybewaived. poor financialconditionoftheclaimant isproven,thebenefitoffree costs mustbepaidupfrontbythe claimant.However, incasethe indemnification asaconsequence ofanenvironmentaldamage, On theotherhand,inindividual privateactionsseeking such costs,aspublicprosecutorsanddefenders. parties legitimatedtofilesuchactionsareexemptedbylawfrom do notneedtopayforthecostsupfront.Besidessuchrule,certain For thefilingofPublicCivil Actions andPopular Actions, claimants 8.6 may befiledbyanyindividual,alsowithsuchpurpose. well asfullyorpartiallypubliccompanies.PopularClaims,which (federal, stateandmunicipal),civilassociations,foundations,as be filedbypublicprosecutorsanddefenders,thegovernment Brazil forpursuingenvironmentalclaims.PublicCivil Actions may The PublicCivil Action isthemostcommontypeofactionusedin 8.5 parent company’s country. would dependvastlyonthespecificitiesoflawapplicablein Regarding theparentcompany’s exposureinitsnationalcourts,it environmental damages. company andinvolvedwiththepracticesthatcaused the shareholderisdirectlyinvolvedwithmanagementof shareholder. Suchliability, however, shouldonlybeappliedincase liability soughtisnotsubsidiary, butdirectlyattributedtothe the piercingofcorporateveil.Inthiscase,pleasenotethat prosecutors toseekshareholders’ jointandseveralliabilitynot Nonetheless, inrelevantenvironmentalcasesitisusualfor compensation orremediationoftheformerenvironmentalconditions. obstacle (irrespectiveoffaultorabuseright)toproper jeopardises therecoveryofenvironmentaldamagesoractsasan Such theorymayapplywhenevertheexistenceofcompany © Published and reproduced with kind permission byGlobal Legal Group Ltd,London damages available? report environmentalviolations/matters? pursuing environmentallitigation? Are thereanylawstoprotect“whistle-blowers”who Do individualsorpublicinterestgroupsbenefitfrom environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing any exemptionfromliabilitytopaycostswhen

irrespective oftheliabilityfordamages. the offenders tobothcriminalandadministrativepenalties, Obligations varyfromcasetoandfailurecomplysubjects equipment andperiodicmonitoringofgasemissionsingeneral. require theadoptionofcontrolmeasures,improvementexisting environmental licensingprocess,thecompetentauthoritiesmay greenhouse gasemissionshasbeenestablishedsofar. Duringthe emissions, aswellonemissionstandards,butnocapfor The legislationinforceprovidesforspecificguidelinesonair 9.2 different ways,notablythroughthestockexchange. Emission Reductions(CER)canbetradedbyprivatepartiesin formally implementedsofarbythepublicauthorities,Certified municipal levels.Eventhoughnoemissiontradingschemehasbeen reduction ofgasemissions,whichhasbeenreplicatedatthestateand the Braziliangovernmenthascommittedtoavoluntarytarget onthe Change (FederalLawNo.12,187/2009).Pursuanttosuchlegislation, emissions, mainlybymeansoftheNationalPolicyonClimate developed itsownguidelinesandobjectivesonthereductionofgas the goalsestablishedwhenKyotoProtocolwasinforce,Brazilhas Convention onClimateChange(UNFCCC),aswellaccordingto In linewiththepoliciessetoutbyUnitedNationsFramework 9.1 compensation forpainandsuffering inanamountthatgivescomfort to exposure, includingboth(a)compensation fordamages,and(b) compensation fordamagessuffered inconnectionwiththeasbestos labour, consumerandcivilclaimsresultindecisions awarding asbestos liabilitiesareresolvedby monetaryawards.Successful and (d)otherpeopleindirectlyexposed totheasbestos.Mostof exposure; (c)exposureofconsumerstoasbestos-containingproducts; areas ofconcern:(a)environmentalrestrictions;(b)labourforce The liabilitiesinvolvingasbestosproductsaredividedintofourmain 10.1 crop andlivestockareas. in anattempttopreventforestsfrombeingconvertedmainlynew deforestation. Surveillancemeasuresareconstantlybeenimproved progress hasbeenmadeinreducingemissionsarisingfrom lack ofconcreteactionstodate,however;ontheotherhand,firm objective ofdecreasingemissionlevelsby2020. There hasbeena commitment forreducinglocalgasemissions,withthemain are animportantstep,asBrazilmadeanationalvoluntary The provisionsenactedbytheNationalPolicyonClimateChange 9.3 9 10 to monitorandreportgreenhousegasemissions? market developingthere? jurisdiction? regulation inyourjurisdiction? Emissions Trading andClimateChange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation What istheexperienceofasbestoslitigationinyour What istheoverallpolicyapproachtoclimatechange Asbestos WWW.ICLG.COM

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41 Brazil 42 Brazil for theestablishmentofmandatoryenvironmentalrisksinsurance. and thediscussionstakingplaceinBrazilduetolegislativeproposals environmental insuranceasatoolforthefosteringofgreenfinancing hardening oflawenforcement,theinternationalreckoning Brazil. This scenario,however, iscurrentlychanginginlightofthe So far, environmental risksinsurancehasplayedasmallrolein and (iv)liabilityderivedfrompollutiondamages,amongstothers. and services;(iii)transportationofenvironmentalinterestmaterials; (i) installationandoperationofinfrastructureassets;(ii)civilworks insurance typesinthemarket,suchascoveringrisksdueto: thereof hastriggeredasurge ofdifferent andspecificenvironmental development oftheBrazilianEnvironmentalLawandenforcement restricted tocommoncivilliabilityinsurance.Currently, however, the For alongperiod,theenvironmentalinsurancemarketinBrazilwas 11.1 expenditure. such contamination–acircumstancethatmayentailsignificant the clean-upofland,whetherornotitisentitywhichcaused infraction tobeissuedbytheenvironmentalauthoritydemanding hazardous materials,suchasasbestos,issubjecttoanoticeof The owneroroccupierofapropertywhichiscontaminatedby be implementedbythecompany. control measuresforthecorrectmanagementofsuchresiduesmust inconvenience topublichealthandwelfare. Therefore, disposaland must causeneitheranydamagetotheenvironment,nor The managementandfinaldisposalofresiduescontainingasbestos land contamination. of theresiduesgeneratedbyuseasbestos;and(b)eventual owners/occupiers shallfocusonare:(a)managementanddisposal Under anenvironmentalperspective,themajoraspectsthat 10.2 Machado MeyerAdvogados © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM asbestos (amiantocrisotila the SuperiorCourtshaveforbiddenextractionanduseofwhite enrichment). Itisimportanttonotethatrecentdecisionsrenderedby compensation forpainandsuffering doesnotcauseunreasonable the inflictedpersonandpunishesoffender (providedthatsuch 11 in relationtoasbestoson-site? risks insuranceplayinyourjurisdiction? in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable What arethedutiesofowners/occupierspremises Environmental InsuranceLiabilities ) inmanufacturingprocessesthecountry. ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

structuring andimplementationofreverselogisticssystems. conditions theissuanceorrenewalofenvironmentallicenceson São Paulo(CETESB)publishedDecisionNo.076/2018/C,which In theStateofSãoPaulo,Environmental Agency oftheState affect theQuilombolascommunities(slaveryrefugeedescendants). must complywiththeFCP regardingthelicensingofprojectsthat Instruction No.01,whichprovidesthatadministrativeproceedings Palmares CulturalFoundation(FCP)publishedNormative With regardtothe speciallyprotectedareas,on31October2018,the tools. Accordingly, newactivitieshavebeensubmitted totheCTF. Activities (CTF/APP)andestablishnewenvironmentalcontrol amend theFederal Technical RegistryofPotentiallyPolluting published NormativeInstructionsNos11/2018 and12/2018,which The BrazilianInstitutefortheEnvironmentandNaturalResources Paris Agreement. to reducegreenhousegasemissionsand,therefore,complywiththe RenovaBio intendstoexpandbiofuelsproductioninBrazilorder established theNationalPolicyofBiofuels(RenovaBio). The On 27December2017,FederalLawNo.13,576waspassedand logistics, environmentallicensingandspeciallyprotectedareas. to severalareas,suchasmitigationofclimatechange,wastereverse At thefederalandstatelevel,newruleshavebeenpublishedinrelation 12.1 approval bytheNationalCongress. to whichcompaniesareexposed.SuchBillisstillpendingfinal contracting ofenvironmentalinsuranceagainstrisks Federal SenateapprovedBillNo.767/2015,whichcompelsthe Additionally, on5June2018,theEnvironmentCommitteeof companies isclearlyvisible. over thelastdecade,stiffening ofthescrutinyinsurance some relevantenvironmentalaccidentsthathavehappenedinBrazil Nevertheless, consideringthestrengtheningoflawenforcementand far inBrazil,therehavenotbeenmanyclaimsrelatingthereto. Due totheincipientrolethatenvironmentalinsurancehasplayedso 11.2 12 in environmentlawyourjurisdiction. experience inyourjurisdiction? summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a What istheenvironmentalinsuranceclaims Updates

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Machado MeyerAdvogados ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London actions insupportofvarioussocialandculturalprojects. We investinvaluingdiversity withourtalentattraction,training,development,andretainmentprogramme.We Committeetoplan haveaCitizenship of themostprestigiousindustryawardsinBrazilandworldwide. havereceivedsome Since webelievethatexcellenceistheresultofhardworkanddedication,arerecognisedbyleadinglegalpublications are alwaysworkingtoestablishapartnershipthatisbuiltwithday-to-dayinteraction,empathy, andemployees. andourcommitmenttoclients heavy industryingeneral. agribusiness, steel,mining,automotive,banking,pharmaceuticaland as infrastructure,logistics,foodandbeverage,chemicals,realestate, and hasexperienceinassistingclientsawiderangeofareassuch to herpersuasiveabilityandsolidenvironmentalpracticebackground Ms. Leonhardtisbecomingrenownedforenvironmentaldisputesdue Prosecution. working withenvironmentalagenciesandtheDepartmentofPublic the identificationandmanagementofenvironmentalrisks,aswell environmental liabilities,supporttoinvestorsandfinancialinstitutionsfor implementation ofpotentialpollutingprojectsandtheanalysis provision ofenvironmentalassistanceinmattersrelatedtothe Leonhardt’s workembracesthecoordinationofworkingteamsfor her skillsincoordinatingmultipleinterestsnegotiationprocesses.Ms. performance inthemanagementofcomplexenvironmentalcrisesdueto Leonhardt isaspecialistinenvironmentallaw, havingoutstanding Estate, LitigationandCompetitionLawpractices,RobertaDanelon Partner oftheEnvironmentalLawpracticeandHeadLabour, Real Our human capital qualifies and helps us to serve large Brazilian and multinational companies, including eight of the 10 largest Braziliangroups.W Our humancapitalqualifiesandhelpsustoservelargeBrazilianmultinationalcompanies,includingeightofthe10largest intelligent legalsolutionsthatcontributetothebusinessgrowthofourclientsandtransformrealities. Our focus:business.We weworktoof provideinnovativelegalsolutionsthatanticipatescenariosandmakebusinesspossible.Inotherwords, with ourclients.We areranked asoneofthemajorlawfirmsinBrazil,withover700professionals. We andacloserelationship havebeenbuildingour historyfor45years,inspiredbysoundethicalprinciples,thetechnicalskillsofourprofessionals,

11 Avenida BrigadeiroFariaLimanº3144 Machado Meyer Advogados Roberta DanelonLeonhardt URL: Email: Tel: Brazil São Paulo th floor www.machadomeyer.com.br [email protected] +55 11 31507009

beverage, chemicals,realestate,agribusiness,andmining. several businessareas,suchasinfrastructure,logistics,foodand has previousexperienceinprovidinglegalassistancetoclientsof Office, anddraftingadministrativedefences.Ms.Stump Prosecutor’s litigation andpracticebeforeenvironmentalagenciesthePublic responsibilities amongthecontractingparties,supporttoenvironmental contaminated areas,identificationandallocationofenvironmental of Ms.Stump’s workconcernslegalassistanceforthemanagementof of assets,mergers/acquisitionsandconcessionsprojects. A largepart environmental risksandliabilitiesinthestructuringofinfrastructure,sale consultancy, withanemphasisontheidentificationandmanagementof Daniela Stumpisaspecialistinenvironmentallitigationand 11 Avenida BrigadeiroFariaLimanº3144 Machado Meyer Advogados Daniela Stump URL: Email: Tel: Brazil São Paulo th floor www.machadomeyer.com.br [email protected] +55 11 31507003 WWW.ICLG.COM Brazil fer e

43 Brazil Chapter 8 Canada Jonathan W. Kahn

Blake, Cassels & Graydon LLP Anne-Catherine Boucher

1 Environmental Policy and its established which contain information on a variety of matters such as proposed regulations and approvals, permitted activities, Enforcement environmental assessments in progress and enforcement actions. Any person may request information from public authorities 1.1 What is the basis of environmental policy in your through access to information legislation at the federal and jurisdiction and which agencies/bodies administer provincial levels. However, there are exceptions built into the right and enforce environmental law? of access in each statute, such as for some confidential technical or commercial information or personal information. Jurisdiction to legislate with respect to environmental matters in Canada’s courts have determined that government actions or Canada is found at each of the federal, provincial and municipal decisions that may affect Indigenous or Treaty rights impose upon levels. The Constitution Act, 1867 allocates responsibility for the government a duty to consult and accommodate affected groups. different subject areas to the federal government or the provinces. In addition, most environmental legislation imposes broad However, responsibility for environmental matters is not specifically consultation obligations on project proponents. assigned to either the federal government or the provinces and the courts have determined that it is a shared, joint area of responsibility. The provinces have jurisdiction over property and civil rights and 2 Environmental Permits matters of a local or private nature and therefore, much of the legislation governing environmental issues is enacted at the provincial level. The federal government retains jurisdiction over fisheries, 2.1 When is an environmental permit required, and may environmental permits be transferred from one navigation, oceans, nuclear energy, as well as matters (such as person to another? transportation of dangerous goods and interprovincial undertakings such as pipelines and railways) which cross provincial or international boundaries. The federal government has also legislated in the area of Environmental permits or approvals are generally required for a toxic substances. broad range of activities such as any discharge of contaminants into air or water, water taking, waste management activities, as well as Environmental requirements and regulations are often also found in some specific undertakings such as mines and energy facilities. municipal by-laws. Environment and Climate Change Canada and the various provincial The ability to transfer a permit from one person to another will Ministries of the Environment are responsible for the development of depend on the jurisdiction which issued the permit and the specific environmental policy and the enforcement of environmental type of permit. Certain permits may be issued by simply providing legislation and regulations. notice to the regulator while other cases require the prior consent of the regulator to transfer the permits. Certain other permits are non- transferable. 1.2 What approach do such agencies/bodies take to the enforcement of environmental law? 2.2 What rights are there to appeal against the decision of an environmental regulator not to grant an Environmental regulators at the federal and provincial levels have environmental permit or in respect of the conditions broad regulation-making and approval-granting powers. In cases of contained in an environmental permit? failure to comply with laws or approvals, or threats to the environment, the regulators have broad order-making powers. Most environmental statutes provide a statutory right to appeal a While administrative penalties are an option for regulators, breaches decision to a tribunal, board or court or to a government minister or of environmental laws tend to be addressed by way of prosecution, cabinet. Decisions on whether or not to grant an environmental and the imposition of fines or prison sentences upon conviction. permit, or challenges to permit conditions, may generally be appealed by the applicant and other persons affected by the decision, 1.3 To what extent are public authorities required to in certain cases subject to obtaining leave. provide environment-related information to interested persons (including members of the public)?

In certain Canadian jurisdictions, public registries have been

44 WWW.ICLG.COM ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 © Published and reproduced with kind permission by Global Legal Group Ltd, London monetary penalties,prosecution,orastopcontrolorder. a permitmayleadtowarningordirectivecomply, administrative powers thataremostappropriateinaparticularcase. The violationof enforcement powersanddiscretionastothetypeof Environmental regulatorsaregenerallygrantedarangeof 2.4 and ofteninvolvepublichearings. for majorinstallations/projectsinordertoobtainprojectapproval processes aregenerallytriggeredatthefederalandprovinciallevels polluting industries.Environmentalimpactassessmentreview imposed asaconditiontoanenvironmentalpermitforcertain The requirementtocarryoutregularenvironmentalauditsmaybe 2.3 Blake, Cassels&GraydonLLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 Most provinces have adoptedextendedproducer responsibility 3.4 for off-site treatmentordisposalinCanada. retain liabilityoncetitletothewaste istransferredtoathirdparty accordance withregulatoryrequirements,thegeneratordoesnot Provided thatwasteismanaged,shippedanddisposedofin 3.3 disposal sites. authorisation. Disposalofwastemayonlyoccuratapproved waste aboveprescribedthresholdsgenerallyrequiresapermitor of wastebeingstoredandthejurisdiction.Storageorgeneration Restrictions ontheon-sitestorageofwastewilldependtype 3.2 PCB waste),whichismoreheavilyregulated. (industrial, chemical,corrosive,toxic,pathological,radioactiveor waste (municipalordomesticwaste)andhazardous Generally, wasteregulationisdividedbetweennon-hazardous products andresidues. discarded orthattheholderintendstodiscard,aswellprocessby- definitions tendtobequitebroadandcanincludeanyobjectthatis variety ofwaysbasedonthetypewastebeingregulated,but Waste isdefinedthroughprovinciallegislationorregulationsina 3.1 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 3 waste involveadditionaldutiesorcontrols? permits? polluting industriesorotherinstallations/projects? regarding thetake-backandrecovery oftheirwaste? bankrupt/disappears)? produced? Waste regulators haveinconnectionwiththeviolationof What enforcementpowersdoenvironmental Is itnecessarytoconductenvironmentalauditsor environmental impactassessmentsforparticularly To whatextentdowasteproducers haveobligations another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore How iswastedefinedanddocertaincategoriesof the transferee/ultimatedisposergoes

programmes. and packagingtofundthecostofmunicipalcurb-siderecycling provinces, whichrequiredistributorsofpaperproducts,containers Blue boxstewardshipregimesarealsoinplaceanumberof internalised inthepriceaskedforproductatpointofsale. costs relatedtotherecoveryandreclamationofaproductmustbe recovery andreclamationprogrammesforthesameproducts. The meet theirobligationsbyjoininganassociationthatimplements as thosetheydistribute.Itisgenerallypossiblefordistributorsto recovery andreclamationprogrammesforproductsofthesametype paint, tyres,electronicproducts,batteries,etc.)toimplement regimes whichrequiredistributorsofcertainproducts(usedoils, of spills. also createsstatutorycausesofactionforclean-upcostsinthecase negligence, trespassandstrictliability. Someprovinciallegislation common law, undertheheadsofactionprivatenuisance, property, thereissignificantpotentialforcivilliabilityunderthe Finally, whereabreachofenvironmentallawcausesdamageto imposed withoutafullprosecution). orders, oradministrativemonetarypenalties(whichmaybe instance, leadtoawarning,directivecomply, stoporcontrol of apermit. A breachofenvironmentallaworapermitmay, for enforcement powerstorespondbreachesofenvironmentallawor levels generallyhaveanumberofadditionaladministrative In addition,environmentalregulatorsatthefederalandprovincial system beinplacetopreventenvironmentalharm. requires ataminimumthataneffective environmentalmanagement determined bythecourtonacase-by-casebasis,butgenerally particular casewilldependonthecircumstancesandbe commission oftheoffence. What constitutesreasonable stepsina establish thatheorshetookallreasonablestepstopreventthe prosecution foranenvironmentaloffence. A defendantmust Due diligenceisthemostcommondefenceincaseof and minimumfinesapplytocertainoffences. imprisonment uponconviction. The finescanbequitesignificant offences). Suchabreachmayleadtoprosecutionandfines do notrequireproofofintenttocommitanoffence (strictliability regulatory offence. Suchoffences arequasi-criminalin natureand In mostcases,abreachofenvironmentallegislationconstitutes criminal), administrativeorcivil. Liability underenvironmentallegislationcanberegulatory(quasi- 4.1 with permitlimitswouldnotbeadefence. also beliabilityunderanuisancecause ofaction,wherecompliance notwithstanding compliancewith permitconditions. There may person maybeprosecutedfor causing environmentaldamage the environmentthatcausesormaycauseanadverseeffect. A Environmental statutesprohibitthedischarge ofcontaminantsinto 4.2 4 what defencesaretypicallyavailable? within permitlimits? Liabilities breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage WWW.ICLG.COM Canada

45 Canada 46 Canada receivers andtrusteesinbankruptcy. protections againstregulatoryordersareavailableforlenders, environment. Environmentalregulators generallyhavebroad who causedorcontributedto a discharge orspillinto the had managementorcontrolovera contaminatedproperty, orthose generally attachtocurrentorpastowners, occupiers,thosethathave liability forclean-uporremediation ofhistoriccontaminationcan While thereissomevariationfrom provincetoprovince,potential 5.1 de facto may alsobeexposedtoenvironmentalclean-upordersiftheyhave acquiesced orparticipatedinthecommissionofanoffence. Lenders Lenders canbeexposedtoenvironmentliabilityiftheydirected, 4.5 transfer referredtoabovetendsbemoreofanissueinassetdeals. be liableforhistoriccontamination.Inaddition,theissueofpermit case ofanassetdeal. The purchaserofrealproperty, however, could corporation. Liabilitydoesnotflowtothenewoperatingentityin the effective dateofthetransaction,carryforwardandremainwith including prosecutionforviolationsofenvironmentallawspriorto In thecontextofasharedeal,liabilityforactscorporation, 4.4 reasonable groundstobelievethathisorherconductwaslawful. criminal oradministrativeactionsunlesstheindividualhad prohibit theindemnificationofdirectorsandofficers inthecaseof matters arecovered.Certainstatutesrelatingtobusinesscorporations the policymustbecarefullyreviewedtoensurethatenvironmental Directors andofficers aregenerallyabletoobtaininsurance,though bankruptcy orinsolvency. preventative orders.Suchordersareaparticularriskinthecaseof Directors andofficers mayalsobepersonallysubjecttoclean-upor to preventthecorporationfromcommittinganoffence. directors andofficers haveapositivedutytotakeallreasonablecare even iftheydidnotactivelyparticipate.Incertainprovinces, have knownthatthecorporationwasincontraventionoflegislation Directors andofficers mayalsobeheldliableiftheykneworoughtto participated inthecommissionofoffence mayfaceliability. corporation whodirected,authorised,assentedto,acquiescedor commits anoffence underthe Act, anyofficer, directororagentofthe Canadian Environmental Protection Act, 1999 directors andofficers ofcorporations.Forinstance,underthe Environmental statutesinCanadaimposepersonalliabilityon 4.3 Blake, Cassels&GraydonLLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 5 indemnity protectioninrespectofsuchliabilities? groundwater? environmental wrongdoingand/orremediationcosts? the onehandandanassetpurchaseonother? Contaminated Land What istheapproachtoliabilityforcontamination To whatextentmaylendersbeliablefor environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract (including historiccontamination)ofsoilor managementandcontrolofland.Certainstatutory , whenacorporation

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right ofindemnification. liability thoughitcould,dependingonthecontract,giverisetoa However, thatwillnotinsulatethesellerfromcivilorregulatory 5.3 among responsiblepersons. jurisdictions haveadoptedstatutorymechanismsforallocatingliability any amountexceedingitscontributiontothecontamination. A few contamination. Suchpartymustthenturntothecivilcourtsrecover for 100%oftheremediationcosts,irrespectiveitsroleincausing considered responsibleunderthelegislationmaybeheld to liabilityforremediationofcontaminatedland,whereaparty Most Canadianjurisdictionshaveadoptedajointandseveralapproach 5.2 courts. damages foraestheticharmsbut has notyetbeentestedbythe resources causedbyanenvironmental offender, whichcouldinclude the Crowntoseekmonetarydamages forthelossofpublic The SupremeCourtofCanadahas recognisedintheorytherightof 5.5 between buyerandsellerwillgenerallybeamatterofcontract. incurred fromcontributingparties. The allocationofliability generally withoutprejudicetorecoveryoftheremediationcosts Clean-up costsincurredbyapartyunderregulatoryschemeare 5.4 receptors. Riskassessmentsarepermittedinsomecircumstances. which varybasedontheuseoflandandsurroundingenvironment regulatory limitvaluesforsubstancesconsideredcontaminants, When remediationisrequired,landmustbedecontaminatedbelow contaminated bythemigrationofcontamination. of asuitbroughtbyanotherlandownerwhosepropertyhasbeen a currentorpurchasingowneroperatoratcommonlawinthecase Liability forhistoricenvironmentaldamagecanalsobeimposedon and parentcompaniesmayalsobeexposedtoliability. contamination atthetimeofpurchaseproperty. Directors original sourceofcontaminationorwasnotawarethe against apersonorcompanythatwasnotresponsibleforthe out remediationwork. The ordermay, incertaincases,bemade remediation, monitororreimbursetheregulatorforcoststocarry orders tocharacterisepotentiallycontaminatedland,carryoutfull powers withrespecttoclean-upofcontaminatedlandandcanissue a measureofprotectionagainstthatrisk. provinces havebuiltprotectionsintotheregulatoryschemetoprovide While therehavebeencasesofremediationbeing“re-opened”,some is responsibleforthecontamination? public assets,e.g.rivers? contaminated landliabilitytoapurchaser? can athirdpartychallengetheagreement? regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis How isliabilityallocatedwheremorethanoneperson polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek

Canada

7.1 correct aviolation. issue complianceorderstostopillegalactivitiesorrequireaction of documentsandconductingtestsanalyses.Inspectorsmayalso collecting samples,interviewingindividuals,requiringtheproduction and seizurepowers,entryintolandorbuildingwithoutawarrant, and investigationpowerstoenforcementofficers, includingsearch Federal andprovincialenvironmentalstatutesgrantbroadinspection 6.1 Blake, Cassels&GraydonLLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 or criminalliability. contract andwillnotinsulateaparty fromadministrative,regulatory be constrainedinsofarasitapplies onlytotheparties Contractual allocationofenvironmental liabilityispossiblebutwill 8.1 misrepresentations orfailtodiscloselatentdefects. conclusion ofatransaction. That said,asellermustnotmakeany environmental issuesshouldbecloselystudiedpriortothe deals absentspecificrepresentationsandwarrantiesand,assuch, “Buyer beware”istheprevailingconceptincontextofpurchase 7.3 off-site migration. be exercisedwhenthereexistsarisktohumanhealthorsafetyof preventive measuresorremediation.Inpractice,thesepowerstendto Regulators aregenerallygrantedwidepowerstoorderinvestigations, 7.2 and ofrisksoff-site migrationvaryfromprovincetoprovince. Requirements toreportthediscoveryofhistoricalcontamination an adverseenvironmentalimpact. out ofthenaturalcourseevents(i.e.aspill)thatislikelytocause immediately benotifiedinthecaseofadischarge ofcontaminants Environmental statutesgenerallyrequirethattheregulator © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 7 6 8 contamination? parties? conduct siteinspections,interviewemployees,etc.? potential liabilityforthatmatter? takeover transactions? Reporting /DisclosureObligations Powers ofRegulators General migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe What powersdoenvironmentalregulatorshaveto matter (e.g.remediation)discharge theindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto environmental regulatororpotentiallyaffectedthird require productionofdocuments,takesamples, Is itpossibletouseanenvironmentalindemnity To whatextentisitnecessarytodisclose have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson

national courtforpollutioncausedbyaCanadianaffiliate. Subject tolocallaws,aforeignparentcompanymaybesuedinits thereby increasingthespectreofindividualliability. claimants couldrelyonthisdecisiontopiercethecorporateveil, control ofapollutant”basedonfact-specificassessment.Future director orofficer couldalsobeconsideredtoa“personhaving of thepollutant,courtdeterminedthatacorporateprincipal, control ofthepollutant”. While thecorporationwasclearlyowner could bebroughtagainstthe“ownerofapollutantorpersonhaving damages payablepursuanttoastatutoryrightofcompensationwhich liable alongwiththecorporationonajoint-and-severalbasisfor An appellate-leveldecisioninOntarioheldaprincipalofcorporation over thecontaminatedsiteorpollutant. or participatedinthecommissionofanoffence orexercisedcontrol environmental lawtotheextenttheyacquiesced,directed,influenced shareholders willgenerallyonlybeheldliableforbreachesof Subject tocircumstancespermittingaliftingofthecorporateveil, 8.3 a contaminant,includingparents,directorsandofficers. be takenagainstanypersonwhohadcharge, managementorcontrolof liability. Enforcementaction(includingprosecutionandorders)may Dissolving acompanywouldnotnecessarilyeliminateenvironmental contingencies. statements orrelatednotesandestimatesmadeaboutnecessary require thatcertainenvironmentalissuesbereflectedinfinancial environmental issues.Generallyacceptedaccountingprinciples disclosure obligations,whichincludestheofmaterial Public or“reporting”issuersinCanadaaresubjecttocontinuous 8.2 in practice. exemplary damagesareavailablebut arerareandgenerallylimited health-based claimsarelesswell-suited toclassactions.Punitiveor claims arelimitedtopropertydamageasthecourtshavefoundthat likelihood ofobtainingcertificationisgreaterwhereplaintiffs’ provinces. Pastcertificationdecisionsappeartoshowthatthe be broughtinCanadaandhavethepastbeencertifiedseveral Subject toobtainingcertification,environmentalclassactionsmay 8.5 about anenvironmentaloffence fromemployerretribution. protecting apersonwhoprovidesinformationtothegovernment There existslegislationincertainprovincesandatthefederallevel 8.4 caused byaforeignsubsidiary/affiliate? order toescapeenvironmentalliabilities? damages available? report environmentalviolations/matters? company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing Are thereanylawstoprotect“whistle-blowers”who WWW.ICLG.COM

Canada

47 Canada 48 Canada Nations ConferenceoftheParties(“COP 21”)inDecemberof2015. Canada isasignatorytotheParis Agreement, negotiatedattheUnited 9.3 GHG emissionsreachacertainthreshold. monitoring andreportingobligationsforcertainindustriesorwhere In mostprovincesandatthefederallevel,legislationprovides 9.2 cover theirreportedandverifiedemissionswithemissionallowances. 25,000 metrictonsormorearerequiredtoregisterforthesystemand regime. Industrieswhoseannualgreenhousegasemissionsare emissions in2013whichisfullyharmonisedwiththeCalifornia Québec adoptedacap-and-tradesystemforgreenhousegas(“GHG”) 9.1 on publicinterestinvolvement. arguing thatacostawardagainstthemwouldhavenegativeimpact groups, butsuchgroupshaveavoidedpayingcostsbysuccessfully are nostatutoryexemptionsfrompayingcostsforpublicinterest side’s costs,butcostsremainatthediscretionofcourts. There In Canada,thelosingsideisusuallyrequiredtopaywinning 8.6 Blake, Cassels&GraydonLLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM industrial emitters. The federalregimewillapplyinprovinces and on fossilfuelsandofanoutput-based pricingsystemforlarge a federalGHGemissionspricingscheme, composedofacarbontax The federalgovernmenthasrecently enactedlegislationestablishing mentioned above),acap-and-trade system. measures andothershaveadopted,orareabouttoimplement(as adopted ataxorlevyoncarbonaswelladditionalGHGreduction As partofthePan-CanadianFramework,anumberprovinceshave plan tofightGHGemissions,inDecember2016. Clean GrowthandClimateChange,Canada’s nationalclimatechange and thefederalgovernmentadoptedPan-CanadianFrameworkon target of30%below2005levels by2030.MostCanadianprovinces As partofitscommitment,CanadahasaGHGemissionsreduction emission performancecreditsforseveralyears. alone systemwhichallowsthetradingofemissionoffsets and stand-alone cap-and-tradeprogrammeand Alberta hashadastand- based pricingsystem.NovaScotiaissettoimplementitsown emissions limittobetradedexclusivelywithinthefederaloutput- allocated tofacilitieswhoseemissionsfallbelowtheirannual pricing system(seequestion9.3below)toallowsurpluscredits There willbeatradingcomponentunderthefederaloutput-based aligned withQuébec’s system,butwhichhassincebeenabandoned. Ontario adoptedacap-and-traderegimeinJanuary2017whichwas 9 pursuing environmentallitigation? regulation inyourjurisdiction? to monitorandreportgreenhousegasemissions? market developingthere? Emissions Trading andClimateChange What istheoverallpolicyapproachtoclimatechange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation Do individualsorpublicinterestgroupsbenefitfrom any exemptionfromliabilitytopaycostswhen

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damages awardedtendtobemorelimitedthanintheU.S. products, torecovermorefullyfortheirinjuries;however, the primarily themanufacturersandproducersofasbestos-containing defendants whofalloutsideoftheworkerscompensationregime, impacted byasbestosintheworkplacehavetendedtopursue damages thatmightbeawardedbyajuryintheU.S.Plaintiffs Damage awardsissuedbytheseboardsaremodestcomparedto and theliabilityofsecuredcreditors. such asasbestos,storagetanks,transportationofhazardouswaste Insurance productsarealsoavailabletoaddressspecificconcerns, and detailsrelatingtosamplestaken. registry ofinspections,thelocationmaterialscontainingasbestos undertaking anyworkliabletoemitasbestosdustandkeepinga asbestos fibres,takingspecialprecautionarymeasurespriorto standards withrespecttotheconcentrationofair-borne breathable requirement forasbestosmanagementplans,meetingairquality exposure ofworkerstoasbestosfibres.Suchmeasuresincludethe owners/occupiers generallyhavevariousobligationstolimitthe provincial occupationalhealthandsafetylegislation.Employersor Exposure toasbestoson-siteisregulatedunderfederaland 10.2 settled ona“no-fault”basisbyworkerscompensationboard. Workers inCanadaaregenerally requiredtohavetheirclaims 10.1 coverage forenvironmentalliability. general commercialliabilityinsurance productsbegantoexclude Canada onaconsistentbasisforat least20years,particularlyafter A widerangeofenvironmentalinsurance hasbeenavailablein 11.2 pollution eventsonapropertyorundiscoveredcontamination. claims duetooff-site migration andinsuranceagainstfuture economic loss),environmentalimpairmentliabilityforthird-party costs, certainclean-updamagesassessedincourtand liability forpollution(whichwouldcoverexpensessuchaslegal coverage. Insuranceproductsmayincludeinsuranceforlegal Several carriersinCanadaoffer environmentalinsuranceliability 11.1 C$10 peryeartoC$50tonnein2022. C$20 pertonneofcarbonemittedin2019,withthistaxincreasingby federal benchmarkasof2019. The carbontaxonfossilfuelswillbe territories thatdonothaveacarbonpricingsystemalignswiththe 10 11 in relationtoasbestoson-site? jurisdiction? experience inyourjurisdiction? risks insuranceplayinyourjurisdiction? What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour What istheenvironmentalinsuranceclaims in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable Asbestos Environmental InsuranceLiabilities

Canada

scope offederalenvironmentalassessment,clarifythe legislation toenhancefederalenvironmentalprotectionsandthe environmental assessmentandregulatoryprocesseshastabled The federalgovernmenthasundertakenareviewofkey 12.1 Blake, Cassels&GraydonLLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London training and permit requirements for projects with potential environmental ramifications and provide representation when disputes arise. training andpermitrequirementsforprojectswithpotentialenvironmentalramifications andproviderepresentationwhendisputes for ourclientscreatedbycleantechnologiesandclimatechangeregulations. We procedures, alsoadviseonmanagement, compliance,duediligence and developsophisticatedstrategiestominimiseourclients’ exposuretoenvironmentalliabilities.We andchallenges focusonemergingopportunities efficient andeffective advicetoassistclientsinthiscomplexfield.We havebeeninvolvedinthedevelopmentofmajorproj Ontario Bar Association. Association, andaformerchairoftheEnvironmentalLawSection Environment, EnergyandResourcesLawSectionoftheCanadianBar and chairedseveralcommittees.HeisalsoapastchairoftheNational Energy andResourcesLaw, havingalsoservedonitsgoverningCouncil Committee ofthe American Bar Association’s SectionofEnvironment, Jonathan wasthefirstnon-AmericantoserveonExecutive across abroadrangeofindustries. and providingenvironmentallawadviceonsignificanttransactions, representing accusedcorporationsinmajorenvironmentalprosecutions environmental matters.Jonathan’s wide-rangingexpertisealsoincludes permitting; air, waterandwasteregulation;lenderliability;other handling anddisposalofhazardoussubstances;environmental and permitting;managementofnaturalresources;transportation, purchase, sale,andremediationofcontaminatedland;miningregulation issues. Herepresentsclientson:majorprojectdevelopment;the advice onabroadspectrumofenvironmentalandnaturalresourceslaw Graydon LLP, hasformorethan30yearsprovidedrepresentationand Jonathan Kahn,apartnerinthe Toronto office ofBlake,Cassels& Our national environmental team has extensive knowledge of environmental legislation and contacts with regulatory authorities to providetimely Our nationalenvironmentalteamhasextensiveknowledgeof legislationandcontactswithregulatoryauthoritiesto in virtuallyeveryareaofbusinesslaw. national andinternationalclientbase,Blakeshasanintegratednetworkofnine offices spectrumofcapabilities worldwideproviding clientswithafull Blake, Cassels&GraydonLLP Servingadiverse (Blakes)providesexceptionallegalservicestoleadingbusinessesinCanada andaroundtheworld. 12 in environmentlawyourjurisdiction. summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a Updates URL: Email: Tel: Canada Toronto, ON,M5L 1A9 Suite 4000,CommerceCourtWest 199 BayStreet Blake, Cassels&GraydonLLP Jonathan W. Kahn www.blakes.com [email protected] +1 4168633868

the quantumoffineshasincreasedrapidlyinrecentyears. much moreaggressiveinprosecutingenvironmentaloffences and Both thefederalgovernmentandseveralprovinceshavebecome associated withoff-site migration. and assuchthereissomeuncertaintyassociatedwithliability approaches oncivilclaimsfordamagescausedbycontamination Courts have,inrecentyears,beentakingsomewhatinconsistent Indigenous peoplesinsomeoftheprocesses. opportunities forpublicparticipationandexpandtheroleof environmental assessmentprocessformajorprojects,increase investigations andprosecutions. environmental administrativemonetarypenaltiesandin .Shehasalsobeeninvolvedinthecontestationof and treatmentofhazardoussubstances,theprotection the protectionofwaterandfisheries,transportation,management the rehabilitationofcontaminatedlands,mineclosureandrestoration, with respecttogreenhousegasemissionsandcap-and-tradesystems, requirements andenvironmentalassessmentprocesses,obligations obligations generallyaswellonmattersrelatingtovariouspermitting aboriginal andmininglaw. Sheadvisesclientsontheirenvironmental Anne-Catherine Boucher’spracticefocusesonenvironmental,energy, URL: Email: Tel: Canada Montreal, QC,H3B4N8 1, PlaceVille Marie,Suite3000 Blake, Cassels&GraydonLLP Anne-Catherine Boucher www.blakes.com [email protected] +1 5149824133 ects inavarietyofindustries WWW.ICLG.COM Canada ,

49 Canada Chapter 9 Chile Julio Lavín Valdés

LAVÍN Abogados & Consultores Andrés Del Favero Braun

1 Environmental Policy and its The agencies below administer and enforce environmental law: ■ The Ministry of the Environment collaborates with the Enforcement President of the Republic in the design and enforcement of environmental policies, plans and programmes. This Ministry handles the protection and conservation of 1.1 What is the basis of environmental policy in your biodiversity and renewable natural and water resources in jurisdiction and which agencies/bodies administer order to promote sustainable development, the integrity of and enforce environmental law? environmental policy and environmental regulation. ■ The Environmental Assessment Service administrates the The Environmental Framework in Chile is contained in Law 19300 Environmental Impact Assessment System (“SEIA” in and Law 20417, which amended Law 19300 to create the Ministry Spanish) and coordinates the government agencies involved of the Environment, the Environmental Assessment Service and the in project permitting and approvals. Environmental Superintendence. These agencies are autonomous, ■ The Environmental Superintendence oversees compliance have their own legal capacity and equity, and report to the President with: the environmental approvals of of the Republic through the Ministry of the Environment. Law and Statements; the measures and instruments contained in 20600 completes the environmental regulation, which created the Prevention and Decontamination Plans; the environmental Environmental Courts that hear appeals against administrative quality and emission standards; and management plans. decisions by the Environmental Assessment Service and the ■ Three Environmental Courts: There are three courts, each Environmental Superintendence, as well as any other matter, such as comprised of three judges, two of whom must be attorneys environmental damage claims. and one a scientist. These courts decide any environmental disputes within their purview according to the law. Environmental legislation is supplemented by several regulations, such as the the Environmental Impact Assessment System that Other government agencies have permitting and enforcement controls water pollution, hazardous waste handling, mining safety faculties, such as: the Regional Offices of the Ministry of Health; the and other related matters. Agriculture and Livestock Service; the National Forest Association; the National Fishing Service; the National Geology and Mining There are also other special laws that regulate aspects of Service; the General Water Bureau; the General Administration of environmental protection, such as the Sanitary Code, the Penal the Maritime Territory and Merchant Marine; and Municipalities. Code, the General Fishing and Aquaculture Law, the Navigation Law and the Native Forest Protection Law. Lastly, Chile has signed and enacted several international treaties, 1.2 What approach do such agencies/bodies take to the such as: enforcement of environmental law? ■ the 1940 Convention on Nature Protection and Wild Life Preservation in the Western Hemisphere; Due to the amount of agencies within the environmental regulation system, there are different approaches. The Environmental ■ the 1971 Convention on Wetlands, or Ramsar; Assessment Service applies the principle of prevention in granting ■ the 1981 Convention for the Protection of the Marine environmental permits – its task is to evaluate the potential Environment and Coastal Area of the South-East Pacific; environmental impacts that a project or activity may cause prior to ■ the 1981 Agreement on Regional Cooperation in Combating project implementation by means of an environmental impact study Pollution of the South-East Pacific by Hydrocarbons or other or an environmental impact statement. The Ministry of the Harmful Substances; Environment follows the same principle in its function of issuing ■ the 1989 Basel Convention on the Control of Transboundary environmental quality standards, prevention and management plans. Movements of Hazardous Wastes; A second approach, used by both the Ministry of the Environment ■ the 1992 United Nations Framework Convention on Climate Change; and by different government services, as applicable, is based on the “command and control” principle, and it is enforced through ■ the 1997 to the Convention on Climate emission standards and the grant of sectorial environmental permits Change; and and other permits and authorisations for projects. ■ the 2001 Stockholm Convention on Persistent Organic Pollutants. The third approach is corrective. The Ministry issues decontamination plans and the Environmental Superintendece exercises its authority of

50 WWW.ICLG.COM ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 © Published and reproduced with kind permission by Global Legal Group Ltd, London considered tobeconfidentialpursuantthelaw. that right.However, accesscanbedeniedtoanyinformationthatis government agencies,andtheprocedurestoexerciseprotect transparency, therighttoaccessinformationheldby Information, whichsetsdowntheprincipleofgovernment The aboveaccessisconsistentwithLaw20285on Access toPublic protection oftheenvironmentand/orhumanhealth. oversight actions,inquestsandprovisionalmeasuresforthe Assessment Service’s website.Italsocontainsinformationon existing environmentalpermitsisupdatedontheEnvironmental The informationonenvironmentalassessmentprocessesand this system,itwillindicatewhichothergovernmentauthorityhasit. have amaterialenvironmentalimpact.Iftheinformationisnotin environment; andadministrativeauthorisationsofactivitiesthatmay other administrativeacts;reportsontheconditionof treaties, conventions,internationalagreements,laws,regulationsand system contains,forexample:thetextofenvironment-related decentralised, NationalEnvironmentalInformationSystem. This The MinistryoftheEnvironmentadministratesanonline,regionally information inpossessionofthegovernmentanyformat. The lawstipulatesthateveryonehasarighttoaccessenvironmental 1.3 Metropolitan Region. matter emissionsoffset systemhasalsobeenimplementedinthe nitrogen oxide;sulphurdioxide;andcarbondioxide. A particulate the airemissionstaxonfollowingcontaminants:particulatematter; Finally, thefourthapproachconsistsofeconomicincentives,suchas or prosecutesliabilityforenvironmentaldamage. oversight andpenalisationofinfringementsenvironmentalpermits, LAVÍN Abogados&Consultores ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 Executive Director oftheEnvironmental Assessment Service, ifthe The denialofanenvironmentalpermit canbeappealedbeforethe 2.2 Service. change inholderisreportedtotheEnvironmental Assessment An environmentalpermitcanbelegallytransferredprovidedthe issuance ofanenvironmentalpermit. The environmentalassessmentoftheseprojectsconcludeswiththe monuments orsitesformingpartofaregion’s culturalheritage. alteration ofthelandscapeoritstouristicvalue;anyimpacton impact onpopulations,resourcesandprotectedareas;significant resettlement ofcommunitiesoranalterationtotheirwaylife;any population; materialadverseimpactsonrenewablenaturalresources; cause oneormoreofthefollowingimpacts:risktohealth means ofanenvironmentalimpactstatementorstudyastheymay submitted totheEnvironmentalImpact Assessment Systemby Article 10ofLaw19300liststheprojectsoractivitiesthatmustbe 2.1 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 2 persons (includingmembersofthepublic)? contained inanenvironmental permit? person toanother? Environmental Permits To whatextentarepublicauthoritiesrequiredto environmental permitsbetransferredfromone provide environment-relatedinformationtointerested What rightsaretheretoappeal againstthedecisionof When isanenvironmentalpermitrequired,andmay environmental permitorinrespect oftheconditions an environmentalregulatornot tograntan

based onprocedureviolation. before theSupremeCourtviaaremedyofvacationjudgment Committee; andanyEnvironmentalCourtdecisioncanbeappealed Court againstarefusalbytheExecutiveDirectororMinisters’ Permit applicantscanalsobringanappealbeforetheEnvironmental Development and Tourism; Agriculture; Energy; andMining. is comprisedoftheMinistersof:Environment;Health;Economy, made bymeansofanEnvironmentalImpactStudy. This Committee Statement, orbeforetheMinisters’ Committee,ifthe Assessment was project wasevaluatedbymeansofanEnvironmentalImpact permit. final closingofthefacilityandrevocationenvironmental US$900 toUS$9millionperviolation,includingthetemporaryor The penaltiesforviolationsofthelaworpermitsrangefromfines environmental permit. for anyinfringementofthelaworrequirementsunderan compliance withenvironmentalregulationsandtoapplypenalties The EnvironmentalSuperintendencehasthepowertooversee 2.4 System toobtainenvironmentalpermits. impact mustbesubmittedtotheEnvironmentalImpact Assessment industries. All projectsoractivitiesthatmaycauseanenvironmental The lawdoesnotrequireenvironmentalauditsofhighlypolluting 2.3 industrial wasteas wastedischarged byanindustrialfacility. of LiquidIndustrial Waste intoSewerageSystemsdefinesliquid The EmissionStandardforRegulation ofPollutantsinDischarges emitting sourceintoabodyofwater. liquid waste,wastewateroreffluents aswaterdischarged froman Waste Discharges intoOcean andInlandBodiesof Water defines The EmissionStandardfortheRegulationofPollutantsinLiquid environment, eitherdirectlyorfromactualplannedhandling”. to publichealthand/ormaycauseadverseimpactsonthe waste asa“wasteormixofthatishazardandpresentsrisk The Hazardous Waste ManagementRegulationsdefine houses andsugarrefineries. mining ororganic waste,or such astheby-productsfromslaughter industrial ormanufacturingprocesses,suchasslagandashfrom Industrial waste,nowknownassolidindustrialiswastefrom places, suchaswastefromhomelifeandcleaningproducts. household waste,aswasteproducedbypeoplelivingininhabitable Standards (1947)definedhouseholdwaste,nowknownassolid The formerRegulationsontheMinimumMunicipalSanitary proposes todisposeoforisobligatedof”. as a“substance,elementorobjectthattheproducerdisposesof, Waste isdefinedintheHazardous Waste ManagementRegulations 3.1 3 permits? polluting industriesorotherinstallations/projects? waste involveadditionaldutiesorcontrols? Waste regulators haveinconnectionwiththeviolationof What enforcementpowersdoenvironmental environmental impactassessmentsforparticularly Is itnecessarytoconductenvironmentalauditsor How iswastedefinedanddocertaincategoriesof

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hazardous Chile

51 Chile 52 Chile and/or permits,suchasobligations, standardsandmeasuresunder The lawlistsseveraltypesofbreaches onenvironmentallaws 4.1 recover 25%by2021.Recoverymustincreasegradually. inches musttakeback50%ofwasteby2021and90%2028, that themanufacturersorimportersoftyreswitharingsmallerthan57 must bedictatedtothateffect. The tyresregulationbilloflawprovides management systemsregulatedbyspecificexecutivedecreeswhich and thestorage,carriagetreatmentofthatwasteusingone the collectionofwastefrompriorityproductsthroughoutnation The producer’s/importer’s obligationsincludeorganising andfunding they sellinthecountry. the take-backandrecoveryofwastefromanythoseproductsthat batteries, packages,packaging,andtyres)mustorganise andmanage priority products(lubricants,electricalandelectronicdevices, system forwastemanagement. The producersandimportersof The ExtendedProducerResponsibilityLawestablishesaspecial 3.4 recovered ordisposedof. and tyresliable,fromthemomentwasteisproduceduntiliteither electrical andelectronicdevices,batteries,packages,packaging, 2016 madeproducersorimportersofwaste-producinglubricants, The enactmentoftheExtendedProducerResponsibilityLawin parties. has beentransferredforoff-site disposalortreatmentbythird Chilean lawhasnogeneralrulesonresidualliabilityforwastethat 3.3 an industrialfacility. hazardous waste,anditcanbekeptfornomorethansixmonthson Approval ofaHazardousManagementPlanisrequiredtostore provided theHealth Authority hasissuedasanitaryauthorisation. disposed ofonanindustrialproperty, inaworkplaceorbuilding, allow industrialandhazardouswastetobeaccumulated,treated the Workplace andtheHazardous Waste ManagementRegulations The RegulationsonBasicSanitaryandEnvironmentalConditionsin 3.2 of themanagementwasteproducedfromtheseproducts. packages, packingandtyresliablefortheorganisation andfunding importers oflubricants,electricalandelectronicdevices,batteries, Extended ProducerResponsibilityLawholdsproducersor cause aconsiderableenvironmentalimpact.Bywayofexample,the and allocatesagreaterresponsibilitytotheproducersofwastethat The lawdistinguishesbetweenthetreatmentofeachtypewaste LAVÍN Abogados&Consultores © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 4 and/or disposeofitonthesitewherewasproduced? what defencesaretypicallyavailable? regarding thetake-backandrecoveryoftheirwaste? bankrupt/disappears)? Liabilities breach ofenvironmentallawsand/or permits,and What typesofliabilitiescanarise wherethereisa To whatextentdowasteproducershaveobligations another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin To whatextentisaproducerofwasteallowedtostore the transferee/ultimatedisposergoes

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will beliableforthedamagetoenvironment. Consequently, iftheoperatorcausesanyofthosematerialeffects, he impairment totheenvironmentoronemoreofitscomponents. damage isdefinedasanyloss,decrease,detrimentorsignificant is operatingwithinpermitlimitsorstandards,sinceenvironmental An operatormaybeliableforenvironmentaldamageeventhoughhe 4.2 environmental wrongdoingorremediationcosts. projects thatmaycauseenvironmentaldamagearenotliablefor Lenders ofcompaniesconductingactivitiesorimplementing 4.5 the purchase,inwhichcaseredressmaybesoughtfromseller. unless itcanbeproventhatthebreachordamageoccurredpriorto Environmental liabilityinanassetpurchaselieswiththebuyer and alsoconductsthedamagingactivity. the shareholders,ascompanyholdsenvironmentalpermit In asharesale,environmentalliabilityfollowsthecompany, andnot 4.4 environmental liability. Companies cancarrydirectorandofficer insurancetocover decision thatledtotheenvironmentaldamage. directors andofficers ifitisproventheywereresponsibleforthe repair orindemnifyenvironmentaldamagecanseekredressfromits for environmentalwrongdoing.However, anycompanyrequiredto There isnoruleholdingdirectorsandofficers ofcorporationsliable 4.3 vacation ofjudgment. by thatcourtcanbebroughtbeforetheSupremeCourtseeking Court inthelocationwheredamageoccurredandanyjudgment An environmentalclaimmustbefiledbeforetheEnvironmental can fileanactionseekingreparationforanyenvironmentaldamage. The lawalsostipulatesliabilityforenvironmentaldamage. Anyone breach isqualifiedasordinary, seriousorveryserious. environmental permit,foreachbreach,dependingonwhetherthe or finalclosingoffacilities,andeventherevocation admonition, tofinesofUS$900US$9million,and/ortemporary These breachescanbepenalisedbysanctionsthatgofromwritten without holdingtherelevantenvironmentalpermit. environmental permits,orfortheexecutionofprojectsactivities within permitlimits? environmental wrongdoingand/orremediationcosts? the onehandandanassetpurchaseonother? indemnity protectioninrespectofsuchliabilities? notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage To whatextentmaylendersbeliablefor environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract

Chile

damage. greater protectioninseekingremediationandindemnityforany apparent andnotfromwhenitwascaused,soChileanlawoffers damage prescribesfiveyearsafterthecontaminationhasbecome As forhistoriccontamination,anyactiontoclaimenvironmental person hasactednegligentlyorwithwilfulmisconduct. event thatcausesdamageattributabletoacertainpersonand subjective tortliabilityisfollowedwherethepresuppositionsarean activity mustbeheldliableforitsdamage,inChiletheprincipleof liability forenvironmentaldamage,wherewhoeverperformsan Unlike theinternationaltrendofenforcingprincipleobjective must befollowed. underground water, sothegeneralrulesonenvironmentaldamage special regulationstopursueliabilityforthecontaminationofsoilor as theequivalentto“environmentaldamage”,Chileanlawhasno Assuming thattheword“contamination”isusedincomparativelaw 5.1 LAVÍN Abogados&Consultores ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 the SupremeCourtforvacationof judgment. Environmental Court. The court’s decisioncanbebroughtbefore of anenvironmentalremediationplanbymeansappealtothe Under thelaw, thirdpartiescantakeactiontoobjecttheapproval culprit willbereleasedfromanyadditionalmeasures. environmental remediationactionswillbeextinguishedandthe If theculpritcompletesremediationplansatisfactorily, all environmental courts. for thefilingofanenvironmentalremediationactionbefore remediation planandforwardthecasetoStateDefenceCouncil is thusnotremediated,theSuperintendencewillputanendto culprit doesnotfollowtheremediationplanandcontamination measures andobjectivesincludedintheremediationplan.If responsible fortheremediationmustcompleteeachofactions, Remediation Planhasbeenapproved. Therefore, theperson authority torequireadditionalworkafteranEnvironmental The lawdoesnotgranttheEnvironmentalSuperintendence 5.3 according togeneralrules. against theotherpersonsresponsibleforcontamination, prejudice totheactionavailableaccusedtakeredress more thanonepersonisresponsibleforcontamination,without Code wouldapply, whichstipulatejointandseveralliabilitywhen make referencetogeneralrulesincivillaw, therulesinCivil responsible forcontamination.However, sinceLaw19300does Environmental lawdoesnotenvisagemorethanonepersonbeing 5.2 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 5 is responsibleforthecontamination? groundwater? can athirdpartychallengetheagreement? Contaminated Land What istheapproachtoliabilityforcontamination (including historiccontamination)ofsoilor regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis How isliabilityallocatedwheremorethanoneperson

damage topublicproperty. rule, theStatehasauthoritytoseekanindemnityforaesthetic and civilsuitforanydamageinsidethenation. According tothis The governmenthastheauthoritytofileanenvironmentalaction 5.5 liability intheircontract. However, thepartiescanfreelystipulateareleasefromenvironmental risk ofresponsibilityforthecontaminatedlandtoabuyer. be obligatedtoremediateit,soacontaminatorcannottransferthe damage totheenvironmentbynegligenceorwilfulmisconductwill Under theenvironmentalliabilitysystem,anyonewhohascaused from anyenvironmentalliability. the buyerandsellerstipulatingthatreleased contamination exists,unlessthereisaprivateagreementbetween previous ownerandalsoseekanindemnityifthecourtdeclaresthat action beforethecompetentenvironmentalcourtagainst The purchaserofpropertyonwhichcontaminationisfoundcantake 5.4 report contaminationtotheEnvironmental Superintendence. Superintendence orpotentiallyaffected thirdparties,butanyone can contaminated landoroff-site migrationtotheEnvironmental Environmental regulationsdonot stipulateanobligationtoreport 7.1 overseen entitiesandtotestifyaboutanypunishabledeed. representatives, directors,managers,advisorsandemployeesofthe The Superintendencehasthepowertorequirestatementsfrom prepare statuscertificates,amongothermeasures. take samplesormakerecordsofthesiteassetsinspected,to whereoverseenactivitiesarebeingconductedinorderto The Superintendence’s officers willalsohavethepowertoenter projects. environmental regulationsandthepermitsfor part ofitsoversightfacultiestherequirementsimposedby conduct inspections,takemeasurementsandperformanalysesas The EnvironmentalSuperintendencehastheauthoritybylawto 6.1 7 6 public assets,e.g.rivers? contaminated landliabilitytoapurchaser? parties? conduct siteinspections,interviewemployees,etc.? Reporting /DisclosureObligations Powers ofRegulators polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek environmental regulatororpotentiallyaffectedthird migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe require productionofdocuments,takesamples, What powersdoenvironmentalregulatorshaveto

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Chile

53 Chile 54 Chile dissolved toeludeenvironmentalliability. Directors ofacompanywillbe held liableifthatcompanyis absorbing companytoassumearisk. disclose theenvironmentalliabilityandcausingbuyeror balance sheetwillimmediatelytriggerdefaultclausesforfailureto Any auditrevealingthatanenvironmentalliabilitywasleftoff the Reporting Standards(IFRS). is permittedinmergers oracquisitions bytheInternationalFinancial No overvaluingofacompany’s assetsorundervaluingofliabilities 8.2 liability forcontaminationinrespectofthirdparties. stipulate thistypeofclause,buttheywillnotbereleasedfromany Under therulesofprivatelaw, partiestoacontractarefree future environmentalliabilitytotheStateorthirdparties. Under Chileanlaw, releasesfromliabilitydonotlimitpresentor 8.1 indemnities. untrue, buyerswillhavetherighttoclaimpaymentof representations andwarrantiesonenvironmentalmattersprovetobe and warrantiesonpre-existingenvironmentalissues.Ifthose As ageneralrule,buyerswillrequestfromsellersrepresentations environmental issues. prevails whenacontractstipulatesthatsellermustdiscloseany Civil lawoncontractsappliesinthisregard,wheregoodfaith disclose environmentalissuesinmergers andacquisitions. The regulationsdonotsetthecontractualdutiesofpartiesto 7.3 investigate landforcontamination. The lawdoesnotcontainanyrulesrequiringindividualsto 7.2 events. authority ofanyunforeseenimpacts,includingcontaminating impose adutyuponthepermitholderstonotifyenvironmental inform theauthorityorthirdparties,environmentalpermitsdo Although environmentalregulationsdonotimposetheobligationto LAVÍN Abogados&Consultores © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 8 contamination? order toescapeenvironmentalliabilities? potential liabilityforthatmatter? takeover transactions? General matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff Is itpossibletouseanenvironmentalindemnity To whatextentisitnecessarytodisclose have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson

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8.5 wrongdoings, includingenvironmentalviolations. Internally, companieshavesetupprotectionsforworkersreporting reporting environmentalviolations. Regulations donotcontainlegalprotectionforwhistle-blowers 8.4 subsidiary. The actualperpetratorofthedamageisheldliable. A parentcompanyisnotliablefordamagecausedbyaforeign that willhavestandingtobesuedinanycourtaction. pollution, sincethecompany, itsofficers anddirectorsaretheones be heldliableforthatcompany’s violationofenvironmentallawor Under Chileanlaw, apersonwhoownssharesincompanycannot 8.3 matter (PM),nitrogenoxide(NOx), sulfurdioxide(SO2)and The Tax ReformLaw20780addeda“greentax”on particulate 9.2 emissions limits,underpriorapprovaloftheHealth Authority. allowing emissionstradingbetweensourcestomeettherequired particulate matteremissionsoffset systemhasbeenestablished At aregulatorylevel,validonlyintheMetropolitanRegion, emissions tradingsystemhavenotyetbeenissued. and decontaminationplans.However, theregulationson encourage meetinggoalsforemissionsreductionunderprevention Law 19300authorisestheuseofemissionstradingschemesto 9.1 damages; inthiscasethecostsarehandledbymunicipality. municipality tofileanactionforreparationofenvironmental The lawoffers toanypersonthepossibilityofrequesting 8.6 available. contamination andtherearenopenalorexemplarydamages Environmental regulationsdonotenvisagecasesofclassactionsfor 9 damages available? report environmentalviolations/matters? caused byaforeignsubsidiary/affiliate? to monitorandreportgreenhouse gasemissions? market developingthere? pursuing environmentallitigation? Emissions Trading andClimateChange environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing Are thereanylawstoprotect“whistle-blowers”who company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation any exemptionfromliabilitytopaycostswhen Do individualsorpublicinterestgroupsbenefitfrom Chile

10.1 (Spanish version). content/uploads/2017/07/plan_nacional_climatico_2017_2.pdf Plan, whichmaybeviewedat: As aresult,Chilenowhas2017–2022NationalClimateChange connection withclimatechange. proposes policiesanddesignsplans,programmesactionsin The ClimateChangeDivisionoftheMinistryEnvironment 9.3 Superintendence. to monitoremissionsandreporttheirresultstheEnvironmental capacity greaterthanorequalto50MWt. They havetheobligation carbon dioxide(CO2)airemissionsbyfacilitieswitharated LAVÍN Abogados&Consultores ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 at thistime.Civilliabilityinsurance isavailableonthedomestic There isonlyonelocalcompanyoffering environmentalinsurance 11.1 management plan. will requiretheHealth Authority’s approvalandanasbestos equipment, installationsormachinerywhichcontainasbestosfibres such asdemolitions,dismantlingormodificationofbuildings, every semesterastoitsstockmovementsandrecipients. Activities manufacturing ofitsproducts,itmustinformtheHealth Authority case thatafacilityhasasbestosinstockfortheproductionor material intotheenvironmentoverpermittedamounts.In Authority. Itsstoragemustbedonewithoutliberatingfibresofthe is authorisedunderstrictconditionsandsupervisionoftheHealth of asbestosandanyothermaterialorproductcontainingit,unlessit Chilean lawprohibitstheproduction,import,distributionandsale 10.2 inhaling asbestoswhileheworkedforPizarreño. contracted aterminalcancercalledpleuralmesotheliomafrom indemnity ofapproximatelyUS$82,000toMr. Olivares,who Second LabourCourtofSantiagoorderedthecompanytopayan adopted despiteknowingthemortaldangerofasbestos.In2014, handling ofasbestosparticulates.Nopalliativemeasureswere the lawsuitfiledbyRaúlOlivaresagainstPizarreñofornegligent One ofthemostrepresentativecasesregardinguseasbestosis authorises itsimportanduseunderverystrictconditions. Health, whichprohibitstheuseofasbestosincertainproductsand Asbestos wasprohibitedbyDecree656/2000oftheMinistry © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 10 11 in relationtoasbestoson-site? jurisdiction? regulation inyourjurisdiction? risks insuranceplayinyourjurisdiction? What istheexperienceofasbestoslitigationinyour What istheoverallpolicyapproachtoclimatechange in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable What arethedutiesofowners/occupierspremises Asbestos Environmental InsuranceLiabilities http://portal.mma.gob.cl/wp-

caused bythecontamination. fines imposedupontheinsuredoranydamagestothirdparties accidental contamination,butthisinsurancedoesnotcoverany market thatcoverstheexpensesofremovalandclean-upsudden in environmentalprotectionandsustainabledevelopment. institutional frameworkdemonstratethatthecountryhasprogressed The measuresaddedbythelawandimprovementsin risk matricesafewyearsago. must haveagreaterawarenessofsubjectthatwasnotevenintheir closure ofthefacility. Nowcompaniesdoingbusinessinthecountry by BarrickGold. The fineamountedtoUS$11.5 millionandthe environmental violationstothePascuaLamaminingproject,owned highest fineinthecountry’s historywasimposedlastyearfor analysis, andbettercontrol,ofpermits.Bywayexample,the and theEnvironmentalSuperintendence. There isamoremeticulous of theEnvironmentalCourts, Assessment Service The environmentalframeworkhasbeenstrengthenedbytheaddition types ofenvironmentalcrimestothePenalCode. introduced agreentax.Congressiscurrentlydebatingaddingcertain recovery ofwastetoavoiddisposal. The Tax ReformLaw Responsibility Lawforwastemanagementandthereuse New billsoflawhavebeenapproved,suchastheExtendedProducer and engagementoflocalcommunitiesclimatechangepolicies. policies andenvironmentalremediation;aswelltherecognition offshore andtheexpansionofexistingones;wastemanagement energy generation;thecreationofnewprotectedzonesonlandand government administrations;theexplosivegrowthofrenewable strengthen theenvironmentalframeworkdesignedbypastfew subject hasforthecurrentChileanpublic,andalsoinpoliciesto environment inChile. The aboveisreflectedintherelevancethis and Development(OECD)hasbeenaveryimportantboostforthe Chile’s incorporationtotheOrganisation forEconomicCo-operation 12.1 environmental insuranceclaims. tort liabilityinsurance,sothereisnoorverylittleexperiencein insurance industryhasnotdevelopedinChile,exceptforsubjective Considering thesubjectiveciviltortsystem,environmental 11.2 Tel: +56232452700/Email: Consultores specialisinginenergy andenvironmentallaw. preparing thischapter. Arturo isalawyeratLAVÍN Abogados & The authorswouldliketothank Arturo Lavínforhisassistancein Acknowledgment 12 in environmentlawyourjurisdiction. experience inyourjurisdiction? summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a What istheenvironmentalinsuranceclaims Updates

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Chile

55 Chile 56 Chile LAVÍN Abogados&Consultores © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM completion whileensuringtheiroperationalcontinuity. the ChileanNavy. Bertelsen-Oelkers-Genskowsky-Lavin Abogados &Consultores;and Experience: JaraDelFavero Abogados, GrastyQuintanaMajlisyCía.; at Law(1976). Degree, PontificiaUniversidadCatólicadeValparaíso, Chile, Attorney Education: MasterofPoliticalScience,UniversityChile(1989);Law and leaderoftheNaturalResourcesDepartmentinfirm. Zoning andMaritimeConcessions.Mr. LavínistheFoundingPartner He isalsoagovernmentadvisorandwriterforthebilloflawonCoastal and industrialsectors(suchaswineexportersforestry&paper). aquaculture concessions.Heisinvolvedinthemining,energy, utilities also focusedonpublicandadministrativelaw, andonmaritime 2018 and2019intheEnvironmentallawsection,JulioLavínValdés is A resources sector, providinglegalservicesinthediverseareasrequiredbyindustry, projects’ andhelpingthosecompaniesachievetheir The firm’s attorneyshave extensiveexperienceintheenvironmentalsector, inthenatural bothwithinlawfirmsandinmultinationalcompanies environmental, renewableenergy, electrical,mining,maritimeconcessions,naturalresources,corporate,taxandaccountingareas. consultancy onthe attorneys inChile,andcomprisingahighlycapableexperiencedteamspecialisedprovidinglegalservicestechnical LAVÍN Abogados &Consultores Chambers andPartners URL: Email: Tel: Chile Santiago Las Condes Burgos 80,SecondFloor LAVÍN Abogados &Consultores Julio LavínValdés SeniorStatesmanfortheyears2016,2017, www.lavinabogados.com [email protected] +562 32452700 isaSantiago-basedboutiquefirmledbyitsfoundingpartnerJulioLavín,oneofthemostrecognisedenvironmental ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

Favero Abogados. Jacobs EngineeringGroup(formerly Aker Solutions);andJaraDel Corporation; in-housecounsel,Carey& Allende; in-housecounselfor Experience: Anglo-American in-housecounsel,BarrickGold Universidad CatólicadeChile. Attorney atLaw(2007). University ofPennsylvania(2014);andLawDegreefromPontificia Wharton BusinessandLawCertificate,School, Education: MasterofLaws(LL.M.),UniversityPennsylvania(2014); industrial sectors(suchaswineexportersandforestry&paper). concessions areas,andisinvolvedinthemining,energy, utilitiesand hand-in-hand withJulioLavínValdés intheenvironmentalandmaritime and aquacultureconcessions,mining,infrastructurelaw. Heworks Andrés DelFaveroBraunisapartnerfocusedonenvironment,maritime URL: Email: Tel: Chile Santiago Las Condes Burgos 80,SecondFloor LAVÍN Abogados &Consultores Andrés DelFaveroBraun www.lavinabogados.com [email protected] +562 32452700 Chile timely

Chapter 10 Colombia

Macías Gómez & Asociados Abogados S.A.S. Luis Fernando Macías Gómez

1 Environmental Policy and its Regional Authorities may also establish environmental policies at the regional level. Likewise, Law 99 of 1993 also attributes judicial Enforcement functions to departmental, district and municipal authorities. The set of rules from Law 99 of 1993 regarding the imposition of 1.1 What is the basis of environmental policy in your sanctions and penalties for violation of environmental laws was jurisdiction and which agencies/bodies administer later amended by means of Law 1333 of 2009, which established the and enforce environmental law? environmental sanctions regime. Through this regime, environmental sanctions or preventive measures might be imposed Through Law 23 of 1973, the Colombian Government issued Law- by the competent environmental authorities for activities alleged to Decree 2811 of 1974 (the “Decree”), known as the Natural be in violation of environmental legal dispositions. These Renewable Resources and Protection of the Environment Code. attributions are also granted to the National Army, and the This Decree sets forth the legal framework in Colombia for the departmental, district and municipal authorities. protection of the environment and its natural resources, imposing a In September 2011, Congress issued Law 3573 of 2011, the series of obligations on both the State and the Colombian National Authority for Environmental Licences (“ANLA” by its population. Later, the issuance of Law 9 of 1979 provided a series acronym in Spanish) which was created as an administrative and of rules aimed at the protection of the environment in order to financially autonomous entity in charge of evaluating, approving improve sanitary conditions and human wellbeing. and issuing environmental licences, permits and other In 1991, the Colombian National Constitution adopted a variety of environmental procedures, as well as enforcing environmental law principles that were to be further regulated. This Political Charter within such procedures. has been catalogued as the “Ecological Constitution”, given that it contains 34 articles from different perspectives related to the 1.2 What approach do such agencies/bodies take to the protection of the environment. The Constitution establishes (article enforcement of environmental law? 79) the right for its citizens as a whole to enjoy a healthy and safe environment. The environment is also determined as a main factor The enforcement of Colombian environmental law follows the rules for development, which is limited to economic rights. Additionally, of administrative procedural law. The agencies in charge of the Constitution sets forth the obligation of the National Congress to enforcing these dispositions are the ANLA, the Autonomous create and regulate what in Colombia is known as Autonomous Regional Authorities, the Sustainable Development Authorities and Regional Authorities. the Large Urban Districts. Inspired by the international principles and directives included in Additionally, Law 1333 of 2009 establishes the environmental the Rio Declaration of 1992, the Colombian National Congress sanctions regime by which the environmental authorities may issued Law 99 of 1993, which created the institutional framework impose preventive measures and/or sanctions on activities alleged to for the protection of the environment and the management of natural be in violation of the Colombian environmental regime. The resources. The National Environmental System, created therein, is investigations to impose sanctions may be initiated as a result of the a hierarchical structure of the agencies in charge of the enforcement management and control functions of environmental authorities or of environmental legal dispositions and the management of natural due to complaints from the community. resources within the Colombian territory. The Ministry of Environment and Sustainable Development is the agency at the The legal system also provides judicial mechanisms, such as apex of the hierarchy, and it is in charge of creating environmental enforcement actions, class actions, actions for the protection of policies at a national level. There are other environmental fundamental rights, criminal actions and civil actions. authorities, such as the Regional Authorities, the Sustainable Development Authorities, the Large Urban Districts and the Special 1.3 To what extent are public authorities required to Caribbean Districts, formally created by this law to manage the provide environment-related information to interested protection of the environment and enforce environmental law within persons (including members of the public)? the regions of their competent jurisdictions. These Regional Authorities also evaluate, approve, control and issue environmental The National Constitution not only grants the right to a healthy licences, permits and other environmental management and control environment, but it establishes mechanisms to guarantee that its instruments within their jurisdictions. Among their functions, the citizens are able to realise this right. Bearing this in mind, there is a

ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 WWW.ICLG.COM 57 © Published and reproduced with kind permission by Global Legal Group Ltd, London 58 Colombia and 2.2.2.3.2.3ofDecree1076 2015. only requiredtodeveloptheactivities listedinarticles2.2.2.3.2.2 According tothecurrentregulation, anenvironmentallicenceis compensation oftheeffects thattheactivitymayinvolve. obligations withregardstothe prevention,mitigationand through thedevelopmentofactivity. Italsoincludesthe met inrelationtothemanagementanduseofnaturalresources An environmentallicencecomprisesthetermsandconditionstobe aspects aswell. called anenvironmentallicence,itmustcoversocialandeconomic renewable naturalresourcesandtheenvironment. Although itis according totheregulation,mightcausedeteriorationof as theauthorisationgrantedbyStatetodevelopanactivitythat, 2.2.2.3.1.1 andsubsequentofDecree10762015,whichisdefined On theotherhand, set outasfollows: from thecompetentauthority. The variousenvironmentalpermitsare assignment ofenvironmentalpermitsrequirespriorauthorisation permit, accordingtotheresourcebeused. As ageneralrule,the anyone willingtousenaturalresourcesmustobtainanenvironmental Renewable Resources,orLaw-Decree2811 of1974,providesthat specific renewableresource. The NationalCodeofNatural activities duetobecarriedout,andbythepossibleimpactona The needtoobtainanenvironmentalpermitisdeterminedbythe 2.1 imposing sanctionsfortheviolationofenvironmentallaw. affect theenvironment,aswellinproceduresaround cancel environmentalpermitsorlicencesforactivitiesthatmay intervene intheadministrativeactionsinitiatedtoissue,modifyor person, withouttheneedtomanifestanyinterestwhatsoever, can information. Furthermore,Law99of1993establishesthatany Colombian citizensholdtherighttoaccessenvironmental consultation ofethniccommunities. mechanisms: publichearings;interveningthirdparties;andprior The followingaresomeoftheenvironmentalparticipation process thatmayaffect theirrighttoenjoyahealthyenvironment. mechanisms thatenablethemtoparticipateinanydecision-making duty onthelegislatortoguaranteethatcitizenshaveparticipation Macías Gómez&AsociadosAbogadosS.A.S. © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM Research Permit Lifting ofBanoverProtectedSpecies Forestry Permit Emissions Permit Water Discharge Permit Flow OccupationPermit Water ConcessionPermit 2 person toanother? Environmental Permits environmental permitsbetransferredfromone When isanenvironmentalpermitrequired,andmay Environmental Permit

environmental licences Biodiversity Biodiversity Forest Air Water Water Water areregulatedinarticle Resource ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

subsequent 30days. the environmentalauthorityshouldmakeastatementwithin this event,thelicenseemustrequesttransferenceinwriting,and authorisation hasbeengrantedbytheenvironmentalauthority. In possible underDecree1076of2015,butonlywhenprior The totalorpartialtransferenceofanenvironmentallicenceis the licenceorpermitprocess. project, whichcouldbeanypersonwhowouldliketoparticipatein the petitioneroflicenceorpermit,byanyoneinvolvedin to environmentalrights. Therefore, theappealcanbeproposedby different fromwhatthepetitionerasksfororappeartoberestrictive can beinitiatedwhentheconditionsoflicenceorpermitare Authorities, orbeforeasuperioragencywhenapplicable. An appeal issued theresolution,i.e. Autonomous Environmental any personhastherighttoappealbeforesameauthoritythat the sameasthoseapplyingtoadministrativeprocedure.Hence, appeal, ortouseanyoftheotherlegallyestablishedresources,are called administrativeactsor“resolutions”. Therefore, therightsto granted bytheenvironmentalauthoritiesthroughdecisionsthatare administrative procedures,environmentalpermitsandlicencesare Taking intoaccountthatenvironmentallawfollowstherulesof 2.2 licences isheldunderLaw1333 of2009,whichestablishesthe The enforcementoftheconditions ofenvironmentalpermitsand 2.4 assessment. licence mustsupporttheirfilingalongsideanenvironmentalimpact mandatory, butacompanythatseekstheissueofanenvironmental On theotherhand,asmentionedabove,environmentalauditsarenot 2.2.2.3.2.3 ofDecree10762015. put intooperationtheactivitieslistedinarticles2.2.2.3.2.2and Licence, whichturnsouttobeamandatoryrequirementinorder Environmental ImpactStudyisthebasisfor biotic andabioticelements,theimpactassessment. The document containinginformationontheproject’s location,the by itsacronyminSpanish). This studyisdefinedasatechnical 1076 of2015,whichrequireanEnvironmentalImpactStudy(EIA set outinLaw99of1993,andregulatedbyChapter3Decree Furthermore, therearespecificactivities,projectsandinstallations infringement. required inordertodetermineifthereisanenvironmental standards. Forwater-related activities,characterisationsarealso or not,inordertoestablishiftheyareaccomplishingtheairquality and mobilesourcesofairpollutants,whethertheyrequireapermit and characterisationofcertainpollutingactivities,suchasstationary On theotherhand,environmentalregulationsrequireanalysis companies dothesevoluntarily. In Colombia,environmentalauditsarenotmandatorybutmany 2.3 contained inanenvironmentalpermit? permits? polluting industriesorotherinstallations/projects? environmental permitorinrespectoftheconditions an environmentalregulatornottogrant What rightsaretheretoappealagainstthedecisionof regulators haveinconnectionwith theviolationof What enforcementpowersdoenvironmental environmental impactassessmentsforparticularly Is itnecessarytoconductenvironmentalauditsor Colombia

environmental authoritiesasageneratorofthistypewaste. Hazardous Waste ManagementPlan,aswellregisterwiththe characterisation ofhazardouswasteandprepareaComplete Generators ofhazardouswastemustmaintainupdatesonthe labelling andpackagingofhazardoussubstances. waste. The Decreealsosetsforththerulesforhandling, importers, whomustassuretheadequatedisposalortreatmentof attributed jointlyandseverallytogenerators,producers These obligationsaresetforthinDecree1076of2015andtobe Hazardous wastehandlinginvolvesadditionaldutiesorcontrols. in contactwithhazardouswastemustbetreatedashazardous. Furthermore, thisregulationestablishesthatanyconventionalwaste involve riskordamagetohumanhealthandtheenvironment. flammable, infectiousandradioactivecharacteristics,whichmay defines hazardouswasteasthatwithcorrosive,reactive,explosive, On theotherhand,article2.2.6.1.1.3ofDecree10762015 waste management. manner towhoeverisundertakinganyoftheactivitiesrelated control ofordinarywastearetobeattributedinanindividual In thesamesense,thisregulationestablishesthatdutiesand finally disposedof. is subjecttobeingseizedortransformedintoanewasset, activities, rejected,abandonedordeliveredbythegenerator, which element resultingfromdomestic,industrial,commercialorservice and residue,definesitasanyobject,material,substanceorsolid complete managementofsolidwaste. This regulationequateswaste Title 2ofDecree10772015setsforththegeneralregimefor 3.1 and/or sanctionsonthecompaniesthatviolateenvironmentallaw. authorities mayimposeinjunctions(called“preventivemeasures”) environmental sanctionregimethroughwhichthe Macías Gómez&AsociadosAbogadosS.A.S. ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 oils mayonlybestoredforuptothree months. timeframe forthestorageofwaste mayvary. Forexample,used Please notethat,dependingonthetypeofhazardouswaste, this term. generator mayrequestthattheenvironmentalauthoritiesextend to storethewasteforamaximumof12months.Nonetheless, of Decree10762015establishestheobligationforgenerator In termsofhazardouswastedisposalandstorage, Title 6Section3 transferring ittowastedisposalvenues. relies onpublicutilitycompaniesincharge ofcollectingwasteand given byDecree Title 2ofDecree10772015. The mainduty The storageanddisposalrulesregardingconventionalwasteare 3.2 definite suspensionoftheactivities. infraction, andmaycontemplatethepossibilityoftemporaryor The sanctionsmaybeimposedaccordingtotheseriousnessof © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 3 waste involveadditionaldutiesorcontrols? produced? Waste How iswastedefinedanddocertaincategoriesof and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore

4.1 and pneumatics;lightbulbs;electricalelectronicwaste. pesticides; batteries,includinglead-acidbatteries;medicines;tyres adequately collectandmanageseveraltypesofwaste,suchas: of Environmenthas,inthelastfewyears,issuedregulationsto and distributorofspecifictypeshazardouswastes. The Ministry Post-consumption andreturnplansaremandatoryfortheproducer 3.4 even ifitinvolvesoutsourcingforitstransportationanddisposal. on thoseinvolvedinthemanagementchainofthistypewaste, producers, hazardouswasterulesimposejointandseveralliabilities Although non-hazardouswasteretainsnoresidualliabilityforits 3.3 class actionsorfortheprotection ofcollectiverights. operator liableforenvironmental damage isthroughthefilingof are includedintheCriminalCode. A common waytoholdan also befoundcriminallyliableifthe actionsthatledtothedamage despite operatingwithinpermitorlicencelimits. An operatorcan Civil liabilitycanariseintheeventofenvironmentaldamage, 4.2 event thecriminalconductisproven. in theCriminalCode;hencecriminalliabilitymaytakeplace A setofpunishableconductsregardingtheenvironmentisprovided of thirdparties. person heldliablecouldargue fornegligence, the occurrenceofdamagetoenvironment,inwhichcase On theotherhand,civilliabilitymayariseasresultofproving reconsideration petitionssetforthbyColombianadministrativelaw. Please notethatthedefencemechanismscorrespondto environmental damageoccurring. to imposepreventivemeasuresinorderavoidprobable suspension ofactivities.Italsoenablestheenvironmentalauthorities economic penaltiestothesuspensionoflicenceordefinite authorities toimposesanctions. These sanctionsmayvaryfrom protection oftheenvironmentempowersenvironmental This regulationstatesthatanyviolationofalawregardingthe with environmentalregulation,asprovidedinLaw1333of2009. Administrative liabilitymayariseasaresultofthefailuretocomply laws orpermits. Several typesofliabilitiesmayarisefromabreachenvironmental 4 regarding thetake-backandrecoveryoftheirwaste? bankrupt/disappears)? within permitlimits? what defencesaretypicallyavailable? Liabilities breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa To whatextentdowasteproducershaveobligations the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage

WWW.ICLG.COM force majeure oracts Colombia

59 Colombia 60 Colombia Environment andSustainableDevelopment issuedthe We havetotakeintoaccountthatin2014,theMinistryof criminal liabilities. is conductedfromtheperspectiveofadministrative,civiland The approachtoliabilityforcontaminationofsoilandgroundwater 5.1 ownership, holdstheliability. wrongdoing, thecurrentoperatorofactivity, regardlessof From anadministrativeperspective,andregardingenvironmental invoked undercivillaw. assume remediationcosts,anactiontoseekcontributionmaybe liabilities. Nonetheless,ifthelenderisheldliableandforcedto The lender, when becomingtheowner, inheritsenvironmental 4.5 the assetitself,purchasermayclaimfornon-disclosedliabilities. Therefore, whenpurchasingassets,sincetheliabilityislimitedto not havelimitedliability. partner intheeventofacquiringsharesfromacompanythatdoes An environmentalliabilityistransferredtotheshareholderor 4.4 when theycarryoutactivitiesthatwerenotauthorisedbythestatutes. the directorsorofficers ofcorporationsmustbeheldresponsible On theotherhand,ColombianCommerceCodeestablishesthat damages. officers’ wrongdoing,thecompanycouldsuethemtorecover environmental wrongwascauseddirectlybythedirectors’ and liable fortheenvironmentalwrongwithitscapital.Inanycase,if administrative law, wherethecorporationisonethatwillbeheld this casecanonlybeimposedregardingcriminallaw, notincivilor negligence orwilfulmisconductisproven. The personalliabilitiesin environmental damage,theymaybesubjecttopersonalliabilityif When directorsandofficers undertakeactivitiesthatleadto 4.3 Macías Gómez&AsociadosAbogadosS.A.S. © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM Guide forSoilSampling has notbeenfullydevelopedinthecountry. personal liabilityfromenvironmentalwrongdoings,thispossibility possibility ofdirectorsandofficers obtainingpoliciestoinsureagainst Please beawarethatalthoughColombianlawcontemplatesthe They willalsocompensatethecompanyfordamagescaused. the liabilityregime thatisapplicable. historic contaminationliabilities;therefore, thesearetreatedunder In particular, thecountryhasnotyetdeveloped regulationsfor fossil fuelintothesoil. standards thatcompaniesmustfollow withregardtodischarges of 5 indemnity protectioninrespectofsuchliabilities? groundwater? environmental wrongdoingand/orremediationcosts? the onehandandanassetpurchaseonother? Contaminated Land What istheapproachtoliabilityforcontamination To whatextentmaylendersbeliablefor environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract (including historiccontamination)ofsoilor , inwhichitestablishedtheminimum

Technical ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

programme. environmental authoritytorequirethecompanyadjust sufficient toremedythedamage,thispersonmayask If athirdpartyconsidersthattheprogrammeisnotcompleteor follow-up andcontrolvisits,ifitisconsiderednecessary. the programme,orunderobligationofauthoritytoperform The environmentalauthoritymayrequireadditionalworksunder to starttheremediationactivities. the companyandapprovedbyenvironmentalauthority, inorder A programmeofenvironmentalremediationhastobeproposedby 5.3 both individualsareheldliable. Under criminallaw, ifmorethanonepersoncommitsacrime,then contribution todistributethecoststhatmustbepaid. law. Thus, theinvolvedpartiesmaypursueanactiontoseek In thiscase,jointandseveralliabilitiesmaybeallocatedundercivil 5.2 inspections when evaluatingwhetheralicenceorpermit isgranted. Environmental authoritiesare empowered toconductsite 6.1 of aspecificenvironmentalrule. judicial actionsthatseektherepairofdamageorfulfilment monetary damagesfromthepolluterareclassactionsoranyother to damagesforaestheticharms.Othermechanismsobtain sanctionatory regimeofLaw13332009,whichcanbeapplicable The authoritiescanalsoimposesanctionsandfineswithinthe the environment. from whoeverisproventohavecausedpollution,butalsoprotect The Governmentisnotonlyentitledtoobtainmonetarydamages 5.5 purchaser, butnot towardsthirdparties. may agreeuponthisfact,savingthesellerfromliabilitywith When thecontaminationisdisclosed,ownerandpurchaser seller knew, orshouldhaveknown,abouttheconditionofland. previous ownerofcontaminatedlandwhenitisproventhatthe The purchasercanpursuecivilactionstoseekcontributionfromthe 5.4 6 can athirdpartychallengetheagreement? is responsibleforthecontamination? conduct siteinspections,interview employees,etc.? public assets,e.g.rivers? contaminated landliabilitytoapurchaser? Powers ofRegulators regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis How isliabilityallocatedwheremorethanoneperson require productionofdocuments, takesamples, What powersdoenvironmental regulatorshaveto polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek Colombia

include aclausethatcontainsthisspecificobligation. In thecaseofenvironmentallicencesandpermits,procedures such asituation. The omissiontodosomayresultinliabilityforfailurereport Every citizenhastheobligationtodisclosethistypeofinformation. complaints. authorities. This informationisregularlyreceivedfromcommunity In suchcase,thecompetentauthoritiesareenvironmental 7.1 documents, ortotakethesamplesneeded. administrative acts,authoritiescanrequireanypersontofile investigation ortoruleoutaviolationofenvironmentallaw. In especially whentheauthoritydeemsitnecessarytofulfilan the dutytoobtainsamplesorconductsiteinspections,atanytime, Environmental regulatorsarealsoabletorequireanydocuments,or denying thepermitorlicence. may befurtheradoptedintheadministrativeactapprovingor After avisit,theexpertsmustpresenttechnicalconcept,which inspections. to studythefeasibilityofproject,mustconductthese interview employeesandcollectthenecessaryinformationinorder Technical expertsfromtheauthorities,whomaytakesamples, Macías Gómez&AsociadosAbogadosS.A.S. ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 according tocivillawprocedures. right toseekcontributionfromthe sellerthrougharedhibition, If theenvironmentalsituationisnot disclosed,thepurchaserhas null, andresultinthereversionofliabilitybacktoseller. imperfections inthepurchaser’s consentthatcouldturnthecontract it isnecessarytodiscloseenvironmentalsituationsavoid At anytimepriortotheexecutionofasaleandpurchaseagreement, 7.3 the correspondinginvestigationinordertoimposesanctions. information mustbetakenintoaccountbytheauthoritiestoinitiate authorities aboutthecontaminationandreportingdamage. This In thissense,thegeneralobligationconsistsofinforming so, themagnitudeofcontamination. and toinvestigatethelanddetermineifitiscontaminatedand, person, owneroroccupieroflandhastheobligationtoactdiligently When thereiscircumstantialevidenceofcontamination,any 7.2 found onasite,ormigratingoff-site, tothecompetentauthorities. Colombian legislationestablishestheobligationtoreportpollution © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 7 contamination? parties? takeover transactions? Reporting /DisclosureObligations migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto environmental regulatororpotentiallyaffectedthird To whatextentisitnecessarytodisclose have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson

person) topayfortheenvironmentalliabilities. environmental authoritiescanforcethenewowner(companyor the landwherepollutionordamagewasfound, In othercases,whenthishappensandthereissomeonewhobought environmental damages,andthisisknownas“orphanliabilities”. to justice.Inthiscase,theColombianStateshouldremediate shareholders andadministrativestaff cannotbefoundtobrought There aresomecasesinwhichthecompanydisappearsandits environmental obligationsthatthecompanyorenterprisemayhave. shareholders andadministrativestaff tostillbefoundliableforany other obligationsregardingthismatter, itisusualforits with theideaofavoiding,anykindenvironmentalliabilityor On theotherhand,ifacompanyisdissolvedinordertoavoid,or accounting rules,itsbalancesheethastoreflectthisspecialmatter. If acertaincompanyhasanobviousenvironmentalliability, under 8.2 before apurchaseagreementismade. disclose tothepurchaserorbuyerpossibilityofcontamination Under Colombianregulations,thereisalegaldutyforthesellerto this willonlybeenforceablewithintheagreement. not discharge thepartiesfromenvironment-relatedliabilities,since In thissense,conductingapaymentunderprivateagreementwill to theenvironment. and criminalauthoritieswillonlybearinmindtheliabilitiesrelated indemnity; however, thisislimitedtotheparties,andadministrative From acivillawpointofview, thepartiesmayagreeupon 8.1 intended toprotectwhistle-blowers, orpeoplewhoinformthe In administrativeandcivillaw, thereisnospecificregulation 8.4 environmental wrongdoings. With regardtoparentcompanies,thesemayalsobeheldliablefor environmental remediation. or didnotshowinterestintakingeffective actionstoseekandreach who knowinglyrefrainedfromtakingclearenvironmentalactions corporate veilinsomecases;asaspecificexample,shareholders environmentally adverseeffect islikelytocausetheruptureof It ispossiblethatdiligenceandknowledgeofaspecific 8.3 8 order toescapeenvironmentalliabilities? potential liabilityforthatmatter? report environmentalviolations/matters? caused byaforeignsubsidiary/affiliate? General balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- Is itpossibletouseanenvironmentalindemnity Are thereanylawstoprotect“whistle-blowers” who company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld WWW.ICLG.COM Colombia

61 Colombia 62 Colombia compensations, or demonstratecompliancewithnational goalson holders whointendtooptfor payments forresultsorsimilar level. Through thisResolution,allthemitigationinitiative title and Verification (MRV) System ofmitigationactionsatthenational and SustainableDevelopmentregulated theMonitoring,Reporting By meansofResolution14472018, theMinistryofEnvironment 9.2 and itwilltakeintoaccountwhatispaidascarbontax. activities. The ETSwillinteract withothereconomicinstruments auctions, directly, andthroughoffsets forvoluntarymitigation Regarding thedistributionofallowances,thiswillbedonethrough Environment andSustainableDevelopment. entities coveredbytheETSwillalsoberegulatedMinistryof are notexpresslyincluded. The scope,sectors,pointofregulationand Gas (GHG)emissions.Bankingisallowedbutborrowingandlinking the regulatedsectormustgetannuallytosupporttheirGreenhouse Sustainable Developmentwillregulatethenumberofallowancesthat a specificcap,butestablishesthattheMinistryofEnvironmentand Emission Trading Scheme (ETS)forthecountry. The lawdoesnotset Through Law1931of2018,theColombianCongresscreatedan 9.1 there isnosuchprovisionunderColombianregulation. Regarding criminalorexemplarydamages,pleasebeawarethat which canbeindividualised. recognition ofdamagesfromanyadverseeffect ontheenvironment contingent damagesfromcollectiverights,oragroupmayseekthe collective rightsbywhichanyindividualmayfileaclaimtoavoid Law 472of1998regulatesclassactionsandtheprotection 8.6 damages. account thatColombianlegislationdoesnotallowthesekindsof Regarding penalorexemplarydamages,itisimportanttotakeinto environmental claims. that pursueeconomicrestitutionaswelltheprotectionof In thesameway, Law472of1998regulatesgroupor“class”actions to pursueenvironmentalclaims. collective rights,establishesthatthistypeoflegalactioncanbefiled Law 472of1998,whichregulatesactionsfortheprotection 8.5 in Colombia,reportsorcomplaintscannotbemadeanonymously. witness, shouldbeprotectedtoo.Nonetheless,itnotedthat protected, soitisonlylogicalthatwhistle-blowers,beingasortof there areprovisionsthatprescribethewitnessesshouldbe authorities ofenvironmentalviolations.However, incriminallaw, Macías Gómez&AsociadosAbogadosS.A.S. © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 9 damages available? to monitorandreportgreenhousegasemissions? market developingthere? pursuing environmentallitigation? Emissions Trading andClimateChange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation Do individualsorpublicinterestgroupsbenefitfrom environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing any exemptionfromliabilitytopaycostswhen

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

Growth. a NationalPolicyonClimateChangeandpublicpolicyGreen In additiontotheratificationofParis Agreement, Colombiahas and financialinstruments. Information SystemsonClimateChangeandregulateseconomic establishes instrumentstomanageclimatechange,createsthe raises toalegalleveltheNationalSystemofClimateChange, a competitive,sustainablelow-carboneconomy. Additionally, it to theeffects ofclimatechangeandpromotethetransitiontowards greenhouse gases.Likewise,thisLawseekstoreducevulnerability deal withtheadaptationtoclimatechangeandmitigationof entities, andregulatestheconfluenceofdifferent publicactorsto climate changeinColombia,appliesbothforpublicandprivate Law 1931of2018setsforththeguidelinesformanagement 9.3 are alsoapplicable toasbestoshandling. Regulations fortransportingandmanipulating hazardoussubstances licence fortheproductionormanipulation ofasbestos. is nospecificregulationofthe need tohaveanenvironmental an internationaltreatyofenvironmental nature. This means there production ofsubstances,materials orproductssubjecttocontrolby this Decree,anenvironmentallicence isonlyneededforthe environmental licencefromthecompetentauthority. However, with that wantedtouseasbestosintheirprojectshadrequestan On theotherhand,untilLaw-Decree2041of2014,companies or constructions. asbestos materials,andanyeliminationoffrombuildings perform thedemolitionofstructuresandedificationsitescontaining personnel enforcingqualifiedstandardsorpracticesshouldonly regarding asbestosuse. Article 17establishesthatqualified In Colombia,underLaw436of1998,different aspectsweredefined 10.2 the firstprecedentonthismatter. know whatthecourt’s decisionwillbeinthiscase,ordertohave known caseinourcountryofasbestoslitigation,wearewaitingto institutions thatworkwithasbestos.Giventhisisthefirst Action againsttheCongressofRepublicandotherprivate In February2015,agroupofcitizensfiledConstitutionalClass 10.1 methodology definedinISO14064-1:2006. and reporttheirInventoryofGreenhouseGases,basedonthe produce Anhydrous EthanolFueltomixwithgasolinemustcalculate Fuel Anhydrous Ethanol.Inordertofulfilthisrequirement,plantsthat of thecoefficient indicatorongreenhousegasemissionsforDenatured Environment andSustainableDevelopmentsetamaximumstandard Additionally, underResolution1962of2017,theMinistry level andtheaccountingrulesestablishedinsuchregulation. the principlesofMRV Systemofmitigationactionsatthenational verification oftheirGHGmitigationactions;thisinaccordancewith Climate Change,mustcarryoutthemonitoring,reportingand climate changeundertheUnitedNationsFrameworkConventionon 10 regulation inyourjurisdiction? in relationtoasbestoson-site? jurisdiction? What istheoverallpolicyapproachtoclimatechange What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour Asbestos

Colombia

insurance hasnotyetbeenimplemented. related toenvironmentalrisksinthecountry, sinceecological There hasbeenverylittleexperienceregardinginsuranceclaims 11.2 guaranteeing thecomplianceofenvironmentalregulations. established inthisregulation,whichismainlydirectedtowards The casesinwhichecologicalinsurancemaybetakenarealso insurance policies. its implementation.Nonetheless,civilliabilitymaybecoveredby of 1999;however, thecompetentauthoritieshavenotyetdeveloped The term“ecologicalinsurance”wascreatedbymeansofLaw491 11.1 Macías Gómez&AsociadosAbogadosS.A.S. ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 11 experience inyourjurisdiction? risks insuranceplayinyourjurisdiction? What istheenvironmentalinsuranceclaims in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable Environmental InsuranceLiabilities

plans thatcompanieshaveundertheaforementionedregulation. application, andfortheapprovalexecutionofcompensation administrative act,therequirementsareestablishedforits Compensation oftheBioticComponentwasissued.Insaid of February22,2018bywhichtheManualEnvironmental Finally, andofgreatimportance,istheissuanceResolution0256 said permit. requirements, procedureandfinallytheconditionsforgrantingof related toapermitfordirectdischarge totheground;thatis 1076 of2015. This Decreeregulates,amongotherthings,everything Development issuedDecree050of2018,whichamended Further, in2018,theMinistryofEnvironmentandSustainable jurisdiction toperformairqualitymeasurements. Authorities toimposeobligationsoncompanieswithintheir of contaminants,isthatitgrantedthepossibilityforEnvironmental addition tothefactthatitmodifiesmaximumpermissiblelevels into forceonJanuary1,2018. The importanceofthisregulation,in 2017. Although thisrulewasissuedattheendoflastyear, itentered First ofall,wemusthighlightResolution2254November1, Colombia. Someoftheregulatorychangestohighlightareasfollows: order tofurtherdevelopthemanagementofnaturalresourcesin Throughout 2018,theColombianGovernmentissuedregulationsin 12.1 12 in environmentlawyourjurisdiction. summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a Updates WWW.ICLG.COM Colombia

63 Colombia 64 Colombia Macías Gómez&AsociadosAbogadosS.A.S. © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM forefront oftheinteractionenvironmentallawwithotherareaslegalpractice, suchasprivatelaw,law infrastructure,tax participation asaresultofcorporateenvironmentallawapproach.Inaddition, in different economicsectors.Inparticular, forpublic theFirm hastakentheleadinprovidinglegaladviceonsocialissuesandscenarios The Firm’s mainobjective istoprovidethenecessarylegalsupportandstrategiesallowstrengtheningofcorporations' workable legalsolutionsforColombia’s mostcomplexenvironmentalchallenges,becomingoneofthecountry’s lawfirms. leadingenvironmental For over20years,MacíasGómez& Asociados Abogados S.A.S. Macías Gómez& Asociados Abogados S.A.S. Likewise, thefirmprovideslegalsupporttothoseapplyingforenvironmentaltaxincentives. projects. proper managementintermsofmitigation,adaptationandresilience,aswellthedevelopmentnon-conventionalrenewableenergy andensureits included ClimateChangeLawintoitsSustainabilityareaofpractice,inordertoaddressthisglobalissueaspecialisedmanner management andtoreducethelegalrisksthatmayexistasaresultoftheiractivities.Recently, the developmentofenvironmentallawin Americas. regional practiceand Specialists (RIELA),anetworkofindependentlawfirmsprovidingfortheexchange ofprofessionalinformationaboutlocaland Macías Gómez& Asociados Abogados S.A.S. controversies surroundingavarietyofenvironmentalissues. antitrust law, expertopinionson amongothers. Furthermore,theFirmhasparticipatedinnationalandinternationalarbitrationtribunals,issuing “Alexander Von Humboldt”ResearchInstituteofBiologicalResources. Environmental Ministry, theUrbanEnvironmentManagementand Nations DevelopmentProgrammeforColombia,theColombian (OEA), EnvironmentalCounselors,theQuinaxiInstitute,United Environmental Law(CEDA)andtheOrganizationof American States Environmental Law, andcounseltotheEcuadorianInstitutefor Señora delRosario.HeisPresidentoftheColombianInstitutefor Universidad ExternadodeColombiaandColegioMayorNuestra is ateacherinseveralNationalandInternationalUniversities,suchas Government inthenegotiationsofCartagena Agreement Board.He the EpiscopalMeetinginBogotá,anddeputyfromColombian Ministry, aspokesmanfortheGovernmentinaboriginaltakeoverof Department andGeneralSecretariatoftheColombianEnvironmental opinion onvariousenvironmentaltopics.HewastheheadofLegal has workedasanexpertinseveralarbitrationtribunals,givinghislegal companies andpublicinstitutionsonvariousenvironmentalmatters.He recognised asaleadingenvironmentallawyerinColombia,advising and hasaPh.D.inPoliticalSciences(FranceColombia).Heis Environmental Law, PoliticalPhilosophyandLatin American Societies, S.A.S. & AsociadosAbogados Luis FernandoMacíasGómezisthefoundingPartnerof Macías Gómez& Asociados Abogados S.A.S. Luis FernandoMacíasGómez URL: Email: Tel: Colombia Bogotá Carrera 11 A #97 A-19 Oficina506 He holds Master’s Degreesin HeholdsMaster’s www.maciasabogados.com [email protected] +57 16114 444 hasextensiveexperienceofprovidingenvironmentallegalcounseltonationalandforeigncompanies istheexclusiverepresentativeforColombiainInter-AmericanNetwork ofEnvironmentalLaw Macías Gómez ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 hasearnedandmaintainedanexceptionalreputationforprovidingpractical

Macías Gómez& Asociados Abogados S.A.S.hasbeenatthe Macías Gómez& Asociados Abogados S.A.S. , publicprocurement, Colombia environmental

Chapter 11 Denmark Søren Stenderup Jensen

SIRIUS advokater Aleksander Pilgaard

1 Environmental Policy and its The EPA issues general guidelines and publishes the results from environment-related research conducted by the EPA itself or its Enforcement partners. Generally speaking, the environmental authorities’ approach to 1.1 What is the basis of environmental policy in your enterprises and private citizens is based on an attitude of cooperation jurisdiction and which agencies/bodies administer rather than on the exercise of public authority. However, if necessary, and enforce environmental law? the authorities will exercise their powers.

Danish environmental legislation consists of a wide range of acts 1.3 To what extent are public authorities required to which, to a large extent, are influenced by EU legislation. The most provide environment-related information to interested important acts are the Environmental Protection Act, the Nature persons (including members of the public)? Protection Act and the Contaminated Soil Act. The aim of the Environmental Protection Act is to contribute to The Danish Freedom of Information Act is supplemented by the safeguarding nature and the environment, thus enabling a Environmental Information Act. The Environmental Information sustainable social development in respect for human conditions of Act implements EU Directive 2003/4 on Public Access to life and for the conservation of flora and fauna. Environmental Information and the Aarhus Convention on access to The aim of the Nature Protection Act is to protect Denmark’s nature information, public participation in decision-making and access to and environment so that social development can take place on a justice in environmental matters. sustainable basis in respect of human living conditions and the According to the aforementioned legislation, public authorities, conservation of animals and flora. including some private enterprises acting on behalf of public The aim of the Contaminated Soil Act is to assist in the prevention, authorities, must provide access to environmental information, with elimination, or reduction of soil contamination and the hindrance or only very few limitations. prevention of the detrimental impact of soil contamination of groundwater, human health and the environment. 2 Environmental Permits The administration of the environmental legislation is divided between local municipalities and government agencies. The municipalities are responsible for granting permits and inspection of 2.1 When is an environmental permit required, and may other enterprises and also to carry out the majority of specific environmental permits be transferred from one public-sector duties. The municipalities are typically the point of person to another? contact for the general public and for companies wishing to access information on the environment. Environmental permits are only required when an enterprise The Environmental Protection Agency (EPA) prepares legislation conducts activity mentioned in lists issued by the Ministry of and guidelines and grants authorisations in several areas. Further Environment and Food pursuant to charter V of the Environmental duties include the monitoring of chemicals and offshore platforms. Protection Act. The EPA authorises and monitors approximately 400 enterprises and Environmental permits are not personal but granted to a certain local waste handling facilities. activity regardless of ownership of the enterprise. Therefore, the The Nature Agency has competence in matters of nature protection. permit may be transferred to a new owner, but the relevant Finally, the regions have certain competences in relation to authorities must be notified of the new ownership. contaminated soil.

2.2 What rights are there to appeal against the decision of 1.2 What approach do such agencies/bodies take to the an environmental regulator not to grant an enforcement of environmental law? environmental permit or in respect of the conditions contained in an environmental permit? The local municipalities’ approach to the enforcement is primarily a traditional approach of granting environmental permits, surveillance, In general, all decisions can be appealed to the Environmental and monitoring and handling violations. Board of Appeal, which is the central administrative board of appeal

ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 WWW.ICLG.COM 65 © Published and reproduced with kind permission by Global Legal Group Ltd, London 66 Denmark stored fornomorethanoneyear. The enterpriseisentitledto useful forthesepurposes. Waste suitedforreuseorrecyclingcanbe waste issortedandpreparedforreuse orrecyclingifthewasteis Furthermore, allenterprisesproducing wastemustensurethattheir on-site. storing ofwasteincludingtheamount ofwastewhichmaybestored Environmental permitscanincludetermsregardinghandlingand 3.2 is subjecttostricterrulesregardinghandlinganddisposal. waste andcommercial/industrialwaste.Ingeneral,hazardous Waste isdividedintocategoriessuchashazardouswaste,household required todiscard”. “any substanceorobjectwhichtheholderdiscardsintendsis “Waste” isdefinedinaccordancewithEUDirective2008/98as 3.1 profits areavailable. leading toprosecution,andtheimpositionoffinesconfiscation to thepolicewitharequestcommencecriminalinvestigations In addition,theenvironmentalauthoritiesmayalsoreportinstance expense oftheaddressee. authorities mayseetothattheorderorprohibitioniscarriedoutat environmental permitmaybewithdrawn.Inothercircumstances,the stop theviolations.Iftheseremediesaredeemedinsufficient, an to achievethis,theauthoritiesmayissueordersandprohibitions entitled andobligedtoensurethattheillegalactivitiescease.Inorder If aviolationhasbeenobserved,theenvironmentalauthoritiesare 2.4 permit isgranted. be conductedforparticularlypollutingplansandprojectsbeforea Danish Environmental Assessment Act, animpactassessmentmust flora (theHabitatDirective). According totheDirectivesand 92/43 ontheconservationofnaturalhabitatsandwildfauna Projects ontheEnvironment(theEEA Directive)andEUDirective 2011/92 onthe Assessment oftheEffects ofcertainPublicandPrivate As amemberoftheEU,DenmarkhasimplementedEUDirective 2.3 Nature Conservation. activities permittedandcertainNGOs,e.g.theDanishSocietyfor permit canbeappealedbythosewhomayaffected bythe It shouldbenotedthatevendecisionstograntanenvironmental orders whichonlyordertheaddresseetoobserveapplicablelaw. from thisrightofappealareso-called“ascertainingorders”,i.e. for allmattersrelatingtonatureandtheenvironment.Exempted SIRIUS advokater © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 3 polluting industriesorotherinstallations/projects? produced? waste involveadditionaldutiesorcontrols? permits? Waste regulators haveinconnectionwiththeviolationof and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore How iswastedefinedanddocertaincategoriesof What enforcementpowersdoenvironmental Is itnecessarytoconductenvironmentalauditsor environmental impactassessmentsforparticularly

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

back arrangements. obligations maybemetbyfinancialparticipationincommontake- to certainproducts,i.e.,batteriesandelectronicdevices. The Producer obligationsregardingtake-backandrecoveryarelimited 3.4 by thelocalmunicipalities. almost allwastedisposalfacilitiesaredirectlyorindirectlyowned question, theproducerdoesnotretainanyliability. InDenmark, the necessarypermitsforhandlinganddisposingofwastein If thewasteistransferredtoanoff-site transferee/disposerholding 3.3 or negligenceinsuchcases. However, itmayofcoursebedifficult toprovideevidenceofintent does notexcludeliabilityfor damages orcriminalliability. The factthatanenterprisehasbeen operatedwithinpermitlimits 4.2 have occurred. range ofDKK10,000–50,000. Within specific areas,larger fines profits. The finesforfirst-time offenders areusuallywithinthe Criminal liabilityisbasicallylimitedtofinesandconfiscationof to operate. similar tothelistofcompanieswhichneedanenvironmentalpermit strict liabilityappliesisprovided. The listis,toalarge extent, Liability Act. As anappendixtothe Act, alistofactivitieswhere environmental damages. This followsfromtheEnvironmental considered tobeespeciallydangerousaspollutionorother Strict liabilityhasbeenintroducedwithregardtoactivitiesthatare provided thataneconomiclosscanbeproved. negligently causesinjuryordamageisliabletocompensatetheloss meaning thatthepersonorenterprisewhichintentionally civil liability. Suchcivilliabilityisgenerallybasedonnegligence, violator ofenvironmentallawsandpermitsmayalsobesubjecttoa In additiontotheobligationfulfilordersandprohibitions,a obliged tofulfilsuchordersandprohibitions. or permits. The addresseesofsuchanorderorprohibitionare or aprohibitioninordertoremedybreachofenvironmentallaws In mostinstances,theenvironmentalauthoritiesmayissueanorder 4.1 In general,on-sitewastedisposalisnotpermitted. installations wheresuchapreparationcanbedone. prepare thewasteforreuseorrecyclingtotransfer 4 regarding thetake-backandrecoveryoftheirwaste? bankrupt/disappears)? within permitlimits? what defencesaretypicallyavailable? Liabilities To whatextentdowasteproducershaveobligations the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa Denmark

4.4 pertaining topubliclaw. Criminalliabilityisrarelycovered. policyholder. The scopeofcoverisusuallycivilliabilityand insurance thatcoversboardmembersanddirectorsaswellthe Major insurancecompaniesoffer specialenvironmentalimpairment negligence ontheirown. Board membersandmanagersareonlypersonallyliableforactsof of whethertheownerisapersonorcompanyotherlegalentity. As forcivilliability, theprimarysubjectisenterprise,regardless the ownerofenterprise. . However, theprimarysubjectofcriminalliabilityis Managers andboardmembersmaybeliablewithinthescopeof 4.3 SIRIUS advokater ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 contamination which theaddresseehascaused.Ifit isnotpossible given toallofthem. The individualordersmustrelateto the If morethanonepolluterisinvolved, acomplianceordercanbe 5.2 to giveaccessandtoleratetheclean-upatcostofpolluter. owns therealestatewhichiscontaminated,ownermaybeordered contamination hastakenplaceafter1January2001.Ifathirdparty that theaddresseeisanenterpriseorcontaminatorand irrespective ofhowthecontaminationhappened,provided,however, concerning thecleaningupofsoilpollutionmaybeissued According totheContaminatedSoil Act, anadministrativeorder 5.1 and permits. applies tocaseswherethelenderhasviolatedenvironmentallaws liable withregardtothewrongdoingsoftheirdebtors. This also Under Danishlawmoneylendersare,ingeneral,notconsidered 4.5 previous owner. new ownereveniftheorderconcernsactsoromissionsmadeby own. Furthermore,ordersandprohibitionsmaybeissuedtothe owner. The newownermaybeliableforactsofnegligenceits new owneroftheasset. Thus, theliabilityremainswithprevious are purchased,theliabilityisnotautomaticallytransferredto If, ontheotherhand,assets(includingenterpriseasawhole) company isirrelevantwithregardtothematterofliability. company isliable,andthesaleorpurchaseofsharesissuedby If theenterpriseisorganised asalimitedcompany, thenthe © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 5 environmental wrongdoingand/orremediationcosts? the onehandandanassetpurchaseonother? indemnity protectioninrespectofsuchliabilities? is responsibleforthecontamination? groundwater? Contaminated Land environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract How isliabilityallocatedwhere morethanoneperson What istheapproachtoliabilityforcontamination To whatextentmaylendersbeliablefor (including historiccontamination)ofsoilor

obligation tocleanupisdividedequallybetweenthecontaminators. to determinewhocausedspecificpartsofthecontamination, or couldbeorderedtocleanuptheproperty. been given,andifthepropertywasacquiredfromapersonwhohad sale, ifthepurchaserkneworshouldhaveknownthatanorderhad clean upifthecontaminatorhadbeenorderedtobefore contaminator. A newownerofthepropertycanonlybeorderedto However, theaddressee oftheordertocleanupisalmostalways property andisorderedtocleanup. pay damagestoapersonorenterprisewhichhaspurchasedthe A previousownerwhohascausedcontaminationmaybeliableto 5.4 an additionalorder–providedthattheconditionsaremet. agreed remediesturnouttobeinsufficient, theauthoritymayissue challenged bythirdpartieswhoareaffected bytheorder. Ifthe remedy, itisstillnecessarytoissueanorder, whichcanbe If theenvironmentalauthorityandpolluterhaveagreedupon 5.3 affected third parties. observed. There isnotasimilarobligationwithregardtoinforming relevant authoritiesifamajorpollution ortheriskthereofis Polluting enterprisesorprivatecitizens areobligedtoinformthe 7.1 and generallyviewedasamatterforthepolice. access toconductinterviewswithemployeesisextremelylimited information fromenterpriseswhichcausepollution.However, empower theenvironmentalauthoritiestodemandallrelevant The environmentallegislationhasawiderangeofprovisionswhich 6.1 damages maybeclaimedinorderto“restoretheenvironment”. No suchauthorityexistsinDanishlaw. However, monetary 5.5 7 6 contaminated landliabilitytoapurchaser? can athirdpartychallengetheagreement? parties? conduct siteinspections,interviewemployees,etc.? public assets,e.g.rivers? Reporting /DisclosureObligations Powers ofRegulators possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis environmental regulatororpotentially affectedthird migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe require productionofdocuments,takesamples, What powersdoenvironmentalregulatorshaveto polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma WWW.ICLG.COM Denmark

67 Denmark 68 Denmark well asnon-anonymoustips. No suchlawsexist,butpublicauthorities mustactonanonymousas 8.4 corporate veilislifted. being heldliable,exceptinthemostextremecaseswhere is thattheownerofalimitedliabilitycompanyprotectedfrom environmental legislation. The generalruleinDanishcompanylaw No specificrulesonthetopichavebeenadoptedinDanish 8.3 liabilities arementioned. General accountingprinciplesapplyandrequirethatallknown 8.2 government orlocalauthorities. limit theexposuretoclaimsofdamagesfromthirdparties,including Such agreementsareonlybindingbetweenthepartiesanddonot 8.1 in thegenerallawofcontracts. disclose informationingoodfaithaboutthepollutionisprovidedfor does notcontainspecialrulesonthematter;seller’s obligationto regarding environmentalproblems.Danishlegislation information ofwhichthesellerisaware. This includesinformation As acivillawrule,sellermustprovidethebuyerwithallrelevant 7.3 permit andthequestionofsoilcontaminationisrelevance. when necessary, e.g.whenhandlinganapplicationforabuilding authorities mayaskforinformationregardingsoilcontamination obligation toinvestigatedoesnotexistinadditionthis,but investigations inordertoevaluatetheeffects ofpollution. A general demand thatpolluterstakesamplesofsoilandperformother As referredtoinsection6above,theenvironmentalauthoritiesmay 7.2 SIRIUS advokater © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 8 takeover transactions? contamination? report environmentalviolations/matters? caused byaforeignsubsidiary/affiliate? order toescapeenvironmentalliabilities? potential liabilityforthatmatter? General matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto Are thereanylawstoprotect“whistle-blowers” who liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff Is itpossibletouseanenvironmentalindemnity To whatextentisitnecessarytodisclose have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

(ETS) Registryaswell. manages allDanishaccountsintheEUEmissions Trading System established theDanishEmission Trading Registry. The registry Pursuant totheKyotoProtocol,DanishBusiness Authority has 9.1 regarding environmentallitigationhavebeenadopted. decided bythecourt.Legalaidisavailablebutnospecificrules loses acourtcaseusuallyhastopaythecostsofotherpartyas The generalrulesoncostsapply. This meansthatthepartywho 8.6 as onlyactuallossesorinjuriesarecovered. claims. PenalorexemplarydamagesarenotavailableinDanishlaw The Danishrulesongroupactionsdonotexcludeenvironmental 8.5 but extraprecautions mustbetakenwhenworkingwith asbestos. There arenoobligationstoremove asbestosfromexistingstructures, The useofasbestoswasprohibited in Denmarkapprox.30yearsago. 10.2 Supreme Courtintroducedstrictliabilityfortheemployer. to asbestosusedinproduction.Inonecasefrom1989,theDanish Most caselawonasbestosconcernsemployees’ long-termexposure 10.1 emission societyin2050,independentoffossilfuels. long-term objectiveofthegovernmentisforDenmarktobealow- the reductionofgreenhousegasemissionsfor2020and2030. The The Danishgovernment’s climatepolicyissubjecttoEUtargets for 9.3 duties accordingtotheDanishEmissions Allowances Act. information astheymayfindnecessaryinordertoperformtheir must, uponrequest,supplytherelevantauthoritieswithsuch Operators andotherswhoaresubjecttotheEUDirective2003/87 9.2 9 10 market developingthere? pursuing environmentallitigation? damages available? in relationtoasbestoson-site? jurisdiction? regulation inyourjurisdiction? to monitorandreportgreenhousegasemissions? Emissions Trading andClimateChange your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation any exemptionfromliabilitytopaycostswhen Do individualsorpublicinterestgroupsbenefitfrom environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing What arethedutiesofowners/occupiers ofpremises What istheexperienceofasbestoslitigationinyour What istheoverallpolicyapproachtoclimatechange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned Asbestos Denmark

has toalarge extentbeenmaintained. the requirementthataleakshouldhavebeensuddenandunforeseen environmental claimsunderprofessionalliabilityinsurance,where claims isverylimited.Intheexperienceofauthor, therehavebeen involved insurance.Hence,experiencewithenvironmentalinsurance the EnvironmentalLiability Act hasbeenapplied,andnoneofthose In Denmark,onlythreepublishedcaseshavebeendecidedinwhich 11.2 unforeseen. by propertydamageinsuranceiftheyaredeemedtobesuddenand the normalprofessionalliabilityinsuranceandmayalsobecovered parts oftheenvironmentalliability, suchaspollution,arecoveredby liability undertheEnvironmentalLiability Act. Moreover, certain It ispossibletobuyenvironmentalinsurancethatcoversenterprises’ 11.1 SIRIUS advokater ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London trained mediator. processes beforeadministrativecouncilsandboards.Sørenisalsoa proceedings beforetheappraisalbodies,andcomplaints/appeal Court andlitigationforagainstpublicauthorities,expropriation arbitration. HehasextensiveexperienceinlitigationbeforetheSupreme Søren isatrainedarbitratorandcontinuouslyworkswithlitigation Søren hasworkedwithenvironmental,planning,energyandsupplylaw. including 18yearsasapartnerwithPlesnerandSIRIUSadvokater, public law, includingenvironmentallaw, inDenmark. For25years, Søren StenderupJensenisoneoftheleadinglawyersinfield reflecting ourclients’ needs.We believethatthisisbestdonebyactinginaprofessionalandhumanfashionbothinternally SIRIUS advokaterwasfoundedsome12yearsago. precisely The overallgoalofSIRIUSadvokateristoprovide clearlegaladviceandsolutions about newfieldsoflawwhichthefirm's clientsmayneedlegaladvicetofullyunderstandandbeableoperatewithin. tolearnmore specialisation ofthefirm.Ourpartners areveryexperiencedwithinthefieldsinwhichtheywork;yetcurious andcommitted within thefieldsof SIRIUS advokaterisaspecialisedlaw firmwhichhasexceptionalqualificationstocarrythroughourclients'legal challenges SIRIUS advokaterhasgrownconsiderablyoverthelastyearsandnow morethan30lawyers. society. strongly committedtocontinuoustrainingandtreatingeachotherdecently, playerin supporting aproperworklifebalanceandbeingresponsible 11 experience inyourjurisdiction? risks insuranceplayinyourjurisdiction? What istheenvironmentalinsuranceclaims in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable Environmental InsuranceLiabilities URL: Email: Tel: Denmark Copenhagen Ø DK-2100 Dampfærgevej 10,2 SIRIUS advokater Søren StenderupJensen www.siriusadvokater.com [email protected] +45 29993030

nd fl.

processes. conflicts withfarmers’ interestinusingpesticidestheirproduction high degreeofattentiontoprotectthegroundwater, whichoften Denmark, alldrinkingwaterisuntreatedgroundwater, andthereisa for agriculturalpurposes,inordertoprotectthegroundwater. In municipalities’ powerstoprohibitorlimitfarmers’ useoftheirland Of interestarealsosomependingcasesconcerningthelocal invalid duetolackofobservationtheseDirectives. Environmental andFoodBoardof Appeal havebeendeclared and HabitatsDirectives.Inanumberofcases,decisionsfromthe observing therulesofEnvironmentalImpact Assessment (EIA) 2018 provedthattheDanishauthoritiesstillhaveproblemsin 12.1 great benefitashespecialisesinthefieldofenvironmentallaw. within publicadministrationandlitigation;experiencewhichisnowof fields oflaw, withanemphasisonrealestatelawandrulesofprocedure SIRIUS advokaterin2010. Aleksander hasgainedexperienceinmany worked inpublicadministrationandattheDanishcourts,beforejoining After graduatingfromUniversityofCopenhagenin2001, Aleksander 12 in environmentlawyourjurisdiction. summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a Updates URL: Email: Tel: Denmark Copenhagen Ø DK-2100 Dampfærgevej 10,2 SIRIUS advokater Aleksander Pilgaard www.siriusadvokater.com [email protected] +45 51998557 andexternally WWW.ICLG.COM nd fl. Denmark . We are

69 Denmark Chapter 12 England & Wales John Blain

Freshfields Bruckhaus Deringer LLP Rachel Duffy

1 Environmental Policy and its emphasises the EA’s regard for the “growth duty”, under which enforcement action or sanctions should only be imposed when Enforcement necessary, and in a proportionate way. Criminal prosecutions and civil sanctions are an important part of the EA’s enforcement policy, aiming to change the behaviour of offenders, eliminate any financial gain or 1.1 What is the basis of environmental policy in your jurisdiction and which agencies/bodies administer benefit from non-compliance, and deter future non-compliance, and enforce environmental law? amongst other things. In June 2018, the EA published an updated list of civil sanctions In England, the Department for the Environment, Food and Rural (including enforcement undertakings) that it has imposed as an Affairs (Defra) is the principal Government department responsible alternative to prosecution. for developing environmental policy. The Department for Business, The expansion of civil sanctioning powers in relation to the EP Energy and Industrial Strategy (BEIS) deals with climate change regime was made by the Environmental Permitting (England and policy. The Department for Transport is responsible for vehicle Wales) (Amendment) (England) Regulations 2015, subsequently emissions. (See further section 9.) consolidated in the Environmental Permitting (England and Wales) The Environment Agency (EA) is mainly responsible for the Regulations 2016, which came into force on 1 January 2017 (see enforcement and administration of environmental law. For example, question 2.4). In September 2017, Defra published guidance on how it is the designated regulator for: Part A (1) installations under the prosecution powers of the regulator under the EP regime interact Environmental Permitting (EP) regime (see question 2.1); waste with local authorities’ powers to prosecute statutory nuisance. management (including producer responsibility initiatives) (see The Office for Product Safety and Standards (which superseded the question 3.1); special sites designated under the contaminated land former Regulatory Delivery directorate in January 2018) is regime in Part 2A of the Environmental Protection Act 1990 (EPA) responsible for the effective delivery of regulation and ensuring that (see question 5.1); flood defence; and emissions trading (see local authorities deal with enforcement issues in a consistent and co- question 9.1). Local authorities are responsible for the regulation of ordinated manner, with a view to easing the regulatory burden on Part A (2) and Part B activities; the administration and enforcement business. of the contaminated land regime; the statutory nuisance provisions The Sentencing Council of the ’ Association publishes contained in Part III of the EPA; and the hazardous substances sentencing guidelines, which encourage Magistrates to consider the regime contained in the Planning (Hazardous Substances) Act 1990 means of companies and the seriousness of offences when they set and subsidiary regulations. financial penalties. A set of environmental sentencing guidelines has The civil and criminal courts and tribunals of England are also been in force since 1 July 2014, providing higher starting points for involved in the making and enforcement of environmental law (see fines, promoting tougher punishment for repeat offenders and question 4.1). There is also a tribunal procedure under which certain placing an increased focus on the proportionality of the fine in rights of appeal, usually against decisions of regulators, are heard. relation to the size of the company. Sentencing guidelines for health Other agencies, such as Natural England, the Health and Safety and safety offences, corporate manslaughter, food safety and hygiene Executive (HSE), the Office for Nuclear Regulation (ONR), the offences came into force on 1 February 2016, which will result in Marine Management Organisation and the Food Standards Agency similar approaches being adopted by the courts for such offences. have an important role to play in ensuring the protection of the Environmental regulation is supplemented by other regulatory environment. controls. In the context of energy regulation, the existence of mechanisms such as the climate change levy (essentially a tax on the 1.2 What approach do such agencies/bodies take to the use of energy from sources by industry and the public enforcement of environmental law? sector) and the Renewables Obligation (which requires all electricity suppliers licensed under the Electricity Act 1989 to The EA’s Enforcement and Sanctions Policy sets out five key produce evidence to the Office of Gas and Electricity Markets that principles of enforcement: proportionality; consistency; transparency; they have supplied customers in England with specified amounts of accountability; and a risk-based approach, with higher-risk sites and electricity generated from “eligible renewable sources”) have been activities being prioritised. The policy, updated on 8 May 2018, now instrumental in influencing more use and highlights the outcome-focused approach adopted by the EA. It also reducing greenhouse gas emissions.

70 WWW.ICLG.COM ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 © Published and reproduced with kind permission by Global Legal Group Ltd, London CfD scheme. Act 2018. These draftregulationsdonotaffect theoperation ofthe instruments tobepublishedundertheEuropeanUnion(Withdrawal) (Amendment) (EUExit)Regulations2018,oneofthefirststatutory published draftFeed-in Tariffs andContractsforDifference October 2018.Separately, inJuly2018,theGovernmentalso implemented intotheCfDscheme:thisconsultationclosedon10 consultation toinviteviewsonthewaythatitsdecisionswillbe response. On30 August 2018,theGovernmentlaunchedafurther making theamendmentsoutlinedinPart A oftheGovernment’s (Miscellaneous Amendments) Regulations2018cameintoforce, in August 2018.InJuly2018,theContractsforDifference two parts:Part A waspublishedinJune2018,withPartB The GovernmentpublisheditsresponsetotheCfDconsultationin exemptions fromthecostsofCfDforeligiblebusinesses. announced thatitwouldamendtheRegulationstointroduce March 2017,followingapublicconsultation,theGovernment burden thiscouldplaceonenergy-intensive industriesandsoin electricity bill.However, theGovernmentrecognisedsignificant ultimately passedontodomesticandindustrialconsumersviatheir funding theCfDarerecoveredthroughalevyonsuppliers,whichis reflects thecostofinvestinginlow-carbontechnology. The costsof between theaveragemarketpriceforelectricity, andthepricethat the scheme,electricitygeneratorisreimburseddifference sources byprovidinggreatersecuritytoqualifyinggenerators.Under intention remainstoincentivisetheuseoflarge low-carbonenergy Company Ltd(LCCC),aGovernment-ownedprivatecompany. The scheme, providingforcontractswiththeLowCarbonContracts Renewables ObligationwiththeContractsforDifference (CfD) overall schemeistoclosein2037. The Governmentisreplacingthe projects since31March2017(subjecttograceperiods)andthe The RenewablesObligationhasbeenclosedtonewgeneration Freshfields BruckhausDeringerLLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 ■ ■ to dothefollowing(amongotherthings): holding environmentalinformationonbehalfofapublicauthority) The EIRsrequirerelevantpublicauthorities(and/orthirdparties provide forwiderdisclosurethanisavailableundertheFOIA. legislative backgroundandfocustotheFOIA and,onthewhole, Justice inEnvironmentalMatters). As such,theEIRshaveadifferent Information, PublicParticipationinDecision-making,and Access to under the Aarhus Convention(theUNECEon Access to environmental information,andalsoaimtofulfiltheUK’s obligations The EIRsimplementDirective2003/4/EConpublicaccessto with undertheEIRs. FOIA, whichprovidesthatrequestsforsuchinformationaredealt from theambitofaccess-to-informationregimeestablishedby 2000 (FOIA).Environmentalinformationiseffectively excluded January 2005,atthesametimeasFreedomofInformation Act Information Regulations2004(EIRs),whichcameintoforceon1 England since1992. This regimeisnowsetoutintheEnvironmental An accesstoenvironmentalinformationregimehasbeeninplace 1.3 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London persons (includingmembersofthepublic)? disclosure isinthepublicinterest); and requests inlimitedcircumstances, forexample,wherenon- most caseswithin20workingdays (andonlytorefusesuch organisation fromanywhereintheworld)onrequest– public authorityavailabletoanyone (anypersonorany make environmentalinformationheld byoronbehalfofthe the publicauthority; proactively disseminateenvironmentalinformationheldby To whatextentarepublicauthoritiesrequiredto provide environment-relatedinformationtointerested

■ ■ The CJEUruledthat: relating totheenvironmentcanbepublicauthoritiesunderEIRs. the CJEUruledthatcommercialbodiesprovidingpublicservices European Union(CJEU)forfurtherguidance.InDecember2013, made arequestforpreliminaryrulingtotheCourtofJustice questions referred toitbytheUpper Tribunal. The mainproceedings The CJEUjudgmentwasapreliminary ruling,onlydealingwiththe Utilities, Yorkshire Water andSouthernWater and EmilyShirleyvTheInformationCommissionerUnited companies arenotpublicauthoritiesundertheEIRs,in (GI/2458/2010), whereitwasheldthatwaterandsewerage Drainage &Water ReportsLimitedvTheInformation Commissioner Following thedecisionofUpper Tribunal in caught bytheEIRsincertaincircumstances. involved inthesupplyofpublicservices,havebeenargued tobe partnerships withenvironmentalfunctions,suchaspublicutilities environment). Accordingly, privatecompaniesor public-private administration” (regardlessofwhetherthesefunctionsrelatetothe any otherbodyorperson“thatcarriesoutfunctionsofpublic licence orcontract. Also, apublicauthorityundertheEIRsincludes could includearelationshipconstitutedbylegislation,rights, issued bytheGovernmentindicatesthat“control”inthiscontext provides publicservicesinrelationtotheenvironment.Guidance (among otherthings)exercisesfunctionsofapublicnatureor under the“control”ofanotherrelevantpublicauthorityandwhich functions ofpublicadministration,aswellanybodyorperson under theFOIA).Itincludesanybodyorpersonthatcarriesout also verybroad(broaderthanthedefinitionof“publicauthority” The definitionofa“publicauthority”forthepurposesEIRsis affects theenvironment. Regulations, aslongithasasufficient linktoameasurethat environment initselfmaybesubjecttodisclosureunderthe held thateveninformationwhichdoesnotdirectlyconcernthe Information Commissioner(C3/2016/0880),theCourtof Appeal In environmental decision-making. legislation, andcost-benefitothereconomicanalysesusedin impact uponit,reportsontheimplementationofenvironmental among otherthings,thestateofenvironmentandfactorsthat the personalemailaccountsofemployeespublicauthorities)on, including informationrelatingto‘official business’ whichisheldin written, visual,aural,electronicoranyothermaterialform, activities likelytoaffect them. This canincludeanyinformation(in elements andsubstances,butalsoinformationonmeasures the EIRsiswide,coveringnotonlyinformationonenvironmental The definitionofwhatconstitutes‘environmentalinformation’ in ■ Department forBusiness,Energy andIndustrial Strategyv decisive influenceontheiractionintheenvironmentalfield”. their controllingpublicauthority“isinapositiontoexert autonomously determinehowtheyprovidetheirservicesand authorities undertheEIRs),iftheydonotgenuinely the controlofapublicauthority(andtherefore commercial entitiesarecapableofbeingbodiesthatunder powers; and is whethertheyhavespeciallegalpowersbeyondprivatelaw functions” andarethereforepublicauthoritiesundertheEIRs the testforwhethercompaniesperform“publicadministrative relevant services. information thatdoesnotrelate totheprovisionof authority isnotrequiredto provide environmental authority becauseitisunderthe control ofanotherpublic However, acommercialserviceproviderthatisonly apublic mentioned above. authority soastoenableitperformthefirsttwoduties organise environmentalinformationheldbythepublic

England &Wales WWW.ICLG.COM , theUpper Tribunal Smartsource Fish Legal

71 England & Wales 72 England & Wales Permitting (England and Wales) (Amendment) Regulations2018 gas emissionspermit(seequestion 9.1). The Environmental EU Emissions Trading Directivearerequiredtoholdagreenhouse EP regimein theearly2020s.Operatorsofinstallationssubjectto plans tobringwaterabstractionand impoundmentlicenceswithinthe applications forstandardenvironmental permits. There arefurther risk activities. At thesametime,EA published standardrulesfor existing flooddefenceconsentswithenvironmentalpermitsfor (No.2) Regulationscameintoforceon6 April 2016andreplacedthe The EnvironmentalPermitting(Englandand Wales) (Amendment) dioxide (CO2). implement Directive2009/31/EConthegeologicalstorageofcarbon authorisations andradioactivesubstances,hasbeenamendedto regime alsoappliestodischarges intocontrolledwaters,groundwater disposing ofcontrolledwasteonnon-domesticpremises. The EP An environmentalpermitisrequiredforthekeeping,treatingor ■ ■ ■ regimes establishedundertheIPPCDirective: The EP Regulations(asamended)maintainthethreedistinct Regulations 2015(nowconsolidatedinthe2016EP Regulations). the EnvironmentalPermitting(Englandand Wales) (Amendment) Emissions DirectivewasimplementedinEnglandbytheadoptionof Directive 2010/75/EUonIndustrialEmissions. The Industrial prevention regime,hasbeenrecast,alongwithsixotherdirectives,in Directive, requiringMemberStatestoestablishapollution emissions. The originalIntegratedPollutionPreventionandControl effective way, orways,fortheindustrytopreventminimise employing so-calledbestavailabletechniques,i.e.themostcost- environment asawhole. The highlevelofprotectionisachievedby emissions inordertoachieveahighlevelofprotectionthe permitting processtopreventor, wherethatisnotpracticable,reduce The permitregimeisbasedontheprincipleofanintegrated by theEA ortherelevantlocalauthority. premises inthemainexempt.Permitsaregenerallygrantedeither business andcommercialactivities,withemissionsfromdomestic In England,environmentalpermitsarerequiredforawiderangeof 2.1 body wasapublicauthorityundertheEIRs. did notgoasfarlayingdownbroadgeneralprinciplesonwhena powers overandabovethoseinprivatelaw. However, thedecision basing itsdecisiononthefactthatwatercompanieshavespecial water companiesarepublicauthoritiesforthepurposesofEIRs; considered intheUpper Tribunal. Itultimatelyruledthatprivate determine ifutilitycompaniesareinfactpublicauthoritieswere and applicationofthefactstotestssetoutbyCJEU Freshfields BruckhausDeringerLLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 2 person toanother? installations beingtheresponsibilityoflocalauthority. only emissionstoairareregulatedundertheIPPC,such Part Binstallations,whicharesiteswithactivitiesfor be, situated;and of thelocalauthorityinwhoseareainstallationis,orwill environmental media,withregulationbeingtheresponsibility but whicharestillconsideredtohaveimpactsonall regarded ashavingalesserpotentialtopolluteareconducted, Part A(2) installations,whicharesiteswhereactivities the EA; air, landandwater fromtheseinstallationsbeingregulatedby more pollutingactivitiesarecarriedout,withemissionsto Part A(1) installations,regardedassiteswherepotentially Environmental Permits environmental permitsbetransferredfromone When isanenvironmentalpermitrequired,andmay

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

permit. or itwillnotensurecompliancewiththeconditionsoftransferred will nothavecontrolovertheinstallationaftertransferiseffected, to effect thetransferunlessitconsidersthatproposedrecipient regulator containingcertainspecifieddetails;theisrequired proposed recipientofthepermittomakeajointapplication granted undertheEP Regulationsrequiresthecurrentoperatorand permit aremet.Forexample,thetransferofanenvironmental requirements oftheparticularlegislationgoverninggrant usually betransferredfromonepersontoanother, providedthe at identifyingsignificant pollutionoccurringduring operationofthe activity. Ongoing monitoringandreportingrequirementsareaimed condition ofthesitepriorto commencement oftheregulated the operatorisrequiredtosubmit asitereportidentifyingthe In submittinganapplicationforapermit tooperateaPart A activity, returned toasatisfactorystateand posesnopollutionrisks. subsequently, upondecommissioning,toensurethatthesiteis pollution duringthedesignandoperationofinstallationand, Various measuresareincorporatedwithintheEP regimetoprevent 2.3 nature ofthepermit. he/she seesfit. The timelimit forappealsvariesdependingonthe permit whereonehasbeenrefusedsubjecttosuchconditionsas the permitbyregulator, ordirectthegrantingvariationofa regulator’s decision,quashalloranyoftheconditionsimposedin any publichearing. The SecretaryofStatemayaffirm or quashthe involved insuchappeals,includingrightstoaddresstheinspectorat holding ahearing,andinterestedthirdpartieshaverightstobe Appeals canbeconductedbywayofwrittenrepresentationsor Secretary ofStatefortheEnvironment,FoodandRural Affairs. certain circumstances.Ingeneral,therightofappealisto All oftheabovepermittingregimesincludeprovisionsforappealin 2.2 who isincontroloftheinstallation.Environmentalpermitscan the different EP regimes,butisusuallytheperson(naturalorlegal) authorising this. The definitionoftheterm“operator”variesbetween or discharge orundertakingtheprescribedactivityholdspermit Generally, theoperatorofinstallationthatismakingemission environment occursbeyondacceptedlimits. appropriate toensurethatnoharmhumanhealthorthe the discretiontoattachsuchconditionsasitthinksnecessaryand In alltheabovecases,competentauthoritygrantinglicencehas authorities (mostlylocalplanningauthorities). 1 June2015. The systemisoperatedbyhazardoussubstances (Hazardous Substances)Regulations2015,whichcameintoforceon require obtainingahazardoussubstancesconsentunderthePlanning undertaker. The presenceofahazardoussubstanceonlandmayalso grant ofatradeeffluent consent,grantedbytherelevantsewerage Discharges oftradeeffluent topublicsewersarecontrolledbythe emissions fromcertaindieselgenerators. basis forexistingplants),andintroducingcontrolsonnitrogenoxide regime from20December2018fornewplantsandonastaggered Combustion PlantsDirective2015(bringingsuchplantsintotheEP came intoforceon30January2018,implementingtheMedium polluting industriesorotherinstallations/projects? contained inanenvironmentalpermit? environmental impactassessmentsforparticularly Is itnecessarytoconductenvironmentalauditsor environmental permitorinrespectoftheconditions an environmentalregulatornottogrant What rightsaretheretoappealagainstthedecisionof

England &Wales

incident pre-datingthisdate. proving thatparticulardamagewascausedbyanemission,eventor baseline conditionreport,theremaybeevidentialdifficulties in order toavoidliabilityforhistoricpollution.Intheabsenceofa some operatorstoundertakeassessmentsofbaselineconditionin the lateimplementationofDirective–andmayhavecaused retrospective effect before1 March2009–ananomalycausedby The originalUKregulationsimplementedin2009conferredno an emission,eventorincidentthattookplacebefore30 April 2007. has noretrospectiveeffect, sodoesnotapplytodamagecausedby fails, remediationofvariouscategoriesenvironmentaldamage.It environmental liabilityrequiringthepreventionand,wherethat Remediation) Regulations2015,establishesaframeworkof English lawthroughtheEnvironmentalDamage(Preventionand The EnvironmentalLiabilityDirective,currentlyincorporatedinto subject toassessment. aims toreducetheburdenondevelopersbymakingfewerprojects mandatory introductionofpenaltiesfornon-compliance.Italso demolition impactandbiodiversityintheassessment, the additionalconsiderationofclimatechange,biodiversity, Regulations 2017inMay2017.KeypartsoftheDirectiveinclude and theInfrastructurePlanning(EnvironmentalImpact Assessment) Planning (EnvironmentalImpact Assessment) Regulations2017 was implementedinEnglandthroughthe Town andCountry uniform andstreamlinedassessmentprocessacrossMemberStates, The EIA Directive2014/52/EU,whichwasintendedtocreatea environmental information. environmental assessmentuntilconsiderationoftherelevant planning permissionispreventedwhereadevelopmentrequiresan application forplanningpermissionisgranted. The grantingof determine whethertheywillhaveasignificanteffect beforean projects tobesubjectaformalscreeningprocessinorder implementing theEIA DirectiveinEnglandrequiresSchedule2 environment (Schedule2development). The secondarylegislation development proposedislikelytohaveasignificanteffect onthe provided inallcases(Schedule1development)oronlywherethe according towhethertheyrequireanenvironmentalstatementbe foodstuffs andcertaininfrastructureprojects.Projectsaredefined plants, paperandboardplantsmanufacturingcertain construction ofintegratedchemicalinstallationsandother be madeontheeffect ofcertainpublicandprivateprojects,e.g. 1985/337/EC, asamended,requiresanenvironmentalassessmentto The EnvironmentalImpact Assessment (EIA)Directive satisfactory state. condition whereitrepresentsnopollutionriskandisina surrender oftheenvironmentalpermitwhensiteisputina any contaminationdiscovered. The regulatorwillonlyacceptthe report, totheregulatoronconditionofsiteandgivedetails Regulations requiretheoperatortoprovideevidence,i.e.asite Where theoperatorplanstoleaveorclosesite,EP enforcement actionbytheregulator. voluntary actionbytheoperatororthroughundertakingofan installation andensuringthatitisattendedtoimmediatelyeitherby Freshfields BruckhausDeringerLLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 conditions thatmay beattachedtoit. These aretypicallystrict other thanpursuanttoapermit andinaccordancewithany it acriminaloffence tocarryontheactivity, ormakethedischarge, authorisation forthecarryingonof anactivityoradischarge makes In general,legislationrequiring thegrantofapermitor 2.4 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London permits? regulators haveinconnectionwiththeviolationof What enforcementpowersdoenvironmental

3.1 EP Regulations. end disposal,thenthisrequiresan environmentalpermitunderthe to takeinthirdparties’ wasteforstoragependingconsignment for intention istoundertakesometreatment activityonthepremisesor things) thatwasteismanagedso astoavoiditsescape.Ifthe care”, whichrequiresproducersof wastetoensure(amongother Part IIoftheEPA introducedtheconceptofwaste“duty 3.2 the WFD, e.g.:itwillbeexplosive;highlyflammable;corrosive,etc. will displayoneormoreofthe15hazardouspropertiesdetailedin So-called “hazardouswaste”isalsodefinedinthe WFD. Suchwaste European Commission. waste inMay2016.Guidancehasalsobeenpublishedbythe cases, Defrapublishedupdatedguidanceonthelegaldefinitionof to beadifficult definitiontoapplyinpractice,andassistsuch the holderdiscardsorintendsisrequiredtodiscard. This canprove Regulations). “Waste” isessentiallyanysubstanceorobjectwhich in theUKby Waste (Englandand Wales) Regulations2011 (Waste in the Waste FrameworkDirective2008/98/EC(WFD),implemented The definitionof“waste”thatcurrentlyappliesinEnglandissetout (See furtherquestion3.4.) legislative requirementsthanwastegenerally. shipment ofwaste,andradioactivewasteissubjecttodifferent Additional controlsalsoapplyinthecontextoftransboundary transported andhandled. WFD, forexample,inrelationtohowsuchwasteisstored, hazardous waste,additionaldutiesandcontrolsareimposedbythe updated inMay2018.Duetothepotentiallyharmfulnatureof assessment (particularlyhazardouswaste)inMay2015,whichwas The Governmentpublishedguidanceonwasteclassificationand offences requiring question isoneofstrictliability;butthat,inthecasecriminal its employeesinfringeanenvironmentalpermitandtheoffence in imposed onacompanyincircumstanceswheretheactionsofone Appeal confirmedthatitispossibleforcriminalliabilitytobe Company LtdvR[2011] EWCA CrimDiv2527,theCourtof negligence inthecommissionofoffence. In liability offences withnorequirementtoproveintentionor subject tocertainexceptions. damage asaresult,thatpersonisentitledtoclaimforthedamage, of awastemanagementlicenceoccursandthirdpartysuffers comply withaconditionattachedtoit.Forexample,wherebreach Civil liabilitymayalsoflowfromafailuretoholdpermitor offences. accept enforcementundertakingsinrelationtothemainEP revoke orsuspendtheoperationofapermit. The EA isableto any permitgrantedor, inveryseriouscasesofnon-compliance,to have thepowertoissuenoticesvarytermsandconditionsof In additiontotheirpowerspursueprosecution,regulatorsalso “directing mindandwill”ofthecompany. company wheretheemployeeinquestioncanbesaidto 3 produced? waste involveadditionaldutiesorcontrols? Waste How iswastedefinedanddocertaincategoriesof and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore mens rea, liabilitywillonlyattachtothe

England &Wales WWW.ICLG.COM St. RegisPaper

73 England & Wales 74 England & Wales ■ that aresubjecttotake-backandrecoveryobligationsinclude: arrangements totakebacktheirwaste.Othercategoriesofwaste those choosingtofollowtheindividualroutewillusuallymake requirements byjoiningregisteredcomplianceschemes,although waste. Inpractice,mostobligatedcompaniesdischarge these required torecoverandrecycleaproportionoftheirpackaging £2 million,handlingover50tonnesofpackagingannually, are Regulations 2007(asamended).Companieswithaturnoverofover under theProducerResponsibilityObligations(Packaging Waste) responsibility obligationsforitsre-use,recoveryandrecycling As aseparatecategory, packagingwasteissubjecttoproducer 3.4 it underacontract. as aregisteredwastecarrier)knowinglyassumesresponsibilityfor waste producermustensurethatthepersonreceivinghis(e.g. to thesafehandlinganddisposalofwasteafteritleavesthissite, In ordertoeffectively passontheburdenofobligationswithrespect these provisionsarecarriedovertotheEP regime. during theoperationofalandfillsiteorfollowingitsclosure,and that fundsareavailabletoundertakeanyclean-upworksrequired operators provideafinancialguaranteeorbond,inordertoensure It hasbeencommonpracticeforsometimetheEA toinsistthat have appliedthewastemanagementhierarchyofoptions. include asigneddeclarationthat,todate,thosehandlingthewaste Regulations, itisnowalegalrequirementthatsuchtransfernotes and (iv)tocomplywiththedutyofcare.Under Waste enable eachpersonreceivingittoavoidcommittingawasteoffence; written descriptionofthewasteisalsotransferred,sufficient to authorised transportpurposes,and(whenwasteistransferred)thata transfer ofwasteisonlytoanauthorisedpersonorafor his controlorthatofanyotherperson;(iii)toensure waste managementoffence; (ii)topreventtheescapeofwastefrom take reasonablestepstopreventanyotherpersoncommittinga The wastedutyofcarerequiresthepersonsubjecttoduty:(i) 3.3 following closureofthesite. appropriate environmentalcontrolmeasuresbothduringand can offer appropriatefinancialguaranteesrelatingtotheadoptionof environment, andthatthepersonisqualifiedtooperatesite operation ofthedisposalsiteposesnoharmtohumanhealthor planning andEP systemsrequirethedisposer todemonstratethat be required. Applications fordisposalofwasteunderboththe permit undertheEP Regulationsandplanning permissionwillalso Activities involvingtheactualdisposalofwastealwaysrequirea Freshfields BruckhausDeringerLLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM bankrupt/disappears)? regarding thetake-backandrecoveryoftheirwaste? other changes,the recastdirectivecreatedanobligation for 2013, whichcameintoforceon1 January2014. Amongst passed in2012andimplemented by the WEEE Regulations 2012/19/EU on WEEE, extendingthecurrentregime,was England bythe WEEE Regulations2006. A RecastDirective collection systems. The Directivewasimplementedin return theirwasteequipment free ofcharge through recovery, andobligatesdistributorstoallowconsumers responsible forfinancingitscollection,treatment,and Directive 2002/96/ECmakesproducersof WEEE Waste ElectricalandElectronicEquipment(WEEE).EU To whatextentdowasteproducershaveobligations another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin the transferee/ultimatedisposergoes ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

land. InNetworkRailInfrastructure Ltd vWilliams interference withathirdparty’s rightof ownershiporenjoymentof damages and/oraninjunctionwhere pollutionresultsinanunlawful protection isthatofnuisance,which givesrisetoremediesof of tortlaw. The tortofparticular relevancetoenvironmental Civil liabilitymayalsoariseinan environmental contextforbreach compliance withfloodriskactivities. 2018, theEA canalsouseenforcementundertakingstoenforce 2018, undertheEnvironmentalPermitting(Amendment)Regulations the mainEP offences (seequestions1.2and2.4). As of30January enforcement undertakings,butnoothercivilsanctions,inrelationto imposition ofanadministrativepenalty. The EA canaccept authority andthebreachcommittedisonedesignatedfor a criminalprosecutioninsomecaseswheretheEA istheenforcing legislation engaged.Civilsanctionsareavailableasanalternativeto The availabledefencesdependupontheparticularenvironmental that theregulatorhasservedinrespectofactivityorpollution. or thedischarge oremissions made,orfailingtocomplywithnotices holding anenvironmentalpermitinrelationtotheactivityundertaken environmental mediumwhichisthesubjectofprotectionwithout liabilities. Criminaloffences ariseasaresultofpollutingan Breach ofenvironmentallawcangiverisetobothcriminalandcivil 4.1 ■ ■ which listsfournewwasteDirectivesas“prioritypendingproposals”. Commission willcontinuetoworkonitsCircularEconomyregime, The Commission’s Work Programme2018confirmedthatthe Strategy forPlasticsinaCircularEconomy”January2018. the PackagingDirective. The Commissionpublishedits“European Directive, theBatteries Waste FrameworkDirectiveand The proposedDirectiveswillamendthe WEEE Directive,theELV 4 what defencesaretypicallyavailable? Liabilities breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa the Waste Batteriesand Accumulators Regulations2009. provisions wereimplementedinEnglandbythepassingof paid forbyproducersandimportersofbatteries. These setting upofbatterycollectionandtake-backsystemstobe includes producerresponsibilityprovisionsregardingthe Batteries. The BatteriesDirective(Directive2006/66/EC) for ProductSafetyandStandards). to theNationalMeasurementOffice (nowpartoftheOffice April 2015,responsibilityfortheELV regimewastransferred the ELV (Producer Responsibility)Regulations2005.In producer responsibilityrequirementswereimplementedby England bythepassingofELV Regulations2003,andthe requirements oftheELV Directivewereimplementedin comply withspecifiedenvironmentalstandards.Mostofthe (“treated”) byauthoriseddismantlersorshredders,whomust Member StatestoensurethatELVs areonlyscrapped protect theenvironment. The ELV Directiverequires the collection,re-useandrecyclingoftheircomponentsto (2000/53/EC) aimstopreventwastefromELVs andpromote End ofLife Vehicles (ELV). The ELV Directive England, on1January2019. number ofthechangesarestillduetocomeintoforcein to allowconsumersrecyclesmallelectronicgoods. A large electronicretailerstoprovidecollectionpointsinstore into forceon1July2015. the Market)(Amendment)Regulations2015,whichcame implemented bytheBatteriesand Accumulators (Placingon which removescertainexceptionstotheregime,andwas This isexpandedbytheBatteriesDirective2013/56/EU,

England &Wales [2018]EWCA

for theeventthatgivesrisetodamage(seequestion4.3). in certaincircumstancesincurpersonalcivilliabilityifresponsible Officers andemployees,aswelltheundertakingconcerned,can been heldnottoamountadirectinterference. and carriedbythecurrentbeforereachingaclaimant’s propertyhas pollution causedbythedischarge ofpollutingmaterialsintowater Proving directinterferencehasproveddifficult as,forexample, for innationallegislation(seequestion 5.1). liability arisesundertheDirective beyondthatcurrentlyprovided they arenotatfaultornegligent, butonlyinsofarasadditional bear thecostsofanyremedialactionthatmayberequiredprovided availability ofthedefencemeansthatoperatorswillnotbeliableto Environmental DamageRegulations2015(seequestion2.3). The Environmental LiabilityDirective,whichwasadoptedinthe However, apermitdefenceisspecificallyprovidedforinthe predecessor regimes. of suchallegedbreaches. These provisionsarecarriedoverfrom staff and/ormanageormaintain equipmentusuallyformsthebasis compliance withapermit.Someformoffailuretoproperlymanage found liableforanyenvironmentalharmcaused,notwithstanding Furthermore, itispossibleundertheEP regimeforoperatorstobe it maycarrysomeevidentialweight. will notbeenoughtopreventliabilityforprivatenuisance,although that anallegednuisancehasthebenefitofaplanningpermission another [2014]UKSC13,theSupremeCourtheldthatmerefact unlawful acthascausedadirectphysicalinterferencewiththeland. but tosucceed,theclaimantmustshowthatdefendant’s The tortoftrespasshasalsobeenpleadedinenvironmentalcases, to bepleadedasanalternativenuisance. of careincasesenvironmentalharm.Itiscommonfornegligence in ordertosucceed.However, itisoftendifficult toestablishaduty nuisance, theclaimantdoesnotneedtoestablishaninterestinland complains isaforeseeableconsequenceofthebreach.Unlike has beenabreachofthatdutyandthedamagewhichhe must showthatthedefendantowesadutyofcaretohim,there The tortofnegligencemayalsoberelevant. To succeed,aclaimant substance escapingfromland,providedthedamageisforeseeable. liability fordamagecausedbyadangerousaccumulationof The rulein question 4.2belowforadiscussionofnuisanceandpermitdefences. be causedbyinactionoromissionwellasapositiveaction.See damage isnotarequirementforcauseofactionandnuisancecan into oneofthesecategoriestobeactionable.Furthermore,physical violation ofpropertyrights:anuisancedoesnothavetoneatlyfall encroachment, interferenceandphysicalinjuryareexamplesofthe Civ 1514,theCourtof Appeal heldthatthecategoriesofnuisance, Freshfields BruckhausDeringerLLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 provisions oftheirpermit.In notwithstanding thattheyhavenotbeennegligentorbreachedthe environmental permitcanstillbeliableinprivatenuisance, defendants whooperateunderadetailedregulatoryschemeand [2012] EWCA Civ312,theCourtof Appeal reaffirmed that within permitlimits.In third party, notwithstandingthatthepollutingactivityisoperated An operatorcanbeliableforenvironmentaldamagecausedtoa 4.2 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London within permitlimits? notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage Rylands vFletcher Barr andothersvBiffaWaste ServicesLtd Coventry andothersvLawrence and establishestheprincipleofstrict

company asaresultofthepollution-relatedloss). or claimsfromshareholders(i.e.allegingafallinvalueofthe although somepolicieswillprovidecoverforrelateddefencecosts pollution eventsisoftenexcludedfromsuchinsurancepolicies, company forthesematters.Furthermore,liabilityarisingfrom him/her, andthecourtsmightnotenforceanindemnitybya director orofficer forcriminalfinesorpenaltiesimposedon policy, itwouldnotbepossibletoobtaininsuranceindemnifya provide indemnitiesdirectlytothem;however, asamatterofpublic officers frompersonalliabilityforenvironmentalwrongdoingor companies canpurchaseinsurancetoprotecttheirdirectorsand Subject tosections232234oftheCompanies Act 2006, both thecompanyanddirectormaybeprosecuted. to anyactorneglectonthepartofsuchperson.Incases, officer orotherpersonactinginasimilarcapacity, orisattributable been attributabletotheconsentorconnivanceofanydirector law wheretheoffence committedbyacompanyisproventohave Personal liabilitycanalsobeimposedforbreachesofenvironmental circumstances givingrisetothecommissionofoffence. own actsoromissions,theycanbesaidtohavecreatedthe imposed forbreachesofenvironmentallawif,asaresulttheir Personal liabilityfordirectorsandofficers ofcompaniescanbe 4.3 liabilities forenvironmentalwrongdoing, intheabsenceof Lenders under, forexample,amortgagedeedare unlikelytoincur 4.5 the differences betweenashare andassetpurchaseareminimal. allocating environmentalriskmeansthat,inmanypracticalrespects, contractual andothermechanismsfortransferringotherwise company thatissold.However, theavailabilityofawiderange crystallises intermsofactionpursuedbytheregulatoragainst agreement tothecontrary)escapeanyliabilitythatsubsequently In thecaseofasharesale,sellershould(inabsenceany occupation oftherelevantsite. also becomeliablemerelyasaresultofbeinganownerorin can resultinliability. Incertaincircumstances,thepurchasercould permitter, ifnotacauser, ofanongoingenvironmentalproblemthat condition, thenthepurchasermightbesaidtoaknowing breach continuingorotherwisetoremedytheenvironmental in relationtotheassetacquiredandhasabilityprevent of abreachenvironmentallawand/orancondition A key riskforthepurchaserinanassetpurchaseisthatifitaware failure ofanotherentitytocomplywithenvironmentallaw. does notautomaticallytakeonliabilityforanycurrentandongoing has historicallyoperated;whereasinanassetpurchase,thepurchaser the business/sitesthatcompanycurrentlyoperates,ortothoseit associated withthecorporateentityconcerned,whetherrelatingto company, oneeffectively inheritsallenvironmentalliabilities The fundamentaldistinctionisthatwhenonebuysthesharesofa 4.4 indemnity protectioninrespectofsuchliabilities? environmental wrongdoingand/or remediationcosts? the onehandandanassetpurchaseonother? to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract To whatextentmaylenders beliablefor environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman England &Wales WWW.ICLG.COM

75 England & Wales 76 England & Wales risk assessment). There isnogeneralrequirement onanowneror considering source-pathway-target relationshipsandconducting a areas shouldbeclassifiedascontaminated land(whichinvolves Local authoritiesarerequiredtoconsider whetheranylandintheir the LawSociety’s interpretationofbest practice inthisarea. same. Compliancewiththenoteis notmandatory, butdoesreflect Land Warning Card,although therecommendationsarebroadly when applyingtheregime. This notereplacestheContaminated the contaminatedlandregime,updatedin April 2016,tobeofhelp occur. PractitionersmayalsofindtheLawSociety’s practicenoteon Defra in2012confirmsthecircumstanceswhichthisisdeemedto “significant possibility”ofsuchharm.Statutoryguidanceissuedby waters dependsonwhetherthedamageis“significant”ortherea Whether landis“contaminated”orcontaminatingcontrolled of controlledwaters. sites andthesituationwherelandcontaminationiscausingpollution including landcontaminatedbyradioactivityfromnuclear-licensed regime fordealingwiththemostseriouslycontaminatedland, level ofcontamination.Part2A oftheEPA 1990setsoutastatutory in theshortterm,whetherremedialactionisrequireddependson Where itisnotintendedtoredevelophistoricallycontaminatedland or leaseoftheresultingdevelopment. costs oftheprojectandberecoupableasaconsequencesale for thecostofremediation,whichwillnormallybefactoredinto it becomesfitforitsintendedpurpose.Often,thedeveloperwillpay requiring investigationandclean-upofthesitetoastandardwhere approach isfortheplanningpermissiontobesubjectconditions Where itisproposedtoredevelopacontaminatedsite,theusual depends uponthecircumstancesthatapply. The approachoftheregulatortoliabilityforhistoriccontamination 5.1 capital cost(inthecaseofprojectfinance,US$10millionormore). all industrysectorsandtoloansforprojectsaboveaspecified environmental andsocialpracticesinprojectfinancing,applyto Principles arespecificallydesignedtopromoteresponsible (the private-sectorinvestmentarmofthe World Bank). The Equator safeguarding policiesandguidelinesofthe World BankandtheIFC voluntary guidelinesforfinancialinstitutionsbasedonthe voluntary agreements,suchastheEquatorPrinciples,asetof environmental, socialandgovernancepoliciesaresignatoriesof activities. As aconsequence,manyleadingUKbankshavedetailed infrastructure projectsandtocompaniesundertakingcontroversial lending onwhatareperceivedtobeenvironmentallysensitive Lenders mayalsofacereputationalrisksasaconsequenceof then deemedtobetheownerofsite. possession couldbeliableasaClassBpersononthebasisthatitis cannot establishanappropriateClass A person,alenderin the presenceofcontaminationonproperty. Also, iftheregulator EPA 1990,ifitcanbesaidtohavecausedorknowinglypermitted liability asaClass A personundertheprovisionsofPart2A ofthe property. Itisconceivable,forexample,thatalendercouldincur undertaking orpayingforremediationofcontaminationthe possession ofapropertythenitmay, potentially, becomeliablefor occurring. If,however, alenderenforcesitssecuritybytaking application ofthemonieslenttoborrowerpreventpollution knowledge ofthewrongdoingoranyrealabilitytocontrol Freshfields BruckhausDeringerLLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 5 groundwater? Contaminated Land What istheapproachtoliabilityforcontamination (including historiccontamination)ofsoilor

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

■ ■ environmental damagearecovered,namely: environmental damageifithasoccurred. Three categoriesof first place,butalsotoownupregulatorshavingcaused preventative actiontoavoidenvironmentaldamageoccurringinthe damage aremanaged. They requireoperatorsnotonlytotake on hownewinstancesofthemostseriouscasesenvironmental The EnvironmentalDamageRegulations2015alsohaveanimpact claims arising,orforbreachofanyinjunctionorderedbythecourt. caused. Ultimately, clean-upmayberequiredtoavoidfurther grant ofaprohibitoryinjunctionand/ordamagesfortheharm commonly pleadedbeingthetortofnuisance.Remediesinclude is acivilliabilitythatarisesunderthelawoftorts,most to claimremedieswherepollutionhasmigratedontoitsland. This give risetotheabilityofathirdpartybringproceedingsinorder Liability forhistoriccontaminationofsoilorgroundwatermayalso costs ofremediationbetweensuchpersons. groups ofpolluters(seebelow),aswelltheapportionment from liabilityandallocationofonvariousgroundsbetween The regimeiscomplexandincludesdetailedprovisionsonexclusion or occupierforthetimebeing. contamination) or, wheresuchapersoncannotbefound,theowner permitted thepresenceofsubstancethatcaused the appropriateperson(thewhocausedorknowingly event thatitisnotdonevoluntarily, payforremediation,lieswith standard andextentofremediation.Liabilitytoundertakeor, inthe reasonableness considerationsarerelevantindeterminingthe The regimeisbasedona“suitableforuse”approach,andcost and exactlywhatformthatremediationshouldtake. “special sites”)toconsiderwhetherthereisaneedforremediation, the localauthorityasregulator(orEA,incaseofcertain contaminated land,thenastatutoryrequirementarisesonthepartof permission istobeundertaken).Ifthelandsatisfiesdefinitionof (except incircumstanceswheredevelopmentrequiringplanning occupier tonotifythelocalauthorityofexistencecontamination new conceptsforEnglishLaw. of theuseorenjoymentresource orservice.Bothoftheseare remediation mayalsoberequiredto compensatesocietyfortheloss the originalresourcecannotbefully restored.“Compensatory” resource orservicemayberequired tobeundertakentheextent “complementary” remediationby improvementofasimilar harm tobiodiversityorprotectedwaterscannotbereversed,then damage toland,theriskhumanhealthmustberemoved.If returning theenvironmenttoitsbaselinecondition;incaseof Where biodiversityorwaterdamageoccurs,itmustberemediedby been negligent. liable forbiodiversitydamage,butonlyiftheyareatfaultorhave liability applies.Operatorsofotheroccupationalactivitiesmaybe three categoriesofenvironmentaldamageiscoveredandstrict which arepotentiallydamagingtotheenvironment,liabilityforall comprising awiderangeofactivitiesregulatedbyEClegislation For occupationalactivitieslistedinSchedule2oftheRegulations, ■ damage); of aSiteSpecialScientificInterest(SSSI)(biodiversity natural habitatsprotectedunderEClegislationortheintegrity maintaining favourableconservationstatusofspeciesand damage thathassignificantadverseeffects onreachingor (Directive 2000/60/EC)(waterdamage);and of waterscoveredbythe Water FrameworkDirective chemical and/orquantitativestatusecologicalpotential damage thatsignificantlyadverselyaffects theecological, health beingadverselyaffected. land contaminationthatcreatesasignificantriskofhuman England &Wales

Crest as85:15for onecontaminantand45:55for another. Inthe The SecretaryofStateapportioned liabilitybetweenRedlandand removed toremainandleachdeeper andfasterintotheground. site. This hadcausedcontaminantsthatwouldotherwisehave been built, despiteitbeingawareofthe presence ofcontaminationonthe rainfall leachingforsometwoyears beforethenewhouseswere demolished hard-standings,leavingcontaminatedsoilexposedto Secretary ofStateparticularlypointedtothefactthatCresthad it dealtwiththesite,toohadcausedcontamination. The as aresultofitsactionandinactionduringownershipintheway brought thechemicalsontosite,SecretaryofStatefoundthat contamination tobeon,inandunderthesite;whilstCresthadnot supply. BothRedlandandCrestwerefoundtohavecausedthe water abstractionboreholesandthreateningthepotable the underlyingchalkaquifer, leadingtotheclosureofanumber housing. Chemicalsfromthesitewerefoundtohaveseepedinto Redland hadformerlyownedthesiteandCrestdevelopeditfor appropriate personsandliabletoremediatecontaminatedland. Residential plc(Crest),whowerebothfoundtobeClass A involved RedlandMineralsLimited(Redland)andCrestNicholson notice illustrateshowthiscomplexregimeworksinpractice. This A determination ofanappealagainsttheservicearemediation the landinquestion. apportionment shouldbemadeonthebasisofcapitalvalue who ownoroccupythatparticularareaofland.Otherwise, particular areaofland,liabilityshouldbeapportionedtomembers group, theguidanceindicatesthatwhereremediationreferstoa In termsofapportionmentbetweenmembersaClassBliability result intheexclusionofallmembersliabilitygroup. capital valueofland. Again, thetestisnottobeappliedifitwould applicable istoexcludethosewhodonothaveaninterestinthe In relationtoClassBliabilitygroups,theonlyexclusiontest liability inequalshares. responsibility, thestatutoryguidanceadvisesregulatorstoapportion information isavailabletomakeanassessmentofrelative for creatingorcontinuingtherisknowbeingcaused.Ifno so astoreflecttherelativeresponsibilityofeachthosemembers apportion liabilitybetweenmembersoftheClass A liabilitygroup, Having appliedtheexclusiontests,regulatoristhenrequiredto may wellthereforebethelastone(s)left. that theperson(s)responsibleforbearingcostofremediation exclude everymemberoftheliabilitygroup. This meansessentially sequence inwhichtheyaresetout. They mustnotbeappliedto that hasbeenobtained. The exclusiontestsmustbeappliedinthe a balanceofprobabilities,afterconsideringtherelevantinformation judgments inrelationtowhetherornotthetestsapplyaretakenon exclusion fromliabilityapply. There aresixtestsintotal,and the regulatorisrequiredtofirstconsiderwhetheranyoftestsfor bear responsibilityforremediation.InrelationtoClass A groups, designed toensurethatitisfairformembersoftheliabilitygroup The exclusiontestsandsubsequentapportionmentare persons havebeenfoundafterreasonableenquiry. owners and/oroccupiersforthetimebeingwherenoClass A permitted thepresenceofpollutants;orClassBpersons,being Class A persons, thatispersonswhohavecausedorknowingly depending uponwhethertheliabilitygroupcomprisesso-called deemed toberesponsibleforcontamination. The rulesdiffer regime setsouttherulesthatapplywheremorethanonepersonis Statutory guidanceunderthePart2A EPA 1990contaminatedland 5.2 Freshfields BruckhausDeringerLLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London is responsibleforthecontamination? How isliabilityallocatedwheremorethanoneperson

later successfullyappealedthisdecisiononothergrounds. contamination causedbyapredecessor;however, thelocalauthority “responsible person”underPart2A oftheregime,inrespect Council In November2016,inthecaseof for thedamage(seequestion5.4). claim contributionfromanyotheroperatorwhoisalsoresponsible against anyoralloftheoperatorsconcerned–withableto authority maycarryoutnecessaryworkandreclaimthecosts measures tobecarriedout.Ifremedialactionisnotout,the themselves thesharesinwhichtheyshouldbearcostsof indicates thatoperatorsshouldendeavourtoagreebetween case, guidanceaccompanyingtheimplementingregulations operator andservearemediationnoticeoneachone.Inthelatter identifiable operators,theregulatormaynotifymorethanone environmental damageiscausedbytheactionsofasmallnumber of theactivitiescanberequiredtoremediate,andwhere more thanoneactivitycontributestoanincident,theoperatorofany Damage Regulationswheremulti-partycausationarises: Defra hasadoptedthefollowingapproachinEnvironmental damage (seequestion5.4). contribution fromothertortfeasorsresponsibleforthesamelossor Liability (Contribution) Act 1978enablesatortfeasortoclaim adopted acontinuingnuisancecausedbypredecessor. The Civil nuisance, assubsequentownersoroccupiersmaybeallegedtohave his loss. This isparticularlypertinentinthecaseoftort damage, heisentitledtosuealloranyofthemforthefullamount different personscausedtheclaimanttosuffer loss,injuryor trespass orbreachofstatutorydutyismadeout,thenifbreachesby Accordingly, whereoneofthetortsnuisance,negligence, Civil liabilityforcontaminatedlandisjointandseveral. contamination ofthesitebyfirstcontaminant. therefore onlypartlyreduced.Noinformationhadbeenprovidedon Liability onthebasisof“soldwithinformation”testwas Crest tohavebeenawareofthepresenceitinaquifer. amount ofinformationonitspresence,butnotsufficient toenable case ofthesecondcontaminant,Redlandhadprovidedalimited required toshow groundsforbringingjudicial review, by successfully challengetheagreement, thethirdpartywouldbe cases, asdetailedintheCriminal Justice andCourts Act 2015. To fast-track courtforenvironmental andplanningjudicialreview decision bytheregulator. Casesmayalso beheardbyadedicated Administrative Courtonthebasis oftheagreementrepresentinga could challengetheagreementby wayofjudicialreviewinthe remediation workstobecarriedoutontheparty’s land,athirdparty agreement isreachedbetweenapartyandregulatorwithregardto In termsofthirdpartychallenges,itisconceivablethatwherean that theworkswillnotachieveagreedremediationobjectives. dissatisfied withtheprogressofremediationworksorconsiders remediation hasbeen“agreed”,suchaswhentheregulatorbecomes be carriedouteventhoughaprogrammeofenvironmental proportionate regulation,aregulatorcanrequireadditionalworksto acting reasonablyandtherequirementforappropriate subject toproceduralsafeguardssuchastheconceptofregulator will berequiredtodoneremediateit.Consequently, and to determineattheoutsetofaremediationprogrammeexactlywhat The natureofcontaminatedlandissuchthatitnotalwayspossible 5.3 can athirdpartychallengetheagreement? regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis , theHighCourtconfirmedthatalocalauthoritycouldbe Price andanothervPowysCounty England &Wales WWW.ICLG.COM

77 England & Wales 78 England & Wales other thantoinsistuponthebuyerrelyingonitsowninspections). information (otherthanwherethesellermakesnorepresentation disclose mattersaboutwhichtheotherpartyexpresslyseeks leased, subject,however, tothesellerorlandlord’s obligationto itself astothestateandconditionofpropertybeacquiredor buyer beware”. Accordingly, apotentialbuyerortenantmustsatisfy rule inrelationtopropertytransactionsof should payforanypollutionhecauses,thisconflictswiththegeneral Whilst itisageneralprincipleofenvironmentallawthatthepolluter 5.4 the EA isinvolved. Ombudsman investigatescomplaintsconcerningsuchissueswhere in theeventthatcomplaintisupheld. The Parliamentary the complaintandmakefindingsincludingrulingsforcompensation as aresultofmaladministration. The Ombudsmanwillinvestigate if theyfeelthatalocalauthority’s behaviourhasresultedininjustice Third partiesmaycomplaintotheLocalGovernmentOmbudsman basis ofillegality, irrationalityorproceduralimpropriety. demonstrating thatthedecision-makerreacheditsdecisionon Freshfields BruckhausDeringerLLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM misdescription, misrepresentationorfraudulentconcealment. make suchdisclosureorasaresultofbreachcontractfor Private rightsofactionmayarisewheretherehasbeenafailureto mechanisms wherebyasellerof land caneffectively transfer the The statutoryguidanceunderPart 2A EPA 1990alsoprovides a greatersumthancanberecovered fromhimbytheclaimant. overriding principlethatonedefendant cannotbefoundliabletopay damage inquestion. The court’s powers are,however, subjecttothe with regardtotheextentofperson’s responsibilityforthe ordered issuchasmaybefoundbythecourttojustandequitable, of trustorotherwise. The amountofcontributionthatcanbe whether thebasisofhisliabilityisintort,breachcontract, otherwise). A personisliableundertheprovisionsof Act person liableinrespectofthesamedamage(whetherjointlyor damage suffered byanother to recoveracontributionfromanyother (Contribution) Act 1978allowsanypersonliableinrespectof liable atcommonlawforcontamination. The CivilLiability subsequent owneroroccupierhasbeenfoundjointlyandseverally to recoveragainsttheoriginalpollutermayalsoarisewhere escaping fromtheirsite. As aconsequence,privaterightofaction pollution, andthepowertopreventsubstancebeingthereor have boththeknowledgeofpresencesubstancecausing which pre-datestheirownershiporoccupationofasite,wherethey subsequent ownersoroccupiersmaybeliableforcontamination predicated onthebasisof“causing”or“knowinglypermitting”,and Liability inenvironmentallawforcontaminationistypically the selleractivelyconcealingsomedefectinproperty. remedies applyinrelationtofraudulentconcealment,whichinvolves contract dependingonthenatureofmisrepresentation.Similar gives risetoarightofactionfordamagesand/orrescissionthe where answerstopreliminaryinquiriesarefalseormisleading.It material factinrelationtotheproperty, whichmayarise,forexample, Misrepresentation requirestheretobeamisrepresentationof fact, heavilycontaminatedmaygiverisetoaremedy. Representing thatapropertyisfreefromcontaminationwhenitis,in contaminated landliabilitytoapurchaser? possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek caveat emptor

, or“letthe ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

complementary orcompensatoryremediation(seequestion5.1). baseline conditionor, wherethisisnotpossible,toprovide operator toremediatetheharmcausedbyreturninghabitatits claim damagesforaestheticharms,inthesenseofrequiring Where biodiversitydamageiscaused,publicauthoritiesareableto other triggersspecifiedapply, e.g.thesiteaffected isanSSSI. definition ofbiodiversitydamage(seequestion5.1),providedthe aesthetic harmtopublicassetscould,forexample,becoveredbythe assets islimited.UndertheEnvironmentalDamageRegulations, The powertoobtainmonetarydamagesforaestheticharmpublic 5.5 whether anoffence hasbeencommitted. persons (includingemployees) in thecourseofinvestigating include powerstosearchpremises, conductsamplingandinterview powers underthePoliceandCriminal Evidence Act 1984. These information aboutthecommissionofoffences pursuantto where criminaloffences have beencommitted,toobtain environmental legislation,regulatoryauthoritieshavepowers, In additiontoinformation-gatheringpowerscontainedin are protectedbylegalprivilege. not, however, extendtorequiringtheproductionofdocumentsthat and (ii)requiretheproductionofcertainrecords. The powersdo thinks fittoaskandsignadeclarationofthetruthhisanswers; investigation, toanswersuchquestionsastheauthorisedperson able togiveanyinformationrelevantexaminationor whom anauthorisedpersonhasreasonablecausetobelievebe Environment Act 1995,includingpowersto:(i)requireanyperson persons authorisedbythemaresetoutinsection108ofthe Various generalandspecificpowersofenforcingagencies excuse, tocomplywithanyrequirementofsuchanotice. specified inthenotice;itisanoffence tofail,withoutreasonable the EP Regulations2016,insuchformandwithinperiodasis as itreasonablyconsidersneedstodischarge itsfunctionsunder require anypersontofurnishsuchauthoritywithinformation also providesthattherelevantauthoritymay, bywrittennotice, the regulatorinordertodetermineapplication.Regulation61(1) must providesuchfurtherinformationasisreasonablyrequiredby the EP Regulations2016,applicantsforanenvironmentalpermit the circumstances.Forexample,underparagraph4ofSchedule5 to discharge theirfunctions. The natureofthesepowers dependson Regulators havewidepowerstoobtaininformationenablethem 6.1 remediation liability. circumstances toagreewiththesellerthatwillretain its remediation,althoughitisalsopossibleforapurchaserinsuch member ofthesameClass A liabilitygroup)shouldbearfor to apurchaseranditisreasonablethatthe(who example, whereasellerhasprovidedknowledgeofcontamination liability risksassociatedwithcontaminationtoapurchaser, for 6 public assets,e.g.rivers? conduct siteinspections,interviewemployees,etc.? Powers ofRegulators polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma require productionofdocuments,takesamples, What powersdoenvironmentalregulatorshaveto England &Wales

account whenacourtisassessingthepenaltiesforoffence. migration mayprovidemitigatingfactswhichwouldbetakeninto disclosure ofinformationconcerningtheexistencepollutionorits deposited orpollutingmattertoentercontrolledwaters),theproactive committed acriminaloffence (e.g.byillegallycausingwastetobe Also, incircumstanceswherethepersonresponsibleforpollutionhas ■ ■ ■ ■ following circumstances: of anenvironmentalproblem.However, thismayariseinthe inform andinvolvetheregulatoryauthoritiesuponbecomingaware In England,thereisnolegaldutyplacedonpersonsgenerallyto 7.1 Freshfields BruckhausDeringerLLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 The basicposition inEnglandis 7.3 the planningprocess. proposed developmenttoproceed,beingamaterialconsiderationin contaminated toanextentthatitrequiresremediationinorderfora condition toaplanningconsent;whetheranygivenlandis of the Water Resources Act 1991. They mayalsoberequiredasa Part 2A oftheEPA 1990oraworksnoticeservedundersection161A remediation noticeservedunderthecontaminatedlandprovisionsof investigations mayalsobenecessarywheretheyarestipulatedina contemplating makinganenvironmentalpermitapplication.Site authority wherethe(proposed)operatorofaPart A EP activityis requirement thatasiteconditionreportbesubmittedtotheenforcing contamination incertaincircumstances.Forexample,itisa A person doeshaveanaffirmative obligationtoinvestigatelandfor 7.2 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 7 parties? takeover transactions? contamination? danger tothirdparties. dangerous incidentorstateofaffairs isawarethatitposesa common law, suchaswhereapersonresponsiblefor a “dutytowarn”mayariseincertaincircumstancesunder question 5.1);and “environmental damage”totherelevantregulator(see occupational activitiestoreportthediscoveryof there isageneraldutyontheoperatorsofwidescope of anymajoraccidentatsuchasite; EA, actingjointly),assoonpracticable,oftheoccurrence to informtheCompetent Authority (i.e.theONR/HSEand Accident Hazard(COMAH)Regulations2015arerequired the operatorsofsitesregulatedunderControlMajor abstraction licences; obligations arealsotypicallyincludedinwaterdischarge and may causesignificantpollution.Monitoringandreporting without delay, ofanyincidentoraccidentwhichiscausing of themonitoringemissionsandtoinformregulator, the operatortosupplyregulatorregularlywithresults under theUKEP regimemustincludeacondition requiring a permitauthorisingtheoperationofPart A installation there maybereportingobligationsinpermits.Forexample, Reporting /DisclosureObligations migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe prospective purchaserinthecontext ofmergerand/or environmental problems,e.g.by asellerto environmental regulatororpotentiallyaffectedthird To whatextentisitnecessary todisclose have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson

caveat emptor or“letthebuyer

such agreements. apportionment andattributionofliability inordertogiveeffect to authority shouldgenerallymakedeterminations ontheexclusion, concerning contaminatedlandunder Part2A,andthattheenforcing persons whoareresponsibleforthe costsofaremediationaction provides foragreementsonliabilities tobeenteredintobetween example, theStatutoryGuidance underPart2A specifically environmental riskshasassumedincreasedimportance.For of Part2A oftheEPA 1990,thecontractualallocationof Following theimplementationofcontaminatedlandprovisions environmental liabilitiesasbetweenasellerandpurchaser. use ofsuchindemnitiesisacommonwayallocating effectively transferriskfor such liabilitiestoanotherperson. The actual orpotentialenvironment-relatedliabilities,aswellto possible touseanenvironmentalindemnitylimitexposurefor mechanisms forallocatingenvironmentalrisksintransactions.Itis Environmental indemnitiesprovideimportantcontractual 8.1 covered bytheEnglishregime. but extendsto“publicinterestentities”whichmaynotalreadybe England undersections414A–414DoftheCompanies Act 2006, throughout theEU. This overlapswithexistingobligationsin environmental andnon-environmentalmattersbylarge companies February 2016. The Directiveprovidesformandatoryreportingon (then theDepartmentofBusiness,InnovationandSkills)in UK inDecember2016,followingaconsultationlaunchedbyBEIS financial ReportingDirective2014/95/EUwasimplementedinthe information, aswellsocialandhumanrightsmatters. The Non- to someextent,thewaycompaniesreportonenvironmental Recent legislationonnarrativecorporatereportingwillalsoaffect, environmental informationthanwaspreviouslypossible. purchasers inahostiletakeovermayhavegreateraccessto (including lower-tier COMAHsites). As such,prospective information requiredtobeprovidedinrelationCOMAHsites Aarhus Convention,thereisnowanincreaseintheamountofpublic Directive, implementedbytheCOMAHRegulations2015,and provided byagreementofthetarget. PursuanttotheSeveso-III the contextoffriendlytakeovers,suchinformationmaywellbe target’s environmentalproblemsfrompubliclyavailablesources.In normally reliantonwhateverinformationtheycangleanaboutthe In hostiletakeovertransactions,prospectivepurchasersare providing afalseormisleadingresponsecouldbeactionable. prospective purchasersconcerningenvironmentalmatters,as always becarefulwhengivingrepliestoenquiriesraisedby subject matteroftherepresentationorwarranty. Sellersshould the extentthatsellerhasfairlydisclosedinformationabout purchaser cannotsueforbreachofarepresentationorwarrantyto acquisition transactionsarenormallydocumentedsothata disclosure ofinformationbytheseller. This isbecausemerger and purchasers asacontractualmechanismeffectively requiring representations andwarrantiesareoftenrequiredbyprospective associated withthetarget’s businessorassets.Environmental environmental duediligencetorevealanyrisks beware” (seequestion5.4).Purchaserswillusuallyundertake 8 potential liabilityforthatmatter? General matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- Is itpossibletouseanenvironmentalindemnity England &Wales WWW.ICLG.COM

79 England & Wales 80 England & Wales time limitifitcan beshownthatthetransaction was effected in more thantwoyearsbeforetheentry intoliquidation(thereisno transaction asbeingatanundervalue, providedthatitoccurredno appointed liquidatormayusestatutory powerstochallengethe company mustreceivefairconsideration. Ifitdoesnot,the of itsliabilities(includingenvironmental liabilities).However, the and assetstoa“clean”corporatevehicle, leavingbehindsomeorall company mayinsteadconsidereffecting atransferofitsbusiness valuable assetsand/orhasanotherwisehealthybusiness.Sucha environmental liabilityarising,particularlyifthecompanyowns This mayseemaratherdrastic“solution”totheproblemofan unpaid willthenbehighlyunlikelytoreceiveanyfurtherpayment. (including environmentalcreditors)remainingunpaidorpartly liquidation process,thecompanywillbedissolved. Any creditors creditors accordingtostatutorypriority. At theendof available assetsofthecompanyandtodistributetheirvalue liquidation processrequirestheappointedliquidatortorealiseall minimise lossestocreditors,liquidationwillbeinevitable. The liabilities orotherwise,subjecttothedirectorsdoingalltheycan If acompanyisinsolventeitherasresultofenvironmental with thegroup’s accounts. stated intheSPV’s balancesheetwouldneedtobeconsolidated liabilities, itcouldwellbethatthefinancialamountofliabilities contaminated propertiesthatmaygiverisetoenvironmental Even wherethistypeofSPV iscreatedandrunproperlyinholding use ofthecorporateformasadeviceforevadingexistingliabilities. obligation, asthecourtshavedemonstratedalackofsympathyfor fact theintentionofapartyinsettingupSPV toevadethe the factsandcircumstancescarefullytodeterminewhetheritwasin is anexisting Another exceptionconcernssituationswheretheliabilityinquestion they arewoundup(seebelow). the group,itisdifficult toseehowtheywouldescapeliabilityunless problems. If,forexample,thosepersonsremaincompanieswithin properties) whocausedorknowinglypermittedtheenvironmental of persons(otherthantheSPV establishedtoholdtherelevant An exceptionariseswheretheliabilityresultsfromactsoromissions properties thathavecontaminationissuesintoSPVs. from site-specificenvironmentalproblemsbytransferring time byconduct.Itmaybepossibletoisolatetheliabilitiesarising occupier. This isanongoingprocess,asagencycanariseatany is actingasanagentorthatanothercompanytheowner minimise theriskofthirdpartiesbelievingcompanyinquestion ownership ismadeknowntothirdpartiesandthatstepsaretaken liabilities tothirdparties.Itisessential,however, thatsuch vehicles –SPVs)toownandoccupypropertythatmayincur incorporated companieswithlimitedliability(specialpurpose There isnothingtopreventacompanyestablishingEnglish- 8.2 arises asaresultofpost-completionactionsbythepurchaser. limitations limitingthepurchaser’s abilitytoclaimwherethe sharing asbetweentheparties;therearenormallyalsoother thresholds andrespectivecapsforclaims,sometimescosts- example, financiallimitationsmayinclude limitations togoverntherelationshipbetweenparties.For them. The indemnitiesnormallycontainarangeoffinancialandother the scopeofindemnitiesandeventsthattriggerclaimsunder Typically, environmentalindemnitiescontaindetailedprovisionsasto Freshfields BruckhausDeringerLLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM Conduct anddispute-resolutionprovisionsarealsotypicallyincluded. order toescapeenvironmentalliabilities? balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff one. Where thisisthecase,courtswouldexamine de minimis,aggregate ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 future

shareholders, norareitsliabilitiestheofshareholders. As ageneralprinciple,company’s actsarenottheofits 8.3 statutory creditors. on thepremisesandisregistrableassuch,takingpriorityovernon- to anyrightsofappealagainstthenotice),costbecomesacharge land). Where acharging noticehasbeenvalidlyserved(andsubject incurred bytheenforcingauthorityincleaningupcontaminated concerned (e.g.section78P oftheEPA 1990,concerningcosts amount whichtheauthorityclaimsisrecoverablefromcompany costs, itmaybeentitledtoserveacharging noticespecifyingthe In certaincircumstances,wherearegulatoryauthorityitselfincurs disqualification issuesmayalsoarise. have beeninhadthetransactionnotoccurred.Directors’ dutiesand for thepurposeofrestoringcompanytopositionitwould successful, thecourthaspowertomakeawiderangeoforders order toputassetsbeyondcreditors’ reach).Ifthechallengeis automatically and onlyarisesinparticularcircumstances: parent parent companytoasubsidiary’s employees doesnotexist disease. The Courtemphasisedthatthedutyofcareowed bya subsidiary’s employee,whohaddeveloped anasbestos-related Appeal held,essentially, thatCapeowedadirectdutyofcaretoits In up costsithadincurred. seek anorderforrecoveryofitscosts,whichmayincludetheclean- were aprosecutiontosucceed,theprosecutingauthoritywouldalso criminal (asopposedtoacivil)liability, althoughitislikelythat, neglect onthepartofmemberinquestion. This givesrisetoa by thecompanyandisprovedtohavebeenattributableany prosecuted asthoughheisadirectorwhereanoffence iscommitted 1990). Underthatsection,amemberofcompanymaybe corporate aremanagedbyitsmembers”(e.g.section157oftheEPA company’s shareholdersliable“wheretheaffairs ofabody Water Resources Act 1991containprovisionswhichcanmakea Statute alsointervenesincertaincases. The EPA 1990andthe authorised actsofitsagentsubsidiary. parent couldbeliableasprincipalfortheexpress(orimplied) parent and,assuch,befoundtoactitsagent.Inthatcase,the However, asubsidiary could,onthefacts,be“puppet”of that isnotofitselfsufficient togiveriseanagencyrelationship. the company. Evenifacompanyis“whollyowned”byparent, could bepersonallyliableas“shadowdirectors”fortheliabilitiesof circumstances, typicallyinvolvingfraudulentorwrongfultrading, or instructionsoftheshareholders,thoseshareholdersincertain If directorsare(orbecome)accustomedtoactingonthedirections evade itsownexistingobligations. facilitate fraudorusesuchacompanyasdevice“sham”to allow shareholdersto“hidebehind”alimitedcompanyinorder parties (e.g.guaranteesorindemnities);and(c)thecourtswillnot shareholders mayhavegivendirectcontractual“comfort”tothird at closelyandeachsituationwillturnonitsfacts;(b)acompany’s may beliableforitsacts. The conductofthepartieswillbelooked shareholders then,onnormalagencyprinciples,its to thisgeneralrule:(a)ifacompanyactsasanagentforits shares; thecourtsstrictlyapplythisprinciple.Bywayofexception limited topayinguptheunpaidamountofnominalvaluetheir The liabilityofshareholdersinalimitedcompanyisusually Chandler vCapeplc caused byaforeignsubsidiary/affiliate? company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld [2012]EWCA (Civ)525,theCourt of England &Wales

is “domiciled”withinEngland.In involving incidentsoccurringabroadwherethedefendantcompany Under commonlaw, Englishcourtshavejurisdictiontohearcases ■ or similarproceedings arependinginanotherstate.) defendant shouldbestayedincertain circumstances,wherethesame that theproceedingsbroughtin EnglandagainstanEnglish ■ ■ ■ [2017] EWCA Civ1528),theCourtof Appeal furtherclarifiedthat: In amorerecentcase( protect thesubsidiary’s employees. employees wouldrelyonCapeapplyingitssuperiorknowledgeto (iii) Capeknew(oroughttohaveforeseen)thatthesubsidiaryorits subsidiary’s systemofworkinrelationtoasbestoswasunsafe;and businesses; (ii)Capeknew(oroughttohaveknown)thatthe the basisthat:(i)Capeandsubsidiaryhadrelativelysimilar Cape hadassumeddutiesofcaretoitssubsidiary’s employees,on considered, havingregardtotheparticularfactsofcase,that inappropriate to“piercethecorporateveil”.However, theCourt companies haveaseparatelegalpersonalityand,onthefacts,itwas Freshfields BruckhausDeringerLLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 Regulation hasnotresolvedthe questionsraisedby subject offurtherconsiderationatthe ECJlevel. The recastBrussels action tobeheardinEngland? The mattermay, induecourse,bethe claimant showthattheinterestsofjusticeneverthelessrequire forum fortheissuesraisedinaction;and(2)ifso,can shown thatthecourtsofanotherjurisdictionaremoreappropriate two-stage test,essentially:(1)hastheEnglishdomicileddefendant occurred wouldbereasonablysafeorfreefromhiddendangers. breach ofanimpliedtermthattheprivatebeachwhereaccident domiciled intheUK. The claimant suedintheEnglishcourtsfor property inJamaica. The defendantpropertyownerwasalso British nationaldomiciledintheUKsuffered seriousinjuriesona with theeventswhichresultedinrelevantloss.In defendant isdomiciledthere,evenwhereEnglandhadnoconnection Contracting PartytotheBrusselsConvention)provided claimant wasentitledtobringproceedingsinEngland(beinga Court ofJustice(ECJ)ruledthat,undertheBrusselsIRegulation,a However, inOwusuvJackson ([2005]ECRI1383),theEuropean on thegroundsofforumnonconveniens. brought byanoverseasclaimantcouldapplytostaytheproceedings Previously, anEnglishdefendantagainstwhomaclaimhadbeen corporate defendantwhois“domiciled”inEngland. traditional territorialjurisdictionoftheEnglishCourtovera “as ofright”intheEnglishcourts–meaningthattheyinvoked ER 268),South African claimantswereentitledtobringproceedings (Notwithstanding thedecisionin principles, which,priorto excluding, asitdoes,anyconsiderationof Some commentatorsviewthedecisionascontroversial,largely © Published and reproduced with kind permission byGlobal Legal Group Ltd,London operations ofthesubsidiary. employees ofthesubsidiarybuttothoseaffected bythe Such adutymaybeowedinanalogoussituations,notonlyto expertise toprotecttheemployeesofsubsidiary. the parentiswellplaced,becauseofitsknowledgeand and thesubsidiaryareinrelevantrespectsame,butthat the same)requiresnotsimplythatbusinessesofparent businesses oftheparentandsubsidiaryareinarelevantrespect The firstofthefourindiciain claim. claim, or(b)controlstheoperationswhichgiveriseto and safetypolicytheadequacyofwhichissubject has takendirectresponsibilityfordevisingamaterialhealth Those circumstancesmayarisewheretheparentcompany(a) that subsidiary, incertaincircumstances. a subsidiary, orapartydirectlyaffected bytheoperationsof A dutymaybeowedbyaparentcompanytoanemployeeof Lungowe andothersvVedanta Resources plc Owusu, hadinvolvedthecourtsapplyinga Owusu, itremainspossibletoargue Chandler vCapePlc Lubbe vCapeplc forum nonconveniens

([2000]4 All (i.e.thatthe

Owusu, a Owusu.

Dutch Shellplcandanother Lungowe, theCourtof Appeal foundin Court of Appeal inFebruary2018.Incontrasttothedecision from oilspillagesatthedefendant’s pipelines,washeardbeforethe Another case,inwhichNigerianclaimantsallegeddamageresulting currently underappealtotheSupremeCourt). (although thedecisionofCourt Appeal in in different grounds. by theCourtof Appeal ([2018]EWCA Civ1532),albeitonslightly [2017] EWHC371(QB)). This judgmenthassincebeenaffirmed behalf ofthesubsidiary( sufficient proximityfortheparentcompanytooweadutyofcareon failing topreventethnicviolence,asitwasheldthattherenot unsuccessful inbringinganactionagainstEnglishparentfor Similarly, inFebruary2017,agroupofKenyannationalswere exercise majoritycontroloverthatsubsidiary. remained withinthesubsidiary, andtheparentcompanydidnot wide policiesandstandards,day-to-dayoperationalcontrol care bytheparent:forexample,althoughparentissuedgroup- the parentanditsoperatingsubsidiarytoestablishadirectdutyof On thefactsofcase,therewasnotsufficient proximitybetween defendant parentcompanydidnotowetheclaimantsadutyofcare. The 8.4 prevent theemployeefrommakinga“protecteddisclosure”. towards theiremployervoidtotheextentthatthosedutieswould effect ofrenderinganemployee’s contractualdutyofconfidentiality (as insertedbythePublicInterestDisclosure Act 1998)havethe Sections 43A to43L and103A oftheEmploymentRights Act 1996 Regulations 2010. Tribunals (ConstitutionandRules ofProcedure)(Amendment) claimant hasgivenitsexpressconsent, undertheEmployment directly toaregulator(alsoknown as aprescribedperson)wherethe Employment tribunalscansenddetailsofwhistle-blowingclaims order forittobeconsidereda“protecteddisclosure”. have areasonablebeliefthatthedisclosureisinpublicinterest disclosures madeonorafter25June2013,thewhistle-blowermust The EnterpriseandRegulatoryReform Act 2013requiresthatfor HSE, andtheFoodStandards Agency. Order 2003,andincludedisclosuretobodiessuchastheEA, the PublicInterestDisclosure(PrescribedPersons)(Amendment) disclosing istrueorsubstantiallytrue.Bothdefinedtermsreferto failure” hasoccurredorisoccurringandthatinformationtheyare “prescribed person”iftheyreasonablybelievethata“relevant Section 43Falsoallowsanemployeetomakeadisclosure automatically unfair. dismissed onthebasisofa“protecteddisclosure”,dismissalis under section1oftheOfficial Secrets Act 1989).Ifanemployeeis criminal offence indoingso(e.g.adisclosurewhichwouldfall as a“protecteddisclosure”ifthepersondisclosingcommits The disclosuremustbemadeingoodfaithandcannotregarded health andsafetyofanyindividual,ordamagetotheenvironment. include thecommittingofacriminaloffence, theendangeringof stipulated insection43BoftheEmploymentRights Act 1996,which the persondisclosing)theyshowoneormoreofanumbermatters Protected disclosuresareallowedwhere(inthereasonablebeliefof Lungowe andothersvVedanta Resources Plc Owusu principlewasrecentlyconfirmedbytheCourtof Appeal report environmentalviolations/matters? Are thereanylawstoprotect“whistle-blowers”who AAA andothersvUnileverplcanother ([2018]EWCA Civ191)thatthe England &Wales Okpabi andothersvRoyal WWW.ICLG.COM , notedabove Lungowe is

81 England & Wales 82 England & Wales or atapointinthepre-trialprocedurelaiddownbycourt. members ofthegroupmustbeidentifiedatstartlitigation environmental claimscanbebroughtbygroupsofclaimants,butall Under theexistingrulesgoverningGroupLitigationOrders, private actionscanbebroughtforbreachesofcompetitionlaw. introduces aspecificprocedurepursuanttowhichopt-inandopt-out Consumer Rights Act, whichcameintoforceon1October2015, legislation thatwouldallowsuchclaims.Forexample,the rules toallowaformofclassactionbecreatedwithoutspecific the Englishcourtsarenotpreparedtointerpretexistingcourt national law(beforetheendofBrexittransitionperiod). passed, thedraftDirectivewouldneedtobeimplementedinto the Energy LabellingDirective(2017/1369),amongothers.If the Energy PerformanceofBuildingsDirective(2010/31/EU)and 1272/2008), theEcodesignFrameworkDirective(2009/125/EC), Classification, LabellingandPackagingRegulation((EC)No number ofprovisionsrelevanttotheenvironment,suchas set outinthe Annex tothecurrentdraftDirective,whichcontainsa breached identifiedconsumerprotectionlegislation. These lawsare which redresswouldbeavailablewhereatraderisshowntohave on representativeactionstostrengthenconsumerrights,under on 11 April 2018,theCommissionproposedanew draftDirective across theEU. As partofits“NewDealforConsumers”,announced safeguards againsttheirpotentialabuse,arestillnotconsistent availability ofsuchmechanisms,aswelltheimplementation its 2013recommendationsoncollectiveredress,findingthatthe on theprogressmadebyMemberStatesimplementationof On 26January2018,theEuropeanCommissionpublishedareport therefore tendtobelowerthanintheUS. , anddonotgenerallycontainanypunitiveelement. They Damages awardsintheUKaresetbyprofessionaljudges,not brought underCivilProcedureRule19.6. damages orinjunctivereliefaseparate,simultaneousclaimcanbe awarded onanindividualbasis.Inordertoobtaincollective causative agentoreventofwhichtheycomplainanddamagesare prove thattheirparticularinjuryorlosswasattributabletothe “generic” pleadings,ultimatelyeachmemberofthegroupmust Although theactionmaybemountedbywayofcollectiveor engaging the Aarhus Convention (seequestion1.3):English courts this isincasesinvolvingenvironmental judicialreviewproceedings taxation (ifappropriate),aswell itsowncosts.Oneexceptionto event”: theloserwillberequiredto paythewinner’s legalcosts after The generalruleinEnglishlitigation isthat“costsfollowthe the publicpurse. or allofthecostsinvolvedinpursuingcasewillbefundedfrom rare caseswherethelatterappliestoenvironmentallitigation,some Community LegalService(previouslyknownaslegalaid).Inthe public fundingfromtheLegalServicesCommissionvia some extent,whethertheindividual(andcase)qualifiesfor This dependsonthetypeofproceedingsbeingpursuedandalso,to 8.6 Plc British Airways Court of Appeal’s decisioninthecaseof US-style “classactions”arenotcurrentlyavailableintheUK. The 8.5 Freshfields BruckhausDeringerLLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM damages available? pursuing environmentallitigation? Do individualsorpublicinterestgroupsbenefitfrom environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing any exemptionfromliabilitytopaycostswhen [2010]EWCA Civ1284hasmadeitclearthat Emerald SuppliesLtdv

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

September 2020. Convention toEUinstitutionsand tootherEUbodies)by30 (the regulationwhichappliesthe threepillarsofthe Aarhus proposal foraregulationtoamend Regulation(EC)No1367/2006 principles oftheEUanditssystem ofjudicialreview;and(ii)a comply withtheconventionina way thatiscompatiblewiththe Convention bysubmitting:(i)astudy exploringhowtheEUcan report onimprovingtheEU’s compliancewiththe Aarhus Decision (EU)2018/881requestedtheCommissiontopreparea Working DocumentpublishedinQ22019.InJune2018,Council States, theoutcomeofwhichislikelytobeaCommissionStaff consultations withpublicauthoritiesandexpertsintheMember matters. The Commission intendstocarryouttargeted implemented withregardtoaccessjusticeinenvironmental Impact Assessment onhowthe Aarhus Conventionhadbeen In May2018,theEuropeanCommissionadoptedanInception Commission andeachMemberState. environmental implementationreviewdialoguesbetweenthe as beingproblematic,particularlyforNGOs,andlaunching highlighting discrepanciesinstandingrulesacrossMemberStates Commission publishedacommunicationinresponse April 2017, environmental mattersformembersofthepublic. The European Convention byfailingtosecuresufficient accesstojusticein published itsfindingsthattheEUhadviolated Aarhus In March2017,the Aarhus ConventionComplianceCommittee ■ ■ ■ ■ ■ regard to: When consideringwhethertomakeaJRCCO,thecourtmusthave ■ ■ ■ The courtmaynowonlymakeaJRCCOifitissatisfiedthat: costs cappingorder(JRCCO). costs cappinginjudicialreviewsandanewformofreview Criminal JusticeandCourts Act 2015)introducedanewcodefor Accordingly, thenewrules(containedinsections88to90of is bringingjudicialreviewfortheirownbenefit. balance toofarbyallowingsuchorderstobeusedwhenaclaimant concern thatthecourts’ expansiveapproachtoPCOshadtippedthe further reformofjudicialreview, theUKGovernmentexpressedits ability tomakePCOs.Inits2013consultationonproposalsfor The oldrulesgavethecourtsconsiderablediscretionregarding Orders (CCOs)(previously“ProtectiveCostsOrders”orPCOs). prohibitively expensive. These ordersareknownasCostsCapping access tojusticeinenvironmentalmattersshouldnotbe have thepowertomakeanorderreflect Aarhus principlethat the interestsofotherpersonsorpublicinterestgenerally. Whether theclaimantisanappropriatepersontorepresent of charge. Whether legalrepresentativesfortheclaimantareactingfree benefit ifreliefisgrantedtotheapplicantforjudicialreview. provide, theclaimantwithfinancialsupportislikelyto The extenttowhichanypersonwhohasprovided,ormay granted relief. The extenttowhichtheclaimantislikelybenefitifhe provides, ormayprovide,financialsupporttotheparties). (including thefinancialresourcesofanypersonwho The financialresourcesofthepartiestoproceedings It wouldbereasonablefortheapplicanttodoso. to participateintheproceedings. would withdrawtheapplicationforjudicialrevieworcease In theabsenceoforder, theapplicantforjudicialreview likely toprovideanappropriatemeansofdoingso). requires theissuetoberesolvedandproceedingsare is ofgeneralpublicimportanceandtheinterest there isanissuethatthesubjectofproceedingswhich The proceedingsare“publicinterestproceedings”(meaning England &Wales

emissions fromthatinstallationduringtheprecedingcalendaryear. installations mustsurrenderanumberofallowancesequaltothetotal emissions permit(non-tradable)toemitGHG.Operatorsof All installationscoveredbytheEU-ETSschemeneedaGHG and geologicalstorageofgreenhousegasemissionsarealsocovered. perfluorocarbons fromthealuminiumsector. The capture,transport (NOx) emissionsfromnitric,adipicandglyoxylicacidproduction production werebroughtintothescheme,aswellnitrousoxide 2013, CO2emissionsfrompetrochemicals,ammoniaandaluminium (those witha20megawattorgreaterthermalcapacity),from1January products, andpulppaper)large combustioninstallations industries (e.g.production/processingofferrousmetals,mineral to includeotherGHGemissions.Inadditionenergy-intensive the initialoperationofEU-ETS;coveragehasnowbeenextended will runfrom2021–2030.OnlyCO2emissionswerecoveredunder introduced severalchangesforthefourthphaseofscheme,which 2020, isnowinforce.InMarch2018,Directive(EU)2018/410 2009/29/EC, thethirdphaseofscheme,whichrunsfrom2013– began operationin2005.FollowingpoliticalagreementonDirective gas (GHG)emissionsallowancetradingwithintheCommunitywhich 2003/87/EC applies. The EU-ETScreatesaschemeforgreenhouse The EUemissionstradingscheme(ETS)createdbyDirective 9.1 Freshfields BruckhausDeringerLLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 at thetime. or downinaccordancewiththenumber ofallowancesincirculation which willautomaticallyadjustthe annualsupplyofallowancesup rules. A MarketStabilityReservewillbe introducedfrom2019 Allocation ofallowancesisnowon thebasisoffullyharmonised annually andsubmittedtotheEuropean Commissionforapproval. setting outtheallocationofallowances. The NAT must beadjusted Member Statesmustprepareabasenationalallocationtable(NAT), Protocol. Joint Implementation(JI)projectsapprovedundertheKyoto credits generatedunderCleanDevelopmentMechanism(CDM)and Subject tocertainexceptions,theEU-ETSalsorecognisestradingin carbon tax. participating intheEU-ETSwouldbereplacedinitiallywitha under theEU-ETS,indicatingthatinthosecircumstances, how a“nodeal”Brexitmayaffect theregulationofGHGemissions On 12October2018,theGovernmentpublishedatechnicalnoticeon instance, managedgrasslandandcropland). emissions againstcreditsfromcertaincategoriesofland(for Member Statehasexceededitsallocation,offset someofits proportion oftheirallocationtoanotherMemberState;and,wherea unused portionoftheirallocationfromthepreviousyear;sella emissions allocationfromthefollowingyearorbringforwardany their targets, MemberStatesmay:borrowaproportionoftheir will applyfortheperiod2021–2030.UnderESR,tohelpreach non-ETS industryandwaste. These annualtargets arebinding and for nonEU-ETSsectorssuchastransport,buildings,agriculture, introduced GHGemissionreductiontargets foreachMemberState In July2018,theEffort SharingRegulation2018/842(ESR) surrender ofpermitsandpenaltiesfornon-compliance. implementing theEU-ETS,setoutrulesforissue,transferand Greenhouse GasEmissions Trading SchemeRegulations2012, 2013, andrisesannuallyinlinewithEurozoneinflation. The The penaltyfornon-compliancewassetat100Euros/tonneCO2in © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 9 market developingthere? Emissions Trading andClimateChange your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation

to registerforPhaseIII(whichhadbeenduebyDecember2018). which markstheendofPhaseIIScheme.Nobusinessesneed close attheendof2018/19complianceyear(31March2019), Order 2018enteredintoforceon1October2018. The schemewill the CRCEnergy Efficiency Scheme(Revocationand Savings) abolish theCRCafter2018/19complianceyear, andaccordingly the 2016Budget,Governmentannounceditsintentionsto administrative burdenitplacesonthemtoensurecompliance.In criticism fromparticipantsregardingitscomplexityandthe CRC hasbeenthesubjectofsubstantialmodificationinresponseto to covertheiremissionsinthepreviousyear. Overtheyears, participants couldbuyallowancesfromtheGovernmenteachyear measure andreporttheircarbonemissionsannually. From2012, (MWh) peryearofelectricity. ParticipantsoftheCRCneedto intensive organisations usingmorethan6,000megawatt-hours scheme whichtacklesGHGemissionsfromlarge non-energy- 2010. Itisamandatorycarbonemissionsreportingandpricing The CRCEnergy Efficiency Scheme(CRC)wasintroduced in April maintain anappropriatemarketbalance. enhancing theflexibilityofsystemtoreactchangesand introduce anumberofkeychangestothecurrentEU-ETS,aimedat Phase IV oftheEU-ETSwillrunfrom2021–2030,and allowances forextra-EEA flightswouldbeauctionedfrom2021. annually atthesamerateastotalcapforEU-ETS.Halfof the averageallocationofperiod2015–2016,andwilldecrease allocated toaircraftoperatorswillbesetatalevel10percentbelow participation from2024–2026.In2021,thenumberofallowances a voluntaryfirstphasefrom2023–2024,withcompulsory emissions. There willbeapilotphasefrom2021–2023,followedby GMBM throughwhichairlinesmayoffset thegrowthoftheirCO2 (GMBM). InOctober2016,theICAOagreedtoestablishsucha Aviation Organisation (ICAO)onaglobalmarket-basedmechanism operation wastofacilitatediscussionswithintheInternationalCivil to theEU-ETSschemeforaviationsector. The delaytoits of annualGHGemissions fromactivitiesforwhich acompanyis Since 1October2013,legislationrequires themandatorydisclosure 9.2 reports. Bothofthesechangeswilltakeeffect from1 April 2019. for reportingCO2emissionsandenergy useincompanyannual ,whichwillextendtheexistingrequirements streamlined energy and carbon reportingregimeunderthe any revenuelostfromabolishingtheCRC);and(ii)introduceanew main ratesoftheclimatechangelevyfrom April 2019(torecover In placeoftheCRC,Governmentintendsto:(i)increase day ofOctober2019. allowances for2017/2018mustbesurrenderedbythelastworking their emissionsattheendof2018/19complianceyear, and Existing PhaseIIparticipantswillcontinuetoberequiredreport organisations andnon-EUcountrieshaveexpressedstrongopposition extended until31December2023.Internationalaviation the EuropeanCouncilandParliament–nowfurther provisional agreementbetweentheCouncilofEuropeanUnion, Regulation 2014(Regulation421/2014)and–accordingtoa until 31December2016bytheEU-ETS Aviation Extending The April 2014deadlineintheDecisionwaseffectively extended into andoutoftheEuropeanEconomic Area (EEA)until April 2014. Decision suspendedtheEU-ETSobligationsonoperatorsforflights included intheEU-ETS.However, the2013“StopClock” Since January2012,emissionsfromtheaviationsectorhavebeen to monitorandreportgreenhouse gasemissions? in question9.1above,isthere any otherrequirement Aside fromtheemissionstrading schemesmentioned England &Wales WWW.ICLG.COM

83 England & Wales 84 England & Wales local authoritiesto carryoutstudiestoidentifyhow to meetthelegal revised Air QualityPlanfortacklingNO2 thatrequiresspecified Following thejudgment,inJuly2017, theGovernmentsubmitteda with theDirectiveor Air QualityStandards Regulations2010. proposals tointroducecleanairzones becausetheyfailedtocomply Directive 2008/50/EC. The CourtquashedtheGovernment’s regarding theGovernment’s failuretocomply withthe Air Quality running judicialreviewapplicationbroughtbyClientEarth In November2016,theHighCourtdelivereditsjudgmentinalong- UK since17July2014. Savings OpportunityScheme(ESOS)whichhasbeeninforcethe years thereafter. IntheUKthisisachievedthroughEnergy audits mustbecarriedoutby5December2015,andtheneveryfour large enterprisestopromote energy-efficiency measures. These Member Statestointroducearegimeofregularenergy auditsfor Article 8(4)oftheEUEnergy Efficiency Directive2012requiresall companies. emissions willremainvoluntaryforquotedandlarge unquoted and anintensitymetric. The disclosureofScope3(energy indirect) company’s ownuse(Scope2emissions);totalglobalenergy use; from thepurchaseofelectricity, heat,steamandcoolingforthe company isresponsible(Scope1emissions);emissionsresulting now reporton:allemissionsarisingfromactivitiesforwhichthe the samereportingrequirementsasquotedcompanies,andmust types. Inaddition,large unquotedcompanieswillnowbesubjectto companies toreportontheirtotalglobalenergy useacrossallenergy April 2019.SECRintroducesadditionalrequirementsforquoted (SECR) undertheCompanies Act 2006whichwillapplyfrom1 introduced anewstreamlinedenergy andcarbonreportingregime As notedinresponsetoquestion9.1above,theGovernmenthas agreement withcompanies. of lastresort,withtheConductCommitteeseekingtooperateby preparation ofarevisedreport,thisisseenverymuchasweapon requirements oftheregulations,andforanorderrequiring court foradeclarationthatthereportdoesnotcomplywith report. Whilst theConductCommitteehaspowertoapply follow-up action(ifappropriate)bywayofpreparationarevised the ConductCommitteeofFinancialReportingCouncil,and The sanctionfornon-complianceislimitedtoaninvestigationby Reporting Guidance. Greenhouse GasProtocolortheGovernment’s ownEnvironmental recognised independentstandardsuchasISO14064,the robust andacceptedmethods,recommendstheuseofawidely information. The guidanceemphasisestheimportanceofusing reports tostatethemethodologiesusedcalculatedisclosed adopted toreportemissionsdata;itsimplyrequiresthedirectors’ The legislationisnotprescriptiveastothemethodologybe shareholders”. “to giveawiderpictureof[theorganisation] toinvestorsand suggest thatcompaniesshouldconsiderreportingtheseseparately their productswhentheyareusedbyconsumers. The guidancedoes emissions, noronoutputsfromthecompany, e.g.emissionsfrom appropriate). Companiesdonotneedtoreportonsupplychain reporting requirementcoversbothUKandoverseasoperations(if emissions reporting guidancepublishedbyDefraindicatesthatthe Environmental ReportingGuidelines:Including mandatoryGHG directors’ report. Exchange orNASDAQ. The informationmustbeprovidedinthe an EEA stateoradmittedtodealingontheNew York Stock the mainmarketofLondonStockExchange,officially listedin UK-incorporated companieswhoseequitysharecapitalislistedon assessed. The requirementappliestoquotedcompanies,namelyall responsible, totheextentitispracticalforsuchemissionsbe Freshfields BruckhausDeringerLLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

£220 millionClean Air Fundwaslaunched.Morethan£40million for retrofittedandnewlow-emissionbuses.InMarch2018,the authorities tobidforadditionalmoney;anda£100millionbudget to supportlocalauthorities;establishingaClean Air Fundforlocal The planincluded:settingupa£255millionImplementationFund limits ofNO2intheshortestpossibletime(theRevisedPlan). on 1October2018. and theEmissionsPerformanceStandard. That consultationclosed Capacity MarketmechanismintroducedundertheEnergy Act 2013 The Governmentalsorecentlyconsultedontheperformanceof taking toadaptclimatechange. for invitinginfrastructureoperatorstoreportontheactionstheyare climate changefortheperiod2018–2023,whichincludesastrategy In July2018,DefrapublishedanupdatedNational Action Planon emission levelsforeachpollutantin2005. a specifiedpercentageofoverallemissionswhencomparedto NOx, sulphurdioxide,ammoniaandPM2.5mustbereducedbelow Directive intheUK.Under2018Regulations,UKemissionsof Regulations 2018cameintoforceon1July2018,implementingthe force on31December2016. The NationalEmissionCeilings additional restrictionsonseveralatmosphericpollutants,cameinto The revisedNationalEmissionCeilingsDirective,whichplaces Regulations 2018. Environmental Permitting(Englandand Wales) (Amendment) Directive 2015wasimplementedintheUKthrough As notedabove(atquestion2.1),theMediumCombustionPlants October 2018. shortcomings. The Government’s supplementwaspublishedon5 produce asupplementtotheRevisedNO2Planaddressingthese Court grantedamandatoryorderrequiringtheGovernmentto and didnotincludeacompliantairqualityplanfor Wales. The Quality Directiveandthe Air QualityStandardsRegulations2010, not includesufficient measurestoensurecompliancewiththe Air Revised NO2Plan,holdingittobeunlawfulongroundsthatdid application forjudicialreviewinrespectoftheGovernment’s In February2018,theHighCourtgrantedClientEarth’s third local authorities. of the£255millionImplementationFundhasalsobeenawardedto Strategy (CGS),a GHGreductionstrategysettingout theprocesses In October2017,theGovernment publishedtheCleanGrowth to anaverageof57percentbelow1990 levels. budget fortheperiod2028–2032will limitannualUKGHGemissions made intheCCC’s fifthcarbonbudgetreport andannouncedthatthe In July2016,theGovernmentpublicly acceptedtherecommendations assessing progresstowardsthestatutorycarbonbudgets. and bytherestofeconomy(thenon-tradedsector),aswell the economycoveredbycap-and-tradeschemes(thetradedsector), emissions reductiontargets through theeffort madebythepartof public bodytaskedwithassessinghowtheUKcanbestachieveits on ClimateChange(CCC). The CCCisanexpert,independent budgets forsuccessivefive-yearperiodsaresetbytheCommittee cent by2020. To assist inmeetingthesetargets, bindingcarbon levels. Italsorequiresareductioninemissionsofatleast34per per centreductioninGHGemissionsby2050,asagainst1990 Government committedtheUKtoalegally-bindingtarget ofan80 demonstrating UKleadershipinternationally. Underthe Act, the helping theUKtransitiontowardsalow-carboneconomy, and Passed in2008,theClimateChange Act hasthetwinaimsof 9.3 regulation inyourjurisdiction? What istheoverallpolicyapproachtoclimatechange England &Wales

by 2030,andproposestoreformstabilisetheEU-ETSregime. renewable energy toatleast27percentoftotalenergy consumption levels). The frameworkalsosetsthetarget ofincreasingtheshare reduction indomesticgreenhousegasemissions(against2005 Climate andEnergy Framework,centredonatarget ofa43percent 2020 (against2005levels).InOctober2014,theEUsetoutits2030 achieve aminimum20percentreductioninEUGHGemissionsby Renewable Energy Package,whichseestheEUasawholehavingto The UKisalsosubjecttotheEUtargets setintheClimateand and increasedenergy efficiency (seequestion1.2). measures toencourageinvestmentinrenewableenergy technologies reductions includetheEU-ETS(seequestion9.1),aswell At boththeEUandnationallevels,meanstoachieveemissions The GovernmentpublishedaCGSprogressreportinOctober2018. heating inhomesandbusinessesoff thegasgridduring2020s. 2035, andphasingouttheinstallationofhigh-carbonfossilfuel homes aspossibletoEnergy PerformanceCertificateBandCby out ofnewpetrolanddieselcarsby2040,theupgradingasmany (amended in April 2018)containsproposalsincludingthephasing- carbon budgetsundertheClimateChange Act 2008. The CGS through whichtheGovernmentintendstomeetfuturestatutory Freshfields BruckhausDeringerLLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 Convention onClimateChange(UNFCCC)Paris Agreement. In November2016,theUKratifiedUnitedNationsFramework broken housingmarket. proposal containedintheFebruary2017 White Paper, to includerisingtemperatures,implementingtheGovernment’s emissions. The 2018NPPFamendsthelistofclimatechangefactors authorities inthatrole)toshapepolicywhichreducesCO2 clearly relevanttothedutyofplanningauthorities(includinglocal objective ofan80percentreductioninCO2emissionsby2050 Act asarelevantconsiderationindecision-making,makingthe NPPF (revisedinJuly2018)directlycitesthe2008ClimateChange climate change,aswelladaptingfortheanticipatedeffects. The how planningshouldcontributetoreducingemissionsandstabilising Planning forClimateChange– A GuideforLocal Authorities The sustainable, whichincludesachievingGHGemissionreductions. Local authoritiesarerequiredtoensurethatnewdevelopmentis 2010 (Directive2018/844/EU). directive amendingtheEnergy PerformanceofBuildingsDirective introduced thefirstpieceoflegislationunderpackage,adoptinga electricity marketreformandregulation.InJune2018,theEU revised Energy Efficiency Directive;andseveralproposals forEU including: adraftrevisedRenewableEnergy Directive;adraft All Europeans”draftlegislationformalisingtheframework, In November2016,theCommissionpublished“CleanEnergy for and scientificdevelopments, inparticulartheParis Agreement. In Celsius abovepre-industriallevels) inlightofnewinternationallaw (which wasconsistentwithlimiting averagewarmingto2degrees failing torevisetheGovernment’s 2050 carbonreductiontarget that theSecretaryofStateviolated theClimateChange Act by Business, Energy, andIndustrialStrategy. The claimantsalleged filed aclimatechangelawsuitagainst theSecretaryofStatefor realise thegoalsofParis Agreement, and11 citizenclaimants, In December2017,PlanBEarth,acharitywiththemissionto force on1January2019. between 2019and2036. The Kigaliamendmentwillenterinto hydrofluorocarbon greenhousegases(HFCs)by85percent UN MontrealProtocolthatcommitsnationstoreducing In November2017,theUKratifiedKigaliamendmentto Celsius increaseinglobaltemperature. zero netemissionsfrom2050onwards,andamaximum1.5degrees Principal commitmentsunderthe Agreement includeatarget for © Published and reproduced with kind permission byGlobal Legal Group Ltd,London National PlanningPolicyFramework

(NPPF),togetherwith Fixing our , setout

asbestos claims. Forexample,in The Englishcourtshavegenerally taken apro-claimantapproachto after 10February2015,ortheireligible dependants. to 100percentofaveragecivildamages forpeoplediagnosedonor applicants couldreceive. The paymentwasraisedfrom80per cent amendments ledtoanincreasein the levelofpaymentthateligible their percentageofthecurrent insurancemarket.In2015, 2014, isfundedbyleviesonexistingliabilityinsurers,based Mesothelioma PaymentScheme,whichcameintoforcein April the employerorEL insurercannotbefound. The so-calledDiffuse individuals withdiffuse mesothelioma andtheirdependantswhere The Mesothelioma Act 2014establishedapaymentschemefor the likelyimpacts. ATE premiumsandsuccessfeesuntilithadundertakenareviewof Government wouldnotbeabletoremovetheexceptionrelating provisions intoforceformesotheliomacases. As such,the review shouldhavebeenundertakenbeforebringingtherelevant was handeddowninOctober2014,establishingthatafullimpact (Admin), thisdecisionwaschallengedinjudicialreview. Judgment Forum UK))vSecretary ofStateforJustice defendants. InR(Whitston(AsbestosVictims SupportGroups to recoversuccessfeesand ATE insurancepremiumsfrom claimants insuccessfulmesotheliomacaseswouldnolongerbeable Punishment ofOffenders Act 2012formesothelioma,whereby bring intoforceprovisionsintheLegal Aid, Sentencingand out-of-court processoradedicatedpre-actionprotocol;itplannedto In 2014,theGovernmentconfirmeditwouldnotbeintroducingan claims. meant thatfundingwasmorereadilyavailableforasbestosdisease erosion oftheprohibitiononUS-styleconditionalfeearrangements, of after-the-event (ATE) insuranceforlegalcosts,andjudicial handling procedureformesotheliomacases. Also, theavailability of theEnglishHighCourtcreatedaspecial“fast-track”claims- litigation process. A PracticeNotepublishedbytheSeniorMaster for claimantsandincreasingtheefficiency andspeedofthe substantial reform,aimedatensuringmoreuniformaccesstojustice In recentyears,civillitigationprocedureinEnglandhasundergone arrangements andpunitivedamages. unavailability intheUKof“classactions”,contingencyfee cumulative” diseases(suchasmesothelioma);and(3)the employer, thatthey shouldbeabletorecoverdamagesfor“non- are notstatute-barredand,wheretheyworkedformorethanone illness); (2)thedifficulties forclaimantsinprovingthattheirclaims liability (EL)insurancetomeetclaimsforwork-relatedinjuriesor employers havebeenlegallyobligedtopurchaseemployer’s (the firstUKschemewasestablishedin1932,andsince1972 insurance obligationsrelatingtooccupationalasbestosexposure example: (1)thehistoricalexistenceofcompensationschemesand the relativelyslowgrowthoflitigationinUK,including,for of damagesbytheEnglishcourts. A numberoffactorsmayexplain of casesagainsttheCentral Asbestos Co.Ltd.resultedinanaward related claimwassettledintheUK,andearly1970sthataseries as earlythe1930s,itwasnotuntil1950thatfirstasbestos- Whereas thefirstUSasbestos-relateddiseasecaseswerebroughtin 10.1 judicial reviewoftheSecretaryState’s decision. July 2018,theclaimantswererefusedpermissiontoapplyfor 10 jurisdiction? What istheexperienceofasbestoslitigationinyour Asbestos Fairchild vGlenhavenFuneral England &Wales WWW.ICLG.COM [2014]EWHC3044

85 England & Wales 86 England & Wales they maydosoinfuture. symptoms ofanasbestos-relateddisease,arenonethelessworriedthat from pleuralplaqueswho,thoughtheyhavenotyetcontractedthe question oftheavailabilitycompensationforpersonssuffering The Englishcourtshavetakenalessclaimant-friendlyapproachtothe trigger forthepolicyrespondingiswhentumourstartstodevelop. the Courtof Appeal’s judgmentinthecase,whichhadheldthat general industrypractice,althoughitisasignificantdeparturefrom exposure, theemployers’ insurerswerealsoliable. The rulingreflects number ofemployershavebeenfoundliableforhavingcausedthe measures orequipment required). information onasbestosrisks,andto recordtheuseofanyprotective does notstartbeforetheyare presentedwiththerelevant ensure thatanyonewhocomesto carryoutworkonthepremises sign; and(c)introducinganon-site “permittowork”system(to and condition;(b)labellingsuchlocations withanasbestoswarning noting thepresenceof ACMs andmaintaining aregisteroflocation those ACMs. Appropriate stepstobetakenmightinclude:(a) system ofmanagement,andimposeadutytomanagetherisk provide thatitisbettertoleavetheminplaceandimplementa likely tobeworkedonordisturbed,the Asbestos Regulations If ACMs areingoodcondition,notlikelytobedamagedand on theirpremises. reasonably practicable,no-onecancometoanyharmfromasbestos require employersandotherdutyholderstoensurethat,asfaris “manage therisk”from Asbestos-Containing Materials(ACMs)and implement Directive2009/148/EC. They imposeanexpressdutyto The Controlof Asbestos Regulations2012(the Asbestos Regulations) 10.2 assigned toexposurebythe period mustbeinterpretedflexiblyenoughtoembracetherole policies, theconceptofadiseasebeing“caused”duringpolicy of theexposure. The CourtalsoconfirmedthatinconstruingEL liability istriggeredaslongtheEL policywasinplaceatthedate asbestos, notatthetimetumourstartstodevelop. As aresult, policy respondingiswhentheemployeewrongfullyexposedto disease havingbeen“sustained”or“contracted”,thetriggerfor held, inrelationtoEL policies,thatwherepolicywordingrefersto (the “Employers’ Liability‘Trigger’ Litigation”),theSupremeCourt As regardsinsurance,in safety ofhisworkers,givenwhathekneworoughttohaveknown. reasonable andprudentemployertakingpositivethoughtforthe breached. The Courtalsoheldthattheemployer’s dutyisofa mesothelioma isrelevanttocausation,notwhetheradutyhasbeen Whether thereisamaterialincreaseintheriskofcontracting whether adequateprecautionsweretakeninresponsetothatrisk. case basiswhetherdevelopingmesotheliomawasforeseeableand acceptable “minimumlevelofrisk”:itshouldbejudgedonacase-by- note publishedin1970. The Courtconfirmedthatthereisno to alowerlevelofasbestosthanthatrecommendedintechnicaldata Court judgmentthatbarredaclaimbecausethedeceasedwasexposed Ltd) [2018]EWCA Civ243,theCourtof Appeal overturnedaHigh Furthermore, in potentially “onthehook”forfullamountofhisorherloss. employers ofaclaimantwhohasdevelopedmesotheliomaare responsible. The Compensation Act 2006confirmedthatall grounds thattheclaimantcouldnotprovewhichofemployerswas than oneemployerfromrecoveringdamagesformesotheliomaonthe that hadeffectively barredclaimantsexposedtoasbestosdustbymore Services Ltd[2002]UKHL 22,apreviousdecisionwasoverturned Freshfields BruckhausDeringerLLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM in relationtoasbestoson-site? What arethedutiesofowners/occupierspremises Bussey v00654701Ltd(formerly Anglia Heating

Durham vBAI(RunOff)[2012]UKSC14 Fairchild rule.Consequently, oncea ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

assessment. against thebackgroundofadutytocarryoutcontinuousrisk latitude indecidingonthemeanstocontrolsiteasbestosexposures, The basicpositionintheUKisthatemployershaveadegreeof intensity andshort-termexposuretoasbestos. licensable work”withasbestos,whichincludessporadic,low- force, requiringmedicalsurveillanceforthoseundertaking“non- additional obligationsunderthe Asbestos Regulationscameinto to anyonewhoisliableworkonordisturbit.From April 2015, (f) provideinformationonthelocationandconditionofmaterial be managed;(e)implementtheplanandreviewitperiodically; prepare adetailedplansettingouthowtheriskfrommaterialwill from anasbestossurveyor, alaboratoryorlicensedcontractor;(d) the riskfrommaterial,seekingspecialistadvice,ifnecessary, condition of ACMs orpresumed ACMs onthepremises;(c)assess premises; (b)makeandmaintainrecordsofthelocation involve engagingasuitablytrainedpersontoconductsurveyofthe unless thereisstrongevidencethattheydonot). This willgenerally and whatconditionitisin(presumingthatmaterialscontainasbestos find outwhetherthereisasbestosinorontheirpremises,itsamount More generally, the Asbestos Regulationsobligedutyholdersto:(a) further damage),orremoved. Regulations (e.g.bysealingorenclosingthe ACMs toprevent ACMs inpoorconditionmustberepairedunderthe Asbestos flooding. homeowners whosepropertiesare deemedtobeathighriskof into forceon4 April 2016andoffers affordable insuranceto both the Association ofBritishInsurers andtheGovernment)came The FloodReinsuranceScheme(the insuranceschemepreferredby cover providedbythecaptive. or topurchasedirectenvironmentalinsurancepluggapsinthe are lookingeithertoreinsuretheircaptiveenvironmentalliabilities primarily throughtheuseofcaptiveinsurers,butsomecompanies Many large companieshave historicallycoveredthemselves the policy, includingworkperformedbysub-contractors. against pollutionconditionscausedbytheoperationscoveredunder pollution legalliabilitycover, whichisdesignedtoprotectcontractors A furthertypeofinsuranceavailableisknownascontractor’s gradual pollution. conditions. Someenvironmentalinsuranceisalsoavailablefor conditions, althoughtypicallyexcludingon-siteclean-upofsuch available forthirdpartyclaimsarisingfrommigrationofknown off-site thirdpartyinjuryandassetdamage.Covermayalsobe regulatory clean-upcostsforon-sitecontaminationandcover inception). The scopeofcoverwouldtypicallyincludeenforced conditions” (i.e.incidents/pollutionthatfirstexistafterpolicy manifesting duringthepolicyperiod)andonetofiveyearsfor“new (i.e. environmentalconditionsexistingbeforepolicyinception,but Typical policyperiodsare10yearsfor“pre-existingconditions” relevant policieswrittenonaclaims-made,site-specificbasis. It ispossibletoobtaincoverforremediationliabilities,withthe policies isincreasing. been widelypurchasedintheUK,therearesignsthatuptakeof Notwithstanding that,historically, environmentalinsurancehasnot 11.1 11 risks insuranceplayinyourjurisdiction? in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable Environmental InsuranceLiabilities England &Wales

in nature. in anyvolumeuntilveryrecentlyandtendtoberelatively“long-tail” above. This isnotsurprising,astheseproductshavebeenwritten experience todateinrespectoftherelativelynewproductsdescribed However, thereappearstohavebeenverylittlesignificantclaims insurers carefullyguardsuchinformation. It isdifficult toobtainenvironmentalinsuranceclaimsfigures,as 11.2 coming ontotheUKmarket. innovative insurance-backedenvironmentalrisk-transferproducts averse givencurrentmarketconditions. There arealsoanumberof and post-disposal,particularlyaslendershavebecomemorerisk- of therolethatinsurancecanplayasatransactionsolution,bothpre- warranties andindemnities.However, thereisagrowingawareness it isnotlikelytosupplanttraditionalriskallocationtoolssuchas allocating environmentalriskaspartofM&A transactions,although Environmental insuranceissometimesusedasamethodof Freshfields BruckhausDeringerLLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 European Communities Act 1972atthedateof“exit”.Only The EuropeanUnion(Withdrawal) Act 2018willrepealthe 12.1 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 12 in environmentlawyourjurisdiction. experience inyourjurisdiction? What istheenvironmentalinsuranceclaims summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a

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Unilever founded onenvironmentalorhumanrightsgrounds(seethe England asaforumforbringingcollectiveredressproceedings Unrelated toBrexit,thereappearsbeadevelopingtrendforusing environment [and]climatechange”. White Papercommittedto“maintaininghighstandardsonthe agreed transitionalarrangements). The Government’s July2018 how theUKimplementsandenforcesit(again,subjecttoany environmental legislation,albeitwithnodirectsaybytheECJon the UKwouldcontinuetoapplysubstanceofmuchEU implement andenforceEUenvironmentallaws.Itseemslikelythat At leastuntilBrexit,theUKwillcontinuetobeobliged protection intheeventofa“nodeal”Brexit. number oftechnicalnoticesrelatingtoenvironmentallawand automatically applyintheUK. The Governmenthaspublisheda period (currentlytargeted asbeing31December2020)will directly-applicable EUlawadoptedbeforetheendoftransition TCFD bymid-2019. guidelines ontheimplementationandrecommendationsof on Climate-relatedFinancialDisclosure(TCFD).Itplanstopublish the recommendationsofFinancialStabilityBoard’s Task Force In March2018,theUKGreenFinance Taskforce formallyendorsed Initiative inJune2018). approved acounter-proposal tothecitizen-ledResponsibleBusiness being consideredinSwitzerland(wheretheNationalCouncil are complyingwithenvironmentallaw;asimilarprovisionisalso qualifying companiestotakestepsensurethattheirsubsidiaries vigilance reflects increasingEuropeaninterestinthisarea:theFrench Arroyo vEquionEnergia Ltd , , adoptedinMarch2017,imposesastatutorydutyon Vedanta andOkpabicasesdiscussedatquestion8.3;also [2016]EWHC1699). This trend England &Wales WWW.ICLG.COM loi de

87 England & Wales 88 England & Wales Freshfields BruckhausDeringerLLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM resolve disputeswithotherparties,andmanageyourenvironmental,planningregulatoryriskincorporatefinancetransactions. We W canhelpyoudeliverinfrastructure projects,andmanageyourindustrialriskfromregulatoryinterventionacrosstheworld. legislation, globalconventionsandnationallawscouldaffect yourbusiness. Our Environment,ProductandRegulatorygrouphasmorethan50lawyersaroundtheworldreadytoadviseyouonhowEUinter the world’s mostchallenging legalenvironments. including complex challenges,whereverandwhenevertheyarise.Inthelastyearwe’vehelpedclientsdobusinessinover200legaljurisdictions, Freshfields Bruckhaus Deringer is a global law firm – we combine the knowledge, experience and energy of the whole firm to solve ourclients’ Freshfields BruckhausDeringerisagloballawfirm–wecombinetheknowledge,experienceandenergyofwholetosolve the firm’s EnvironmentalWorking Group. corporate socialresponsibilityreportingprogrammeandthechairof John haspreviouslybeenthepartnerresponsibleforfirm’s parliamentary authorities. respect ofdiesel-relatedissues,includingdealingwithregulatoryand John istheleadpartnerforVolkswagen andrelatedcompaniesin Evaluation, Authorisation andRestrictionofChemicals(REACH). manufacturing clientsinrelationtotheEUregulationonRegistration, electronic equipment(WEEE)regulationandcompliance; restriction ofhazardoussubstances(RoHS)andwasteelectrical Hewett UKNorthSeacommerciallitigation);consumergoodsclientson John hasadvisedenergycompanies(inparticularontheJ-Blockand hazardous substances,andsupplychainissues. of thedefencecross-bordercontentiousmatters,use development andapproval,regulatorycompliance,theco-ordination environmental regulationissues.Specifically, headvisesonproduct John’s practicefocusesonbothproductriskandliability, and Regulatory (EPR)group. Resolution practiceandisheadoftheEnvironment,Products John BlainisaLondon-basedpartnerinFreshfields’ Dispute URL: Email: Tel: United Kingdom London, EC4Y 1HS 65 FleetStreet Freshfields BruckhausDeringerLLP John Blain www.freshfields.com [email protected] +44 2078327482

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social responsibilityandenvironmentalreportingrequirements. safety regulationsandguidance.Rachelalsoadvisesoncorporate bodies andtheGovernmentinrelationtointerpretationofproduct advising aleadingfurnituremanufactureronengagementwithtrade considerations relevanttotheclosureofamanufacturingsite,and liability. Herrecentexperienceincludesadvisingonenvironmental Rachel advisesonregulatorycompliance,consumerrightsandproduct London. and Regulatory(EPR)groupwithintheDisputeResolutionpracticein Rachel Duffy isanassociateinFreshfields’ Environment,Products URL: Email: Tel: United Kingdom London, EC4Y 1HS 65 FleetStreet Freshfields BruckhausDeringerLLP Rachel Duffy www.freshfields.com [email protected] +44 2077164791 England &Wales e canalsohelpyou national most

Chapter 13 Finland Casper Herler

Borenius Attorneys Ltd Henna Lusenius

1 Environmental Policy and its subsequent supervision has increased due to a wide-ranging transition in environmental legislation to a lighter permitting process. Enforcement

1.3 To what extent are public authorities required to 1.1 What is the basis of environmental policy in your provide environment-related information to interested jurisdiction and which agencies/bodies administer persons (including members of the public)? and enforce environmental law? In accordance with the Finnish Act on the Openness of Government Finland does not have a federal structure, therefore the environmental Activities (621/1999), all official documents must be available to policy is regulated through state and municipal authorities. The state the public unless specifically otherwise provided by law. authorities have a regional representation. The Ministry of the Environment defines environmental policies and 2 Environmental Permits makes strategic plans at national level, sets administrative controls as well as targets for environmental protection, and prepares environmental legislation. The Finnish Environment Institute 2.1 When is an environmental permit required, and may (“SYKE”) produces and compiles environmental data, develops new environmental permits be transferred from one ways to protect the environment and supervises international waste person to another? transportation. The AVI Agencies (the Regional State Administrative Agency) are An environmental permit is required for all activities listed in the main environmental authorities responsible for environmental Appendix 1 of the FEPA. Under certain preconditions, an licensing. In certain smaller-scale activities specified in the Finnish environmental permit is also required for activities that may cause Environmental Protection Act (527/2014, “FEPA”), environmental pollution of a water body or place an unreasonable burden on the and water permits are granted by municipal environmental surroundings, as well as for conducting wastewater. All the protection authorities. environmental effects of an activity are considered within the same permit procedure, regardless of in which element of environment The ELY centres (the Centre for Economic Development, Transport the effects occur (soil, water, air, etc.). The scope of activities and the Environment) are regionally responsible for supervision of covered is broader than in the EU’s Directive Concerning Integrated compliance with the environmental permits throughout the entire life Pollution Prevention and Control (“IPPC”) and Industrial Emissions cycle of operations. In addition, the ELY centres ensure that public Directive (“IED”). In accordance with a recent amendment to the interest is taken into account in environmental and water issues. FEPA, certain functions that currently require an environmental In addition, municipalities promote and supervise environmental permit have been transferred under the range of a lighter notification protection locally. Chemical safety permits and mining permits are procedure as of 1 January 2019. An environmental permit is granted granted by the Finnish Safety and Chemicals Agency, which also for the operations in question and not tied to a specific operator, but acts as the supervisory authority with respect to the compliance of the supervisory authority must be informed of a change of operator. operators with the said permits. In connection with the implementation of the major amendment of 2.2 What rights are there to appeal against the decision of the FEPA, a new permitting authority called the State Permitting and an environmental regulator not to grant an Supervisory Authority (“LUOVA”) will be established (for more environmental permit or in respect of the conditions information, see question 12.1). contained in an environmental permit?

1.2 What approach do such agencies/bodies take to the The competent appeal body in environmental issues is the enforcement of environmental law? Administrative Court, and all parties to the permission procedure may appeal the authority’s decisions. In addition, environmental The enforcement of Finnish environmental law is strongly based on non-governmental organisations have a right of appeal in most preliminary supervision, which in practice relies on a comprehensive environmental decision-making processes. environmental permitting system. Recently, however, the role of

ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 WWW.ICLG.COM 89 © Published and reproduced with kind permission by Global Legal Group Ltd, London 90 Finland ■ ■ aim isnottheproductionofthatsubstance orobject,and: by-product, ifitresultsfromaproduction processwhoseprimary According tothe Waste Act, asubstance orobjectisnotwastebuta the holderdiscards,intendstodiscard orisrequiredtodiscard. Act (646/2011), wasteisdefinedasanysubstanceorobjectwhich In accordancewiththeEU Waste DirectiveandtheFinnish Waste 3.1 and legislation. investigation andprosecutionincasesofincompliancewithpermits years, hencecompaniesandofficers faceamaterialriskforcriminal possible. The thresholdfordoingsohasbecomelowerinrecent where acorporatefineandconfiscationoftheproceedscrimeare supervisory authoritymayalsoinitiateacriminalinvestigation authority mayimposearemediationobligationontheoperator. The In theeventofsoilorgroundwatercontamination,supervisory operator toclosedowntheactivity. authority, thepermitauthoritymayrevokepermit,forcing the permitconditionsdespiteawrittencautionbysupervisory the activityornoticeofenforcedcompliance.Incaseviolation compulsion, whichmaytaketheformofacoercivefinesuspension the supervisoryauthority(ELY centre)mayuseadministrative If thepermitregulationsorenvironmentallegislationareviolated, 2.4 (132/1999, “LUBA”)requirealimitedEIA. zoning procedureundertheFinnishLandUseandBuilding Act apply, theenvironmentallicensingprocedureunderFEPA andthe given itsstatement.EvenwhenanEIA undertheEIA Act doesnot power plants,theMinistryofEmploymentandEconomy)has coordination authority(theELY centreor, inprojectsrelatedtonuclear permit authorityhasobtainedtheassessmentreportand environmental permit.However, apermitcannotbegrantedbeforethe An EIA doesnotfreetheoperatorfromitsdutytoapplyforan impact comparabletotheprojectslistedinEIA Act. quality andscope,wouldlikelycausesignificantenvironmental smaller projectsclosetothethresholdsifproject,intermsofits a discretionaryEIA maybeorganised forotherprojecttypesaswell the EIA Act (252/2017). The listcovers50projecttypes.Inaddition, agreement bindingonFinland.ProjectssubjecttoEIA arespecifiedin environment orforwhichanassessmentisrequiredbyinternational to projectsthatmayhaveasignificantadverseimpactonthe Environmental impactassessment(“EIA”)proceduremustbeapplied 2.3 Court. appeal fromthe Administrative CourttotheSupreme Administrative January 2018,nearlyallenvironmentalissuesrequirealeaveof grounds forappealareslightlymorelimitedinzoningmatters. As of T Borenius AttorneysLtd © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM here aregenerallynospecificgroundsforappeal,althoughthe 3 polluting industriesorotherinstallations/projects? waste involveadditionaldutiesorcontrols? have inconnectionwiththeviolationofpermits? any furtherprocessing otherthannormalindustrial practice; the substanceorobject canbeuseddirectlyasis,or without further useofthesubstanceorobject iscertain; Waste How iswastedefinedanddocertaincategoriesof What enforcementpowersdoenvironmentalregulators Is itnecessarytoconductenvironmentalauditsor environmental impactassessmentsforparticularly

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3.3 permit is,however, regulatedinthepermitconditions. disposal ofwasteoriginatingfromoperationssubjecttoenvironmental facilities inaccordancewiththerelevantlegislation. The storageand the appropriatedisposalofwasteinlandfillsandprocessing organising wastemanagement. This includestheobligationtosee Under the Waste Act, theproducer/holderofwasteisresponsiblefor 3.2 site isdependentuponthepurpose of usethesite. available, buttheextentofremediation requiredforthecontaminated actions requiredbytheauthorities. There arenotmanydefences required toassesstheneedforremediation andtakethenecessary in possessionofthearea(e.g. current ownerortenant)maybe which hasoriginallycausedthecontamination orthepartycurrently In theeventofsoilorgroundwatercontamination,eitherparty criminal oradministrativesanctions. The breachofenvironmentallawsorpermitsmayleadtocivil, 4.1 of whothewasteholderis. product isresponsiblefororganising wastemanagement,regardless batteries, packages,recycledpaper).Hence,theproducerof Waste Act (e.g.certainvehicles,cartyres, electronicequipment, The producer’s liabilityappliesforcertainproductsspecifiedinthe 3.4 ■ ■ another party. Waste mayonlybedelivered toapartythat: not transferredtoamerecarriertransportingwasteonbehalfof waste isdeliveredtoalawfulconsignee.However, responsibilityis management isterminatedandtransferredtoanewholderwhenthe The wasteproducer/holder’s responsibilityfororganising waste transport andrecycling)ofhazardouswaste. There isspecialregulationforthehandling(e.g.storage,packaging, ■ ■ 4 bankrupt/disappears)? produced? what defencesaretypicallyavailable? regarding thetake-backandrecoveryoftheirwaste? waste inquestion. has therightunderanenvironmentalpermittoreceive dealer; or has beenregisteredasaprofessionalwastetransporteror Liabilities the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa To whatextentdowasteproducershaveobligations or theenvironment. overall, itsusewouldposenohazardorharmtohumanhealth human healthforthespecificusethereofand,whenassessed and requirementsfortheprotectionofenvironment the substanceorobjectfulfilsallrelevantproductrequirements production process;and the substanceorobjectisproducedasanintegralpartofa

Finland

the permitlimits. notwithstanding thatthepollutingactivityhasbeenoperatedwithin well asfordamagetoprotectedspeciesandnaturalhabitats groundwater, payingcompensationforenvironmentaldamageas An operatormaybeliableforrestoringcontaminatedsoiland 4.2 environmental liabilities. that itshouldstandforthecostsaccruedtopartydue a partymayraisecivilactionagainstthecounterpartyandclaim division ofenvironmentalliabilityarebindingbetweentheparties, by contractualagreement.However, asagreementsregardingthe Environmental liabilityinrelationtothirdpartiescannotbeavoided confiscation oftheproceedscrimearepossible. also initiateacriminalinvestigationwherecorporatefineand permit mayimposearemediationobligationontheoperatorand The supervisoryauthorityforoperationssubjecttoanenvironmental Borenius AttorneysLtd ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 operations willalso followtheacquiredcompany. of oldindustrialcompanies.Potential liabilitiesforprevioussitesof back intime,therisksmaybesubstantial, especiallyinacquisitions As liabilitiesforsoilandgroundwater contaminationmayextendfar environmental damagethattheactivity mayhavecausedinthepast. liability forpossiblecontamination ofsoilorgroundwater, orother acquiring company. Consequently, theacquiringcompany mayface company, itsenvironmentalliabilitiesincluded,istransferredtothe The acquisitionofcompanysharesimpliesthatthewholetarget 4.4 environmental issuesaresufficiently attendedto. also beheldliableiftheyhavenotsupervisedsothatsubstantial Supreme Court(KKO:2016:58)in2016,directorsoftheboardcan control ofthesubsidiary’s operation.Basedonarulingbythe officers ofalocalsubsidiaryenoughpowertoremaininfactual responsibilities withinthecompany, aswellbyprovidingthe monitoring complianceandclearlyallocatingtheenvironmental Criminal liabilityofdirectorsandofficers isbestpreventedby to acriminalinvestigation. environment, breachesofenvironmentallegislationmayeasilylead Code prohibitsbothintentionalandnegligentimpairmentofthe responsibility ofthepersoninunlawfulactivity. As theCriminal overall basiswithdueaccounttothefactualparticipationand does notassuchexcludeliability, astheassessmentismadeonan parent company. The formalpositionofanofficer inthecorporation rules donotexclude,e.g.externalboardmembersorofficers ofa sphere ofresponsibilitytheactnegligencebelongs. The allocation allocates liabilityforenvironmentaloffences tothepersoninwhose operator. Incontrast,chapter48oftheCriminalCode(39/1889) significant enoughforthemtoberegardedasthefactualpolluteror directors ofacompany, unlesstheirownershipinthecompanyis public laworregulationsconcerningenvironmentaldamagetothe There isnolegislationorcaselawexplicitlyallocatingliabilityunder 4.3 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London indemnity protectioninrespectofsuchliabilities? within permitlimits? the onehandandanassetpurchaseonother? notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract

operations andaftercareof,e.g.,non-operationalindustriallandfills. responsibilities underanenvironmentalpermitregardingtheclosingof transfer. The acquirerofafacilitymayalsobecomeliablefor known aboutthepollutionorriskofattime Damage (737/1994, ACED) iftheacquirerkneworshouldhave also faceliabilityunderthe Act onCompensationforEnvironmental cannot befoundorhasceasedtoexist.Moreover, theacquirermay liable astheholderofcontaminatedpropertyifactualpolluter soil orgroundwatercontamination,astheacquirermaybeconsidered The acquisitionofassetsmayimplyarisksecondaryliabilityfor 5.1 covenants shouldnotassuchrenderthelenderliable). lender exercisesfactualcontrolovertheoperator(e.g.ordinary financing theoperations;however, onlyintherareeventthat polluting activity. This rulemayalsobeappliedtothelender liability maybeextendedtotheshareholderofoperator In certainjustifiedsituationsspecifiedinthe ACED andtheFEPA, 4.5 both soilandgroundwater remediationliabilities for thepolluter been contaminatedthroughpolluted soil,itispossibletoimpose area cannotbeheldliableforremediation. Ifthegroundwaterhas polluter. A non-pollutingholderofthecontaminated groundwater prohibition. Liabilityforgroundwater contaminationlieswiththe contamination, theFEPA containsagroundwaterpollution rules inthe1927healthprotection legislation.Inadditiontosoil landfill whichwasclosedinthe1950sbasedonwastemanagement Supreme Administrative Courtconsideredamunicipalityliablefor Other groundsforliabilitymayalsoevolve;inKHO2013:187the Management Act (Supreme Administrative Court,KHO2006:30). of thepropertycanbeheldliableforremediationbasedon Waste soil-polluting activitiesceasedpriorto1 April 1979,onlytheholder polluters wouldbeprimarilyliablebeforeholders.However, ifthe be responsibleforremediation,recentcourtpracticesuggeststhat property. Although therearenospecificrulesonwhichpartyshould polluter ortheholder(ownerand/ortenant)ofcontaminated activities between1 April 1979and31December1993onthe of liabilityforhistoricsoilcontaminationthatoriginatesfrom the old Waste Management Act (673/1978)allowstheestablishment application ofliability. However, caselawdevelopedonthe basisof Finnish legislationdoesnot,asamainrule,allowretroactive ■ ■ made tofulfilitsremediationresponsibility–and: liability –however, onlyifthepollutercannotbefoundor property wherethecontaminationhasoccurredmayfacesecondary hazard totheenvironmentorharmhealth. The holderofthe the contaminatedsoiltoaconditionthatwillnotcauseharmor have causedthecontamination. The polluterisrequiredtorestore 1994) liesprimarilywiththepolluter, i.e.thepartywhoseactivities new soilcontamination(contaminationthatoccurredafter1January In accordancewiththeFEPA, liabilityforremediation ofso-called 5 environmental wrongdoingand/orremediationcosts? groundwater? contamination whenthepropertywasacquired. the holderwasorshouldhavebeenawareof holder oftheproperty;or the contaminationhastakenplacewithconsentof Contaminated Land (including historiccontamination)ofsoilor What istheapproachtoliabilityforcontamination To whatextentmaylendersbeliablefor WWW.ICLG.COM

Finland

91 Finland 92 Finland otherwise neglectsitsmonitoringduties. The newFEPA introduces take placeonlyiftheoperatordoes notpresentanadequatereportor conducted bytheoperator, whichmeansthatinvestigations usually activities isprimarilyconductedthrough monitoringandreporting tests, carryoutmeasurementsand take samples. The supervision of to placeswhereactivitiesareengagedinandmakeinspections legislation, theenvironmentalauthoritiesareentitledtogainaccess For thepurposeofsupervisionandenforcementenvironmental 6.1 or fishing. caused bywaterresourcesmanagementprojectsto,e.g.,fishstocks addition, the Water Act (587/2011) regulatesliabilityfordamage environmental damageorreinstatingapollutedenvironment.In compensation forthecostsincurredbyauthoritiespreventing In accordancewiththe ACED, apollutershallpayreasonable 5.5 pollution ortheriskofattimetransfer. the ACED iftheacquirerkneworshouldhaveknownabout ceased toexist.Moreover, theacquirermayalsofaceliabilityunder contaminated propertyiftheactualpollutercannotbefoundorhas An acquirermaybeconsideredliableastheholderof benefit ofapolluter. agreement doesnotbindauthoritiesorthird-partyclaimantsforthe a liablepartytoassessand/orremediatesite. An The currentownermaydemandauthoritiestotakeactionandorder 5.4 have changed. This ispossibleifthecircumstancesaroundoriginaldecision 5.3 one personisresponsibleforcontamination. There arenoclearrulesforallocationofliabilitywheremorethan 5.2 that havebeenoperationalasof1 April 1962. extended onthebasisofold Water Act (264/1961)toactivities (KHO 1996 A 29).Liabilityforgroundwatercontaminationcanbe Borenius AttorneysLtd © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 6 can athirdpartychallengetheagreement? is responsibleforthecontamination? conduct siteinspections,interviewemployees,etc.? public assets,e.g.rivers? contaminated landliabilitytoapurchaser? Powers ofRegulators possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof What powersdoenvironmentalregulatorshaveto polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma Does apersonhaveprivaterightofactiontoseek regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis How isliabilityallocatedwheremorethanoneperson require productionofdocuments,takesamples,

inter partes

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

the sizeofcontaminatedareaandneedforremediation. preconditions, theholderofarea,isunderobligationtoestablish groundwater, the operatorofthepollutingactivityor, undercertain In addition,iftherearegroundstosuspectcontaminationofsoiland/or under obligationtoremediatethesite. the siteisfoundharmfulforhealthorenvironment,operator contamination ofsoilorgroundwaterisdetected,ifthebaseline compared totheresultsofbaselinestudy. Inthecasethatincreased activities, soilandgroundwaterconditionsmustbereinvestigated environmental permitapplication. When thecompanydissolves to performasoilandgroundwaterbaselinestudybeattachedan with theIEDwhichare,undercertainpreconditions,obligation The FEPA containsalistofso-calleddirectivefacilitiesinaccordance 7.2 authorities. Yes, therelevantenvironmentalactscontainsuchdutiestowards 7.1 No, Finnishlegislationdoesnotallow this. 8.2 agreement andisthereforenotbindingupontheauthorities. such indemnityisonlyeffective betweenthepartiesto It ispossibletoagreeonanenvironmentalindemnity. However, 8.1 contracts. provision appliestoassetsales,realestatesalesandnewlease environmental informationinconnectionwithtransferofland. The The FEPA containsaspecificprovisionontheobligationtodisclose 7.3 determined basedondependencyrisk,sizeandtrackrecord. risk-based monitoring,thustheintensityofauthoritymonitoringis 7 8 contamination? parties? order toescapeenvironmental liabilities? potential liabilityforthatmatter? takeover transactions? Reporting /DisclosureObligations General have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson environmental regulatororpotentiallyaffectedthird migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe balance sheet,andcanacompany bedissolvedin Is itpossibletoshelterenvironmental liabilitiesoff matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- Is itpossibletouseanenvironmentalindemnity prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto To whatextentisitnecessarytodisclose

Finland

8.5 No, therearenone. 8.4 polluting activity. Liabilityisnotlimitedtoofficers ofthecorporation. extended totheparentcompanyorshareholderofoperator situations specifiedinthe ACED andtheFEPA, liabilitymaybe regarding piercingthecorporateveil.However, incertainjustified The Finnishgeneralcorporatelawdoesnotcontainanyspecificrule 8.3 Borenius AttorneysLtd ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 emissions inindustrial operations.Iftheoperations arenotsubject employ thebestavailabletechnique forreducinggreenhousegas major amendmentoftheFEPA in2014,includingtherequirementto The IEDhasbeenimplementedin Finlandinconnectionwiththe 9.2 trading authority, andthedistributionofemissionallowances. an obligationtodelivernecessaryinformationtheemissions concern e.g.theapplicationprocedureforfreeemissionallowances, the EUEmissions Trading Directive. The proposed changes Emissions Trading Act inordertoimplementtherecentchanges November 2018,thegovernmentgaveaproposalforchanging 600 facilitiesinFinlandarecurrentlysubjecttotheEUETS.In European UnionEmissions Trading Scheme(“EUETS”). About certain restrictionsintheaviationindustry, aresubjecttothe (311/2011), meaningthatmostsectorsofheavyindustry, andwith Trading DirectivethroughthenationalEmissions Trading Act As amemberoftheEU,FinlandhasimplementedEUEmissions 9.1 risk ofcosts(e.g.damagesbasedonthe ACED). adjusted. However, partiestoacivilprocessbearmuchgreater parties, asdamagesareseldomimposedandhighbillsofcosts No, buttheFinnishadministrativeprocessislowincostsfor 8.6 No, theyarenot. deemed toexercisefactualcontrolovertheoperator. However, thisruleonlyappliesiftheparentcompanyorshareholderis © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 9 pursuing environmentallitigation? damages available? report environmentalviolations/matters? caused byaforeignsubsidiary/affiliate? to monitorandreportgreenhouse gasemissions? market developingthere? Emissions Trading andClimateChange environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing Are thereanylawstoprotect“whistle-blowers”who liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent in question9.1above,isthere any otherrequirement Aside fromtheemissionstradingschemesmentioned your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation Do individualsorpublicinterestgroupsbenefitfrom any exemptionfromliabilitytopaycostswhen

gas emissionsby39%comparedtotheyear20052030. that arenotsubjecttotheEUETS. The goalistoreducegreenhouse necessary measuresforreducinggreenhousegasemissionsinsectors Climate ChangePlanfor2030inMarch2018. The planoutlinesthe The ParliamentacceptedtheGovernmentReportonMedium-term renewable energy, energy efficiency andclean-techsolutions. to reducegreenhousegasemissionsby80–95%arerelated achieving acarbon-neutralsociety. The measurestobetakeninorder year 2050andservingasastrategyguideonthejourneytowards energy andclimateissueshaspreparedaroadmapextendingtothe achieve thelong-termobjective,parliamentarycommitteeon as measuresrespondingtotheeffects ofclimatechange.Inorderto sectors uptotheyear2050andincludesanticipatorymeasuresaswell adapting toclimatechangeoutlinesadaptationmeasuresfor15 Paris ConventionandtheEU. The Finnishnationalstrategyfor set bytheUNClimateChangeConvention,KyotoProtocol, Finland’s nationalclimateactionsarelargely basedontheframework 9.3 and propertyinsurance,arealsoavailable. insurance. Voluntary insurance types,suchasliability environment ingeneral,shallbecovered byenvironmentaldamage environmental damage,orwhose operationscauseharmtothe all companieswhoseactivities involveamaterialriskof Under theFinnishEnvironmentalDamageInsurance Act (81/1998), 11.1 regulated. asbestos-containing materials(e.g.demolitionwork)isstrictly built before1994priortoanyconstructionwork. The handlingof however, obligatory toconductasbestostestingonallbuildings unless itisfoundhazardousforhealth(i.e.looseorfriable).Itis, legal obligationtoremoveasbestos-containingmaterialon-site materials, whichareinnormaluse. Therefore, thereisnoexplicit not consideredtoconstituteahealthriskwhenfoundinintact Finland in1977andtotallyprohibited1994. Asbestos iscurrently The useofasbestos-containingmaterialswaspartlyprohibitedin 10.2 diseases causedbyasbestos. asbestos safetyregulationsandcompensationforoccupational Asbestos litigationcasesinFinlandrelatemostlytoneglectof 10.1 gases isregulatedintheenvironmentalpermit. to emissionstrading,themonitoringandreportingofgreenhouse 10 11 regulation inyourjurisdiction? risks insuranceplayinyourjurisdiction? in relationtoasbestoson-site? jurisdiction? What istheoverallpolicyapproachtoclimatechange in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour Asbestos Environmental InsuranceLiabilities WWW.ICLG.COM Finland

93 Finland 94 Finland under preparation. The amendmentisplannedtointroduce, The thirdphaseofthemajoramendmentFEPA iscurrently 12.1 statutory environmentaldamageinsurance. limited, asthereisonlyonecaseinvolvingadisputeoverthe The environmentalinsuranceclaimsexperienceinFinlandis 11.2 Borenius AttorneysLtd © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM groundwater contaminationliability. doctoral degreeinlawandcompletedadissertationonsoil mining lawandhasbeenaspecialistcounselatPöyryOyj.He previous experienceinlegislativeworkthefieldofenvironmentaland environmental lawattheUniversityofHelsinki.Casperalsohas He hasalsoworkedattheMinistryofEnvironmentandteaches frequently adviseclientsonlanduseplanning,buildingandotherenvironmental licensing,environmentalimpactassessments,e relations.W providing strategicadviceforlargeprojectsrequiringcoordinationofanumber ofregulatoryproceedingsandcomplexstakeholder isspecialisedin The environmentandnaturalresourcespracticeofBoreniusisonethelargest andmostacknowledgedinFinland.Ourpractice commitment toourclients’ andinnovation. successisfirmlygroundedinstrongexpertise,long-termcommitment,genuineinvolvement,experience liabilities, natureconservation,mining andnaturalresources,chemicals,renewables,energyemissionstrading. Prior tojoiningBorenius,CasperwasaPartnerwithanotherlawfirm. legislative reforms. frequently relyonhisexperiencewhensafeguardingtheirinterestsin Finnish mininglawyer. Trade associationsand industrial clients financing arrangements.Clientsalsorecognisehimastheleading involved inassessingenvironmentalliabilitiestransactionsand projects aswellcorporateresponsibility(“CSR”).Heisregularly issues relatedtoenvironmentallaw, naturalresourcesandinfrastructure Resources practiceatBorenius.Headvisesclientsonawiderangeof at-law; ManagingPartner)headstheEnvironmentandNatural Casper Herler(LL.M.2000,LL.D.2008,UniversityofHelsinki; Attorney- Established in1911, corporatelaw Boreniusisoneofthelargestandmostexperiencedlawfirms inFinland.Ourservicescoverallareasof 12 in environmentlawyourjurisdiction. experience inyourjurisdiction? Please provide,innomorethan300words,a What istheenvironmentalinsuranceclaims summary ofanynewcases,trendsanddevelopments Updates URL: Email: Tel: Finland 00130 Helsinki Eteläesplanadi 2 Borenius Attorneys Ltd Casper Herler www.borenius.com [email protected] +358 207133288

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 inter

also gaveaproposalforlawonpromotingtheuseofbiomassfuels. by theyear2029. As asubstitutefortheuseofcoal,government law forphasingoutfromtheuseofcoalinheatandpowerproduction In October2018,theFinnishgovernmentgaveaproposalfornew temporal coordinationofvariousenvironmentalmatters. application procedure. The modelallowsthecombinationand environmental permit,waterpermitandbuildingintoone stop-shop modelwillcombinevariouspermits,suchasthe permitting procedurebyadoptingaone-stop-shopmodel. The one- alia, amorefocusedsupervisionsystemandlighterenvironmental law andnaturalresources. numerous administrativecourtproceedingsrelatedtoenvironmental contamination. Hennahasalsosuccessfullyrepresentedclientsin zoning andlanduse,natureconservationenvironmental regularly advisesonmattersrelatingtoe.g.environmentalpermitting, of miningandexploration,windpowerlandextraction.Henna natural resourceslawassignments,withaspecificfocusonthesectors Henna hasextensiveexperienceinawiderangeofenvironmentaland advises clientsinthefieldsofenvironmental,energyandlanduselaw. Henna Lusenius(LL.M.2007,Universityof Turku; Senior Associate) URL: Email: Tel: Finland 00130 Helsinki Eteläesplanadi 2 Borenius Attorneys Ltd Henna Lusenius www.borenius.com [email protected] +358 207133587 nvironmental Finland . Our e

Chapter 14 France

David Desforges, Avocat à la Cour David Desforges

1 Environmental Policy and its Local governments (municipal) enjoy only residual prerogatives in environmental matters. Enforcement At the governmental level, this competence is mainly entrusted in the (currently named) Ministry of Ecological and Inclusive Transition 1.1 What is the basis of environmental policy in your (note: this designation is subject to change based on the political jurisdiction and which agencies/bodies administer allocation of prerogatives between ministries). The Ministry is vested and enforce environmental law? with expansive powers towards the integration of sustainable development issues into the following fields: energy (including Note: unless otherwise stated, references hereunder are from the renewables); climate change (and international negotiations in relation French Environmental Code. Statutory provisions are referred to as thereto); biodiversity; pollution and risk prevention; transport, ‘L’ articles and regulatory provisions as ‘R’ articles. buildings, networks and urban development; seashores; and the seas. French environmental law is based on: At the site/facilities level, the enforcement of environmental laws ■ European law, especially the Treaty on the Functioning of the and regulations is a State prerogative: European Union, relevant EU Regulations and Directives. ■ The local representative of the State (préfet) is the key ■ The Environmental Charter (Charte adossée à la constitution) decision-maker. The préfet issues environmental operating of 2005 (Charter) which forms part of the French Constitution. permits (autorisation environnementale) (Art. L.181-1 et seq. This Charter affirms key principles such as the right of citizens and R.181-1 et seq.) for the variety of activities listed based to public health and to live in a balanced environment, their on their propensity to impact the environment (see question duty to participate in the preservation of the environment, and 2.1 below). to contribute to the compensation of damages they cause to the ■ Technically, the préfet relies upon the services of the Regional environment. The Charter is binding on public and Environment, Planning and Housing Directorate (Directions administrative authorities in all the rights and obligations Régionales de l’Environnement, de l’Aménagement et du which it defines (Constitutional Council, 19 June 2008; Logement or DREAL) (formerly DRIRE), acting under the Administrative Supreme Court (Conseil d’État), 3 October authority of the Ministry of the Environment. DREAL agents 2008). Particularly, it provides that public authorities shall oversee environmental permits applications and filings, and abide by the precautionary principle. Since a 2010 are in charge of the inspection of activities. Note: in the Ile- constitutional reform, persons involved in court proceedings de-France Region (greater Paris area) the DREAL is referred are entitled to seek ‘a priority preliminary ruling on the issue of to as DRIEE-IF. constitutionality’ of the statutory provision applicable to the case in issue (question prioritaire de constitutionnalité). From a judicial perspective, environmental law is administered by: Consequently, the fact that a piece of legislation may violate ■ Administrative courts, which review either the lawfulness of rights and principles guaranteed by this Charter may now be administrative decisions (decrees, ministerial orders, and raised. individual environmental permits) (recours pour excès de ■ The French Environmental Code which lays down the main pouvoir), or rule over indemnification actions deriving from principles governing environmental law (Art. L.110-1) and harm caused by administrative action under an unlimited incorporates most laws and regulations governing the jurisdiction regime (recours de plein contentieux). protection of the environment. In line with EU requirements, Environmental permits are subject to review under the applicable principles include the precautionary principle, the unlimited jurisdiction regime (Art. L.181-17 and L.514-6; principle of preventive and corrective action, the ‘polluter Art. R.181-50 to R.181-52 and R.514-3-1). Under this pays’ principle, the right for any person to access regime of extended prerogatives, administrative courts may environmental information held by public authorities, and the cancel, amend and even grant environmental permits. principle of participation according to which persons are ■ Civil and criminal courts each also have jurisdiction over entitled to be informed and to issue observations as regards environmental liability issues (see question 5.5 below). decisions impacting the environment. New items were added further to the Biodiversity Law of 8 August 2016 including the non-regression principle. The Environmental Code is 1.2 What approach do such agencies/bodies take to the supplemented by many ministerial orders (arrêtés ministériels) enforcement of environmental law? on technical aspects. The administration and implementation of environmental policy is Although applicable provisions provide for the possibility of essentially a competence of the State (État) (central government level). administrative action as well as criminal prosecution, the authorities’

ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 WWW.ICLG.COM 95 © Published and reproduced with kind permission by Global Legal Group Ltd, London 96 France Environmental permitsissuedbythe 2.1 factored intoenvironmentaldecisions. they beinformedofhowsuchobservationsandproposalswere public havereasonabletimetoissueobservationsandproposesthat commissioner’s recommendations. Notably, itnowrequiresthatthe participation andtakingintoconsiderationthepublicinquiry in 2010,2011 and2018withaviewtoimprovingpublic to projectsorplanslikelyimpacttheenvironmentwerereformed amended byalawof30July2018). Also, publicinquiriesrelating and havinganimpactontheenvironment(Art.L.120-1 Charter (Art.7),appliestoalldecisionstakenbypublicauthorities Furthermore, theprincipleofpublicparticipation,definedby information protectedbythelaw(Art.L.124-4). with theinterestsofnationaldefence,publicsecurityorothersecret such requestswheretheconsultationorcommunicationinterferes (formerly thelawof17July1978).Publicauthoritiesmayreject relations entre lepublicetl’administration relationship betweenthepublicandauthorities( exercised undertheconditionsdefinedbyCodegoverning drawn upbythepublicauthorities,orontheirbehalf. This rightis each persontoenvironment-relatedinformationheld,received,or Environmental Code(Art.L.124-1)provideforarightofaccess environment-related information. The Charter(Art.7)andthe Directive 2003/4/EC,Franceprovidesextendedaccessto As asignatoryofthe Aarhus Conventionof1998andpursuantto 1.3 installations servicesmultiannualcontrolplan). (Ministerial Noteof24November2016governingtheregistered and basedonnationalguidelinesissuedbytheMinistryofEcology priorities (quantitativeorqualitative)setbyeachregionalservice Inspections areorganised attheregionalleveldependingon installation maybeorderedbydecree(Art.L.514-7). hazards cannotbeeliminated,theclosureorsuppressionof order thetemporarysuspensionofitsoperation.Inrarecases,where displays risksnotknownatthetimeofpermitting,authoritiesmay in formalnoticesbeingserveduponoperators. Where aninstallation compliance withenvironmentallaw. About 10%ofinspectionsresult authorities tendtoseeksolutionsbringtheinstallationinto In practice,whenanoperatordemonstratesgoodfaith,public prosecutor inviewofthelaunchingcriminalprosecution. sanctions (seequestion2.4below)orreferringthematterto en demeure) requiringcompliancebeforetakingadministrative non-compliant, the corrective actionandsolutions. Where aninstallationisfoundtobe one ofdialoguewithoperatorsandpragmatisminthesearchfor approach totheenforcementofenvironmentallegislationisgenerally David Desforges © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM affecting waterresources(Art.L.181-19andL.214-1)registered activities inrelationtotheabstraction ortreatmentofwater variety ofactivitieslikelytoimpact theenvironment. These include 2 person toanother? persons (includingmembersofthepublic)? Environmental Permits environmental permitsbetransferredfromone When isanenvironmentalpermitrequired,andmay To whatextentarepublicauthoritiesrequiredto provide environment-relatedinformationtointerested préfet issuestotheoperatoraformalnotice( préfet arerequiredforawide ) (Art.L.300-1etseq.

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site overhaulsandpermitupdates(Art. R.181-45). required fromoperatorsandparticularly atthetimeofsignificant For certainactivities,EIAsorrisk assessmentupdatesmaybe measures (Art.R.122-5). developments regardingreduction, avoidanceandcompensation of 3 August 2016)tobecomeacomprehensivedocumentincluding ambitiously widenedinrecentyears(sincealegislativeOrdinance appended to Art. R.122-2). The scope ofEIAshasconsiderablyand context ofmostapplicationsforenvironmentalpermits(Chart assessments (étudesdedangers)(Art.R.181-25)arerequiredinthe assessments (étudesd’incidence L.122-1 environmental impactassessments(EIAs)( Pursuant toEUlawobligationsastransposedintoFrenchlaw, 2.3 R.514-3-1). from thedateoftheirpublication/publicposting(Art.R.181-50and with standingmayfurtherchallengepermitswithinfourmonths R.181-50 andR.514-3-1). Third parties(includingmunicipalities) tribunal withintwomonthsfromtheirnotification/publication(Art. petitioner/operator beforethelocallycompetentadministrative (Art. R.181-41andR.181-42),maybechallengedbythe Environmental permitsandrefusalsthereof,whichmaybetacit 2.2 taken place(Art.L.181-15,R.181-47,andR.512-68). The declaration tothe In mostcases,environmentalpermitscanbetransferredbywayofa with permittingproceduresorganised accordingly. subject toauthorisation,registration( R.511-9). This isathree-tiersystemwherebyactivitiesareeither environmental impact( installations categorisedinadecreeonthebasisoftheirpotentialfor For industrialactivities,environmentalpermitsarerequiredforall authorisation fromthe of whicharelikelytocausesignificantsoilorwaterpollution),an ( For sitessubjecttofinancialguarantees(Art.R.181-47andR.516-1) issues anacknowledgementtothenewbeneficiarywithinonemonth. covers avarietyofactivitiesandnotablyincludesfarmingactivities. regime isbroaderthanthatoftheforegoingEC/EUDirectives.It IED). However, thescopeof(pre-existing)registeredinstallations recast bytheIndustrialEmissionsDirective(Directive2010/75/EUor implements theIPPCDirective(Directive96/61/EC)asrecently As farasindustrialinstallationsareconcerned,thisregime dangers ornuisances. regulate alldischarges (toair, water, andsoil),allpotential Such permitscoveralltheactivities/installationsatagivensiteand The environmentalpermitregimeisanintegratedsystem. L.122-1-1 andchartappendedto Art. R.122-2). infrastructure, etc.)enumeratedintheEnvironmentalCode(Art. also includeotherworksandactivities(civilengineeringworks, installations (referredtoasICPE)(Art.L.181-24andL.511-1). These i.e., wastestoragefacilities,quarries,hazardousinstallations,etc.all polluting industriesorotherinstallations/projects? contained inanenvironmentalpermit? environmental impactassessmentsforparticularly Is itnecessarytoconductenvironmentalauditsor environmental permitorinrespectoftheconditions an environmentalregulatornottogrant What rightsaretheretoappealagainstthedecisionof et seq.;R.122-5andR.181-13),orenvironmentalincidence préfet préfet décret denomenclature withinthreemonthsofthetransferhaving isrequiredtoeffectuate apermittransfer. ) (Art.R.181-13),andrisk enregistrement études d’impact ) (Art.L.511-2 and ) ordeclaration,

France ) (Art. préfet

comply withthenoticewithinafforded timeperiod,the mere reminderbeforeactingformally). Where theoperatordoesnot (although inspectionservicesmayattimesshowleniencyandissuea cases, aformalnoticeisservedupontheoperator(Art.L.171-8) complaints orestablishedduringenvironmentalinspections.Insuch prescriptions. Suchinfringementscanbeidentifiedthrough without apermitordoesnotcomplywithlegaladministrative The authoritiesmayimposesanctionswhereaninstallationisoperated sanctions. The violationofpermitsmaycarrybothadministrativeandcriminal 2.4 David Desforges ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 (valorisation waste whereithasundergone atreatmentandrecovery end-of-waste provisionswherebywastemayceasetoqualifyas exclude itsqualificationaswaste.Besides,Francehastransposed II). Consequently, thepossiblereuseofagivenmaterialdoesnot reduction ofitspollutantorhazardouscharacter’ (Art.L.541-2-1- moment, notablybytheextractionofreusablepartor recovered underthetechnicalandeconomicconditionsof waste’ isdefinedas‘wastewhichnotlikelytobereusedor or intendsisrequiredtodiscard’ (Art.L.541-1-1). Also, ‘ultimate object or, more generally, anymovableswhichtheholderdiscards As perDirective2008/98/EU,‘waste’ isdefinedas‘anysubstance, 3.1 settlements remainpossible(Art.L.173-12). suspension ofactivities(Art.L.173-5).Undercertainconditions, top oftheabovesanctions,criminalcourtsmayalsoorder be increasedfivefold(Art.L.173-8;CriminalCode, Art. 131-38).On For convictionsoflegalentities,thefineamountsindicatedabovemay imprisonment sentencesofonetofiveyears(Art.L.173-1L.173-5). may carryfinesrangingfromEUR75,000.00to300,000.00and/or with aformalnoticeontime,orseveredegradationoftheenvironment, Misdemeanours fortheoperationwithoutapermit,failuretocomply petty offences (uptoEUR1,500.00)(Art.R.514-4 launched. Forregisteredinstallations,thisentailscriminalfinesfor Notwithstanding theabove,acriminalprosecutionmayalsobe of EUR1,500.00. fine amountingtoEUR15,000.00(max.)andadailypenaltypayment until theconditionsimposedhavebeencompliedwith;and/or(iv)a the authoritiesatoperator’s expense;(iii)suspensionofoperation needed tocarryoutthenecessaryworks;(ii)executionofworksby following: (i)mandatorydepositwiththePublic Treasury ofthesums take administrativesanctions. These includeoneorseveralofthe seq.), bio-waste(Art.L.541-21-1andR.543-225 etseq.),household electronic equipment(WEEE)(Art. L.541-10-2andR.543-172 ,usedoils,medical waste,wasteelectricaland L.541-7-2, R.541-8,andD.541-12-1 etseq.)andspecialwastelike These include,forinstance,hazardouswaste(Art.L.541-7-1, out andsubjecttospecificrulesentailingadditionalobligations. In linewithEUDirectives,severalcategoriesofwastearesingled L.541-4-3 andD.541-12-4etseq.). © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 3 permits? waste involveadditionaldutiesorcontrols? Waste regulators haveinconnectionwiththeviolationof What enforcementpowersdoenvironmental How iswastedefinedanddocertaincategoriesof ) operationandcomplieswithspecificcriteria(Art.

préfet et seq.).

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R.543-228 etseq.),andend-of-lifevehicles(Art.R.543-156-1). times, monitordisposalactorsandpractices. via mandatorywasteconsignmentnotessoauthoritiesmay, atall applicable tosuchon-sitetemporarystorage. Traceability issecured certified contractors.Environmentalpermitsspecifyconditions store wastebeforepick-up,recoveryandtreatment/disposalby Therefore, wasteproducersareundertheobligationtosortandsafe- case ofbankruptcy(Art.R.516-1 authorities andwasteproducersfromhavingtobearsuchcostsin required toprovidefinancialguaranteesprotectboththe reason whyoperatorsofwasteeliminationorstoragefacilitiesare stipulations tothecontrary(Art.L.541-3). This isnotablythe at theproducer’s orholder’s expenseregardlessofany contractual is notlawfullyeliminated,publicauthoritiesmayforceelimination that theircontractorsarevalidlyentitledtotreatwaste. Where waste 2). Itisthereforeadvisablethatwasteproducersorholdersensure been transferredtoanotherpersonforoff-site treatment(Art.L.541- waste untilitseliminationorfinalrecovery, evenwherewastehas The producerorholderofwasteisliableforthemanagement 3.3 On-site storage 3.2 1 clothing, chemicals,packaging,furniture, usedtyres(Art.L.541-10- schemes apply, treatment organisations (Art. L.541-10).Suchtake-back/recovery individual wastecollectionsystems,ortheuseofcollective its managementbythirdparties. The choiceisbetweeneither generating productsmustthemselvesmanagesuchwasteorsecure responsibility’, producers,distributorsorimportersofwaste- Furthermore, inconformitywiththeprincipleof‘extendedproducer disposal inconsideredalast-resortoptiononly. other recoverymethods(Art.L.541-1II2°).Hence,bylaw, waste must favourthereuseofwaste,thenitsrecycling,andeventually prioritises wastetreatmentmethods:producersandholdersof reduce wastegenerationatthesource,EnvironmentalCode a thirdparty(Art.L.541-2). Above andbeyondtheobligationto until thewaste’s elimination,orrecyclingevenwhentransferredto Waste managementisadutyofwasteproducersandholders 3.4 L.541-40 etseq.andR.541-62). prerogatives ofFrenchauthoritiesandapplicablesanctions(Art. supplements EURegulation1013/2006withrulesspecifyingthe seq.). As regardsthecross-bordershipmentofwaste,Frenchlaw and R.543-228etseq.)orPCB-containingwaste(Art.R.543-17 waste resultingfromdangerouschemicalproducts(Art.L.541-10-4 qualifies asawastestoragefacilityandispermittedaccordingly. et seq.),householdwastederivingfrom chemical products(Art. disappears)? produced? regarding thetake-backandrecoveryoftheirwaste? the transferee/ultimatedisposergoesbankrupt/ another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore To whatextentdowasteproducershaveobligations inter alia per seisnotpermissibleunlessthesiteitself , tocertainprintedmaterials, WEEE, et seq.). WWW.ICLG.COM

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97 France 98 France abnormal private nuisanceaction,athirdpartymay obtainredress are dulypermittedandperformed compliantly. Basedonan or materialdamagecausedbytheir activitiesevenwhere Consequently, operatorsremainliableforanypollutionorphysical are grantedsubjecttotherights of thirdparties(Art.L.514-19). In principle,undertheICPEregime, authorisationsandregistrations 4.2 ■ ■ ■ ■ following liabilities: Breach ofenvironmentallawsand/orpermitsmaycarrythe 4.1 David Desforges © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 4 what defencesaretypicallyavailable? within permitlimits? the damageoccurredpriorto30 April 2007. L.162-23). This regimedoes notapplywhereeventscausing technical knowledgeatthetimedamageoccurred(Art. environmental damageunderthestateofscientificand emission oractivitywasnotconsideredlikelytocause ‘state oftheart’ defence isavailabletooperatorswherean may alsobeimposedandenforcedbypublicauthorities. A necessary preventionorremedialmeasures.Suchmeasures (iv) ecologicalservices.Operatorsarerequiredtotake protected underEuropeanBirdsandHabitatsDirectives;or human health;(ii)water;(iii)speciesandnaturalhabitats where contaminationcreatesasignificantriskofharming deterioration occursdirectlyorindirectlyandaffects: (i)land applies onlywhereseriousandmeasurableenvironmental 2008 (Art.L.161-1etseq.andR.161-1). This regime regime fordirectharmtotheenvironmentisinforcesince In linewithDirective2004/35/EC,anenvironmentalliability 5.5 below). Sanctions includefinesand/orimprisonment(seequestion the actionandseekdamages( may movetoinstituteproceedings. Victims mayalsojoinin question 2.4above). The publicprosecutoraswellvictims provide forcriminalsanctions(Art.L.173-1 instance, basedonspecificenvironmentallawswhich life (CriminalCode, Art. 223-1 criminal grounds,suchasendangeringaperson’s healthor Criminal liability:prosecutioncanbesoughtongeneral (Construction andHousingCode, Art. L.112-16). nature ofthenuisancecaused,subjecttocertainlimitations Code, Art. 544)wherebyclaimantsmustshowtheabnormal private nuisance’ basis( permit, anoperatormayalsobelookedafteron‘abnormal court inFrance.Intheabsenceofanyviolationlawor victim. These arebenchtrialsonlyasnojuriessitincivil liable partyprovescontributorynegligenceonthepartof damage andacausation.Indemnitiesarereducedwherethe (Art. 1240etseq.).Claimantsmustshowwrongfulconduct, person maybeheldliablefordamagescausedtothirdparties Civil liability(tort):pursuanttotheFrenchCode,a be challengedbeforeadministrativecourts. well ascriminalprosecution. Administrative sanctionsmay notices mayentailsanctions(permitsuspension,fine,etc.)as operate bywayofformalnotices.Non-compliancewith although administrativeactionismeanttobeofficial andto authorities mayoccasionallyactbywayofreminders, administrative sanctions(seequestion2.4above). The non-compliance withlawsorpermittermsmaycarry Regulatory liability(responsibility Liabilities notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa trouble anormaldevoisinage constitution departiecivile et seq.and221-6)for vis-à-vis theauthorities): et seq.)(see ) (Civil ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

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(see question11.1 below). covering damagecausedtothirdpartiesviaenvironmentalharm Furthermore, legalentitiesthemselvesmaytakeoutinsurance parties, exceptdamagescauseddirectlytotheenvironment. on behalfoftheirD&Os.Itcoversalldamagesincurredbythird ‘Directors CivilLiabilityInsurance’ maybetakenoutbycompanies normal performanceofcorporateduties’. An an intentionalandparticularlyseriousfault,incompatiblewiththe (i.e., theexistenceofwrongdoing bear thesomewhatdifficult burdenofprovingD&Os’ directliability Practically, actingagainstacompanyispreferredwayasclaimants or (ii)theshareholdersonbehalfofcompany. victims. Suchproceedingsmaybeintroducedby(i)thecompany, company’s liabilityresultedindamagesbeingpaidtothird-party violation ofstatutes,lawsorregulationsgroundswherethe towards theiremployermayalsobesoughtonmismanagement, criminal offence alsoconstitutesaciviltort.D&Os’ civilliability Liability mayresultdirectlyfromtheircriminalactswherethe abnormality ofthenuisancesuffered (seequestion4.1above). against acompliantoperatorifitsuccessfullydemonstratesthe several grounds,providedtheirwrongdoingdamagedthirdparties. D&Os mayalsobeheldcivillyliable,directlyorindirectly, on grounds, althoughitsdirectordidnotactwithduediligence. regulation. Yet, acompanymayalonebeconvictedonpollution found simultaneouslyliableforthebreachofanenvironmental procedures). Bothacompanyanditsdirectormaythereforebe the exclusionofcompanyfrompublicprocurementtender sanctions mayalsobeimposed( may beincreasedfivefold(seequestion2.4above)whileadditional their behalfbyrepresentativesorbodies.Insuchcase,fines may alsobefoundcriminallyliableforalloffences committedon intent tocausethedamage.Furthermore,since2004,companies insurable totheextentoffender candemonstratetheabsenceof regulations providingforcriminalsanctions.Suchliabilityis D&Os’ criminalliabilitymaybesoughtforbreachofenvironmental liable, eithercriminallyorcivilly, forenvironmentalwrongdoing. Directors andofficers (D&Os),aswelllegalentities,maybeheld 4.3 unless theauthorities areawareofapartialasset contribution by themeretransferofassetsand the transferorwillremainliable, the permitstayswithtransferor, theauthorities will notbebound operator declarationisfiledbythe transferee. Where thebenefit of In assettransfers,theissuerests on whetherornotachangeof L.516-1 etseq.). guarantees inlinewiththecredentials ofthenewshareholding(Art. the authoritiesmayrequiremodificationofamountsuch limited) wheninvolvingactivitiessubjecttofinancialguarantees,as question. Notealsothatsharedealsmayhaveconsequences(albeit environmental liabilitiesthereforeremainwiththeentityin reflected incaselawandmostacademicsconcur. Inthatcase, purchase doesnottranslateintoachangeofoperator. This is on tothepurchaser. Fromtheauthorities’ perspective,ashare In sharepurchases,existingandlatentenvironmentalliabilitiespass 4.4 indemnity protectioninrespectofsuchliabilities? the onehandandanassetpurchaseonother? to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman e.g., closureoftheestablishmentor faute détachable ad hocpolicynamed ) ‘intheformof

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Methodology, April 2017;MinisterialNoteof19 April 2017). Ministry ofEcology(NationalPolluted SitesandSoilsManagement provisions arebackedbyguidelines recentlyupdatedandissuedbythe methodological standpoint,applicable statutoryandregulatory sécurité This includesatwo-phaseapproach ofsurfacemeasures( L.512-6-1, L.512-7-6,andL.512-12-1)(seequestion5.3below). environmentally safeinaccordancewithitsfutureintendeduse(Art. permanently shuttingdownanactivitymustmakethesite nutshell, thematterisgovernedbyprinciplewherebyanoperator dealt withintheframeworkofregisteredinstallationsregime.Ina In mostcases,however, soilandgroundwaterpollutionmattersare ■ ■ ■ Persons liableforsoilcontaminationareprioritisedasfollows: question 8.3below). Code, Art. L.511-35; CommerceCode, Art. L.225-102-1)(see documented intheiraccountingdocuments(MonetaryandFinancial and theirsustainabledevelopment-orientedactionmustnowbe accountable, astheenvironmentalconsequencesoftheiractivities Note finallythatcreditinstitutionsmaybecomeincreasingly successfully demonstrated. found liablewheretheirdirectcontroloverapollutingentityis Under commerciallawprinciples,lendersmayneverthelessbe L.512-17; CommerceCode( required astheresultoftheirbankruptsubsidiaries’ activities(Art. found liableandcalledupontofinanceremediationundertakings liable. Incertainlimitedcircumstances,parentcompaniesmaybe As ageneralrule,lendersfinancingpollutingactivitiesarenot 4.5 conducted theactivitiesinquestion. change ofactivities,contaminationsattachtotheentity(ies)having pass ontohim(providedthesameactivityispursued).Incaseof of operator(seequestion2.1above),existingandlatentliabilities Chimie, 02LY01929). Where thetransfereeeffectuates thechange Administrative Courtof Appeals ofLyon, 6July2006, agreement governedbythelegalregimeforspin-offs ( David Desforges ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 necessary worksattheexpenseofresponsibleparty(Art.L.556-3). public authoritiesareentitled,afterformalnotice,tocarryoutthe is recent. Where soilcontaminationisoccurringorthreatened, Autonomous legislationandregulationrelatingtosoilcontamination 5.1 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 5 person wasnegligentorotherwiseinvolvedinthepollution. polluted bytheactivityorwaste,ifitisdeterminedthatthis per theabove,liablepartyisownerofland on asubsidiarybasis,intheabsenceofanyliablepersonas pollution; or waste producerorholderwhocontributedtothe where thepollutionhasothercauses,liablepartyis any thirdpartyofficially substitutedtosuchoperator); to thetitleoperator(or, inthecaseofregisteredinstallations, installation, or(iii)anuclearfacility(INB),liabilityattaches listed in Appendix IIIDirective2004/35/EC,(ii)aregistered where thepollutionoriginatesfrom(i)oneofactivities groundwater? environmental wrongdoingand/orremediationcosts? Contaminated Land To whatextentmaylendersbeliablefor What istheapproachtoliabilityforcontamination (including historiccontamination)ofsoilor ), andintrusiveones( remise enétat ), Art. L.233-5-1). Code decommerce), Art. ), whereneeded.Froma

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apply tohistoriccontamination,wherethedamagingeventoccurred operators, whicharebroadlydefined(Art.L.160-1),butdoesnot human healthandseriousdamagetowater. This regimetargets applies tocontaminatedlandcreatingasignificantriskofharm Lastly, theenvironmentalliabilityregimeofDirective2004/35/EC of thesite(Art.R.515-75). R.515-81). This reportshallserveasabenchmarkupontheclosure examination ofthesite’s permit(Art.L.515-30,R.515-59,and conditions priortocommissioningtheinstallationorre- be establishedbytheoperatordescribingsoilandgroundwater accommodate IEDprinciples.Forthesesites,abaselinereportmust The aboveprinciplesandprovisionswererecentlyamendedto facility (Art.L.512-18andR.512-44°). upon thefilingofanapplicationforasubstantialmodification operators ofcertainsitestoissueaninterimsoilconditionreport the regimehasfurtherbeensupplementedwithanobligationfor polluted sites(Art.L.515-12andR.515-31-1 impose landuserestrictions( notified orknowntotheauthorities. The authoritiesmayalso a periodnotexceeding30yearsfromthedatewhenclosurewas last operatorthefinancialconsequencesofsite’s remediationfor In thecontextofasiteclosure,authoritiesmayimposeupon such failure. possibility ofdamagesbeingawardedtothirdparties’ victimsof obligations alsoqualifiesasaciviltortandconsequentlyentailsthe indicates thatfailureforanoperatortocomplywithsuchregulatory where thesiteislocated).Importantlyalso,controllingcaselaw established jointlywiththelandownerandmayoroflocality risk-based andfactorsintheintendedfutureuseofsite(as The authoritiesadoptapragmaticapproachwherebyremediationis condition. buildings northerestorationofsiteintoahypotheticaloriginal purchaser. Remediationdutiesneitherentailthedemolitionof the saleoflanddoesnottransferremediationliabilitiesto his beingthelandownerornot. Where theoperatorislandowner, Liability forremediationattachestothetitleoperatorirrespectiveof May 2011). L.541-3 caused bytheiroperations( ordinarily responsibleforsoilandgroundwatercontamination Under theregisteredinstallationsregime,siteoperatorsare 5.2 l’Energie via the ADEME (Agencedel’Environnement etdelaMaîtrise qualifies asan‘orphan’ site.RemediationisthenbornebytheState Finally, wheretheliablepersonisunknownorinsolvent,site ceased definitivelybeforethatdate(Art.L.161-5). before 30 April 2007orwhereitresultsfromanactivityhaving of liabilitiesbetweenthelast/current operatorandtheformer In practice,publicauthoritiesare reluctant toaccepttheallocation the previousone,thusleaving previous oneoff thehook. of breakingthischainliabilityis foranewoperatortosubstitute activities takenover. Fromaregulatory perspective,thesolemeans by hispredecessors,providedsuchcontaminationresultsfromthe contamination whichhecaused,aswelltocaused authorities regardlessofalandsale. This liabilityextendsto its finalclosure,thelastoperatorremainsliable a givenactivity). Where acontamination isfoundatasitefollowing is responsibleforthecontamination? How isliabilityallocatedwheremorethanoneperson in fine ), anagencyoftheMinistryEcology(Art.L.131-3,

, andL.556-1; Administrative CircularLetterof26 i.e. wherecontaminationistraceableto servitudes d’utilitépublique WWW.ICLG.COM et seq.).Notealsothat vis-à-vis the France ) on

99 France 100 France proposals basedontheirassessmentofthesite’s condition. landowner, mayor),theoperatorsissuetechnicalremediation between stakeholdersregardingthefutureintendeduse(operator, authorities. Although anagreement(orrather, anapproval)issought Remediation isnotagreed 5.3 the damageoritsimminentthreat(Art.L.162-18). the operatorsinaccordancewithcontributionoftheiractivityto remediation costsareallocatedbyadministrativeauthoritiesamong 2004/35/EC, andwheremultiplepartiesareinvolved,preventionor Finally, undertheenvironmentalliabilityregimeofDirective (Civil Code, Art. 1240and1242). for thepollutionorbasedontheirhavingcustodyofproperty held liabletothirdpartiesundertheCivilCodeeitherifresponsible derived fromcaselaw. Landownersofpollutedsitesmayalsobe regime (seequestion5.1above)inlinewithwastelawprinciples Landowners mayalsobeheldliableunderthenewsoil-specific inability ofthewasteproducertomanageitlawfully. have knownofthepresencewasteonhispropertyand unknown, orwhereitisdemonstratedthatthelandownershould dumped attheirsiteandwherethewasteproducerorholderare for remediationunderwastelawsifnegligentinrespectof pursuant tothisregime.Landownersmay, however, beheld liable have actedasoperatorsorsuccessorstobereached remediation undertheregisteredinstallationsregime. They must Landowners, inthatsolecapacity, cannotbeheldliablefor regulatory powers(seequestion8.1below). nevertheless berememberedthatsuchagreementsdonotoverride operators asregardsthefinancingofremediationefforts. Itmust Again, thisdoesnotprecludecontractualarrangementsbetween remediation obligations. to theauthorities,andhence,bydefault,soledebtorof damaging fortheformeroperatorasheremainsonlyoneknown authorities. Hence,failuretonotifythechangeofoperatorcanbe former operatorisreleasedfromanyliabilityatthesite L.181-15, R.181-48,andR.512-68)(seequestion2.1above),the However, incaseofanotifiedchangeoperatoratsite(Art. operator(s). prior operatormayalwayshaverecourseagainsttheprevious The rationaleofthisapproachisthat,ifnotso,themostrecent though different activitieshavebeencarriedoutatthesiteovertime. that thenewoperatorisliableforallcontaminationsatsite,even activities, theauthoritieswilltendtoconsider–outofexpediency new operatortakesoverasitealongwithallorpartoftheexisting operator basedtheirrespectiveactivities.Consequently, wherea David Desforges © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM required bysuchnew usemaynotbeimposedupon the lastoperator Where theuseofsiteissubsequently modified,additionalworks 39-4, R.512-46-28,andR.512-66-2) (seequestion5.1above). last operatorwithintheaforementioned 30-yearperiod(Art.R.512- environment, theauthoritiesmayrequire additionalworksfromthe authorities. Ifandwherewarranted byapatentneedtoprotectthe and R.512-46-27-III).Nowaiver orreleaseisissuedbythe remediation orderisrecordedbytheauthorities(Art.R.512-39-3-III Upon completionofremediationobligations,compliancewiththe be challengedbythirdpartiesbeforetheadministrativecourts. agreement. This administrative decision(anorderofthe obligations qualifiesasaunilateraladministrativedecision,notan Eventually, theremediationorderlayingdown can athirdpartychallengetheagreement? regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis per sebetweenoperatorsandthe vis-à-vis the préfet

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

) can

the operator compliedwiththeadministrativerequirementsimposedby also beenheldtoconstituteaciviltort,evenincaseswherethelast administrative sanctionsandmaybecriminallyprosecuted.Ithas remediation obligationssetbyapreviousoperatorcarries landowner. As indicatedabove,non-compliancewithregulatory proceedings onpollutiongroundsagainsttheformeroperatoror There isnostatutorybartoasiteoperatorcommencingcivil recognised environmentalNGOs. the damage). Any aggrievedthirdpartymaybasicallyact,including site (id., Art. 1242)(whichimpliesacontrolovertheassetcausing 1240) (whichimpliesfaultornegligence),asthecustodianof either asthepartyhavingcausedcontamination(CivilCode, Art. The owneroroperatorofasitecanbeheldliabletothirdparties, 5.4 the remediationcosts ortoreimbursethemwherepublic authorities to environmentaldamage The environmentalliabilityregime ofDirective2004/35/ECapplies environment, landscape,habitat,fauna, flora,etc. specifically aesthetic)prejudiceas aresultofharmcausedtothe for commercial,reputational(including aesthetic)andmoral(not expenses incurredtorespondactsofpollutionandclaimdamages The governmentorotherpublicauthoritiesmayseektherefundof 5.5 insufficient (Art.L.512-21and R.512-76 remediation obligationsandshouldthefinancialguaranteesbe hook shouldsuch‘interestedthirdparty’ failtocomplywith financial guarantees.However, thelastoperatorremainson order todoso,theso-called‘interestedthirdparty’ mustprovide particular), thusrelievingthelastoperatorofhisobligations.In operator andbearlastoperator’s obligations(remediationin developer) maynowapplytotheauthoritiessubstitutelast Finally, atthetimeofasiteclosure,thirdparty(usuallyland that pointonwards,alloftheobligationsattachingtosuchstatus). the remediationorwillfileforoperatorstatus(andthusbear, from provide thatthepurchaserwillbearfinancialconsequencesof contracts mayfreelyallocateburden-sharingissuesand transferring regulatoryobligationstothepurchaser, partiestosuch often reliedupon(Art.L.514-20)(seequestion7.3below).Shortof registered installationssubjecttoauthorisationorregistrationisalso information dutyimposedonsellersoflandhavinghosted against hiddendefects(Art.1641). The violationofthestatutory a compliantgood(Art.1603and1604);orbreachofthewarranty misrepresentation ( against theselleronavarietyofCivilCodegrounds:fraudulent In acontractsetting,thepurchaserofcontaminatedlandmayact 11/08231). (Art. L.556-1andR.556-1etseq.). implemented accordinglyandcertifiedbyaqualifiedconsultant of thesite,additionalpollutionmanagementmeasuresmustbe rehabilitation ofthesite,landownercontemplatesadifferent use unless heinitiatedsuchmodification.If,aftertheinitial préfet contaminated landliabilitytoapurchaser? public assets,e.g.rivers? possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma ( see Courtof Appeals of Versailles, 6September2012,no. dol) (Art.1137); violationofthedutytodeliver per se. The operatorisrequiredtobear et seq.).

France

remains unusual(Art. R.123-15). may alsobeconductedduringthe publicinquiry, althoughthis the dangersofactivitiesapplied for(Art.R.512-7).Sitevisits may, forexample, requirethird-partyexpertworkwherejustifiedby documentation (Art.R.512-6 operation ofregisteredinstallations, andinadditiontotherequired In thecourseofenvironmental permitapplicationforthe (Art. L.171-2). shall havetobeapprovedbythelocal Should theoperatorrefusetograntaccesspremises,visits been drawnupandcountersignedbytheoperator(Art.L.171-3). necessary information,andtotakeawaydocuments,afteralisthas (with orwithoutpriornotice)(Art.L.171-1 departments (Art.L.172-1). They areentitledtovisitinstallations gendarmerie) andofficials ofothermore specialisedadministrative L.162-17 or otherpersonshavetakenmeasuresinlieuoftheoperator(Art. David Desforges ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 in theDREAL inspectorsbutalsoinsworn-inofficers ( environmental regulatorsaresignificant. These arenotonlyvested As farastheoversightofactivitiesisconcerned,powers and R.162-2). occupational premisesandinstallations(Art.L.162-13,R.165-22°, any necessaryinformationordocumentsandmayaccessthe damage, competentpublicauthoritiesmayrequiretheproductionof of Directive2004/35/EC,andincaseimminentriskoractual Under thegeneralframeworkofenvironmentalliabilityregime 6.1 the environmentbyhumans. to elementsandfunctionsofecosystemsbenefitsdrawnfrom harm inandofitself( 1999) hasruledonthepossibilitytocompensateenvironmental recent caselaw(relatingtothe‘Erika’ shipwreckinDecember result oftheviolationenvironmentallaw(Art.L.142-4).Finally, entitled toclaimdamagesforharmcausedtheirterritoryasa remediation, preferably governments aswellallinterestedpartiesmayseekthe Civil Code(Art.1246to1252).Onthisbasis,theState,local Note finallythatthenotionofecologicalprejudicenowsitsin seek damagesinreimbursementofexpensesactuallyincurred. join incriminalactions,wheresuchactionshavebeeninitiated,to reimbursed byresponsibleparties.Suchpublicentitiesmayalso L.541-6), ortowaterresources(Art.L.211-5), areentitledtobe registered installation(Art.L.514-16)orwastemanagement attenuate damageresultingfromanincidentoraccidentcausedbya More generally, publicentities(Stateorlocal)interveningto offence (seeCass.Crim.,25September2012,no.10-82.938). damage causedtotheenvironmentandresultingfromacriminal harm shouldbeindemnifiedanddefineditasadirectorindirect the samematter, the de GrandeInstanceParis,16January2008,no.9934895010).In Court of Appeals ofParis,30March2010,no.RG08/02278; human interest,butimpactingalegitimatecollectiveinterest( interaction betweennaturalelements),notaffecting anyparticular autonomous harmtothenaturalenvironment(including environmental harmsuffered, itbeingdefinedasanobjectiveand In thiscase,localgovernmentsweregranteddamagesonthebasisof case inthepast,asmoralprejudice. © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 6 conduct siteinspections,interviewemployees,etc.? Powers ofRegulators What powersdoenvironmentalregulatorshaveto require productionofdocuments,takesamples, et seq.).Underthisregime,localgovernmentsarealso Cour deCassationconfirmedthatenvironmental préjudice écologique in rem, fornon-negligibleprejudicecaused et seq.),environmentalregulators Tribunal deGrandeInstance ) andnot,aswasoftenthe et seq.),tocollectthe Tribunal

police

see ,

31). information initiallyprovided(Art.R.181-45,R.512-28,andR.512- authorities mayrequestadditionalinformation,ortheupdatingof standard practice.Ontheother, atanytimeduringoperations,the to providemonitoringresultsandexplainoff-specification resultsis one hand,inthecourseofoperationanactivity, theobligations environmental regulatorsseldomtakesamplesthemselves.Onthe As amatterofpractice,unlessatcriminalinvestigationstage, country allrelevantrisk-relatedinformation(Art.R.515-85). authorities mustprovidetotheofthatneighbouring site islikelytohaveanimpactonaneighbouringcountry, public Finally, whereitisassessedthatanaccidentinvolvinga‘Seveso3’ and R.515-89). all relevantrisk-relatedinformation(Art.L.515-38, Art. R.515-88, operators mustprovidetoneighbouringsites,aswellneighbours, The sameappliesto‘Seveso3’ sites(Art.L.515-32 have explicitreportingobligationsincaseofaccident. (Code delasécuritéintérieure (plan particulierd’intervention of dangerousindustrialsitescoveredbyaspecificemergency plan Although thesedonotspecificallyapplytopollution,theoperators conservation (Art.L.211-5). water lawregimeandappliestoalleventslikelyimpact such measuresupondemand. A similarprovisionalsoexistsinthe seek prioradministrativeapproval,andtosubsequentlydocument measures (investigation,containment,remediation)withnoneedto cases, itisalsoadvisabletoimmediatelytakeallnecessary is evidencedorlikely, itisadvisabletoreportthematter. Inall safe approachwillbetoconsiderthat,assoonoff-site migration whether historicalpollutionqualifiesasanincidentoraccident. A without delay(Art.R.512-69). The issuewiththisprovisionisoften environment orpublichealth,theoperatormustreportmatter resulting fromtheoperationofasiteandlikelytoendanger Now, undertheICPEregime,ineventofanaccidentorincident have tobenotifiedtheauthorities. of voluntarysoiland/orgroundwatersamplingsdonotnecessarily Contrary tosomeotherEuropeanjurisdictions,notethattheresults and takeallappropriatemeasures(Art.L.162-4). under thedutytoimmediatelyinformauthoritiesofdamage Under thegeneralenvironmentalliabilityregime,operatoris 7.1 operations, and if warrantedunderthecircumstances, soiland investigations. At thisstagealso,orsubsequently inthecourseof does nottranslateintoadutytocarry outintrusivesamplingand condition oftheland(Art.R.512-8-II-1°). However, thisobligation study (seequestion2.3above)must includeachapterrelatingtothe permit (seequestion5.1above). At the application stage,theimpact This mayoccurpriortoandafterthegrantingofanenvironmental The circumstancespromptingsuchanobligationremainisolated. 7.2 7 parties? contamination? Reporting /DisclosureObligations environmental regulatororpotentiallyaffectedthird migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson ); Art. L.741-6andR.741-21etseq.) orPPI)(HomelandSecurityCode WWW.ICLG.COM et seq.)whose France

101 France 102 France Whether inthecontext ofanassetdealorasharedeal, contractual 8.1 Civil Code. Where silenceonthepartofsellerisfraudulent( should bedisclosedisgovernedbycontractslawpursuanttothe In sharedeals,theissueofwhetherornotenvironmentalproblems Asset dealsinvolvinglandandsharemustbedistinguished. 7.3 submitted tothe each timeactivitiesundergo notablechanges. This updateis subject tofinancialguaranteesmustprovideasoilstatusupdate In thecourseofoperationasite,operatorsinstallations L.512-20, andR.512-31). groundwater investigationscanbeordered(Art.R.181-45,L.512-3, David Desforges © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM discovery ofthepollution(Art.L.514-20§3). or itsremediationbythesellerwithinatwo-yearperiodfrom may seektherescissionofsale,areductionpurchaseprice, makes landunfitfortheusespecifiedincontract,purchaser 4 March2008,SA Citadis,no.06/00516).Finally, wherepollution documented online–isnodefence( existence ofregisteredinstallationsinthepast–whichismostoften an obligationtoconductintrusiveinvestigations.Ignoranceofthe gathering information. This dutydoesnotexplicitlytranslateinto L.514-20) (seequestion5.4above). The dutyofthesellerisone from theiroperationprovidedtheseareknowntotheseller(Art. past operationofsuchinstallations,and(ii)therisksresulting the past,sellermustinformpurchaserinwriting(i)of hosted registeredinstallationssubjecttoanenvironmentalpermitin In thecontextofanassetdealinvolvingsaleaplothaving Appeals ofDouai,19May2011, no.10/04289). risk ofpollutionrelatingtothefacilityinvolved( the purchaserisaprofessional,hemaybeconsideredawareof purchaser alsohasadutytogatherinformation.Inparticular, where Art. 1130). The purchasermaythenclaimdamages.However, the formation ofthecontractandisgroundsforannulment(CivilCode, (see question5.4above),suchpracticeconstitutesadefencetothe survey toassesstheland’s fitnessforuse(Art.L.556-2). construction orsubdivisionprojectswillrequireamandatorysoil polluted zones)(Art.L.125-6,L.125-7,andR.125-23 Finally, in‘soilinformationsectors’ ( 66-2). measures (Art.R.512-39-3,R.512-46-27,R.512-66-1,andR.512- investigated soilandgroundwaterpollutionproposedremedial complied withswiftly, withthesubmissionofareportdetailing obligation toinvestigatesoil(andgroundwater)contaminationis It ishoweveressential,atthetimeofasiteclosure,that include saidsoilupdateaswell(Art.R.512-44°). changes qualifyassubstantial,thefilingrequiredtherewithmust pertaining toplotshostingsuchinstallations( 18). This documentistobeappendedanypromiseordeedofsale 8 potential liabilityforthatmatter? takeover transactions? General matter (e.g.remediation)discharge theindemnifier’s another personunderanindemnity inrespectofa related liabilities,anddoesmaking apaymentto limit exposureforactualorpotential environment- prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto Is itpossibletouseanenvironmentalindemnity To whatextentisitnecessarytodisclose préfet , themayor, andthesiteowner(Art.L.512- see Courtof Appeals ofNîmes, i.e., officially inventoried id.). Where such

see Courtof

et seq.), ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

dol)

questions 4.5aboveand8.3below). be calledupontobearallorpartoftheremediationcosts(see a registeredinstallationfilesforbankruptcy, theparentcompanymay certain narrowlyframedcircumstances,whereasubsidiaryoperating a subsidiaryfromextendingtoitsparentcompany. However, in ‘autonomy oflegalentities’ preventsthenotionof‘titleoperator’ of considered fraudulent.Notefurtherthatthebroadconceptof purposes ofdodgingenvironmentalliabilitiesismostlikelytobe circumstances andonvalidgrounds.Dissolvingacompanyfor Under companylaw, acompanymayonlybedissolvedinspecific 8.2 préfet employee andemployer, theformermayreport mattertothe L.4133-1 Code, Art. products orprocessesusedcarried outintheworkplace(Labour with respecttothepotentialhealth or environmentalriskentailedby individual may, ingoodfaith,raisewiththeemployeranyconcern Since 2013,theLabourCode( 8.4 2001, 97DA01643). breaches oflawordamagescausedbyacompany/subsidiary. In principle,shareholdersandparentcompaniesarenotliablefor 8.3 obligations tocleanuporlawfullytreat/disposeofwaste. fully discharge theoperator/wasteproduceroftheirregulatory applies tolandsalesorwastetransfercontracts,neitherofwhich qualifies asthelastoperator(seequestion5.4above). The same enforcement actionswherethebeneficiaryofindemnity operator, anindemnityclausemaynotberaisedasadefenceto Indeed, asregulatoryremediationobligationsattachtothelast their effect maybelimited. parties. As farasadministrativeenforcementactionisconcerned, environmental indemnitiesarelawfulandenforceablebetweenthe liabilities ( control ofthesubsidiaryandeventuallyagreedtobearremediation contractual relationships,itwasshownthattheparentcompanyhad be admissibleagainstaparentcompanywhere,incomplexsetof Finally, inanisolatedoccurrence,administrativeactionwasheldto subsidiary (Art.L.512-17;CommerceCode, Art. L.233-5-1). a faulthavingcontributedtotheinsufficiency oftheassets an operator)wherethelatterisinsolventandithascommitted part oftheremediationcostsincurredbyoneitssubsidiaries(as Further, aparent companymayberequiredbyacourttobearallor question 4.1above). 2). This maythereforeextendliabilitytoaparentcompany(see that whichhas‘effective control’ overthatoperator (Art.L.160-1§ the notionof‘operator’ includesnotonlythetitleoperatorbutalso Under theenvironmentalliabilityregimeofDirective2004/35/EC, However, incertain circumstances,thisprinciplemaygivein. , Art. L.4133-3). (id.,Art. order toescapeenvironmentalliabilities? report environmentalviolations/matters? caused byaforeignsubsidiary/affiliate? balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff Are thereanylawstoprotect“whistle-blowers”who company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld see Administrative Courtof Appeals ofDouai,26July et seq.).Incaseofdisagreementbetween Code dutravail

) providesthatany France

or thecessationofviolationscausingprejudices,both. Such classactionsmaypursuedamagesforbodilyormaterialharm, the damageiscausedbypublicauthoritiesorserviceentities. of thefinancialharmsuffered. incurred asrightfulclaimantsinfurtheranceoftheirpurpose,part practice forthemtoclaimthereimbursementoflegalcosts exemption fromliabilitytopaycosts.However, itiscommon Environmental associationsdonotbenefitfromanyspecific them toanotherparty(CivilProcedureCode, Art. 696). (dépens), exceptwherethecourtdecidestocharge allorpartof In civilproceedings,thelosingpartymustinprinciplepaycosts party condemnedisalegalentity, itischarged withlegalcosts. Damages arelimitedtotheactualmeasureofvictim’s prejudice. Exemplary orpunitivedamagesarenotavailableinFrance. question 5.5above)maynotbeindemnifiedviasuchaclassaction. Civil Codeasecologicalprejudice(CivilCode, Art. 1247)(see However, non-negligible harmtotheenvironmentdefinedin Justice Code( move ofapartyforindemnification( paid forbytheState.However, wherethecourtconsidersthat Procedure Code( abusive ordilatory, expertfeesmaybecharged tothatparty(Criminal civile before civilcourts(CivilProcedureCode( Environmental associationsmayinitiateclassactionproceedings environment, etc.). nuisances, nuclearsafety, commercialpracticesimpactingthe areas inrelationtotheenvironment(water, air, ,pollutionsand Such classactionsapplytoprejudicearisinginawidevarietyof obligations (Art.L.142-3-1andIV). from thefailureofapersontoabidebyitsstatutoryorcontractual acting onbehalfofvictimsplacedinsimilarsituationsresulting are narrowlyframedandlimitedtoenvironmentalassociationsonly November 2016onthemodernisationofjusticesystem. They Environmental classactionshavebeeninstitutedbythelawof18 Class actionsarearelativelynewfeatureofFrenchlaw. 8.5 Code (PHC)(delasantépublique identified inthecourseoftheirprofessionalduties(PublicHealth authorities alike–factsrelatingtohealthorenvironmentalhazards revealed ingoodfaith–toemployer, orjudicial,administrative or disciplinarysanctionsinstitutedonthegroundsofhaving Whistle-blowers arefurtherprotectedfromdiscriminatorypractices David Desforges ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 Directive 2008/101/EC hasbeentransposedintoFrench law(Art. The EUEmissions Trading Directive(ETS)asamended by 9.1 In criminalproceedings,legalcosts( 8.6 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 9 ), Art. 826-2)orbeforeadministrativecourts(Administrative damages available? market developingthere? pursuing environmentallitigation? Emissions Trading andClimateChange environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing your jurisdictionandhowisthe emissionstrading What emissionstradingschemes areinoperation Do individualsorpublicinterestgroupsbenefitfrom any exemptionfromliabilitytopaycostswhen Code dejusticeadministrative Code deprocédure pénale constitution departiecivile frais dejustice ), Art. L.1351-1 ), Art. ), Art. 800-1). Where the ), Art. R.77-10-1)when Code deprocedure ) areinprinciple et seq.).

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health, andenvironmental governance. transportation, townandcountry planning,biodiversity, waste, relation toenergy efficiency ofbuildings,energy production, consumption to23%by2020and setaseriesofobjectivesin increase theshareofrenewableenergies inthecountry’s domestic legislation (2010)affirmed andlaiddownFrance’s commitmentto The so-called‘Grenelle1’ frameworklaw(2009)and‘Grenelle2’ adopted. commencement, withambitiouslawsandregulationshavingbeen (vs. 1990levels). This policyhas considerablyexpandedsinceits other year, withthetarget ofcuttingGHGemissions by42050 Programme ( flexible mechanismsoftheKyotoProtocol,a2004–2012Climate adopting legislationimplementingtheEUETSschemeand The approachismultifacetedandheavilyregulated.Inadditionto 9.3 R.225-105 II A. 2°(d)). must alsomentiontheirGHGemissions(CommerceCode, Art. Pursuant tocompanylaw, theannualreportofcertaincompanies resulting fromtheiruseofelectricity, heat,orvapor). must listdirectandindirectemissions( the latter(Art.L.229-25andR.229-46 be updatedeveryfouryearsfortheformer, andeverythreeyearsfor establish greenhousegas(GHG)emissionsinventorieswhichmust public entitieswithmorethan250employees,ontheother, must State, localitieswithapopulationinexcessof50,000andother Companies withmorethan500employees,ontheonehand,and Obligations inthisrespecthaveexpandedrecentyears. 9.2 L.229-5 with theParisClimate Agreement ( Commission legislatestoaligntheEU’s currentemissionstargets EUR 25.00–30.00by2021,and55.002030iftheEU the currentEUR24.00/ton(January2019). A 2018reportforesaw ton ofcarbonhasrisenfromtheMay2017lowEUR4.38/tonto now tradedessentiallyontheLondonmarketplace. The priceofa It permanentlyclosedinDecember2012.EUCO2allowancesare of 26 April 2018). environmental tradingexchange,wasfoundedinDecember2007. BlueNext, aNyseEuronex-CaissedesDépôtsEuropean European registry(Art.R.229-34). Dépôts etConsignations(CDC)isthenationaladministratorof et financier behalf oftheirclients)(MonetaryandFinancialCode( authorising biddersonthismarket(financialinstitutionsacting Markets andPrudentialSupervisory Authorities areincharge of As regardstheauctioningofallowances,FrenchFinancial the clock’ Decision377/2013/EUof24 April 2013). the issueofinternationalflightstoandfromEurope(so-called‘stop limited tointra-EUflightsonly, pendinganinternationaldecisionon concerned, theschemewaspartlysuspendedfrom2013tobe of allowancesnotallocatedfreecharge. As farasairtransportis the ETSregimeandtointroduceprincipleofauctioningthatpart scheme wasamendedtobroadenthescopeofactivitiessubject 2009/29/EU relatingtotheEUETS’s thirdperiod(2013–2020),the regulation inyourjurisdiction? to monitorandreportgreenhousegasemissions? What istheoverallpolicyapproachtoclimatechange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned et seq.andR.229-5).FurthertoDirective ), Art. L.621-18-5andL.613-70). The French Plan Climat ) wasinitiatedin2004,andrevisedevery

Source: Carbon Tracker Report et seq.). These inventories i.e., forthelatter, those WWW.ICLG.COM code monétaire France Caisse des

103 France 104 France civil servantsand independentcontractorsalike. victims whichbenefitemployees but remainunavailabletomost the unequalaccesstopre-retirement schemesafforded toasbestos observed thattheabovedifficulties hadpersisted.Itfurtherstressed February 2014,inanewreporton the matter, the asbestos claims,topreventheterogenous rulingsnationwide.In also advocatedthatone Appeals Court bedesignatedtohear to driveindemnificationproceduresfromthecourtsFIVA. It FIVA. ItsuggestedthatFIVA indemnificationamountsbeincreased damages wereawardedongrossnegligencegroundsthanbythe 50% thelandfillingofwasteby2025(comparedto2010). rate in2025fornon-dangerous,non-inertwasteandreducingby 10% in2020(comparedto2010levels),reachinga65%recycling 2015 lawisalsoaimedatreducinghouseholdwastegenerationby public fundsinFrance( In aMarch2005report,theSupremebodyforauditinguseof individuals exposedtoasbestosmaterialsisalsoindemnifiable. term. Notefinallythatsince2010,theprejudiceofanxietyfacedby of EUR3,000.00forthelatter, andasuspendedthree-monthprison 223-1) andsentencedtoafineofEUR75,000.00fortheformer, and held guiltyofendangermentone’s health(CriminalCode, Art. Court of Appeals ofDouai,alegalentityandtheplantmanagerwere prosecution inasbestoscases,2008,alandmarkcasebeforethe Although poisoninghasnotbeenheldavalidgroundfor otherwise compensated. reimbursement actionsagainsttheemployersofvictimsithas before anyoftheforegoingjurisdictions,FIVA mayintroduce jurisdictions, aswellbeforecriminalcourts.Notethatinacting negligence grounds( In parallel,asbestoslitigationhasdevelopedessentiallyongross disbursed bytheFIVA (Source: FIVA annualactivityreport2017). 106,827 totheirbeneficiaries.In2017alone,EUR338.6millionwas issued bytheFIVA, ofwhich111,722 tothevictimsthemselvesand tortfeasor. Since2003,218,549indemnificationoffers havebeen requires thatsuchvictimforfeitdirectlegalactionagainstthe two categories. Acceptance ofFIVA compensationbyavictim asbestos exposureinFrance;and(iii)eligiblesurvivorsoftheabove asbestos; (ii)individualssuffering directlyfromtheconsequencesof ascertained asbestos-relatedoccupationaldiseaserelatedtotheuseof beneficiaries ofsaidfundinclude:(i)individualssuffering froman created (Lawno.2000-1257of23December2000, Art. 53). The ( In theyear2000,adedicatedasbestosvictimcompensationfund additional 68,000to100,000victimsby2050. attributable toasbestos-relateddiseaseswillincreasebyan 1,600 victimsperyear. Yet, itisestimatedthatthedeathtoll peak isexpectedbetween2020and2040withanestimated1,140– deaths areregisteredeachyear. Figuresstarteddecliningin2008. A World War and1997. About 2,000newcancercasesand1,600 France usedasbestosextensivelybetweentheendofSecond 10.1 of thetotalproductionmixby2025( 2030, whilebringingnuclearproductionofelectricitydownto50% renewable energy consumptionlevelof23%by2020and32% 2012 levels)withanintermediatetarget of20%by2023,achievinga 1990 levels),reducingenergy consumptionby50%2050( August 2015.Itstarget istocutGHGemissionsby40%2030(vs. An ‘energy transitiontowardsgreengrowth’ lawwasadoptedon17 David Desforges © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM Fonds d’indemnisationdesvictimesdel’amiante 10 jurisdiction? What istheexperienceofasbestoslitigationinyour Asbestos faute inexcusable Cour descomptes)observedthathigher vs. acurrent75%approx.). This ) beforesocialsecurity Cour descomptes orFIVA) was

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 vs.

in France. (instruction pénale directly beforethecompetentcourtwithoutapriorcriminalinquiry This procedureallowsplaintiffs topresentevidenceoftheirclaims (citation directe voiced itsintenttosoontakeactionthroughprivateprosecution In January2019,theFrench Asbestos Victims Association (AVA) 10 pereight-hourperiod( workplace, theaverageasbestosfibreconcentrationshallnotexceed make hiscaseforsuchcompliance.Notefinallythatinthe with theseprovisionswillbemandatoryandanemployermust occupational healthandsafetymatters. Therefore, strictcompliance R.4412-94 (potential) presenceof ACMs intheworkplace(LabourCode, Art. also havestringentriskassessmentobligationsasregardsthe In theircapacityasownersand/oroccupiersofbuildings,employers R.1334-29-5). amiante) (id.,Art. documented andupdatedinatechnicalreport( (PHC, Art. R.1334-28). All oftheabovemeasuresmustfurtherbe measures (threshold:airbornedustlevels>5fibres/litreofair) assessed withaviewtofurthermonitoring,containmentorremoval ascertained, thestateandconditionofsuchmaterialsmustbe identify thepresenceof ACMs. Where thepresenceof ACMs is a buildingpermitwasissuedpriorto1July1997arerequired et seq.andR.1334-14). The ownersofpropertiesforwhich matters aregovernedbyhealthregulations(PHC, Art. L.1334-12-1 As faraspropertyowners’ obligationsareconcerned,asbestos France (Decreeno.96-1133 of24December1996). no longerbeusedintheworkplaceorplacedonmarket Since 1January1997,asbestos-containingmaterials(ACMs)may 10.2 to remediate expenses likelytoresultfromtheoperator’s obligationtoprevent and in theabsenceofharmtoathird party. These aimatcovering harm causedbyone’s activities. The lattercoverenvironmentalharm damages causedtothirdpartiesorgoods imputabletoenvironmental The formercoverthefinancialconsequences ofcivilliabilityfor risques (onemaystillwanttoreadthefine printthough). and mustbecontractedseparatelyunlessthepolicyislabelled contracts, ontheother. These are seldomfoundinthesamepolicy (RCAE inFrench),ontheonehand;andenvironmentalliability insurance market:civilliabilityforenvironmentalharmcontracts Basically, twotypesofpoliciesmustbesingledoutontoday’s (from whichhistoricalcontaminationswereexcluded). Assurpol andoffer astandardenvironmental damageinsurancepolicy growing marketdemand,insurerspooledresourcestogethertocreate covering environmentaldamages.In1989,andinordertoanswera risks involved,insurershaveessentiallyshrunkfromoffering policies the market.Unabletoadequatelyappraisenatureandextentof in France.Historically, fewinsuranceproductshavebeenoffered on Environmental insurancepoliciesdonotyetappeartoplayabigrole 11.1 performance safetyobligation( 11 in relationtoasbestoson-site? risks insuranceplayinyourjurisdiction? What arethedutiesofowners/occupierspremises in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable Environmental InsuranceLiabilities et seq.).Employersareheldliabletoaspecific in rem ‘pure’ ecological/environmentalharm(damage to ) againstprivateandpublicdecisionmakersalike. ) whichtendstobethenormalproceduralcourse , Art. R.4412-100). id., Art. obligation desécuritérésultat dossier technique

France multi- ) in

flora andfauna(2%)( breakdown isasfollows:air(15%);groundwater(8%);soil(5%); environmental consequences.Intermsofaffected milieu,the Based onstatisticsavailable,30%ofindustrialaccidentscarry operation ofcoolingtowersandtherelatedLegionnaires’ disease). sensitive environmentally( waters). Risksarealsoshiftingtootheractivitiestraditionallyless milieu entailingtheneedtoreintroducefishlarvaeinsurface foodstuffs industry(e.g.,accidentaldischarges intothenatural industry (underground pipelines),chemicaloperatorsandthe According toinsurers,themainrisk‘purveyors’ aretheoilandgas offered today. in the1970stoavarietyofenvironmentalinsuranceproductsbeing The markethasevolvedfromenvironmentalrisksbeinguninsurable 11.2 R&D, etc. the law, poormaintenanceofthefacilities,harmresultingfrom As iscustomary, exclusionsincludeintentionalharm,violationof the environmentalliabilityregimeofDirective2004/35/EC. soil, water, protectedspeciesandhabitats);adirectconsequenceof David Desforges ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 following fields: In thecomingmonthsandyears,developmentsareexpectedin the presidentialelectionofMay2017. Multiple workstreamshavebeeninitiatedbythegovernmentsince 12.1 market (seequestion12.1below). should boostfurthertheoffer ofinsurancesolutionsontheFrench instituting ageneralcivilliabilityforharmtotheenvironment Directive 2004/35/ECandthefutureCivilCodeamendment It iscontemplatedthattheenvironmentalliabilityregimeof (updated figuresnotavailable). © Published and reproduced with kind permission byGlobal Legal Group Ltd,London large environmentalissues. American lawfirmsin thecontextoftransactionalmattersrequiringFrenchenvironmentallawcapabilitiesormoretopical reputed foritsresponsivenessandflexibility. David’sas outsidecounselto strongstand-aloneactivityiscomplementedbyhis long-standingrole As peraLegal500EMEA issues aboveandbeyondlegalones. The firm’s clientbaseisessentiallymadeupofindustrialcompanies,inFranceand abroad. David Desforgescoversvirtuallyallsegmentsofenvironmentallaw, oftechnical invirtuallyallindustrialsectors,withanacknowledgedunderstanding firms, the‘firm’ culturesandmatters. possessesconsiderableexpertisethankstoitsexposureovertheyearsalargevarietyofclients,sectors, 12 in environmentlawyourjurisdiction. experience inyourjurisdiction? What istheenvironmentalinsuranceclaims summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a Updates Source: ARIA database,2015inventory) recentnotice(2017),DavidDesforgesisa‘one-manfirm’.Withlengthyand extensiveexperienceininternationallaw e.g., shoppingmalls,duetotheir DAVID DESFORGES

■ ■ ■ ■ ■ David isagraduateofthe degree programmes(Paris-SudXIandParisDauphineUniversities). Legal practitioners ( consistently beenlistedasoneofFrance’s leadingenvironmentallaw advice, transactionalworkandlitigation.Since2004,Davidhas since 2015,asanindependentpractitioner. Hisactivityincludeslegal partner ininternationallawfirms(GideLoyretteNouel,JonesDay),and over 20yearsofpracticeenvironmentallawasanassociatethen David DesforgesisadmittedtopractiselawinParis(France).Hehas Law Degree,1997,withHonours). Services, 1994),and 1994), DePaulUniversity(CertificateDegree,GraduateSchoolofPublic 1991, withHonours),NorthwesternUniversitySchooloflaw(LL.M., A reformoftheMiningCode. applicable torecycledproducts(packaginginparticular). A reshuffling ofenvironmentaltaxation,withlower VAT procedures). turbines projectsviaasimplificationofadministrative 2015 Energy transitionlaw;andtheboostingofoff-shore wind postponed fromthe2025deadlineinitiallycontemplatedin down to50%by2035or2040–anobjectiverecently nuclear reactorstobringFrance’s shareofnuclearelectricity France’s energy mix(withthecorrelativeclosureofover17/18 A continuedmovetowardstheincreaseofrenewablesin share; andthefightagainstfoodwaste. of certainproducts;theincreasebio-agriculture’s market The ‘Greening’ offarmingmethodsandgradualphasingout increase recycling). use ofsingle-useplasticsandefforts tomakeeasierand A circulareconomy(withadeterminedfocusoncurbingthe ). HelecturesonFrenchandEUEnvironmentalLawinMaster’s The Legal500 Université ParisIIPanthéon-Assas URL: Email: Tel: France 75007 Paris 240 bis,boulevardSaint-Germain Avocat àlaCour David Desforges Institut d'EtudesPolitiquesdeParis , Chambers andPartners www.desforgeslaw.com [email protected] +33 183621380 WWW.ICLG.COM (Postgraduate , The ‘firm’ is Who’s Who France (BA,

105 France Chapter 15 Germany Uwe M. Erling

Noerr LLP Dr. Tim Uschkereit

1 Environmental Policy and its reporting duties. Further, it includes economic instruments such as environmental state aid, environmental levies, fees, taxes and extra Enforcement duties (Sonderabgaben), as well as modern instruments; for example, market-driven certificates for greenhouse gas emissions. 1.1 What is the basis of environmental policy in your jurisdiction and which agencies/bodies administer 1.3 To what extent are public authorities required to and enforce environmental law? provide environment-related information to interested persons (including members of the public)? The cornerstone of environmental policy in Germany is set forth in the Basic Law (Grundgesetz – GG) of the Federal Republic of Access to environmental information, and especially the right to Germany. According to Article 2 para. 2 GG, the state has to protect inspect files, originally was limited to the participants of an life and health. This individual constitutional right not only provides administrative proceeding. Only the Aarhus Convention and EU a protecting right against any state intervention, but is also considered Directive 2003/4 on access to environmental information provided a to protect against any unlawful encroachments from any private third fundamental change. According to the Environmental Information Act parties. The individual basic right stipulated in Art. 2 para. 2 is (Umweltinformationsgesetz – UIG) of 2004, every natural or legal therefore also considered to provide for the minimum ecological person is entitled to freely access any information on the environment existence (ökologisches Existenzminimum). Further environmental held by an agency, without having to state a legal, economic or other policy in Germany follows on from the state declaration of aim interest. However, this right is not granted on an unlimited basis. The (Staatszielbestimmung) proclaimed in Article 20a GG. According to authority may, inter alia, refuse disclosure of information on the this provision, which was only adopted shortly after reunification in grounds of public interests or that the disclosure would reveal personal 1994, the state – in the light of its responsibility for future generations information and this would have considerable adverse effect on the – shall protect the natural bases of life and animals through legislation interests of the person concerned or disclosure would undermine the and, in accordance with law and justice, by executive and judicial confidentiality of commercial or industrial information. action. This provision also covers protection of the climate. Although The 16 German states (Bundesländer) have enacted their own laws individual citizens cannot base claims against the state on the state on freedom of access to environmental information. The provisions declaration of aim as this provision is addressed to the state, it is an of the laws of the German states are similar to those of the Federal important order for the legislator to further flesh out the details of Act in substantive terms or refer to the latter. environmental protection in its legislation. In addition, and even more

importantly, state authorities and courts may use Art. 20a GG as a guiding principle when they apply discretionary provisions of law and 2 Environmental Permits undefined terms of law. Although the competence to legislate on environmental matters rests 2.1 When is an environmental permit required, and may mainly with the Federation, the implementation and administration of environmental permits be transferred from one German environmental law is primarily subject to the jurisdiction of person to another? the 16 regional states (Bundesländer) and their authorities. The Federation, with its own administrative organs such as the Federal The requirement to obtain an environmental permit is regulated by Environmental Agency (Umweltbundesamt), only assumes this role as sector for each type of environmental impact. For example, plants an exception. and installations that cause air emissions or noise impacts, use water bodies or concern waste disposal, require a prior permit by the 1.2 What approach do such agencies/bodies take to the competent authority. Further, environmental impact assessments, enforcement of environmental law? predetermined in European law, are mandatory in the course of the planning and permit procedure – including the land use planning Enforcement of German environmental law is governed by a full procedure – for most of the large-scale industry installations. range of instruments. It covers planning instruments such as the Most of the environmental permits are granted for a specific planning assessment procedure (Planfeststellungsverfahren), installation and, therefore, are object-related (sachbezogene licensing requirements, monitoring, notification, registration and Genehmigungen). These permits are either automatically

106 WWW.ICLG.COM ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 © Published and reproduced with kind permission by Global Legal Group Ltd, London objection proceduremustbeconductedbeforefilingaclaim. criminal oradministrativeoffence proceeding. Further, theviolation oftheenvironmentalpermitmaycausea also beenforcedthroughadministrativecoercion( moveable property. excavated soilsandconstructions”, thelawstillappliessolelyto However, byvirtueofhavingexcludedelements suchas“non- (especially municipalzoningplansorFederalplanningprocedures). conducted inrelationtotheadoptionofcertainplansandprogrammes installations orinfrastructureprojects. The SUP, incontrast,is The UVP isanintegralpartofthepermitprocedureforlarger industrial environmental assessment( assessment (Umweltverträglichkeitsprüfung ( compliance withanadditionalobligation( ultima ratio installation, orinasubsequentorder( 2.3 the states( gerichte administrative proceedings:thecourts( the administrativecourts.InGermany, threestagesofappealexistfor and provisionsofthepermitcanbechallengedbyfilingaclaimwith The decisiontodenyanenvironmentalpermitorcertainconditions 2.2 cannot betransferred. qualifications oftheapplicant( In contrast,person-relatedpermitsthatrefertospecificindividual notification ofthecompetentauthority–fromoneentitytoanother. transferred orcanbe–insomecaseswithapproval Noerr LLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 The stateofaggregationisirrelevant forthequalificationaswaste. specified aswaste. which theholderdiscardsorintends orisrequiredtodiscardare Germany’s mainwastedisposalstatute,allsubstancesorobjects Waste Management Act ( According tothelegaldefinitioninSec.3para.1sent.of 3.1 closedown (Stilllegung non-compliance mayresultinaformalprohibition( With regardtoconditions ortimelimitsoftheenvironmentalpermits, 2.4 impact assessment( German environmentallawrecognisestwotypesof © Published and reproduced with kind permission byGlobal Legal Group Ltd,London Bundesverwaltungsgericht 3 permits? polluting industriesorotherinstallations/projects? contained inanenvironmentalpermit? waste involveadditionaldutiesorcontrols? Waste Is itnecessarytoconductenvironmentalauditsor What rightsaretheretoappealagainstthedecisionof regulators haveinconnectionwiththeviolationof environmental impactassessmentsforparticularly environmental permitorinrespectoftheconditions an environmentalregulatornottogrant How iswastedefinedanddocertaincategoriesof What enforcementpowersdoenvironmental ); higheradministrativecourts( , dismantling( Bundesländer); andtheFederal Administrative Court Umweltprüfungen): theenvironmentalimpact ) orderregardingtheoperationof Beseitigung ) inLeipzig.Insomeofthestates,an Strategische Umweltprüfung Kreislaufwirtschaftsgestz personenbezogene Genehmigungen nachträgliche Anordnung ) mayalsobeordered.Non- Oberverwaltungsgerichte Auflage –UVP);andthestrategic

Verwaltungszwang). ) ofthepermitmay Untersagung) or

–SUP). ), whichis Verwaltungs-

). As

) of

)

transferee toexcludetheriskofliabilityincaseabankruptcy, etc. information regardingtheeconomicandfinancialconditionsof successfully recycled. The producerorholderisentitledtorequest completed ifthequalificationaswasteendsorhasbeen the disposalisultimatelyanddulycompleted. The disposalis The liabilityoftheproducerorholderwasteremainsinforceuntil 3.3 (Bundesimmissionsschutzgesetz). according totheprinciplesofFederalImmissionProtection Act For storageanddisposalon-site,aspecificpermitisrequired with regardtotherelevanttechnical,economicandsocialfactors. are tobeusedthatbestprotecthumanhealthandtheenvironment Disposal. Basedonthishierarchy, thewastemanagementmeasures types ofrecoveryandparticularlyuseforenergy recovery;and Prevention ofwaste;Preparationforrecycling;Recycling;Other waste toperformthefollowingmanagementmeasures: step hierarchypursuantto Article 6requirestheproducerorholderof As oneofthecoreprovisions Waste Management Act, thefive- 3.2 defence areavailable. party’ defenceandthe‘compliancewithacompulsory order’ natural habitats,waterdamageor landdamage.Sofar, the‘third occupational activitiesprovided there isdamagetospeciesand of listedoccupationalactivitiesand negligenceliabilityforother schadensgesetz) in2007.Itprovidesforstrictliability foranumber law byadoptingtheEnvironmental Damages Act ( introduced aliabilityforharmtotheenvironmentitselfunderpublic In addition,followingEUDirective2004/35,Germanyhas civil liability). the EnvironmentalLiability Act ( parties fordamagestopersonsorpropertyunderthelawoftorts Germany: thereisfirsttheriskofbeingheldliablebyprivatethird There aredifferent environmental liabilityregimesapplicablein 4.1 Electronic Equipment Act ( Verordnung), theBattery Act ( material, theEnd-of-Life Vehicles Ordinance( Packaging Ordinance( obligations. Inthiscontext,theFederalGovernmenthasissued when theycomplywiththerespectivetake-backandrecycling producer anddistributorsmayonlyplacetheproductsonmarket waste products. As aconsequenceofproductresponsibility, the issue regulationsrequiringthetake-backandrecyclingofcertain The Waste Management Act entitlestheFederalGovernmentto 3.4

4 bankrupt/disappears)? and/or disposeofitonthesitewherewasproduced? what defencesaretypicallyavailable? regarding thetake-backandrecoveryoftheirwaste? Liabilities the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin To whatextentisaproducerofwasteallowedtostore breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa To whatextentdowasteproducershaveobligations Verpackungsverordnung) forpackaging Elektro- undElektronikgerätegesetz Batteriegesetz Umwelthaftungsgesetz WWW.ICLG.COM ) andtheElectrical Germany Altfahrzeug- Umschwelt- ) (so-called

).

107 Germany 108 Germany by thescopeofpermit. permit defenceonlyappliestoaspectswhichwereactuallycovered gericht judgment oftheFederal Administrative Court( insufficient funds.Ifthisisanissue,theauthorities maytarget the current owner, asthisisgenerallyeasiestunless theownerhas tenant). As apracticalmatter, authoritiestendtoproceed againstthe the sitewassoldafter1999,or(4) occupier(whichwouldcovera against (1)thepolluter, (2)thecurrentowner, (3)theformerowner if contamination. Theoretically, thecompetent authoritycanproceed held liableforclean-upandremediation ofasoilorgroundwater discretion indeterminingandaddressingtheentity/personthatistobe Soil Protection Act – Under thecontaminatedlandregimeinGermany(GermanFederal 5.1 Germany. environmental non-complianceofaborrowerisnotrecognisedin A lender liabilitywherebythecreditorisheldliableforan 4.5 contaminations ofsoilandgroundwater. share saleandassetpurchasearenotsignificant,atleastwithregardto contaminated site(seequestion5.1below),thedifferences betweena provides forliabilityofthecurrentandformerownera contaminated landregimeofGermanenvironmentallaw, which certain assetsinatransaction.However, giventhespecificsof An assetpurchasegenerallyoffers thepossibilitytochooseonly 4.4 under directorsandofficers (D&O)insurancepolicies. heads orenvironmentalprotectionofficers. Insuranceisavailable may alsoextendtomid-managementlevelssuchasdepartment a decisionaffects theenterpriseasawhole.Butcriminalliability ofcompetences,theoverallresponsibilitystillremainsif and comprehensivejurisdiction.Evenifthereisaninternal management, asthemanagementisaffected byoverallresponsibility German environmentalcriminalliabilitytypicallycoversthe 4.3 (Legalisierungswirkung vonGenehmigungen German environmentallawingeneralrecognisesthepermitdefence 4.2 offence and/oracriminalprosecution. Further, environmentalnon-compliancemaytriggeranadministrative Noerr LLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 5 within permitlimits? groundwater? environmental wrongdoingand/orremediationcosts? the onehandandanassetpurchaseonother? indemnity protectioninrespectofsuchliabilities? Contaminated Land What istheapproachtoliabilityforcontamination To whatextentmaylendersbeliablefor environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage (including historiccontamination)ofsoilor ) dated2December1977(ref.IV C75.75).However, the Bundesbodenschutzgesetz

), authoritiesexercise Bundesverwaltungs- ) sinceanearly

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

or modifiedinaspecialclauseofthe Asset Purchase Agreement. of Sec.24para.2theFederalSoilProtection Act canbeexcluded Act isnotapplicable. This means thatthejointandseveralliability parties, theprovisionofSec.24para.2FederalSoilProtection deviating contractualagreementsbetweenthepotentiallyliable with aclaimagainsttheactualpolluter. However, ifthereare remediate accordingtopubliclawfullyonitsown,andwouldbeleft framework, incaseofacontamination,thepurchaserwouldhaveto remediation agreement( Clean-up ofcontaminatedsitesisoftensubjecttoaformal 5.3 introduces jointandseveralliability( to Sec.24para.2oftheFederalSoilProtection Act. This provision As outlinedabove,multipleresponsiblepersonsareliableaccording 5.2 ( can becoveredbyliabilityunder the EnvironmentalDamages Act damages. However, damagestothenaturalhabitats andbiodiversity Aesthetic harmstopublicassets cannotbesubjecttomonetary 5.5 caused thecontamination( major partoftheclean-upcostsistobebornebypolluterwho ( Protection Act. This provisionintroducesjointandseveralliability against thepolluterunderSec.24para.2ofFederalSoil to publiclaw(seequestion5.1above),itmayclaimforcontribution groundwater contaminationbythecompetentauthoritiesaccording Although thepurchasercanbeheldliableforclean-upofsoiland 5.4 it hasacquired. clean-up ofthesoilandgroundwatercontaminationsonproperties purchaser ofacontaminatedsitewouldbegenerallyliableforthe polluter orthetenantasoccupier(ifapplicable). This meansthatthe provided itinfringestheirindividualrights. claim. Third partiescanonlychallengearemediationagreement has beenconductedthereisnolegalbasisforsuchasubsequent law providedtheclean-upisstillongoing.Butonceremediation ask foracontractadjustmentundertherulesofadministrative scientific ortechnicalfindings,theauthoritywouldberequiredto be unlawful.Eveniftherearedifferent legalrequirementsornew that subsequentunilateralordersoftheauthoritiesgenerallywould Soil Protection Act. The bindingnatureoftheagreementguarantees claim againsttheotherresponsibleparties. to dotheclean-upfullyonitsown. This personisthenleftwitha go afterthepersonwho,inviewofauthority, isbestplaced potentially responsiblepersons. The authorityhasfulldiscretionto Umweltschadensgesetz). Gesamtschuld) betweenthepotentiallyresponsiblepersons. The can athirdpartychallengetheagreement? is responsibleforthecontamination? public assets,e.g.rivers? contaminated landliabilitytoapurchaser? regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis How isliabilityallocatedwheremorethanoneperson polluter, monetarydamages foraestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek

Sanierungsvereinbarung) undertheFederal Verursacher). Basedonthisregulatory Gesamtschuld) betweenthe Germany

appear beforeanauthorityortoissueastatement. assist incollectingfactsandevidencebutthereisnogeneraldutyto under therulesofadministrativeprocedurearelimited. They shall and legalinspections.However, thelegalobligationsofparties parties, witnessesandexperts,aswellofficial documents,files covers statementsofallkindssuchasfrominvolved determines thescopeandtypeofdiscovery. Admissible evidence the authorityisrequiredtocollectrelevantfactsonitsown.It according toannex2oftheFederalSoilProtectionOrdinance. examinations revealtheexcessoftestvalues(so-called pollutants intothesoil. A concreteorobviousindicationrequiresthat or disturbancesofproperoperation,suggestsignificantinputssuch operation, managementorothermethodsusedintheindividualcase, an extendedperiodoftimeorinsignificantamountsandwhere site existsinparticularifpollutantswerehandledonpropertiesover Ordinance, anindicationforaharmfulsoilchangeorcontaminated contaminated siteexists. According totheFederalSoilProtection indication orobviousofaharmfulsoilchange reporting obligationonlyappliesprovidedthatanindication,concrete a dutytoreportidentifiedpollutiontheauthorities.However, such 7.1 principle ofinvestigation( Environmental authoritiesinGermanyaregovernedbythejudicial 6.1 Noerr LLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 disclose anyenvironmentalissues totheprospectivepurchaser. The seller, underGermanlawcontracts,iswell advisedtofully 7.3 residual pollution. giving risetosufficient suspicion ofaharmfulchangethesoilor assess thedangersinvolved,providedthereisadefiniteindication (which coversatenant)mustconductthenecessaryinvestigationsto former ownerifthesitewassoldafter1999,or(4)occupier can onlyorderthat(1)thepolluter, (2)thecurrentowner, (3)the According totheGermanFederalSoilProtection Act, theauthority There isnogeneraldutytoconductenvironmentalinvestigations. 7.2 Subject tostatelegislationofthestates( judgment 21July 2017 V ZR250/15). contamination mustalreadybeconsidered amaterialdefect(BGH recently, the FederalCourtofJusticeheldthatameresuspicion consequence, limitationsofliability maynotbeinvoked.Only Otherwise thesellerrisksallegations offraudulentconductand,asa © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 7 6 parties? conduct siteinspections,interviewemployees,etc.? takeover transactions? contamination? Reporting /DisclosureObligations Powers ofRegulators migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe What powersdoenvironmentalregulatorshaveto prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto environmental regulatororpotentiallyaffectedthird require productionofdocuments,takesamples, To whatextentisitnecessarytodisclose have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson Untersuchungsgrundsatz). This means Bundesländer), theremaybe

Prüfwerte

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group dependence. a situationisrecognisedincasesofundercapitalisationorqualified responsibility foralegalentitythatownscontaminatedland.Such commercial laworcompanylaw, isrequiredtobearthe that remediationisalsorequiredbythepersonwho,onbasisof dissolving acompany. The FederalSoilProtection Act stipulates Environmental liabilityinGermanycannotbepreventedby 8.2 remain unaffected andcannotbetransferredbywayofacontract. Obligations underpubliclaw, asoutlinedaboveunderquestion5.1, will relateonlytothecontractualobligationsbetweentwoparties. price adjustment).However, anypaymentsmadeundertheindemnity such costscanbediscountedfromthepurchasepricebywayofa (provided thecostsforremediationcanbecalculatedandareknown, appropriately consideredwhendeterminingthepurchaseprice environmental indemnityunderthe Asset Purchase Agreement, or contaminations priortoclosing,beeithercoveredbyastandard any remainingenvironmentalliabilityriskswhichresultfrom As totheliabilityrisks,itisstandardpracticeforpurchasersrequire 8.1 exist underGerman environmentallaw. addition, U.S.-styleconceptsofpenal orexemplarydamagesdonot Musterfeststellungsklage class action”( claims inGermany. The recentlyadopted “Actintroducingacivil There isnogrouporclassactionavailable forpursuingenvironmental 8.5 environmental whistle-blowers. German environmentallawdoesnotyetprovideforprotectionof 8.4 Germany. by foreignsubsidiariesofGermanparentcompaniesoutside German courtsdonothavejurisdictionincasesofpollutioncaused provided thereisundercapitalisationorqualifiedgroupdependence. liability ofaparentcompanywithregardtocontaminatedland, As outlinedaboveunderquestion8.2,inGermanythereisariskfor 8.3 8 order toescapeenvironmentalliabilities? potential liabilityforthatmatter? damages available? report environmentalviolations/matters? caused byaforeignsubsidiary/affiliate? General balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- Is itpossibletouseanenvironmentalindemnity environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing Are thereanylawstoprotect“whistle-blowers”who company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld Gesetz zurEinführungeinerzivilprozessualen ) onlycoversconsumer-related claims.In

WWW.ICLG.COM Germany

109 Germany 110 Germany using certainquantitiesoff-gases. EU-Regulation No.517/2014. The sameappliestoenterprises (f-gases) aresubjecttomonitoringandreportingobligationsunder Producers, importersandexportersoffluorinatedgreenhousegases and inothercountries,asofJanuary2019. address theincreasingissuessurrounding climatechangeadaptation. laws intheareaofplanningand zoning arealsobeingadoptedto on energy efficiency and reductioninthebuildingsector. Finally, new climate protectionactsatthelevelof thestates( production, aswellareduction ofcaremissions.Inaddition, of renewableenergy sourcesandanexitfromcoal-basedenergy emissions. Keyelementsofthestrategyaremassivedevelopment legislation devotedtoprovidingforadecreaseofgreenhousegas comprehensive ClimateProtection Act, therearemultiplepiecesof environmental andenergy policy. Although thereisnotyeta Climate protectionhasbecomethekeydriverofGerman 9.3 their CO (ICAO), aircraftoperatorsarerequiredtomonitor, reportandverify Aviation (CORSIA)oftheInternationalCivil Aviation Organization Under theCarbonOffsetting andReductionSchemeforInternational of maritimetransport. monitoring, reportingandverificationofcarbondioxideemissions as ofJanuary2018inaccordancewithEU-Regulation2015/757on the EUETS.However, theyareobligedtomonitortheiremissions Shipping companiesdonotparticipateinemissionstradingunder 9.2 Prices ofEUcarboncreditsincreasedby200%during2018. The carbonmarkethasdevelopedextremelydynamicallyrecently. Europe, participateintheemissionstradingsystemGermany. operate flightswithintheEUorcontinentaltoandfrom and energy-intensive industrialplants,plusallaircraftoperatorswho emissions undertheEUETS.Operatorsoflarge energy installations ETS) since2005.Itholdsthelargest shareofinstallationsand Germany isakeyplayerintheEUEmissions Trading Scheme(EU 9.1 claims ofpublicinterestgroupswasintroduced. EU Directive2011/92, ageneralrightoflitigation forenvironmental nature protectionlaw. After ratificationofthe Aarhus Convention and awarded arighttolitigateenvironmentalmattersincasesconcerning – NGOs).However, publicinterestgroupswereinitiallyonly individuals orpublicinterestgroups(non-governmentalorganisations German environmentallawdoesnotrecogniseacostprivilegeof 8.6 Noerr LLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 9 pursuing environmentallitigation? regulation inyourjurisdiction? to monitorandreportgreenhousegasemissions? market developingthere? Emissions Trading andClimateChange What istheoverallpolicyapproachtoclimatechange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation Do individualsorpublicinterestgroupsbenefitfrom any exemptionfromliabilitytopaycostswhen 2 emissionsfromflightsbetweenairportslocatedintheEU

Bundesländer) focus

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insurance areoffered ontheGermanmarket. Therefore, awidevarietyofdifferent typesofenvironmental Under theasbestosguidelines( 10.2 estate andinsurancesectors. exists. Asbestos issuesseemtoplayamorevisibleroleinthereal In Germany, noextensiveenvironmental-relatedasbestoslitigation 10.1 number ofprominent casesarepending.InMay2018, 10families Further, climatelitigationisanewtypeofenvironmental claim. A environmental law. interest groupsarequiteeffective whenitcomestoenforcing group, whichillustratesthatthelegal privilegesgrantedtopublic This trendisdrivenmainlybyclaims initiatedbyapublicinterest an increasingnumberofsuchbanshavebeenissuedatalocallevel. diesel carsincitycentresprovidedthebansareproportionate,there ruled inFebruary2018thatGermancitiesareallowedtobancertain in majorcities. After theFederal Administrative CourtinLeipzig A newtrendinGermanenvironmentallawconcernstheairquality 12.1 Environmental insuranceclaimsinGermanyarerarelylitigated. 11.2 operators ofindustrialorcommercialinstallationsinGermany. schadensgesetz) madeenvironmentalinsuranceindispensablefor haftungsgesetz) andEnvironmentalDamages Act ( The entryintoforceoftheEnvironmentalLiability Act ( 11.1 and maytriggerrelevantcosts. disposal ofasbestosmaterialmayrequirespecificsafetymeasures immediate actiontointerval-basedriskassessments.Removaland criteria toassesstheurgency ofremediation,rangingfrom might causearisktohumanhealth. The asbestosguidelinesprovide asbestos, whichiscapableofreleasingasbestosfibresintotheair, obligation isthepresenceofahealththreat.Inparticular, friable exists. However, thestandardfordeterminingaremediation (Bundesländer), nogeneralobligationfortheremovalofasbestos Most casesinthatareaconcerncontaminatedland. 11 10 12 in relationtoasbestoson-site? jurisdiction? in environmentlawyourjurisdiction. experience inyourjurisdiction? risks insuranceplayinyourjurisdiction? What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a What istheenvironmentalinsuranceclaims in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable Environmental InsuranceLiabilities Asbestos Updates Asbest-Richtlinien Germany ) ofthestates

Umwelt- Umwelt-

protection target. rights byfailingtotakemeasuresmeetthenational2020climate Court, arguing thattheGovernmentisviolatingtheirconstitutional Government inOctober2018beforetheGermanConstitutional In addition,threeGermanfamiliesfiledaclaimagainstthe rights tolife,health,occupationandproperty. dangerous climatechange,andnotenoughtoprotecttheirfundamental 1990 levels,isinadequatewithrespecttotherealneedprevent greenhouse gasemissionsbyatleast40%2030,ascomparedto asserts thattheEU’s existing2030climatetarget toreducedomestic Union. The complaintwasfiledattheEuropeanGeneralCourtand against theEuropeanParliamentandCouncilof from theEU(oneGermany)andabroadfiledaclimatelawsuit Noerr LLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London Uwe isrecognisedby leading attorney. worldwide. exclusive memberfirminGermanyfor LexMundi,theworld’sin 100+countries leading networkofindependentlawfirms,within-depthexperience Noerr isalsointernationallyrenowned, withoffices in11 Inaddition, Noerristhe countriesand aglobalnetworkoftop-ranked“bestfriend”lawfirms. businesses aswellfinancialinstitutions andinternationalinvestorsallcallonthefirm. medium-sized family Noerr isoneoftheleadingEuropeanlaw firms,with500+professionals.Listedgroupsandmultinationalcompanies, largeand German FederalMinistryofEnvironment(onbehalfCO committees suchasthelegalexpertgrouponemissionstradingof speeches. Heservesinvariousregional,nationalandinternational Uwe contributesregularlytopublicationsandisfrequentlyinvitedgive regulatory workforleadinginternationalgroundhandlingcompanies. are typicallyatthecentreofhispractice.However, italsoincludes business inGermanyandEurope.Nationalinternationalairlines His aviationpracticefocusesonallregulatoryaspectsofairline airlines. energy companies,refineries,chemicalplants,suppliers,and this areaaretypicallyplantoperatorscoveredbytheEUETSsuchas covers complianceandallocationissuesundertheEUETS.Clientsin His specialexpertiseinemissionstradinglawandclimatechange and transactions. across thecourts.Heisalsoregularlyinvolvedinprojectdevelopments and EUlevel,healsolitigatesnovelcomplexenvironmentalmatters his deepunderstandingofenvironmentallawatanational,international permit proceedingsofindustrialorcommercialinstallations.Basedon compliance issues,aswellprovidingadviceandrepresentationin Uwe’s practiceofenvironmental andenergylawingeneralcovers of LawinEnergy&Environmentfrom Tulane LawSchool,USA. University of Administrative Sciences–Speyer, andreceived aMaster’s He studiedlawattheUniversityofPassauandGermanFederal . practice withadeepfocusonenvironmentallaw, energylawand public lawandgovernment-relatedmatters.Hehasestablisheda of experience.Heisaregulatorylawyerwhodealswiththefullrange Uwe Erlingisan Associated PartnerofNoerrLLP withalmost20years Who’s WhoLegal URL: Email: Tel: Germany 80333 Munich Brienner Str. 28 Noerr LLP Uwe M.Erling www.noerr.com [email protected] +49 8928628269 , Best LawyersandJUVEasa

2 ncept plus).

change impacts. emissions aretheproximatecauseofparticularadverseclimate Hamm. The keyissueinthiscaseistoestablishwhetherparticular is onappealatthe 2016 (judgmentof15December2016,fileno.2O285/15),thecase Landgericht (DistrictCourt)ofEssenrejectedthecivillawsuitin increased involumeasaresultofclimatechange. After the Huaraz isthreatenedbyafloodwavefromglaciallakethathas plants emittedinGermany. According totheclaim,cityof in thehigh Andes inPerubecauseofthegreenhousegasemissionits partially responsibleforprotectivemeasuresagainstclimatechange issue iswhethertheGermanenergy corporationRWE maybeheld In aquiteuniqueclimatechangelitigationofPeruvianfarmer, at give speeches.Heisrecognisedby Tim contributesregularlytopublicationsandisfrequentlyinvited operator certificatesandlicensing. bilateral airserviceagreements,ownershipandcontrolissues, encompasses airporttermsandcharges,German Air Transport Tax, leading internationalgroundhandlingcompanies. The advice practice. Italsoincludeslong-termexperienceofregulatoryworkfor in Germany. Nationalandinternationalairlinesaretypicallypartofhis His aviationpracticefocusesonregulatoryaspectsofairlinebusiness production facilitiesandchemicalplants. representation ofnationalandinternationalcommercialenterprises, special expertiseinemmissionandnoiseprotectionlawinvolves levels, andisinvolvedinprojectdevelopmentstransactions. Tim’s in novelandcomplexenvironmentalmattersatnationalcourtsofall installations, aswellcomplianceissues.Healsoregularlylitigates and advisinginpermitproceedingsofindustrialorcommercial His practiceofenvironmentallawinparticularcoversrepresentation the CentralInstituteforSpatialPlanningofUniversityMünster. Poitiers, andreceivedadoctoratefromprofessorHansD.Jarassofat He studiedlawattheUniversityofMünsterand within companies. as theimplementationofenvironmentalandregulatoryrequirements public construction,pollutioncontrolandplanningpermission,aswell approval andimplementationofmajorprojects,thelegalaspects project developments.Hehasparticularexperienceintheplanning, environmental andpubliccommerciallaw, realestatetransactionsand legally andpoliticallycomplexmattersregardingregulatoryapproval, Dr. Tim Uschkereitadvisesnationalandinternational companies on Oberlandesgericht (HigherDistrictCourt)of URL: Email: Tel: Germany 80333 Munich Brienner Str. 28 Noerr LLP Dr. Tim Uschkereit www.noerr.com [email protected] +49 8928628269 JUVE asaleadingattorney. WWW.ICLG.COM Germany

111 Germany Chapter 16 Ghana Prof. Raymond A. Atuguba

Atuguba & Associates Courage Asabagna

1 Environmental Policy and its 1.3 To what extent are public authorities required to Enforcement provide environment-related information to interested persons (including members of the public)?

1.1 What is the basis of environmental policy in your Although a recent development, it would appear that public jurisdiction and which agencies/bodies administer authorities are required to provide environmental-related information and enforce environmental law? to interested persons and even to members of the public, subject to some qualifications. Article 21(1) (f) of the 1992 Constitution of The basis of environmental policy in Ghana is the 1992 Constitution. Ghana provides that all persons have the right to information, subject The Constitution, in Chapter Six, mandates the Government to take to such qualifications and laws as are necessary in a democratic appropriate measures needed to protect and safeguard the national society. In Lolan Kow Sagoe-Moses & others v The Honourable environment for posterity; and in cooperation with other agencies, Minister & Attorney General, Suit No. HR 0027/2015, High Court protect the wider international environment for mankind. Flowing (Human Rights Division 2), Accra (unreported), the High Court of from the Constitution, the Environmental Protection Agency Act, Ghana interpreted this provision to mean that persons are entitled to 1994 (Act 490) has been passed by the . This law, various access public information that is in the custody or possession of other sectoral laws, together with Regulations made under these laws, Government upon a request, subject to other human rights and seek to operationalise the broad environmental policy directives in the freedoms, the public interest, public order, national security, and Constitution of Ghana. public morality. The main body which administers environmental laws in Ghana is the Environmental Protection Agency. However, many other sectoral agencies administer various sector-specific environmental laws. 2 Environmental Permits These include the Petroleum Commission, the Commission, the Fisheries Commission, and local government authorities – which 2.1 When is an environmental permit required, and may administer health and safety laws at the local level. environmental permits be transferred from one These agencies have powers to enforce aspects of environmental laws person to another? by themselves, and they do this sometimes with the assistance of other state agencies such as the police, and sometimes by working with the An environmental permit is required if, in the opinion of the Attorney General’s office to prosecute offenders. A few of the Environmental Protection Agency, an activity or an undertaking by agencies have been given delegated prosecutorial powers by the a person or an entity has or is likely to have adverse effect on the Attorney General and may prosecute alleged violators of environment or public health. environmental crimes by themselves. The transfer of an environmental permit from one person to another is allowed; however, the transfer may only be done with the consent 1.2 What approach do such agencies/bodies take to the of the regulator. Where a transfer of a permit is approved by the enforcement of environmental law? regulator, the transfer is limited to the extent of the same activity for which it was originally granted and the conditions under which the The enforcement strategies of agencies with an environmental permit was approved. protection mandate include: the suspension, revocation or cancellation of licences; obtaining from the courts to 2.2 What rights are there to appeal against the decision of correct environmental wrongs; the imposition of fines; prosecution an environmental regulator not to grant an (sometimes to secure a mandatory jail term without the option of a environmental permit or in respect of the conditions fine); and, significantly, any other steps that the Minister for contained in an environmental permit? Environment may consider necessary to ensure compliance with environmental laws. Appeals against refusals of environmental permits or against conditions contained within a permit are made to the Minister responsible for the Environment. A panel is set up by the Minister to determine the complaint by giving the complainant a fair hearing,

112 WWW.ICLG.COM ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 © Published and reproduced with kind permission by Global Legal Group Ltd, London and activitiesthatimpactforests,amongothers. activities thatimpactfisheryresourcesorotheraquaticresources; activities thatinvolvetheexplorationofpetroleumornaturalgas; activities thatinvolvechemicalsandchemicalby-products; assessment. The lawsinGhanahavemadespecificprovisionfor: soil oranearbyecosystemrequiresanenvironmentalimpact Any projectwhichhasthepotentialofadverselyaffecting theair, 2.3 example). per Articles 23and296ofthe1992ConstitutionGhana,for for theirconstitutionality, legality, propriety, andreasonableness(as administrative decisionsandtheexerciseofdiscretionarypowers also bemadetothecourts,whichhavepowerreview to theprotectionofenvironment. Appeals andapplicationsmay directives itdeemsandconsidersjustreasonablehavingregard after whichthepanelmayalterregulator’s decisionorgiveother Atuguba &Associates ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 environment. minimise theconsequenceofpollution onhumanhealthandthe and otherwastewherepollution occurs,stepsmustbetakento steps thatarenecessarytoprevent pollutionfromhazardouswaste person involvedinthemanagement ofwasteisrequiredtotake severe consequenceonhumanhealth andtheenvironment. A waste generatedonthesiteifstorageordisposalwillnothave A producerofwasteispermittedorallowedtostoredispose 3.2 the inventoryuntilendofphase-outperiod. out period,whichisuntiltheyear2025,andalsokeepupdate storage facilitiesforthepolychlorinatedbiphenylsduringphase- importation arerequiredtoundertakeaninventoryandprovide polychlorinated biphenylsthatremaininuseafterabanonits hazardous waste. Additionally, holdersofequipment containing adequate insurancecoverinrespectofthemanagement dispose oftheirwaste;additionally, theyhaveadutytomaintain hazardous waste,aretaskedwiththedutytosafelyhandleand Persons whogenerate,collect,store,transport,ordisposeof disposed of,orrequiredtobeof. mean substancesorobjectswhicharedisposedof,intendedtobe ControlandManagement Act 2016(Act917)to In Ghana,wasteisdefinedinSection37oftheHazardousand 3.1 and prosecuteallegedviolators. revoke licences;andobtaininjunctionsagainst,imposefineson, As statedinquestion1.2above,regulatorscan:suspend,cancelor 2.4 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 3 waste involveadditionaldutiesorcontrols? permits? polluting industriesorotherinstallations/projects? produced? Waste Is itnecessarytoconductenvironmentalauditsor regulators haveinconnectionwiththeviolationof environmental impactassessmentsforparticularly and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore How iswastedefinedanddocertaincategoriesof What enforcementpowersdoenvironmental

4.1 by them,andforrecycling. discarded electricalorelectronicequipmentmanufacturedsold electrical orelectronicequipmentarerequiredtotakebackused providing thereinthatmanufacturers,distributorsorwholesalersof 2016 (Act917)onlyaddressestherecoveryofelectronicwaste; The HazardousandElectronic Waste ControlandManagement Act 3.4 retains absoluteliabilityevenifsaidpartygoesbankrupt. party towhomthewastemanagementresponsibilityistransferred, waste istransferredtoanotherpartyrecognisedbytheregulator. The The producerofwastedoesnotretainanyliabilityforoncethe 3.3 The lawsofGhana imposepersonalliabilityon directorsof 4.3 private orpublicnuisance. activity causesdamagetothepropertyofanotherpersonor environment. Civilliabilityisespeciallylikelyifthepermitted operator hasorislikelytohaveexcessivelyadverseeffects onthe terms ofapermit,anoperatormaybeheldliableiftheactivity Although anactivitymaybeundertakenorcarriedoutwithinthe 4.2 also argue thatthesaidactivitywaspermittedbyregulator. prevent thecommissionofenvironmentaloffence. Onemay Mining Act 2006(Act703))bywayofemployingmechanismsto commission oftheoffence (asperSection107oftheMineralsand reasonable stepshavebeentakentocontrolorpreventthe not inanywaydegradeorharmtheenvironment;showthatall environmental lawsmayargue thattheactivitycomplainedofdoes A person facingeithercivilorcriminalliabilityforbreachof be forfeitedtotheState. the equipmentorappliancesusedincommissionofoffence person, andseektheimpositionofafine,jailterm,oranorderthat civil liabilities,regulatorsmayprosecutetheoffending partyor remediation; orinjunctionsontheprogressofprojects. Aside from licences andpermits;damagesarisingfromsuits;ordersfor sanctions suchas:thesuspension,revocationorcancellationof criminal liabilities. The civilliabilitiesincludeadministrative A breach ofenvironmentallawsorpermitscanresultincivil 4 regarding thetake-backandrecoveryoftheirwaste? bankrupt/disappears)? indemnity protectioninrespect ofsuchliabilities? within permitlimits? what defencesaretypicallyavailable? Liabilities breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa To whatextentdowasteproducershaveobligations the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin to whatextentmaytheygetinsurance orrelyonother personal liabilitiesforenvironmental wrongdoing,and Can directorsandofficersofcorporations attract notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage WWW.ICLG.COM Ghana

113 Ghana 114 Ghana 5.3 party inthesaidmisconduct. misconduct isusuallyproportionaltothelevelofinvolvementa severally liable.However, theextentofliabilityforenvironmental Liability isasharedresponsibility;thepartiesareheldjointlyand 5.2 licence, suchthattheowneroflandisexcludedfromliability. contamination ofgroundwaterisonlylimitedtotheholder pollution ofgroundwateroranaquifer. The liabilityfor any activityinamannerthatleadstothecontaminationofsoilor The regulatorimposesseveralliabilitiesonapersonwhoundertakes 5.1 of enactingpoliciesandlawsthatcouldmakelenderssoliable. stakeholders, especiallythoseinthefinancialsector, onthepossibility responsible fortheenvironmentiscurrentlyinconsultationswith has nocontrolovertheactivitiesofentity. The Ministry that alenderonlyprovidesthenecessaryresourcesforproject,but for environmentalwrongdoingorremediationcosts. The rationaleis Currently, Ghanalawmakesnoprovisionfortheliabilityoflenders 4.5 criminal liabilityoftheseller. In eithercase,theliabilityofpurchaserwillnotinclude steps toremedythesituation. the environmentandhumanhealth,purchaserisliabletotake environmental hazardattachedtotheassetswhichadverselyaffects assets beingpurchased,andwherethereisanyhistoric In thecaseofanassetsale,extentliabilitywilldependon all liabilitiesincurredbytheseller. absorbed bythepurchaserbecausegenerallyacquires incurred beforethedateofsharesaletransactionisautomatically In thecaseofasharesaleagreement,environmentalliability 4.4 liabilities. Directors andpartnersmaysecureinsurancecoverfortheir or partnerswhocommittedthewrongdoing. were legitimatelyunawareoftheactivitiesoneormoredirectors Particular directorsandpartnersmayonlybeindemnifiedifthey partnerships. environmental wrongdoingcommittedbythecorporationsor corporations andpartnersofincorporatedpartnershipsfor Atuguba &Associates © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM The regulatorreserves thepowertoreviewor order additional 5 the onehandandanassetpurchaseonother? can athirdpartychallengethe agreement? is responsibleforthecontamination? groundwater? environmental wrongdoingand/orremediationcosts? Contaminated Land regulator comebackandrequire additionalworksor “agreed” withanenvironmental regulator, canthe If aprogrammeofenvironmental remediationis How isliabilityallocatedwheremorethanoneperson What istheapproachtoliabilityforcontamination To whatextentmaylendersbeliablefor environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman (including historiccontamination)ofsoilor

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recover thecostfrompolluter. regulator mayundertakestepstoremedythedamagecausedand situations, thepollutermayberequiredtorepairdamageor or damagesforcausingaestheticharmtopublicassets.Inmany The regulatorhasthepowertoobtainfrompolluter, compensation 5.5 purchase. knew orshouldhaveknownoftheriskpriortoattime contaminated landmaypassfromthesellertobuyerif owner oroccupierofcontaminatedland.However, liabilityfor It ispossibletosuccessfullymaintainanactionagainstaprevious 5.4 the regulator, especiallyfortheholders ofmineralandpetroleum There isaspecificdutytoreportall suchpollutionfoundonasiteto 7.1 plan andanenvironmentalmanagementfromtheapplicant. an environmentalimpactstatement,ascopingreport,reclamation applicant, theregulatorshavepowertorequestdocumentssuchas In asituationwhereanenvironmentalpermitisrequiredby persons whoseactivitiesmayhaveadverseeffects ontheenvironment. The regulatorsalsohavethepowertorequestinformationfrom the activitiesofaperson. animals ordamagetolandandpollutionofwaterbodiesresultingfrom and theinvestigationofcomplaintsinjurytohumanbeings used, storageordisposalfacilities,areasusedforofwaste, The powersoftheregulatorsextendtoinspectionequipment environmental legislationiscompliedwith. premises atareasonabletimeforthepurposeofensuringthat The regulatorshavethepowertoauthorisetheiragentsenterany 6.1 Minister forEnvironmentortothecourtsoflaw. affect orbreachitsrights. This maybebroughtadministrativelytothe remediation measuresagreeduponifthe A thirdparty, ontheotherhand,canexerciseitsrighttochallenge contamination. the additionalremediationworksarenecessarytodealwith remediation workstobeundertakenif,intheopinionofregulator, 7 6 public assets,e.g.rivers? contaminated landliabilitytoapurchaser? parties? conduct siteinspections,interviewemployees,etc.? Reporting /DisclosureObligations Powers ofRegulators polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek environmental regulatororpotentially affectedthird migrating off-site,mustitbedisclosed toan If pollutionisfoundonasite,or discoveredtobe require productionofdocuments,takesamples, What powersdoenvironmentalregulatorshaveto

Ghana

7.3 measures tobetakenpreventormitigatetheseeffects. situation totheregulatorinorderfornecessaryinvestigationsand environment andpublichealth,apersonisrequiredtoreportthe on landisobviousandhasthepotentialtoadverselyaffect the investigate landforcontamination.Inpractice,wherecontamination There iscurrentlynolegalobligationwhichrequiresapersonto 7.2 this includesadutytoreportortakeactiononpollution. citizens toprotectandsafeguardtheenvironmentforposterity, and a broaderconstitutionallevel,thereiscivicresponsibilityonall done aspartoftheirmandatorymonthlyreportingrequirement. At radioactive materials.Fortheholdersofmineralrights,thisistobe land whodonotholdaminingright,andwithparticularregardto requirement isfurtherextendedtomereoccupiersorownersofsuch rights, astheiractivityisverylikelytoleadsuchpollution. This Atuguba &Associates ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 environmental liabilities off thebalancesheet, thereforeonecan There isnoknownlegaldeterrent tothepracticeofsheltering 8.2 can pursuebothpartiestoensurecompliance. indemnifier failstomakepaymentunderanindemnity, theregulator potential liabilityforthatmatter. However, inasituationwherethe indemnity inrespectofamatter, theindemnifierisdischarged of Where theindemnifierhasmadepaymenttopolluterunderan environmental liabilitiescaused. prevent theregulatorfromholdingpolluterliableforany related liabilities.However, theindemnitydoesnotrestrainor indemnities tolimitexposureforactualorpotentialenvironment- agree toallocateenvironmentalliabilitybyusing It ispossibleforpartiestoacommercialtransactioncontractor 8.1 environmental defects. seller tosellgoodswhicharefreefromdefects,andthisincludes seller totheprospectivebuyer. There isalsoanobligationonthe material factsknownorwhichoughttohavebeenbythe there isafundamentalobligationonthesellertodiscloseallrelevant principles ofcommerciallaw, particularlytheSaleofGoods Act, disclose environmentalproblemstoaprospectivebuyer, underthe laws definingtheextenttowhichasellerisunderobligation Though therearenoexpressprovisionsinGhana’s environmental © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 8 takeover transactions? contamination? order toescapeenvironmental liabilities? potential liabilityforthatmatter? General prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto To whatextentisitnecessarytodisclose have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- balance sheet,andcanacompany bedissolvedin Is itpossibletoshelterenvironmental liabilitiesoff Is itpossibletouseanenvironmentalindemnity

environment. can besaidtohavedirectlyengagedinactivitiesdetrimentalthe liabilities extendtoparentcompanies,unlessthecompany Ghana lawdoesnotprovideforasituationwhereenvironmental environmental wrongdoing. veil ofincorporationandholdtheshareholderliablefor laws orcausepollution,andinsuchinstancesthecourtwilllift uses acompanyasshieldtoperpetuateorbreachenvironmental there areprovisionstotakecareofasituationwhereshareholder company. However, asanadherenttothecommonlawpractice, liable forbreachesofenvironmentallaworpollutioncausedbythe remaining unpaid. As such,ashareholdercannotbeheldpersonally liability toacompanyisonlylimitedtheamountofshares to dealwiththis.UnderGhanaiancompanylaw, ashareholder’s There iscurrentlynoprovisionunderGhana’s environmentallaws 8.3 for-profit entity. as apublicinterestclaimorthatthe entitybringingthesuitisanot- favour andpayminimalcostsbyarguing thatamatterwasbrought It ispossibletoswaytheexercise of thecourt’s discretioninone’s exemplary costsagainstalosingparty. court mayawardnocostsatall,minimalcosts,normalor from alosingparty. The quantumofcostsisdiscretionaryandthe course oflitigation. A successfulpartyisfurtherentitledtocosts Any partytoasuitmayberequiredpaycostsatanypointinthe 8.6 wrongdoing atthediscretionofacourt. Exemplary andpenaldamagesmaybeawardedforenvironmental public interest. to provethatanactionfortheprotectionofenvironmentisin or thatthesuitisbroughtinpublicinterest.Itnottoodifficult can demonstratethattheactionscomplainedofaffect themdirectly Under Ghanalaw, groupsofpersonmaybringsuit,providedthey 8.5 environmental (andother)issues. to personswhomakedisclosuresofimproprietyinrespect There isa Whistle-blowers Act whichoffers protectionandrewards 8.4 escape environmentalliabilitycreatedorcausedbythecompany. argue thatitispossible.However, adissolvedcompanywillnot dissolved, thedirectorswillbepersonallysoliable. liable forenvironmentalliabilitiesandwhereacompanyis The directorsofacompanyarepersonallyjointlyandseverally caused byaforeignsubsidiary/affiliate? pursuing environmentallitigation? damages available? report environmentalviolations/matters? company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld any exemptionfromliabilitytopaycostswhen Do individualsorpublicinterestgroupsbenefitfrom environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing Are thereanylawstoprotect“whistle-blowers”who WWW.ICLG.COM Ghana

115 Ghana 116 Ghana the benefitsthatcouldaccruetocountryfromsuchtrading. development, althoughthereisaconcertedeffort togrowitdue The emissionstradingmarketisstillintheearlystagesof which areresponsibleforwasteremoval andmanagement,prohibit of asbestosormaterialthatcontains asbestos. Also, localauthorities, By administrativefiat,theregulator hasbannedtheimportationoruse 10.2 entry bytheregulator. items containingasbestos. All suchitemsareseizedattheportof function andpower, prohibitedtheuseorimportationofasbestos regulator hasinrecenttimesandusingtheirbroadregulatory no specificenvironmentallawprohibitingtheuseofasbestos, There isnorecordofasbestoslitigationinGhana. Although thereis 10.1 Accord onClimateChange,isyettobepassed. aimed atactualisingthispolicy, beyondtheratificationofParis internationally, ontheother. However, specificnationallegislation counter thenegativeeffects ofclimatechange,bothlocallyand development ontheonehand,andneedtomakeregulations Thus, thestrategicdirectionistobalanceneedforeconomic ii. i. to: Ghana hasadoptedaNationalClimateChangePolicywhichaims 9.3 for monitoringandreportingongreenhousegasemissions. emission levelsby2030. This Strategyhasanin-builtrequirement emissions ofupto45%belowtheBusiness As Usual(BAU) which thereisagoaltoachievereductionofgreenhousegas Ghana hasdevelopedaLowCarbonDevelopmentStrategyunder 9.2 Verification, andthe World Bank’s ForestCarbonFacilityScheme. Emissions Trading Scheme,theGreenhouseGas Accounting Ghana. These includetheCleanDevelopmentMechanism,EU There areanumberofemissionstradingschemesinoperation 9.1 Atuguba &Associates © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 10 9 market developingthere? in relationtoasbestoson-site? jurisdiction? regulation inyourjurisdiction? to monitorandreportgreenhousegasemissions? enhanced mitigationactionsincludinglowcarbongrowth. respond positivelytovariousinternationalmechanismson nations copewithitsimpact;and ensure adaptationtoclimatechangehelpcommunitiesand Emissions Trading andClimateChange What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour What istheoverallpolicyapproachtoclimatechange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation Asbestos ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

general insuranceindustryinGhana. this area.Environmentalriskinsuranceisjustaminutepartofthe insurance industryhasnotdevelopedspecificproductstocaterfor such bondsandguarantees,asinothersectors. As such,the insurance, forwhichmostplayersresorttotheirbankersprovide other similarrequirementsthatnecessitaterecoursetoenvironmental decommissioning ofpetroleumexploratoryactivities,thereareno performance bondsandguaranteesforthepurposeof to undertakeminingbonds,reclamationbondsaswell the extractiveindustries(miningandpetroleum)whicharerequired the market,andsubsectorisnotverywelldeveloped. Aside from There areverylimitedtypesofenvironmentalinsuranceavailableon 11.1 as theysoughtintheirreliefs. establish enoughbasisforthecourt togranttheorderof against thedefendants,asitheldthat theplaintiffs werenotable to obligations. Unfortunately, thecourtdidnotmakeanyorders a resultofthedefaultdefendants ontheirenvironmental harm anddamagecausedtotheenvironmenttheirpropertiesas jointly andseverallyliabletothepeopleadverselyaffected bythe company (BonteMines),thecourtheldthatdefendantswere Protection Agency, theMineralsCommissionandamining the CentreforEnvironmentalLawagainst In a2009courtactionbytheCentreforInterestinPublicLawand said projectdespitehavingsignedtheParis Agreement. It remainstobeseeniftheGovernmentwillstillgoaheadwith into anagreementtobuildacoal-firedpowerplantforthecountry. prior tosigningtheParis Agreement, theGovernmenthadentered environmental commitmentsonGhana.Itissignificanttonotethat legislature andimposes,attheveryleast,international Climate Changein2016. That Agreement hasbeenratifiedbythe Ghana isoneofthe170statesthatsignedParis Agreement on 12.1 insurance marketthatistakenupbyenvironmentalinsurance. claims inGhana,duetotherelativelyinsignificantportionof Our guessisthattherearefew, ifany, environmentalinsurance insurance claimstotheirregulator, andsothereisnodataonthis. Insurance companiesarenotrequiredtoreportonenvironmental 11.2 effective. asbestos. However, theimplementationofdirectivehasnotbeen material containingasbestosarerequiredtotakestepsremovethe nature. Consequently, buildingsorpremisesthathaveasbestos the treatmentofasbestosashouseholdwastebecauseitshazardous 11 12 risks insuranceplayinyourjurisdiction? in environmentlawyourjurisdiction. experience inyourjurisdiction? in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a What istheenvironmentalinsuranceclaims

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Atuguba &Associates ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London other firmsandexpertsiscommonin A&A, thebettertoserveourclients. works alongsideinternationalagenciesincludingUNICEF, theWorld practicewith BankGroupandUNHCRindeliveringtheirprojects.Collaborative Environmental Management. Association (GLiPGOA);andtheCentreforNaturalResources Trawlers Association (GITA); Ghana LiquefiedPetroleumGasOperators Commerce (AHK);Jubilee Tractor (Ghana)Ltd;GhanaIndustrial (ADB); Unibank(Ghana)Ltd;DelegationofGermanIndustryand and GasCompanyLtd; Agricultural DevelopmentBank(Ghana)Ltd Clients include:Lukoil;C.A.NzemaOilandGasCompanyLtd.;G&J workshops. Committees inseveral Africa countries,andfacilitateddozensoftraining papers totheleadershipofParliamentsandParliamentary international conferencesinallcontinentsoftheworld,includingexpert also presentedover200papersonthesesubjectsatnationaland economics ofdevelopment,institutionsandinstitutionalchange.Hehas the intersectionoflaw, humanrights,policy, governance,thepoliticsand Atuguba hasresearchedandpublishedextensively, mostlyinrelationto Sciences PoinFrance,andMonashUniversity Australia. Prof. Harvard University, KuLeuvenUniversityinBelgium,Université and hastaughtinmanyuniversitiesallovertheworld,includingat an Associate ProfessorofLawattheUniversityGhanaSchool Ghana, theGhanaSchoolofLawandHarvardSchool.Heisalso and Atuguba and Associates. HewaseducatedattheUniversityof Raymond A. Atuguba isthe Team Leader(ManagingPartner)atLADA and theprovisionoflegalaid,fightingforsupportingvoiceless underprivilegedinsociety. thesegoals, Inthefurtheranceof the inimicaleffects ofcommercialandindustrialendeavours. interestlitigation Thus, someofourfirst-ratelawyershavemadetheirmarkinpublic In thisvein, A&A orremediate notonlyrepresentsanumberofwell-knownbanksandoilgascompanies,butalsocommunitiesseekingto prevent entities, investmentsandmanyothercorporateprocesses. ofbusiness and commercialtransactions,public-privatepartnerships,negotiationsarbitrations,incorporationregistration of ourclients, A&A adviceforcorporate undertakescivilandcriminallitigation, andalsohasanimpeccablerecordforprovidingclientswithin-depth In concreteterms, A&A individualneeds providesbothlitigationandtransactional lawyeringservices.Becauseourservicesaredeterminedbythe and institutions. (LADA) ConsultandtheLADA Institute, A&Aof policies,laws, alsoprovideslegalinputforthedevelopment,re-design,monitoringandevaluation for theresolutionofsomemostintricatelaw-relatedbusinessandsocialproblems.Working closelywithLawandDevelo Atuguba & andcommunitiesgo Associates (A&A)isnotjustalawfirm;ittheplacewherediscerningindividuals,firms,institutions, organisations, URL: Email: Tel: Ghana Accra GD-210-1189Digital Address Off BrakwatsoLP –33 Adjiringano Road Hse No.3FatherOdaiKobinaStreet Atuguba & Associates Raymond A.Atuguba Prof. www.atugubaassociates.com [email protected] +233 302522553

Immigration Service. Information; andLiberia’s MinistryofJustice,NationalPolice,and (NHIA); Ghana’s ForestryCommission(FC);Liberia’s Ministryof Commission (PURC);Ghana’s NationalHealthInsurance Authority Commission forRefugees(UNHCR);Ghana’s PublicUtilitiesRegulatory International Children’s Fund(UNICEF);UnitedNationsHigh Bank Group;German Technical Co-operation(GIS);UnitedNations Clients include:UnitedNationsDevelopmentProgramme;theWorld partnerships, transferpricingandinternationaltax. transactional adviceandtaxwhichincludestaxationoftrust, Associate at Atuguba and Associates, Courageprovidescorporate Bachelor ofLawsandQualifyingCertificateinLawrespectively. As an Ghana SchoolofLaw, whereheobtainedhisBachelorof Arts, Columbia, BC,hewaseducatedattheUniversityofGhana,and Prior toobtaininghisLL.M.intaxationfromtheUniversityofBritish and Associates. at Atuguba an Associate is Courage A.Asabagna Email: Tel: Ghana Accra GD-210-1189Digital Address Off BrakwatsoLP –33 Adjiringano Road Hse No.3FatherOdaiKobinaStreet Atuguba & Associates Courage Asabagna URL: [email protected] +233 302522553 www.atugubaassociates.com WWW.ICLG.COM pment Associates Ghana A&A also

117 Ghana Chapter 17 India Els Reynaers

M.V. Kini Tavinder Sidhu

1 Environmental Policy and its environmental compliance records. That said, in our experience voluntary disclosures are well received by all enforcement agencies, Enforcement although there are no formal guidelines relating to such situations, and absent explicit rewards for such voluntary disclosures, local companies lack the confidence to approach enforcement agencies. 1.1 What is the basis of environmental policy in your jurisdiction and which agencies/bodies administer Some of the newer environmental laws, such as the E-Waste and enforce environmental law? (Management) Rules, 2016, do allow “self-declaration”, e.g. relating to the Reduction in the use of Hazardous Substances (“RoHS”) The Indian Constitution lays down the foundation for all requirements; such approaches remain the exception rather than the environmental laws. Since the late 1980s and early 1990s, there has rule. Some States have also adopted an “auto-renewal” of Consent also been a clear trend of environmental policies being driven by the Orders (i.e. environmental permits) based on self-certification if (activist) judiciary in India. The fundamental right to life enshrined certain criteria are met, such as: when there is no increase in the in Article 21 of the Constitution has been expanded by judicial overall production capacity and pollution load; if there is only a interpretation to include the right to a clean, healthy and pollution- marginal increase (up to a maximum of 10%) in the capital free environment. The doctrine of sustainable development, investment, etc. “polluter pays” and the precautionary principle were all first The SPCBs tend to issue “show cause” notices (“SCNs”) in the event acknowledged by the judiciary before these principles were of non-compliance, giving the companies 15 to 30 days to reply and explicitly embedded in more recent environmental legislation (such explain why criminal prosecution should not be undertaken or as the National Green Tribunal Act, 2010). electricity/water supply to these companies stopped. The power of The Ministry of Environment and Forest & Climate Change the SPCBs to cut off these basic supplies can at times be unnecessarily (“MoEF&CC”), along with the Central Pollution Control Board harsh on a company, but seems to be the only effective tool which the (“CPCB”) and State Pollution Control Boards (“SPCBs”) of each of SPCBs have at their disposal to enforce environmental laws. Hence, the 29 States in India, administers and enforces environmental laws. all companies must ensure that they take these SCNs very seriously There are separate regulatory bodies for various environmental and duly reply. As per the respective environmental laws, all laws, such as: the State-level Environment Impact Assessment companies are also granted the right to be heard before such drastic Authority, supervising Environmental Clearance applications and measures such as the stoppage of basic supplies will be enforced. Environmental Impact Assessment reports; the Ozone Cell, Moreover, if a site is found to be in grave non-compliance (such as supervising compliance with the Ozone-Depleting Substances operating without an environmental permit), the SPCBs will not Rules; Forest Officers in the context of India’s Forest Act; National hesitate to commence a proceeding before the NGT, with the request and State-level Coastal Zone Management Authorities, supervising to impose a penalty, and in some cases criminal prosecution of the the Coastal Regulation Zone Notification, etc. directors or management of a company can also be initiated. We may also add here that there is only one Supreme Court in India, but each of the States has its own High Court. Importantly, various 1.3 To what extent are public authorities required to National Green Tribunals (“NGTs”) were established in 2010 – provide environment-related information to interested dividing India geographically into several jurisdictional zones, with persons (including members of the public)? the central NGT in Delhi, and four other NGTs in Bhopal, Pune, Kolkata and Chennai – for the speedy disposal of cases where a Under the Right to Information Act, 2005 (“RTI Act”), a citizen can substantial question relating to environment is involved, and for request all government authorities to provide any particular giving relief and compensation for damages to persons and property. information which they hold, at a minimal fee. There are some exemptions to this otherwise broadly drafted right to information, such as: personal information of officers; evidence yet to be 1.2 What approach do such agencies/bodies take to the presented in a court of law; and also, importantly, commercially enforcement of environmental law? confidential information, trade secrets or , the disclosure of which would harm the competitive position of a third The interactions between these enforcement agencies and regulated party, unless the competent authority is satisfied that the larger entities still tend to be based on a carrot-stick approach, with few local public interest warrants the disclosure of such information. For companies, therefore, being proactive or forthcoming with their instance, if local residents were to file an RTI petition seeking

118 WWW.ICLG.COM ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 © Published and reproduced with kind permission by Global Legal Group Ltd, London applications: submission andtrackingofvariousenvironmentalclearance and EnvironmentalSingle-windowHub–tofacilitateonline for Pro-ActiveandResponsivefacilitationbyInteractive, Virtuous launched bytheMoEF&CC,named“PARIVESH” –whichstands Importantly, in August 2018,anewonlineenvironmental portalwas a company, multiplepermitsmayneedtobeobtained. (“CPCB”). Hence,dependingonthetypeofactivitiesundertakenby centralised applicationwiththeCentralPollutionControlBoard Authorisation ofProducers”whichwouldonlyrequireone the newconceptofan“ExtendedProducerResponsibility– instance, therecentE-Waste (Management)Rules,2016introduce pieces oflegislationwilltriggerseparatepermitobligations.For Application totherelevantSPCB.Itisworthnotingthatseparate typically beobtainedbysubmittinga“CombinedConsent” (Management and Transboundary Movement)Rules,2016can under the Water Act, Air Act andHazardousOther Wastes most States.Forinstance,theCTO anditssubsequentrenewals company. Donotethatanintegratedpermitsystemisinplace which mustbeobtainedpriortoanyoperationsbeinginitiatedbythe approval; whichhastobefollowedbyaConsentOperate(“CTO”) manufacturing capacity, pollutionload,etc.forinitialconstruction (“Water Act”) inwhichacompanysubmitsitsinitialplans,shares under the Water (PreventionandControlofPollution) Act, 1974 manufacturing companiesaretheConsenttoEstablish(“CTE”) obtained fromtheStatePollutionControlBoards(“SPCBs”)bye.g. The mostcommonConsentOrdersorenvironmentalpermitstobe 2.1 information. the governmentauthoritybesharedwithcitizensseekingthis larger publicinterestwouldwarrantthatallinformationavailableto information aboutacompany’s off-site groundwaterpollution,the M.V. Kini ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 of theNGT Act). by the Appellate Authority wouldliebeforethe NGT (seeSection16 level Appellate Authority. A subsequentappealagainstadecision Control Boardnottograntorrenew aConsentOrderbeforeState- One canfileanappealagainstthe decisionbyaStatePollution 2.2 change ofname,management,etc.). documents (explainingtheunderlyingreasonfortransfer, the conditionsspecifiedinConsentOrder, alongwithsupporting application, alongwithanundertakingthatitwillcomplyall concerned regulatoryauthority;andthetransfereemustsubmitan transferor wouldneedtoprovideawritten“NoObjection”the transferable, andastraightforwardprocedurehastobefollowed:the Clearances (obtainedundertheEIA Notification),arereadily Consent OrdersissuedbytheSPCBs,aswellEnvironmental environmental clearances. “CRZ”), andcreateauniqueIDforeachprojectmost (i.e. Environment,Forest, Wildlife andCoastalRegulationZone– a singleregistrationandsign-inforalltypesofclearances © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 2 person toanother? contained inanenvironmentalpermit? Environmental Permits environmental permitsbetransferredfromone When isanenvironmentalpermitrequired,andmay What rightsaretheretoappealagainstthedecisionof environmental permitorinrespectoftheconditions an environmentalregulatornottogrant https://parivesh.nic.in . Morespecifically, itwillallow

public consultationandappraisal. The processofEIA involvesfourstages,namelyscreening,scoping, ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ Impact Assessment (“EIA”)study, including: (“EC”), someofwhichalsorequireadetailedEnvironmental 2006, manyactivitiesrequireapriorEnvironmentalClearance Yes, inlinewiththePriorEnvironmentalClearanceNotification, 2.3 limits; andtheinternationaltradedimension ofhazardouswastesis factors, andusesbothalist-basedapproach aswellconcentration complex definitionwhichtakes into accountseveraltechnical intended productandisusedassuch. “Hazardouswaste”isamore to beproducedbutgets intheproductionprocessof generation. A by-productisdefinedasamaterial thatisnotintended products, butexcludesresidualsrecycledorreusedattheplaceof intermediate andfinalproducts,theconsumptionof extraction ofrawmaterials,theprocessingmaterialsinto waste includesthematerialsthatmaybegeneratedduring transformation orconsumption. The HW Rulesfurtherclarifythat the generatorhasnofurtheruseforpurposesofproduction, “waste” asmaterialsthatarenotproductsorby-products,forwhich Movement) Rules,2016(“HW Rules”)introducedadefinitionof The HazardousandOther Wastes (Managementand Transboundary 3.1 Order. The SPCBscanalsoinitiateprosecutionbeforethecourts. operating inviolationoftheconditionsmentionedConsent services suchaselectricityandwater, ifacompanyisfoundtobe Boards havefar-reaching powerstoimposeastoppageofessential As mentionedinquestion1.2above,theStatePollutionControl 2.4 3 polluting industriesorotherinstallations/projects? waste involveadditionaldutiesorcontrols? permits? Townships andareadevelopmentprojects,etc. Building andconstructionprojects. Sugar industry. Pulp andpaperindustry. Chemical fertilisers. Chlor-alkali industry. Asbestos millingandasbestos-basedproducts. Metallurgical industries(ferrousandnon-ferrous). Nuclear powerprojectsandprocessingofnuclearfuel. Thermal powerplants. Oil andgastransportationpipelines. and production. Offshore andonshoreoilgasexploration,development Mining ofminerals. Rules, 1989(“MSIHCRules”)aretriggered). Manufacture, StorageandImportofHazardousChemical certain quantitythresholdsasidentifiedunderthe Isolated storageandhandlingofhazardouschemicals(if Waste environmental impactassessmentsforparticularly Is itnecessarytoconductenvironmentalauditsor How iswastedefinedanddocertaincategoriesof regulators haveinconnectionwiththeviolationof What enforcementpowersdoenvironmental WWW.ICLG.COM

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119 India 120 India and ensuretheenvironmentallysoundmanagementofsuchwaste. electronic equipment(“EEE”)hasadutytochannelbackthee-waste Hence, undertheE-wasteRules,producerofelectricaland 1986 (“EP Act”) –underwhich allthewaste-relatedRuleswere The Water Act, the Air Act andtheEnvironment (Protection) Act, 4.1 CPCB approvingitsproposedEPRapproachandtake-backtargets. producer wouldneedtoobtainapriorEPR Authorisation fromthe recycler, orthroughaProducerResponsibilityOrganisation. The centres, orhavingarrangementswithanauthoriseddismantler The EPRmayconsistofsettingupatake-backsystemorcollection such astheE-Waste RulesandthePlastic Waste ManagementRules. embedded inseveralmorerecentpiecesofenvironmentallegislation, The conceptofExtendedProducerResponsibility(“EPR”)is 3.4 based liabilitywhichwillhavetobeprovedincourt. management ofthe(respective)waste,butthisisbasedonfault- the environmentorthirdpartyduetoimproperhandlingand dismantler, recycler, etc.)shallbeliableforanydamagescausedto all theparties(beitmanufacturer, producer, importer, transporter, developed viacaselaw. Various environmentallawsdospecifythat waste(s) asthisisnotspecifiedinanyenvironmentallaw, nor liability willberetainedbythegenerator/producerofrespective Once thetitlehasbeentransferredtoanotherparty, nosuchresidual 3.3 authorised treatmentstoragedisposalfacility. e-waste, atendoflife,findsitswaytoaregisteredrecycleroran and imposethefurtherobligationonproducertoensurethat generation (whichcanexceptionallybeextendedupto365days), only allowthestorageofe-wasteon-siteupto180daysafterits Rules –whicharebasedontheExtendedProducerResponsibility requirements regardingwastestorage;forinstance,theE-Waste Different wasterulesimposedifferent responsibilitiesand 3.2 Rules”). Rules; andtheE-Waste (Management) Rules,2016(“E-Waste and Waste ManagementRules,2016;thePlastic Waste Management 2016; theSolid Waste ManagementRules,2016;theConstruction respectively, suchas:theBio-Medical Waste ManagementRules, Other waste-specificlegislationwilldefinethewastebeingtargeted which Indiaisaparty. Movements ofHazardous Wastes and Their Disposal,1989,to in linewiththeBaselConventiononControlof Transboundary M.V. Kini © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 4 produced? what defencesaretypicallyavailable? regarding thetake-backandrecoveryoftheirwaste? bankrupt/disappears)? Liabilities breach ofenvironmentallawsand/or permits,and What typesofliabilitiescanarise wherethereisa To whatextentdowasteproducershaveobligations another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore the transferee/ultimatedisposergoes

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required ConsentOrderorenvironmentalpermitwillincurpenalties. adopted –allcontainpenaltyprovisions.Failuretoobtainthe question 4.1),combined withthe“polluterpays” principle,the Yes, the principleofabsoluteliability(discussedaboveunder 4.2 Tribunal, thecompanyispunishablewithafineuptoINR25crore. company failstocomplywithanyorder, awardordecisionofthe conviction forthefirstfailureorcontravention.Moreover, ifa INR25,000 foreverydaythefailure/contraventioncontinues,after or contraventioncontinues,anadditionalfineappliesupto INR10 crore,orboth(1croreisequalto10million).Ifthefailure imprisonment foratermofuptothreeyears,orwithfine order orawarddecisionofthe Tribunal ispunishablewith Green Tribunal Act statesthatapersonwhofailstocomplywithan penalty provisions.Morespecifically, section26(1)oftheNational (at somepoint)tobealignedwiththeNationalGreen Tribunal Act laws. Mostlikelyallexistingenvironmentallawswillbeamended considerably highercomparedtopreviouslyadoptedenvironmental Importantly, theNGT Act containspenaltyprovisionswhichare least 18months,whichcanbeextendedtosixyears,andafine. consent applicationprocessispunishablewithimprisonmentforat For instance,underthe Water Act, anypersonwhobreachesthe ■ instance, inthe impose exemplarydamagesfordamagetotheenvironment.For Moreover, theSupreme CourtandtheStateHighCourtscando and liabletobeprosecuted. officer ofthecompany, theotherpersonisalsoguiltyofoffence, attributable toanyneglectby, adirector, manager, secretaryorother offence wascommittedwiththeconsentorconnivanceof,is exercised allduediligencetopreventtheoffence. Further, ifthe that theoffence wascommittedwithouthisknowledge,orthathe punished accordingly. However, apersonisnotliableifhe proves business, isguiltyoftheoffence andliabletobeprosecuted committed, andisresponsibletothecompanyforconductofits Under these Acts, everypersonwhoisincharge whenanoffence is contain specificprovisionsforoffences committedbycompanies. all Protection Act Environmental Waterand The Act,AirAct after convictionforthefirstfailureorcontravention. up toINR100,000foreverydaythefailure/contraventioncontinues, If thefailureorcontraventioncontinues,anadditionalfineapplies ■ Indian caselaw: environmental civilliabilityconceptswhicharenowengrainedin About 30yearsago,theSupremeCourtevolvedtwofar-reaching compensation, whichamountedtoINR1billion. before depreciation,interestandtaxes(“PBDIT”)hadtobepaidas company’s annualreport,anddeterminedthat10%oftheprofit assessing thecompany’s liabilitytopaydamages,itreviewedthe valid renewalofitsenvironmentalconsenttooperate. When copper smelterplantsinIndiawasfoundtobeoperatingwithouta within permitlimits? notwithstanding thatthepolluting activityisoperated Can anoperatorbeliableforenvironmental damage the carryingonofhazardousorinherentlydangerousactivities. compensation payablebyitforharmcausedanaccident,in prosperous theenterprise,greateramountof magnitude andcapacityoftheenterprise. The larger andmore The measureofcompensationmustbecorrelatedtothe statutory authority). (that is,actofGod,thirdparty, consentofvictimand under thetortprincipleofstrictliabilityin Such absoluteliabilityisnotsubjecttoanyoftheexceptions by anaccident(suchastheaccidentalleakageoftoxicgas). activities areabsolutelyliabletocompensatethoseaffected Enterprises engagedinhazardousorinherentlydangerous Sterlites Industries case(2013),oneofthelargest Rylands vFletcher India

against environmentaldamageclaims. in India,whereassuchinsuranceisavailabletocovercompanies The marketforinsurancepoliciespersonalliabilityisnotmature exercised allduediligencetopreventtheoffence. that theoffence wascommittedwithouthisknowledge,orthathe in theselawsaswell,andapersonwillnotbeheldliableifheproves environmental damage. As mentionedabove,defencesareprovided imposed ingravesituationsofnon-complianceandserious for environmentaldamagearestillratherexceptionalandtendtobe year’s salaryonamanagingdirector–butsuchpersonalliabilities Supreme Courthasimposedpersonalliabilitytothetuneofone proceeded againstandpunishedaccordingly. Forexample,the shall bedeemedtoguiltyofalloffences andshallbeliableto for, theconductofacompany’s businessalongwiththecompany, state thateverypersonwhowasincharge of,andwasresponsible As discussedunderquestion4.1,the Water Act, Air Act andEP Act 4.3 farmers ormakingthewaterunusableforirrigationpurposes. is negativelyimpactingtheenvironmentandhealthofneighbouring which wasotherwisenotcoveredbytheenvironmentalpermit,but effect ofnegativelyimpactingthegroundwaterquality–asituation which canbetracedbacktothecompany’s siteandhaveacombined pollution causedbybothhistoricandcurrentactivities instance, wecouldthinkofasituationoff-site groundwater company complieswithitscurrentenvironmentalpermit.For company liableforenvironmentalpollutionordamageevenifa well establishedinmanyenvironmentalcases–couldholda precautionary principleandthesustainability–whichare M.V. Kini ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 pertaining toenvironmental complianceintheirloan documents. the projectsoftheircustomersand willincludecontractualclauses lenders increasinglyundertakean environmental riskassessmentof involvement intheday-to-dayrunning ofthecompany. However, company, with aboardpositionorsubstantialshareholdingand they aredirectlyresponsibleorliable forthemanagementof wrongdoing and/orremediationcosts forcontaminatedland,unless In India,lendersdonotdirectlyincurliabilityforenvironmental 4.5 due diligencepriortothepurchase. liabilities, whichhighlightstheimportanceofarobustenvironmental insertion ofcontractualwarrantiesrelatingtoenvironmental previous ownership. As aresult,partieswillsettlethispointviathe control overthesite,withoutanyfurtherinvestigationintermsof environmental liabilitytotheoccupier, i.e.theentityhavingcurrent the regulatoryauthoritiesinIndiatypicallysimplyconnect environmental lawsinIndiadonotaddresshistoricalpollutionand parties cancontractuallydecideotherwise. This isbecause event ofanassetsale,thebuyerwilltakeovertheseliabilities,but liabilities, incurredbythecompany. Typically, inIndia,eventhe the buyeralsoacquiresallliabilities,includingenvironmental As isthecaseinmanyotherjurisdictions,eventofasharesale, 4.4 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London the onehandandanassetpurchaseonother? indemnity protectioninrespectofsuchliabilities? environmental wrongdoingand/orremediationcosts? to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract To whatextentmaylendersbeliablefor environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman

application beyondtheinitiallyidentifiedcontaminatedsites. “Remediation ofPollutedSitesRules”wouldhaveawider including forhistoriccontamination;andthesubsequentdraft amendment oftheEP Act addressingtheliability ofparties, land. The longer-term implementation strategywouldrequire merely parameter-based buttakeintoaccounttheexpecteduseof be coveredinafirststage.Importantly, theremediationwouldnotbe reports mappingthepriority(mostcontaminated)siteswhichshould contaminated site.Environmentalconsultantshavealreadyprepared mandatory siteassessmentandreportingthedeterminationofa containing standardsforsoilandwaterpollution,carryingout draft “ContaminatedSites(IdentificationandManagement)Rules” first proposedshort-termimplementationstrategyisthe major changeswithastep-wiseapproachareinthepipeline. The legislation addressingsoilcontaminationandremediationyet,but owner/occupier willbeheldliable.Similarly, Indiahasnospecific remediation. As aresult,evenforhistoricpollutionthecurrent explicitly addressthesituationofhistoricpollutionandrelated Unlike manyotherjurisdictions,environmentallawsinIndiadonot 5.1 contaminated land andhistoricalpollution.Hence, theregulatory As mentionedabove,thereisno specific lawinIndiaaddressing 5.4 arbitrary, unreasonable,nopersonalhearingwasgranted,etc. be challengedbyacompanybasedonthegroundthatdecisionis natural justicewouldapply, andsuchdecisionsbytheregulatorcould being achievedwithintheagreedtime.However, theprinciplesof works orremediationactivities,particularlyifthedesiredresultisnot The environmentalregulatoryauthoritycouldimposeadditional 5.3 responsible forsuchcontamination. parties, whenitisfoundthatmorethanonelegalperson has dividedthecostofremediationequallyamongstresponsible been undertakenovertheyears.However, theNGT inmanycases chemical clusters,withalonghistoryofdifferent activitieshaving undertaking, particularlyinindustrialzones,ormanufacturing Allocating environmentalliabilityisnotalwaysaneasy 5.2 their environmentalliability. management ofthecompanytotakeeffective measurestominimise appropriate conditionsbeforegrantingaloan,requiringthe Lenders normallyundertakepriorduediligenceandinsiston 5 groundwater? contaminated landliabilitytoa purchaser? can athirdpartychallengetheagreement? is responsibleforthecontamination? Contaminated Land (including historiccontamination)ofsoilor What istheapproachtoliabilityforcontamination possible forapollutertotransfer theriskof or inpart,contamination;andto whatextentisit contaminated landwhenthatowner caused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis How isliabilityallocatedwheremorethanoneperson WWW.ICLG.COM

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121 India 122 India except fortheobligation tosubmitapre-feasibility Environmental There isnostatutoryobligationfor investinglandcontamination 7.2 regulatory authoritiesinsuchsituations. India. However, companiesmaystilldecidetoinformthe such situationshavenotbeenforeseenbyenvironmentallawsin discharge ofenvironmental pollutantstandards,simplybecause or environmentalpermitnorexceedthegenerallyapplicable caused byactivitieswhichneitherinfringethevalidConsentOrder The issueisnotasobviousincaseswheretheoff-site migrationis or intheeventofanaccidentasregulatedunder, e.g.,the Water Act. the GeneralStandardsspecifiedunderEP Act andrelatedRules, event ofdischarges ofpollutants abovethestandardscontainedin inform theconcernedauthoritiesandaffected thirdpartiesinthe Yes, theoccupieroflandisunderanobligationtoimmediately 7.1 violating theprovisionsofEP Act, Air Act or Water Act. a companyorcriminalliabilityontheoccupieriftheyarefound and SPCBsareempoweredtoinitiateproceedingslevypenaltieson control environmentalpollutioncausedbycompanies. The CPCB research, verifyrecordsandgivedirectionstoindustriesinorder and testtheprocessesplants,takesamplesfortestingconduct The officials oftheSPCBsareempoweredtoinspectsites,examine 6.1 indirectly pollutingtheriverGanges. Supreme Courtimposedcostsonindustrieswhichweredirectlyor Furthermore, inseriesofjudgments,theNGT aswellthe radius fromthe Taj Mahalmonumentwereorderedtoshutdown. city ofMumbai. Also, theindustriesoperatingwithina100km ecology aswellpollutioncausedinthe Arabian Seaneartheport instance, acompanywasheldliableforINR1billionlossof of publicorhistoricalassets,assetssuchasrivers.For recovered environmentaldamagesfromcompaniesforthepollution Yes. The SupremeCourt,HighCourtsandtheNGT haveall 5.5 would havenosuchright. therefore, havetobecontractuallyforeseen,otherwisethepurchaser rights seekingcontributionfromthepreviousownerwould, entity, whethercurrentlyobservedon-site/off-site. Suchprivate authorities willalwaysholdthecurrentowner/occupierasliable M.V. Kini © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 7 6 public assets,e.g.rivers? contamination? parties? conduct siteinspections,interviewemployees,etc.? Reporting /DisclosureObligations Powers ofRegulators have anaffirmativeobligationto investigatelandfor When andunderwhatcircumstances doesaperson migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe What powersdoenvironmentalregulatorshaveto polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma environmental regulatororpotentiallyaffectedthird require productionofdocuments,takesamples,

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eyes oftheenvironmentalregulatoryauthorities. discharge theindemnifier’s liability indemnity willonlybebindingbetweentheparties,andnot environmental liabilityispossible.However, suchcontractual The enforcementofindemnificationforlimitingactualorpotential 8.1 contractual validityinM&A transactions. existing environmentalliabilitycouldequatetoquestioningof detailed schedulehighlightingliabilityissues.Non-disclosureof disclosed tohimbytheseller. The transferormustdisclosea Material informationaffecting thebuyer’s decisionsmustbe 7.3 prescribed mechanism toinvestigateallegedcorruption andmisuse India adoptedthe Whistleblower Protection Act, 2014,witha 8.4 subsidiary’s activities. situations, aforeignparentcompanycanbeheldliableforits falsification andmisleadingpublicdisclosures;insuch shall takeplaceinlimitedscenariossuchasfraud,account require liftingofthecorporateveil.Liftingveil no distinctionbetweentheshareholdersanddirectorsfacts cannot beheldliableforbreachofenvironmentallawunlessthereis acting throughitsdirectors. Thus theshareholdersofacompany Under Indianlaw, acompanyisseparatelegalentitydeemedtobe 8.3 or fineboth. or falsificationofaccounts,whicharepunishablewithimprisonment disclosure ofanysuchliabilityintheaccountshallbetreatedasfraud liabilities ascontingentinitsfinancialaudit.Non- A company isunderanobligationtodisclosepotentialenvironmental 8.2 legislation maybeadoptedinthefuturetoaddressthislegalvacuum. contamination iscurrentlybeingstudiedbytheMoEF&CCandnew approval process. As mentioned,thisregulatorylacunarelatingtoland Impact Assessment reportaspartoftheEnvironmentalClearance 8 potential liabilityforthatmatter? takeover transactions? report environmentalviolations/matters? caused byaforeignsubsidiary/affiliate? order toescapeenvironmentalliabilities? General matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- Is itpossibletouseanenvironmentalindemnity prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto To whatextentisitnecessarytodisclose Are thereanylawstoprotect“whistle-blowers” who company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff

vis-à-vis thirdparties,orinthe

India

8.6 NGT benches(withamountsattimesbeingashighINR1billion). damages arefrequentlyimposedbytheSupremeCourtaswell Public InterestLitigations(“PILs”). As mentionedabove,exemplary individuals ornon-governmentalorganisations (“NGOs”)tofile groups ofaffected people. The morecommonrouteinIndiaisfor Yes, thereareinstanceswhereclassactionsuitshavebeenfiledby 8.5 blower guidelinesbasedongoodcorporategovernanceprinciples. many larger companiesinIndiahaveadoptedinternalwhistle- whistle-blower lawsareapplicabletoprivatecompanies.However, alleged wrongdoingingovernmentbodies.However, nosuch of powerbypublicservantsandtoprotectanyonewhoexposes M.V. Kini ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 take partinthePAT mechanism, “Designated Consumers”fromeight industrialsectorswhichcould identified SpecificEnergy Consumptionreductiontargets for478 certificates (“ESCerts”). The Act, 2001 intensive large industries by allowingtradeinenergy-saving mechanism inIndiatopromoteenergy efficiency amongenergy- Mechanism waslaunched,afirst-of-its-kind,market-based As partoftheNMEEE,Perform, Achieve and Trade (“PAT”) knowledge forclimatechange. “green” India;(7)sustainableagriculture;and(8)strategic habitat; (4)water;(5)sustainingtheHimalayanecosystem;(6)a “missions”: (1)solar;(2)enhancedenergy efficiency; (3)sustainable Change in2008,whichfocusesonthefollowingeightareasor (“NMEEE”), IndialaunchedaNational Action PlanonClimate Under theNationalMissiononEnhancedEnergy Efficiency countries (therebyearningcertifiedemissionreductions). countries toinvestinemission-reducingprojectsdeveloping Development Mechanism(“CDM”)investments,enabling Annex-I On theotherhand,IndiahasbeenaleadinghostcountryofClean developed countries(emissiontradingandjointimplementation). did nottakepartintheflexibilitymechanismsforeseenfor and theKyotoProtocolin2002but,notbeingan Annex-I country, it ratified theUNFrameworkConventiononClimateChangein1993 There isnospecificcarbontradingschemeinplaceIndia.India 9.1 for abuseofthePIL process. are omnipresent,tothepointthatcourtshavestartedimposingfines deprived hadaccesstocourts.Sincethen,PILshaveflourishedand was deliberatelylowered,particularlytoensurethatthepoorand highlighted isinthepublicinterest.Historically, the NGO tofileapublicinterestlitigation,aslongtheissue In India,therearehardlyanyproceduralhurdlesforcitizenor to meettheirmandated compliancerequirementsor maybebanked and pulppaper. The ESCertsmaybetradedamongcompanies fertiliser; cement;ironandsteel; chlor-alkali; aluminium;textile; © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 9 market developingthere? pursuing environmentallitigation? damages available? Emissions Trading andClimateChange Do individualsorpublicinterestgroupsbenefitfrom environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing any exemptionfromliabilitytopaycostswhen your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation

viz.: thermalpowerstations; locus standi

tree coverby2030.Seealsotheanswertoquestion9.1above. 2.5–3 billiontonsofCO2equivalentthroughadditionalforestand 2030 from2005levels,andtocreateanadditionalcarbonsinkof the reductioninemissionsintensityofitsGDP by33%–35% actions thecountryintendstotake.India’s INDCincludes, (“INDC”) inOctober, 2015,whichoutlinesthepost-2020climate India submitteditsIntendedNationallyDeterminedContribution 9.3 GHG reporting. several industry-drivenvoluntaryinitiativestoencouragesuch There arenomandatoryGHGreportingobligations,butthere 9.2 The PublicLiability Insurance Act 1991(“PLI Act”) requires an 11.1 asbestos millingandasbestos-basedproducts. prepared forindustriesproposingtoengageinactivitiesrelating clearance mustbeobtainedandarelatedEIA reportmustbe are reviewedaccordinglybytheSPCBs. A priorenvironmental polluting industries,andenvironmentalpermit/consentapplications Asbestos-related activitiesfallintotheredcategory, thatis,themost notified asanoccupationalhazardundertheFactories Act). among otherthings,theFactories Act 1948(andasbestosishasbeen health andsafetyregulationsapplicabletoallindustriesunder, regarding asbestoson-site,otherthanthegeneraloccupational Owners/occupiers ofpremiseshavenospecificdutiestodischarge 10.2 workers whosehealthhasbeenaffected duetoexposureasbestos. asbestos, makingtheemployerresponsibletopaydamages Supreme Courtalsoaddressedtheharmfulconsequencesof 2014”, wastabledinParliament,buthasstillnotbeenadopted. The a draftBill,the“White Asbestos (BanonUseandImport)Bill, & Research Centre v. UnionofIndia PIL filedtobanwhiteasbestoswasdismissed( India remainsamajorimporterofchrysotile(white)asbestos,and of blueandbrownasbestos(Kalyaneshwariv. UnionofIndia The SupremeCourtimposedabanonthemanufacturingandmining 10.1 pertaining tothemethodologiesunderpinningPAT Mechanism. 2016, comprehensive Amendment Ruleswerenotified,essentially for thenextcycleofenergy savingsrequirements.On31March, 10 11 regulation inyourjurisdiction? to monitorandreportgreenhousegasemissions? risks insuranceplayinyourjurisdiction? in relationtoasbestoson-site? jurisdiction? What istheoverallpolicyapproachtoclimatechange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned in themarket,andhowbigarole doesenvironmental What typesofenvironmentalinsurance areavailable What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour Asbestos Environmental InsuranceLiabilities ). In2009,andagainin2014, WWW.ICLG.COM Consumer Education inter alia India

) but

,

123 India 124 India contamination lawwillbeadoptedinthenearfuture(althoughthis The onemajordevelopmentwhichisexpectedthataspecificsoil 12.1 insurance claims. infancy andnotmuchispubliclyavailablepertainingtosuch As mentioned,theenvironmentalriskinsurancemarketisstillinits 11.2 is growing,butstilllimitedcomparedtootherjurisdictions. under thePLI Act Policy. The environmentalrisksinsurancemarket an amounttothisfundwhichisequivalentthepremiumpaid through theEnvironmentReliefFund. The insuredmustcontribute of anyawardthatexceedsthe AOA limitispaidbytheGovernment is fixedatmaximumINR150million.UnderthePLI Act, theexcess company, subjecttoamaximumofINR50million. The AOA limit One Accident (“AOA”)mustrepresentthepaid-upcapitalof objection” certificatefromtheSPCB.UnderPLI Act, the Any policy canbeextendedtocoverpollutionrisksubjecta“no the minimumquantityspecifiedinPLI Act. The publicliability hazardous substances,asdefinedundertheEP Act, whichexceed insurance policytobetakenoutbyowners,usersortransportersof M.V. Kini © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 12 experience inyourjurisdiction? in environmentlawyourjurisdiction. Please provide,innomorethan300words,a What istheenvironmentalinsuranceclaims summary ofanynewcases,trendsanddevelopments Updates

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

that theRulescouldbenotifiedapproximately24monthsfromnow. contaminated sites. The expectation(asindicatedintheReport)is mandatory siteassessmentandreporting,thedeterminationof will providestandardsforsoilandwaterpollution,carryingout Contaminated Sites(IdentificationandManagement)Rules,which been undertaken. The ReportalsocontainsdraftRules:the mapping ofthemostpollutedsitesthroughoutIndiahasalready MoEF&CC. As afirstmilestoneofthisexercise,detailed Polluted Sites(“NPRPS”)hasrecentlybeensubmittedtothe Development ofaNationalProgramfortheRehabilitation would beposttheMarch2019nationalelections). A Reportonthe India andcompanieshavetoproactivelyaddressthisshift. which isatrendexpectedtogrowacrossmostStatesin and imposedstrictEPRobligationsongeneratorsofplasticwaste, Several Stateshaverecentlybannedplasticpackagingforproducts or environmentalduediligence. part ofanynewproject,internalenvironmentalmanagementsystem factored inbyallcompaniestheirenvironmentalriskanalysisas company thatownsorleasessuchasite. This wouldneedtobe days ofsigninganagreementforanychangeinownershipa the commencementofdemolitionanyproperty;andwithin60 industrial projectsorexpandingsuchonanysite;priorto for apermittoconstructonsuchsite;priorestablishingnew to signinganagreementforsaleorleaseofland;priorapplying Consent Order;whenobtaininganEnvironmentalClearance;prior undertaken inthefollowingsituations:priortoarenewalof that asoilanalysisandpossibleremediationwouldneedtobe adopted alongthesamelinesascurrentlyproposed,itwouldentail This wouldbeasignificantdevelopment,andiftheRulesare India

M.V. Kini ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London Goa, Bangalore,Hyderabad,LucknowandCalcutta,weareabletoprovideIndia-wideservicesourclients. government relationsteam,litigationandarbitration.Withourheadoffice inDelhi,Pune, inMumbaiandseveralbranchesthroughoutIndia,including from corporateandcommerciallaw, taxlaw, banking law, capitalmarketsandinfrastructurelaw, tolabourlaw, environmentallaw M.V. Kini,whichwasestablished30yearsago,currentlycountsabout150lawyers.M.V. practiceareasrange Kiniisafull-servicelawfirmandits “Environmental Law Award withinIndia”category. received the2019International Advisory Experts Award underthe by theWho’s WhoLegal:Environment She isregularlyrecognisedasaleadingenvironmentallawyerinIndia Health andSafetyLawCommittee(2017–2018). Senior Vice Chairofthe International Bar Association’s Environment, Nuclear Law Association fortheyears2015–2016,andiscurrently India, whichshehelpedco-found,wasthePresidentofInternational Els servesastheGeneralSecretaryofNuclearLaw Association of precautionary principle. Els iswidelypublishedandhaswrittenabookonthestatusof with allenvironmentallaws. assisting companiesinensuringtheyachieveahighlevelofcompliance a widerangeofenvironmentallaws,andhasextensiveexperience Els specialisesinenvironmentallawandnuclearlaw, advisesclientson Resources Institute(“TERI”),NewDelhi. Centre forGlobal Agreements, Legislationand Trade at The Energyand Chicago, USA.PriortoobtainingherIndianlawdegree,Elsheadedthe issues at Allen &Overy, BrusselsandatGiordano& Associates, India, sheworkedasalawyeronenvironmentandenergy-related an LL.M.degreeattheUniversityofGeorgia,USA.Beforemovingto ( She haslawdegreesfromtheFreeUniversityofBrussels,Belgium Els isaPartneratM.V. Kiniandheadsthefirm’s Environmentpractice. magna cumlaude ), andtheUniversityofDelhi,India.Shecompleted URL: Email: Tel: India Mumbai 400001 261/263 DNRoad,Fort Kini House M.V. Kini Els Reynaers www.mvkini.com [email protected] +91 9821870055 edition,includingin2018.She

Pollution ControlBoards. Climate Change,theCentralPollutionControlBoardandState represents clientsbeforetheMinistryofEnvironment,Forestsand hazardous waste,e-wasteandplasticinthiscontext He regularlyadvisesclientsonlawspertainingtowaterpollution, purposes forinfrastructureprojectsofnationalimportance. Zone (“CRZ”)areas,wildlife,anduseofprotectedareasfornon-forest environmental clearancesandapprovalsrelatingtoCoastalRegulation He alsorepresentsclientsbeforeregulatoryauthoritiestoobtain Green Tribunals, theDelhiHighCourtandSupremeCourt. department intheDelhioffice andoverseescasesbeforetheNational Tavinder headstheenvironmental,healthandsafety(“EHS”)law contracts, tenderlaws,labourandemployment-relatedmatters. Wales. Tavinder’s expertiseextendstoissuesrelatinggovernment is qualifiedtopractiseasaSolicitorintheCourtsofEnglandand Tavinder isan Advocate onRecordwiththeSupremeCourtofIndiaand URL: Email: Tel: India New Delhi110 014 6/39 Jangpura-B Kini House M.V. Kini Tavinder Sidhu www.mvkini.com [email protected] +91 9999780987 WWW.ICLG.COM , aviationlaw, India

125 India Chapter 18 Indonesia Kristianto P. H. Silalahi

Daud Silalahi & Lawencon Associates Maurice J. R. Silalahi

1 Environmental Policy and its 1.3 To what extent are public authorities required to Enforcement provide environment-related information to interested persons (including members of the public)?

1.1 What is the basis of environmental policy in your Everyone has the right to access data or information related to jurisdiction and which agencies/bodies administer environmental protection and management, which according to its and enforce environmental law? nature and objectives is open to the public. However, in practice, this has got to go through several formal applications and analysis of Indonesia has implemented its third generation of environmental the nature of the request. Aside from the Environmental Law and law via Law No. 32 of 2009 concerning the Management and MOE Regulation No. 6 of 2011, the MOEF has an integral and Protection of the Environment (“Environmental Law”). The coordinated environmental public information system to publish Environmental Law has developed to include protection aspects in information upon requests from the public and to publish such order to strengthen environmental preservation efforts. information on, among other places, the official website of the The agencies/bodies that administer and enforce the Environmental MOEF. Public information is also regulated by Law No. 14 of 2008. Law are the Ministry of the Environment and Forestry (“MOEF” – previously under the Ministry of Environment (“MOE”), prior to Mr. Joko Widodo’s Administration), governors, and regents/mayors 2 Environmental Permits depending on the respective authorities and autonomy as stipulated under Law No. 23 of 2014 concerning Regional Autonomy as 2.1 When is an environmental permit required, and may amended by Law No. 9 of 2015. Further, MOEF has technical environmental permits be transferred from one implementation units that are divided into five units throughout person to another? Indonesia, those being in Sumatera, Java-Bali-Nusa Tenggara, Kalimantan, Sulawesi, and Maluku-Papua. Other institutions have According to the Environmental Law and MOE Regulation No. 5 of also been established to deal with specific issues related to the 2012, an environmental licence is required in order to obtain a protection of the environment; for example, the Regional business licence for any business activities that require an Environmental Management Agency (“BPLHD”) for regional control. Environmental Impact Assessment (“AMDAL”) or Environmental Management and Monitoring Programme (“UKL – UPL”). The 1.2 What approach do such agencies/bodies take to the criteria for business activities that require an AMDAL include those enforcement of environmental law? that cause changes to the state of the land and landscape, exploit natural resources, whether renewable or non-renewable, could The main environmental legal approach is based on precautionary potentially cause environmental pollution and/or damage as well as principles, which are applied to the permit regime instituted by the consume and degrade natural resources in their utilisations, and/or respective authorised institutions. MOEF, each province and apply technology predicted to have a significant potential to regency/municipality have government officials that have the primary influence the environment. A UKL – UPL is required for, among role of legal enforcement through warnings and administrative others, business activities which do not require an AMDAL (for sanctions, including permit revocation if necessary. activity that has a lesser impact on the environment). Multi-door has been announced as a new instrument As long as the permit remains valid and there is no change in the to resolve matters related to natural resources, including the business’s activity, whether in its production and/or extraction of preservation of the environment, by utilising several legal instruments raw materials, according to Government Regulation (“GR”) No. 27 to encourage and uncover legal violations such as corruption, money of 2012, in the event of a change of ownership of a business, the laundering, tax crimes and other related matters. This is a environmental licence may be transferred from the initial owner to development of the one roof enforcement system (“ORES”). its successor by submitting an application for an amendment to the existing environmental licence to the MOEF, governor or regent/mayor, according to their respective authorities.

126 WWW.ICLG.COM ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 © Published and reproduced with kind permission by Global Legal Group Ltd, London on Environmental Audits. an environmentalauditissetoutinMOERegulationNo.3of2013 an environmentalaudit.Inaddition,theprocedureforconducting Basically, MOEFhasfullauthoritytoforceanycompanyundergo environmental auditor’s competencecertificationbody. certificate ofenvironmentalcompetenceissuedbythe audits areconductedbyenvironmentalauditorsthathavea Article 51oftheEnvironmentalLawexplainsthatenvironmental b) a) that environmentalauditsaremandatoryfor: Moreover, Article 17MOERegulationNo.3/2013furtherexplains risk totheenvironment. environmental audittobusinessesand/oractivitiesthathaveahigh Environmental Law, whichstatesthat:“[the] business activities,assetoutin Article 49paragraph(1) requirements andpoliciesisonlyrequiredforcertain‘high-risk’ An Environmental Audit toevaluatecompliancewithgovernment Regulation No.5of2012. business activitieswhichrequirean AMDAL areprovidedinMOE environment. The definitionofasignificantimpactandthetypes businesses foractivitiesthathaveasignificantimpactonthe The EnvironmentalLawprovidesthatan AMDAL isrequiredby 2.3 administrative courtagainstadecisiononanenvironmentallicence. Regulation No.17of2012allowsanyonetofilealawsuitinstate 1986 asamendedbyLawNo.51of2009).Furthermore,MOE provided bytheLawon Administrative Courts(LawNo.5of licence maybeconductedthroughastateadministrativecourtas decisions byanenvironmentalregulatornottogrant A rightofappealagainstgovernmentinstitutiondecisionsand 2.2 Daud Silalahi&LawenconAssociates ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 damage caused. investigations andsanctionsmay beconductedtoresolvethe the violationofpermit,civilsanctions/ and/orcriminal administrative sanctionshavenotresolvedthedamagecausedby environment mayalsoberequired.Furthermore,intheevent environmental licence.Repairinganydamagecausedtothe compulsory actionandthesuspension,orrevocation,ofan the violationofpermits. These includewrittenwarnings, has thepowertoimposeadministrativesanctionsinconnectionwith According totheEnvironmentalLaw, theenvironmentalregulator 2.4 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London polluting industriesorotherinstallations/projects? contained inanenvironmentalpermit? permits? management. with regulationsinthefieldofenvironmentalprotectionand businesses and/oractivitiesthatindicatenon-compliance environment; and/or businesses and/oractivitiesthathaveahighrisktothe Is itnecessarytoconductenvironmentalauditsor What rightsaretheretoappealagainstthedecisionof regulators haveinconnectionwiththeviolationof environmental impactassessmentsforparticularly environmental permitorinrespectoftheconditions an environmentalregulatornottogrant What enforcementpowersdoenvironmental ” Minister obligatesan

3.2 humans andtheenvironmentsub-chronicorchronictoxicity. B3 Waste whichhasadelayedeffect andhasanindirectimpacton negative impactontheenvironment;and(ii)B3 Waste Category2: is acuteandhasadirectimpactonhumanscertainlywillhave categories basedonitsrisk:(i)B3 Waste Category1:B3 Waste which of B3 Waste. GRNo.101of2014dividesB3 Waste intotwo storage, collection,transport,utilisation,processing,and/ordisposal must implementB3 Waste management,includingthereduction, authorities. GRNo.101of2014stipulatesthatB3 Waste producers manage theB3 Waste andholdalicencefromtherespective All producersofB3 Waste orexpiredB3materialsarerequiredto pollute and/ordamagetheenvironmentanditssustainability. nature, concentrationand/orquantitycanbothdirectlyandindirectly substances, energy and/orothercomponentswhich,duetotheir Waste”) thatistheresidueofabusinessactivitycontaining of businessactivities;and(b)hazardoustoxicwaste(“ Referring totheEnvironmentalLaw, wasteisdefinedas:(a)residue 3.1 managing itswaste. another partywhichhastherelevant licencetoassisttheproducerin dumping. IfaB3 Waste producer isnotabletodothis,itmayuse reduce therisksthatmayarisefrom B3 Waste andreduceB3 Waste for theseactivities. The aimsoftheseactivitiesaretoeliminate or utilisation, processinganddisposal, andholdthelicencesrequired management, includingitsreduction,storage,collection,transport, 2014, B3 Waste producersareobligedtoimplementB3 Waste be disposedoformanaged;therefore,accordingtoGRNo.101 even afterithasbeentransferredand/orexportedtoathirdparty B3 Waste producersremainliablefortheB3 Waste theyproduce 3.4 standards asintendedinthelawandregulations. it mustfolloweveryaspectoftherequiredpermitsandoperations therefore, fortheproducertobestprotectitsinterestsinthismatter, the producerformanagementofB3 Waste itproduces; for disposal/treatmentoff-site doesnotreducetheresponsibilityof No. 101of2014providesthattransferringB3 Waste toanotherparty The producerofwasteretainsresidualliabilityforitsB3 Waste. GR 3.3 may beextended. Licence tostoreB3 Waste. The licenceisvalidforfiveyearsand No. 101of2014.ProducersmustobtainaB3 Waste Management dispose ofitswasteonthesitewhereitwasproducedpursuanttoGR There areseveralmethodsallowedforaproducertostoreand/or 3 waste involveadditionaldutiesorcontrols? regarding thetake-backandrecoveryoftheirwaste? bankrupt/disappears)? produced? Waste and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore How iswastedefinedanddocertaincategoriesof To whatextentdowasteproducershaveobligations the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin

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127 Indonesia 128 Indonesia and/or thelenders’ interventionintheborrower’s businessactivities. any remediationcoststotheextent setforthintheloanagreements Lenders mayonlybeheldliablefor environmentalwrongdoingor 4.5 otherwise agreedbypartiesthroughtheiragreement. liable foranyenvironmentaldamagecausedbythecompanyunless on behalfof,thecompany. A purchaserofassetswillnotbeheld order orleadingtheactivitythatledtoenvironmentalliabilityfor, or otherwise beproventhatthepurchaserintervenedbygiving Environmental liabilityremainswiththecompany, unlessitcan 4.4 officers, onlythecompanyasalegalentity. cover ofatleastIDR5billion,butitmaynotdirectorsorother activity isB3 Waste managementtohaveenvironmentalinsurance MOE RegulationNo.18of2009requirescompanieswhosemain officer. wascommittedontheordersofadirectororcompany behalf of,abusinessentity. The personmaybeheldliableifthe and/or personwhogavetheorderinacrimecommittedby, for, oron Yes, criminalsanctionsmaybeimposedonthebusinessentity 4.3 proceedings, soinsomecasesthisprinciplecannotbeaccepted. debatable andcontroversialduetotheburdenofproofintrial practice, theimplementationofstrictliabilityprincipleremains held liablefortheenvironmentaldamagewhichoccurred.But,in person foundliablewasnotatfaultornegligent,thatmaybe Upon theapplicationofstrictliabilityprinciple,evenif 4.2 use oftheburdenproofincourt. liability provisionremainscontroversialanddebatable that thepartywasatfault.However, theapplicationofstrict responsible foranydamage,withouttheplaintiff havingtoprove causing aseriousthreattotheenvironmentunderwhichitisfully using B3 Waste, producingand/ormanagingB3 Waste and/or provision whichappliestoanypartyengagedinabusinessactivity Article 88oftheEnvironmentalLawprovidesastrictliability of SupremeCourtDecreeNo.36/KMA/SK/II/2013.Furthermore, a guidelineforIndonesianjudgesintheirrulings,asstatedHead used inenvironmentallawenforcementIndonesia.Ithasbecome The ‘polluterpays’ principleisapartofthepreventiveinstruments 4.1 Daud Silalahi&LawenconAssociates © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 4 what defencesaretypicallyavailable? environmental wrongdoingand/or remediationcosts? the onehandandanassetpurchaseonother? indemnity protectioninrespectofsuchliabilities? within permitlimits? Liabilities To whatextentmaylenders beliablefor environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa

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action toseekcompensation. contamination byapreviousowner oroccupierhastherighttotake agreement. Therefore, anyonewhosuffers alossbecauseof purchaser acknowledgestheB3 Waste riskinthesaleandpurchase Therefore, liabilitycannotbetransferredtothepurchaser, unlessthe more accountable. Moreover, parties whoaresubjecttostrictliabilitymaybeheld resolution mechanismasprovidedbytheEnvironmentalLaw. MOEF andresponsiblepartiesthroughtheenvironmentaldispute A court decisionorconsentmaybereachedbyagreementbetween 5.2 (MOE RegulationNo.33of2009). conduct remediationhastobesubmittedandapprovedbyMOEF be bornebytheguiltyparty. Further, theproposalofplansto supervised byMOEF(remediationdirectory),andallthecostshall impacts ontheenvironment. These activitiesshallbedirectly or destruction,andtakingcertainactionstopreventnegative certain actionstoguaranteethattherewillbenorecurringpollution include therecoveryofpollutionand/ordestruction,taking certain actionsand/orpaycompensation. These actionsmay contaminates thesoilorgroundwatermayberequiredtoperform According totheEnvironmentalLaw, aguiltypartythat 5.1 managing thelandcontaminatedbyB3 Waste ithasproduced. Based ontheEnvironmentalLaw, thepolluterisresponsiblefor 5.4 unless newincidentsorevidenceisfound. Neither party, noranythirdparty, canthenchallengetheagreement, settlement, whichislegallyenforceable. settlement agreementwiththedistrictcourttoobtainadeedof settlement agreementoutsidethecourts,partymustregister If aprogrammeofenvironmentalremediationisagreedin planned andtherearenofurtherviolationsinthefuture. may onlysupervisetoseewhethertheagreedproposalisworkedas issued aftertheworkisdone,unlessanewissuearises,regulator by MOEF)withanenvironmentalregulator, andSPPLT hasbeen If aprogrammeofenvironmentalremediationisagreed(approved 5.3 5 is responsibleforthecontamination? groundwater? contaminated landliabilitytoapurchaser? can athirdpartychallengetheagreement? Contaminated Land How isliabilityallocatedwheremorethanoneperson (including historiccontamination)ofsoilor What istheapproachtoliabilityforcontamination possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis Indonesia

monitor andinspectequipmenttakesamplesphotographs. governors orregents/mayorshavetheauthorityandpowerto supervision officials appointed(orawarrant)bytheMOEF, and/or aspartofanongoinginvestigation,environmental are coveredbytheenvironmentalandmanagementregulations To ensurecompliancebyallpartieswhosebusinessesoractivities 6.1 provide proofinacourtoflaworforanout-of-courtsettlement. compensation tobepaidthegovernment.Insomecases,ithas MOE RegulationNo.7of2014regulateshowtocalculatethe 5.5 Daud Silalahi&LawenconAssociates ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 prospective purchaser. requirement forasellertodiscloseenvironmentalproblems However, accordingtoCompanyLaw, thereisnospecific current bookyear. These may include environmentalproblems. disclose anyissuesthathaveaffected theiractivitiesduringthe Companies conductingamerger and/ortakeoverarerequiredto 7.3 respective authorities. report orasaresultofsitevisitsupervision(monitoring)bythe business actorforanallegedenvironmentalcrimeuponreceiptofa The policeorcivilservantinvestigatorswillinvestigateaperson 7.2 sanctioned eithercivillyorcriminally. protect thatright,thepersonwhofiledreportcannotbe potential pollutionand/ordamageisaperson’s right.Further, to healthy lifeandagoodenvironment;therefore,toreportanalleged Based ontheEnvironmentalLaw, everypersonisentitledtohavea 7.1 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 7 6 parties? conduct siteinspections,interviewemployees,etc.? public assets,e.g.rivers? takeover transactions? contamination? Reporting /DisclosureObligations Powers ofRegulators What powersdoenvironmentalregulatorshaveto polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto require productionofdocuments,takesamples, To whatextentisitnecessarytodisclose have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe environmental regulatororpotentiallyaffectedthird

implementation ofstrictliability. environmental liabilities,especiallyinrelationtostrengtheningthe liabilities off balancesheetordissolvethecompanytoescape environmental damagemaynotbeabletoshelterfrom Based ontheEnvironmentalLaw, anyonewhoisliablefor 8.2 insurance covermaylimittheliabilitytoenvironmentalindemnity. activities, especiallyforB3 Waste management,themandatory compensation, includingpotentialcriminalsanctions.Insome damages orpollutionisobligedtopayand/or Based ontheEnvironmentalLaw, anyonewhocausedenvironmental 8.1 group or“class”,communitieshave therighttofileanindividualor Yes, in theeventofenvironmentaldamagethatcauseslossestoa 8.5 that theyarenotprosecutedviacriminalsanctionsoracivillawsuit. fights fortheirrighttohaveagoodandhealthyenvironmentinorder Law 32/2009,itisaffirmed that protectionisgiventoanyonewho Supreme CourtRegulationNo.4of2011. However, inarticle66of “whistle-blowers” whoreportviolations,includingasstipulatedin Indonesia’s regulationsdonotspecificallyregulatetheprotectionof 8.4 shareholder cannotbeheldliableforbreachesofenvironmentallaw. Based ontheEnvironmentalLawandIndonesianCompanyLaw, any 8.3 parent companywasabletoavoidtheallegation. did notinterveneintheirsubsidiary/affiliate’s activity, thenthe law; butaslongtheparentcompanyhadnotbeeninvolvedand/or because oftheirsubsidiaries/affiliates’ breachesof environmental haveshownthataparentcompanywasbeingsued committed byitssubsidiaries/affiliates. However, inpractice,some cannot beheldliableaswellforbreachesofenvironmentallaw due tobreachingenvironmentallaw. Moreover, theparentcompany However, theshareholder maysuffer ifthecompanyiscloseddown 8 order toescapeenvironmentalliabilities? potential liabilityforthatmatter? damages available? report environmentalviolations/matters? caused byaforeignsubsidiary/affiliate? General balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- Is itpossibletouseanenvironmentalindemnity environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing Are thereanylawstoprotect“whistle-blowers”who company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld

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129 Indonesia 130 Indonesia 2. 1. follows: There aresomerelatedregulationsonclimatechangeinIndonesia,as 9.3 gas emission. national greenhousegasandperforminginventoryof MOEF (previouslyMOE)istheauthorisedinstitutiontomonitor Implementation ofaNationalGreenhouseGasInventory, the Based onPresidentialRegulationNo.71of2011 concerningthe 9.2 GR No.46of2017concerningEnvironmentalEconomicInstruments. mechanism toaccelerateclimatechangemitigationactionsthrough moment, thegovernmentofIndonesiaisactivelydevelopinga developed throughPresidentialRegulationNo.61of2011. At this US dollarsandequivalentto32milliontonsofCO2,whichis from nolessthan47projects,withavalueofapproximately1billion development mechanism,whichalreadygeneratesemissioncredits Emission tradingschemeshavebeendevelopedthroughtheclean greenhouse gasemissionsby29%2030. carbon marketcanhelpIndonesiaachieveitstarget ofreducing umbrella oftheParis Agreement tocontrolclimatechange. The the reductionofgreenhousegasemissionsinIndonesiaunder The carbonmarketmayremainasourceoffundingforsupporting 9.1 interest groups. However, suchremediesonlyapplyforindividualsandnotpublic costs whenpursuinglitigationandthecostwillbepaidbystate. the claimantsmayrequestexemptionsfromliabilitytopaycourt claimant doesnothavetheeconomicresourcestopaycost,then Based onLawNo.48of2009thePowersJudiciary, ifthe 8.6 activities. also entitledtofilealawsuitforrestorationbusinessactorsand/or Court RegulationNo.1of2002.Inaddition,environmentalistsare procedural mechanismforaclassactionisregulatedinSupreme this isinlinewitharticle91oftheEnvironmentalLaw. The actor and/oractivitiesthatcausedtheharmtogroup(victims); has therighttofileaclaimforcompensationagainstbusiness class action.Inthecaseofaactionlawsuit,“class”group Daud Silalahi&LawenconAssociates © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 9 pursuing environmentallitigation? regulation inyourjurisdiction? to monitorandreportgreenhousegasemissions? market developingthere? greenhouse gasemissions (article63). Regency/City Governmenttoconduct aninventoryof The EnvironmentalLawrequiresthe Government,Provincial, climate changemitigationinnational communication. national greenhousegasemission levels andefforts towards on ClimateChange,whichrequires Indonesiatoreportthe Law No.6of1994concerningRatification oftheConvention Emissions Trading andClimateChange What istheoverallpolicyapproachtoclimatechange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation Do individualsorpublicinterestgroupsbenefitfrom any exemptionfromliabilitytopaycostswhen

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10.2 asbestos litigationinIndonesiatodate. We havenoexperienceinasbestos litigationandtherehasbeenno 10.1 insurance todate. neither datanorinformationregarding anyclaimforenvironmental management havebeencoveredby insurance.However, wehave From ourexperience,somecompanies thatareinvolvedinB3 Waste 11.2 Indonesia maybeconsideredquitelimited. B3 Waste management.Currently, theroleofenvironmentalriskin from itsownactivitytohaveenvironmentalinsurancecoverfor is managingand/orprocessingB3 Waste thatdoesnotoriginate in MOE18/2009,whichrequiresanycompanywhosemainactivity was introducedforB3wastemanagementinIndonesiaasstipulated for theenvironmentisenacted.Moreover, environmentalinsurance even thoughGRNo.47of2017concerningeconomicinstruments Environmental insuranceremainsastagnantmarketinIndonesia, 11.1 and asawasteisregulatedbyGRNo.101of2014. Moreover, asbestos asamaterialisregulatedbyGRNo.74of2001, environment everythreemonthsoratanothercertainfrequency. entities istomeasureasbestosdustparticlesintheairwork its workerswithprotectiveequipment. The otherdutyforbusiness management ofabusinessentitythatutilisesasbestosmustprovide the safeandhealthyuseofasbestos.UnderthisDecree, to dateisMinisterofManpowerDecreeNo.31985concerning than environmentalissues. The onlyregulationrelatingtoasbestos Asbestos regulationinIndonesiaemphasiseshealthissuesrather including aNationalMid-Term DevelopmentPlanfor2015–2019. development ofanIndonesianSustainableDevelopmentGoal, preparation ofclimatechangeadaptationactionsandalsothe Moreover, MOEFDecreeNo.33of2016setsoutguidelinesfor 5. 4. 3. and supportIndonesia’s nationalcommitmentsonclimatechange. The overallpolicyapproachistomitigateandadaptclimatechange 10 11 in relationtoasbestoson-site? jurisdiction? experience inyourjurisdiction? risks insuranceplayinyourjurisdiction? What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour What istheenvironmentalinsuranceclaims in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable Implementation ofaNationalGreenhouseGasInventory. Presidential RegulationNo.71of2011 concerning the Action Plansforreducinggreenhousegasemissions. Presidential RegulationNo.61of2011 concerning National inventory ofgreenhousegasemissions. formulation ofclimatechangepoliciesandthecreationan Geophysics, Article 65paragraph(3)lettera,requiresthe Law No.31of2009concerningMeteorology, Climatologyand Asbestos Environmental InsuranceLiabilities

Indonesia

application ofstrictliabilityforenvironmentallegalcasesandthe strengthened environmentallawenforcementinIndonesia. The change, environmentaldegradationandplasticwastehas The increasingconcernforenvironmentalissuessuchasclimate 12.1 Daud Silalahi&LawenconAssociates ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London then, DSLA hasgrowntobe oneoftheprominentlawfirmsspecialisinginenvironmentallaw. Havingopeneditsoffice in2008,DSLA inJakarta Daud Silalahi&Lawencon Associates LawFirm(“DSLA”)wasfoundedbyProf.Dr. Since M.DaudSilalahi,S.H.atBandunginSeptember 1999. importance ofthedevelopmentandimprovementenvironmentsocial economyforabetterqualityoflife. ourselves tobetrustedandrespectedbythecommunity, besustainable,ontime, practicalandeffective. appreciatethe Inourservice,wealso litigation. DSLA iscommitted toalwaysinnovatingandoffering effective legal solutions/settlementsforanyexistinglegalmatter and technology;research;bankingfinance;othergeneralcorporate/commercial matters. The firm’s litigationandnon- servicesinvolveboth general mining,oilandgas,forestry, plantationlaw, manufacturing,garmentsindustry, alternativeenergy, labour;information andpropertytourism); resources(suchas services reachouttoclientswithdiverselegalissuesincluding,butnotlimited to:environmentallawsuchasenergyandnatural settlement. law, plantationlaw, manufacturing,oilandgasalternative dispute corporate andcommerciallaw, contractlaw, environmental law, mining local journals.Heisaseniorpartnerofthefirm,specialisingingeneral lecturer, hasco-authoredbooksandwrittenininternational Association ofHazardousWaste ManagementinIndonesia.Heisa Advocates Assocation (“PERADI”)andwasanExecutiveDirectorofthe legal expert,isamemberoftheNationalBoardIndonesian involved intheIndonesianChambersofCommerceasanenvironment of theUniversity Atmajaya. Dr. Silalahiisacertified mediator, actively Managing Partneruntil2015,whenhewasappointedtobeVice Rector Silalahi workedasanadvocateatprestigiouslawfirms.HewasDSLA’s Law (cumlaude Kristianto P. andPh.D.in Master’s H.SilalahiobtainedhisBachelor’s, 12 in environmentlawyourjurisdiction. summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a Updates ) fromPadjadjaranUniversity. PriortojoiningDSLA,Dr. URL: Email: Tel: Indonesia Jakarta, 12940 Block X-7,Kav. 5 Suite E,Jl.HRRasunaSaid Menara Kuningan,12 Daud Silalahi&Lawencon Associates Kristianto P. H.Silalahi www.dslalawfirm.com [email protected] +62 2157945411 th Floor

awareness andadherencetothesustainabilityofenvironment. Indonesia. These improvementsaretobefollowedbycompanies’ nowadays; ithasbeenforthebenefitofenvironmentalprotectionin officials inIndonesiahavebeeneffectively provenstronger capacity-building oflawenforcement-relatedinstitutionsand rapid developmentofenvironmentallawinIndonesia. consultant mayhelpcompaniesindealingwiththeexistingand Having therightandacompetentenvironmentallegaladvisoror MOEF toprovidebetterenvironmentalmanagementandprotection. and environmentalstandardsareregularlybeingreviewedby The government’s legalstandinghasbeensignificantlyincreasing a memberoftheIndonesian Advocates Association (“PERADI”). textiles, plantationlaw, andgeneralcorporatecommerciallaw. Heis Mr. Silalahiisapartnerofthefirm,specialisinginenvironmentallaw, textile industriesandgeneralcorporatecommerciallegalmatters. environmental managementandprotection,mining,plantations,the cases andsettlementdisputes,providingadviceregarding more than10yearsofexperienceindealingwithmajorenvironment a numberofprestigiouslawfirmswithinternationalaffiliation. Hehas having majoredinInternationalLaw. PriortojoiningDSLA,heworkedat Maurice J.R.SilalahiholdsaLawdegreefromPadjadjaranUniversity, URL: Email: Tel: Indonesia Jakarta, 12940 Block X-7,Kav. 5 Suite E,Jl.HRRasunaSaid Menara Kuningan,12 Daud Silalahi&Lawencon Associates Maurice J.R.Silalahi www.dslalawfirm.com [email protected] +62 2157945411 WWW.ICLG.COM th Floor . We challenge Indonesia ’s

131 Indonesia Chapter 19 Italy David Röttgen

Ambientalex - Studio Legale Associato Andrea Farì

1 Environmental Policy and its Environmental information, that must be published, is also subject Enforcement to civic access legislation (art. 40 of Legislative Decree no. 33/2013).

1.1. What is the basis of environmental policy in your 2 Environmental Permits jurisdiction and which agencies/bodies administer and enforce environmental law? 2.1 When is an environmental permit required, and may Italy’s environmental policy is based, amongst others, on the environmental permits be transferred from one principle of sustainable development, prevention, precaution and person to another? “the polluter pays”. These EU principles are codified in Legislative Decree no. 152/2006 (hereinafter, the “Code”). They apply to As a matter of principle, any human activity having any impact on public and private figures as well as lawmakers. An important role the environment is subject to prior authorisation. Italian legislation is played by the Ministry of the Environment (hereinafter, “MoE”). provides for a wide variety of permit types. An operator shall apply Important administrative functions are also assigned to regional and for a permit on the basis of the type of activity planned or conducted local authorities (hereinafter, “Administrations”). Technical and its output, and the environmental aspects which the system surveys and assessments are carried out by technical organisations, considers potentially at risk as a result of the activities in question. such as the Institute for Environmental Protection and Research Some permits are issued on the basis of the applicant’s subjective (hereinafter, “ISPRA”), which provides back-up for the MoE and characteristics. Consequently, though the permit of an operator coordinates the regional and provincial environment agencies. running the activity may be transferred, as a matter of principle, notification to the Administration for assessment/transferral is required. 1.2 What approach do such agencies/bodies take to the enforcement of environmental law? 2.2 What rights are there to appeal against the decision of In order to ensure that environmental law is applied, public figures an environmental regulator not to grant an are provided with traditional scheduling and “command and control” environmental permit or in respect of the conditions tools. With such tools, Administrations establish the relevant limits contained in an environmental permit? and then ensure that they are complied with. Administrations are also given the power, when envisaged by the law, to enter into An operator may appeal, before the authority that is hierarchically agreements (between an Administration and the party(ies) superior to the environmental Administration, against a decision not concerned). The law also regulates economic tools that are aimed at to grant an environmental permit or a decision in respect of the internalising environmental costs or benefits in exchange processes. conditions contained in the permit. Alternatively, an appeal may be lodged with the competent Regional Administrative Tribunal within 60 days from the issuance of the decision, or alternatively, within 120 1.3 To what extent are public authorities required to days with the President of the Republic. The parties that are entitled provide environment-related information to interested to lodge an appeal are operators applying for the permit, external persons (including members of the public)? promoters of environmental protection and public safety schemes, as well as any Administration involved in the issuing procedure. With Legislative Decree no. 195/2005, implementing Directive 2003/4/EC, the legislator created a system of rules regulating environmental information and the public’s right of access. On the 2.3 Is it necessary to conduct environmental audits or one hand, the Administration is given an active role in divulging environmental impact assessments for particularly information on the state of the environment regardless of whether polluting industries or other installations/projects? requests for access are made by individuals. On the other, it is provided that every natural or who is assigned public An environmental impact assessment (hereinafter, “EIA”) is functions connected with environmental topics must make required for the plants referred to in annexes II and III of the Second environmental information available to anyone asking for it. Part of the Code. The projects referred to in annexes II-bis and IV

132 WWW.ICLG.COM ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 © Published and reproduced with kind permission by Global Legal Group Ltd, London disaster, whichare punishablewithweightysanctions. including thecrimesofenvironmentalpollutionand courts, butalsoadministrativecourts). heavily debatedinfrontoftheItaliancourts(especiallycriminal assimilati). The definitionofwasteis,likeinotherjurisdictions, crimes oftheItalianCriminalCode(art.452- envisaged intheCodemaybeimposed,aswellenvironmental the CA.Furthermore,administrativeandcriminalsanctions installation operatingwithoutauthorisationmaybecloseddownby revoke thepermitandrequireclosingdownofaplant. An caution andsuspendactivitiesforafixedperiod. The CA mayalso violations committed.Ifthearerepeated,CA may has thepowertocautioncompanyandobligeitremedy required authorisation,thecompetentauthority(hereinafter, “ When permitsareviolatedoractivitiesconductedwithoutthe 2.4 UNI ENISO14001). environment certificationsvoluntarilyobtainedbytheoperator(e.g. audits, ontheotherhand,arecarriedoutmainlyinconnectionwith permit grantedaccordingtoIPPClegislation.Environmental no. 105/2015).Environmentalauditsmayalsoberequestedbya legislation”, a“safetyreport”mustbedrawnup(LegislativeDecree existing andnew“highthreshold”installations,subjectto“Seveso presentation andevaluationofanenvironmentalimpactstudy. For procedure shouldbeinitiated. The EIA consistsofthecarryingout, ibid. aresubjecttoapreliminarycheckassesswhethertheEIA Ambientalex -StudioLegaleAssociato ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 produces (autosmaltimento waste producerentitledtodispose ofthenon-hazardouswasteit exceptional cases,andafteraformal notificationprocedure,isthe related technicalrules(e.g.fordangerous substances).Onlyin homogeneous categoriesofwaste andincompliancewiththe quantitative limits. Thirdly, storage canonlybecarriedoutfor the discretionofwasteproducer, eithertotime limitsorto generating activityiscarriedout.Secondly, storageissubject,upto temporaneo) cansolelyoccurintheareawherewaste- forth byart.183,para.1,lit.bb)oftheCode.Storage( The originalwasteproducerhastocomplywithallconditionsset 3.2 certain conditions,canbeclassifiedasmunicipalwaste– “non-municipal waste”( above typesofwasteareeitherclassifiedas“municipalwaste”or waste types(e.g.someofexcavatedsoilandrocks). All ofthe aforesaid categories,theItalianlegislatorhasalsoidentifiedother legislation (e.g.packaging, WEEE, etc.).Inadditiontothe categories areidenticaltowastegovernedbyEuropean also identifiesadditionalcategoriesofwaste.Somethese by Europeanlegislation,andothersarenot,asItalianlegislation Some wastedefinitionsareidenticaltoprovided 3.1 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 3 waste involveadditionaldutiesorcontrols? permits? produced? Waste regulators haveinconnectionwiththeviolationof What enforcementpowersdoenvironmental and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore How iswastedefinedanddocertaincategoriesof rifiuti speciali ). –someofwhich,under bis to452-terdecies

deposito rifiuti CA”)

),

to sanctions. obligations setforthundertherelatedEPRschememaybesubject other inregardtotheirfunctioning.Non-compliancewithspecific legislative reform.ItalianEPRschemesdiffer verymuchfromone (EU) 851/2018,saidEPRschemesarecurrentlysubjectto introduced inthefuture.InviewoftranspositionDirective waste oils,tyres,PVC).NewEPRschemesarelikelytobe equipment, batteries,end-of-lifevehicles,mineralwasteoils,edible schemes havebeenintroduced(packaging,electricalandelectronic specific extendedproducerresponsibility(hereinafter, “ On thebasisof“polluterpays”principle,forsomeproducts, 3.4 such responsibility. sometimes farbeyondtheliteralwordingofart.188Code, been thesubjectofcriminalcourts’ rulingswhichhaveenlarged, producer/holder, however, lacks precise boundaries,asthetopichas identificazione deirifiuti producer receivesbackthedulycompletedcertificate( service ortodulyauthorisedentities,providedthatthewaste only ceasesifthewasteishandedovertopubliccollection producer/holder hasenteredintoaspecificagreement.Liability to municipalwastemanagementoperatorswithwhichthe the waste,asamatterofpriority, todulyauthorisedthirdpartiesor A wasteproducer/holder, unlessentitledotherwise,hastoconsign 3.3 can demonstratethat itisnotresponsibleforanynegligent orwilful Code. According toart.308,anoperator willnotbeheldliableifit however, asitconflictswiththeprovisionsofart.308, para.5ofthe complies withthepermitgranted. This isacontroversialissue, situations inwhichanoperatorisheld liableevenwhenitsconduct of objectiveliabilityimposedoncertain operators. This maylead to The implementationofDirective2004/35/EC ledtotheintroduction 4.2 (criminal orcivil)and/oradministrativejudicialauthorities. of liability, theordinaryremediesmaybesoughtbefore comply diligentlywiththerelevantconditions. According tothetype be takentoavoidthistypeofliabilityareobtainapermitand with liabilityforenvironmentaldamage). The measuresthatshould connection withtheEIA)orofaremedialnature(e.g.in IPPC permits,remediation),ofanadministrativenature(e.g.in in connectionwithenvironmentaldisastersandpollution,waste, Liability maybeofacriminalnatureinmoreserioussituations(e.g. 4.1 4 regarding thetake-backandrecoveryoftheirwaste? bankrupt/disappears)? within permitlimits? what defencesaretypicallyavailable? Liabilities To whatextentdowasteproducershaveobligations the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa ). The responsibilityofthewaste WWW.ICLG.COM formulario di

Italy EPR”)

133 Italy 134 Italy “polluter pays”principle, providesthattheresponsibility forthe The regimedealingwithliabilityfor remedialworks,inspiredbythe 5.1 municipal CA andtakepreventivemeasures. risk thatitwillbeexceeded,tonotifytheregional,provincialand contamination thresholdconcentrationhasbeenexceededorthereis bound bycertainobligationssuchas,wheneverhediscoversthatthe remedial operations,however, theinnocentownerisnevertheless concerned, theprincipleofpersonalliability. When itcomesto the ItalianConstitutionsetsforth,asfarcriminaloffences are cannot belegallyattributedtothelendee.Infact,art.27,para.1of by thelendee,providedthatlender’s conductisautonomousand holding lendersnotliableforenvironmentalwrongdoingscommitted Generally speaking,thelinetakenbyauthoritiesisconsistentin 4.5 evolving caselaw. need tobeevaluatedverycarefully, alsotakingintoaccountthe the different implicationsfromanenvironmentalliabilityperspective must beevaluatedonacase-by-casebasis. As amatterofprinciple, company splittingup,thetransferenceofenvironmentalliability environmental liabilityistransferred.Incaseofanassetdealora is alsotransferred.Generallyspeaking,incaseofasharedeal,the even shared.Incaseofmergers, forexample,environmentalliability which environmentalliabilityistransferredornottransferred, various manners. The typeofstructurechosenaffects the degreeto The ItalianlegalsystemallowsM&A dealstobestructuredin 4.4 environmental wrongdoingscommittedinthecompany’s interests. Directors andmanagersmayattractpersonalliabilityfor 4.3 expressly envisagedinthepermitthatwasgranted. conduct andthatthe“damage”wascausedbyanemissionorevent Ambientalex -StudioLegaleAssociato © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM restrict personalliberty. legal proceedings,withtheexceptionofcriminalsanctionsthat wrongdoings maycoverallfinancialaspects,includingthecostof offences envisaged.Professionalinsuranceagainstenvironmental which includesenvironmentalwrongdoingsamongstthepredicate liability forcrimesbybodies(LegislativeDecreeno.231/2001), civil orcriminal. There alsoexistsasystemcoveringadministrative activities carriedoutonbehalfofthecompanyandmaybeeither personally andjointlywiththecompany. Liabilityrelatestothe or manager. Inthiscase,thedelegatewillbeheldliable,both Environmental functionsmayalsobedelegatedtoaspecificdirector 5 indemnity protectioninrespectofsuchliabilities? groundwater? environmental wrongdoingand/orremediationcosts? the onehandandanassetpurchaseonother? Contaminated Land What istheapproachtoliability forcontamination To whatextentmaylendersbeliablefor environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract (including historiccontamination) ofsoilor

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

5.3 principles regardingjointandseveralliabilityforcompensation. the relevantcauses),therebyexcludingapplicationofcivillaw to theextentwhichtheyareresponsibleforcontributingtowards be heldliableonthebasisoftheirshareoverallliability(i.e. authorities hasconfirmedthatinthesesituations,theoperatorswill more thanonecontributingfactor, theadministrativelineof liability insituationswhichthecontaminationwascausedby sites doesnotcontainanyspecificrulesregardingtheallocationof Even thoughItalianlegislationontheremediationofcontaminated 5.2 not influence,iftransferred,anyobligations underpubliclaw. to liabilityhaseffects exclusivelyonthepartiesthemselvesand will of ownership. Any agreementreached by thecontractingpartiesas extra-contractual liability)intheevent ofmeredamagetotheright Civil SupremeCourtexcludeddualliability(contractualaswell defects oftheassetsoldoranycontractualwarrantyclauses. The with theprovisionsofcivillaw, enforcingthelegalwarrantyagainst an assetdeal,thepurchasermaybringalegalactioninaccordance operator whocausedcontamination,canbeinvoked.Inthecaseof compensation forremediationcosts)ofthepreviousowner, orthe Under certainconditions,extra-contractualliability(e.g. 5.4 prejudice tohispersonorassets. taking action,andtheapprovalinquestionwouldcausespecific remediation programmebeforethecourtswhenhehasaninterestin party maychallengethelegitimacyofapproval regulating procedureeventhoughnottotallyindependent. A third action forenvironmentaldamage,whichconstitutesaself- arise. A completedremediationproceduredoesnotprecludean remedied areaisputaltered,anewobligationtoremedymay to berevisedoradjusted.Furthermore,iftheusewhicha evidence thatarisesinsuchstagesmayrequiretheentireprocedure outcome ofwhichconditionsthedevelopmentlaterstages.New The remediationprocedureisdividedintovariousstages,the necessary remedialworks(see contamination cannotbeidentifiedordoesnotcarryoutthe remediation worksbytheCA ifthesubjectresponsiblefor of theland,toreimburseexpensesincurredincarryingout preventive measures.Hemaybeobliged,uptotheincreaseinvalue works. Heisneverthelessobligedtogivenotificationandtake An ownerwhois“innocent”notobligedtocarryoutremedial contamination” (i.e.contaminationsexistingpriorto29 April 2006). contamination. The liabilityprinciplealsoappliesto“historic remedial operationslieswiththesubjectresponsiblefor is responsibleforthecontamination? contaminated landliabilitytoapurchaser? can athirdpartychallengetheagreement? regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis How isliabilityallocatedwheremorethanoneperson possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek infra question7.2).

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subjects informedtobequestioned. authorities mayaskfordocumentstobesubmitted,andany technical bodies. When carryingouttheinvestigations, collect andanalysesamples,benefittingfromtheservicesofvarious verifying thattheconditionssetinpermitshavebeenmet,orto The authoritiesarepermittedtocarryoutinspectionsaimedat 6.1 is subjecttopaying“monetarycompensation”. without landscapingauthorisationorwithinadequate that, undercertainconditions,thesubjectwhocarriedoutworks community. Art. 167ofLegislativeDecreeno.42/2004provides compensation fordamagecausedtopropertybelongingthe under certainconditions,actioncivillawtoobtain for otherpolicymakingsubjects(e.g.localpublicbodies)totake, compensation ofthemonetaryequivalent. There is,however, scope Legislation regulatingenvironmentaldamagedoesnotprovidefor an assetmayfallwithinthedefinitionof“environmentaldamage”. legislation. However, damagetotheaestheticlandscapingvalueof Aesthetic harmisnotacategoryofdamageregulatedbyspecific 5.5 Ambientalex -StudioLegaleAssociato ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 preventive measures, mustalsoperformapreliminary investigation polluter (butnotthe“innocent” owner/operator),havingtaken When aneventarisesthatmaypotentially contaminatethesite, 7.2 contamination ofthesurroundingarea. purpose ofestablishingthecompensationduefordamageby relevant, asfarcivilliabilityisconcerned;forexample,the inactive. Failuretogivenotificationthirdpartiesmayalsobe case whenhistoricalcontaminationisdiscovered,whetheractiveor identify siteswhicharepotentiallycontaminated. This isalsothe apply to Administrations that,intheperformanceoftheirduties, to notifytheCA immediately. Obligationstogivenotificationalso subject responsibleandthe“innocent”owner/operatorareobliged When aneventarisesthatmaypotentiallycontaminatethesite, 7.1 searches, sequestration,etc.),inLawno.689/1981andtheCode. mainly containedintheCodeofCriminalProcedure(inspections, offences affecting theenvironment. The specificregulationsare range ofpowerstopreventandsanctionadministrativeorcriminal Environmental regulators,atbothstateandlocallevel,haveawide © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 6 7 conduct siteinspections,interviewemployees,etc.? public assets,e.g.rivers? contamination? parties? Powers ofRegulators Reporting /DisclosureObligations What powersdoenvironmentalregulatorshaveto polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma require productionofdocuments,takesamples, have anaffirmativeobligationto investigatelandfor When andunderwhatcircumstances doesaperson migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe environmental regulatororpotentiallyaffectedthird

potential environment-relatedliabilities. transaction –ofanagreedenvironmentalindemnity, doesnotlimit very limitedcases,thepayment–betweenpartiestoanM&A transaction chosenunderItalianlaw, ingeneraltermsandexceptfor to theclearingofenvironmentalliabilities.Dependingontype costs anddamagesincurred,oreventogoverntheproceduresrelating exposure byallowinghim,ifproperlydrafted,toclaimfromtheseller do representaneffective meansforreducingthebuyer’s financial environmental indemnities,whichareincreasinglybeingusedinItaly, the environmentalliabilitiesoftarget company. Nevertheless, rise toprecontractualandcontractualliability. standards may, dependingonthenatureofassetbeingsold,give the failuretonotifysituationsthatdonotmeetenvironmental subjects indicatedtherein.Indealingsbetweenabuyerandseller, environmental disclosurealsoimposesobligationsonthe from permitsgranted.Recentlegislationregulatingsocialand environmental problems.Disclosureobligationsmayalsooriginate obligations thatvaryaccordingtothematricesaffected bythe Italian environmentallegislationimposesawiderangeofdisclosure 7.3 pollution inquestion, evenafterthecompanyhasbeen woundup. receiver andanyjointlyresponsible shareholdersliableforthe underlying conditionsaresatisfiedfor holdingthemanagers,directors, phenomenon. This istrueunless,onthebasisofcriminallaw, the winding-up wascompletedonthe basis ofa obligations onlytotheextentof resourcesdesignatedwhenthe obligation toremediateseeingthat they areliableforthecompany’s extinguished company, thathavelimitedliability, mayavoidthe GAAP no.31/2016. A situationmayariseinwhichshareholdersofan (provisions forrisksandcharges), accordingtoparas47–60ofITA principle ofcaution,anyexistingpotentialenvironmentalliabilities The balancesheetisrequiredbylawtoinclude,incompliancewiththe 8.2 transactions cannotlimit, Generally speaking,environmentalindemnitiesagreedwithinM&A 8.1 necessary operationsarecarriedoutbytheCA. action, orathirdpartydoesnottakeactionofhisownaccord,the own initiative.Ifthepollutercannotbeidentifiedordoesnottake prove their“innocence”)and/orremediationoperationson – areneverthelessentitledtocarryoutinvestigation(inorder not responsibleforthecontamination–thoughobligedtodoso remediation procedurearetobecompliedwith.Subjectswho in theareaordertoestablishwhetherfurtherstages 8 takeover transactions? order toescapeenvironmentalliabilities? potential liabilityforthatmatter? General prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto To whatextentisitnecessarytodisclose balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- Is itpossibletouseanenvironmentalindemnity vis-à-vis thecompetentpublicauthorities,

WWW.ICLG.COM sui generissuccession

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135 Italy 136 Italy autonomy withregardtodecision-making. forth bythelaw(art.2497CivilCode),orifsubsidiaryhasno company aretwoseparatelegalentitiesexceptforlimitedcasesset function though,recently, theItalian would notcoveraclaimofdamage withapunitiveorsanctioning assets, eliminatingtheconsequences ofthedamageincurred. This Compensation ofdamageaims at restoringtheinjuredparty’s crime inquestion. associations representingthosedamagedorinjuredasaresultofthe before thecriminalcourts,arightthatisalsovestedinbodiesand damage orinjuryasaresultofthecrimemaybringcivilaction may bebroughtbythejudicialauthorities. The subjectincurring Criminal actionagainstconductamountingtocriminaloffences to theenvironment. activities, etc.)–asaresultofactionsorfactsthathavecauseddamage affecting hisorherpersonal legalposition(health,property, business are entitledtoactonlyinthecaseofdamageanotherkind–that Administration (art.311 oftheCode).Otherpublicorprivatesubjects be inthepublicinterest,maytakensolelybyState An actionforcompensationofenvironmentaldamage,understoodto does notaffect therighttoseekordinarycompensatoryremedies. obtaining, withthesameremedy, compensationofdamage. This Such “public”classactions,however, ruleoutthepossibilityof also applytoadministrativefunctionsandenvironmentalservices. concession holdersforpublicservices. This legislationseemsto collective actionthatmaybebroughtagainstthe Administration and Legislative Decreeno.198/2009regulatesaparticulartypeof 8.5 “whistle-blowing” offences intheprivatesector. Protection schemesarealsoavailableforemployeeorpersonnel s/he committedcrimesrelatedtowilful/grosslynegligentconduct. in casethe“whistle-blower”actedtodefameorslandersomeone, their workingconditions. The aboveprotectionschemesdonotapply organisational actionshaving,directlyorindirectly, negativeeffects on downgraded, removed,terminatedorrenderedsubjecttoanysortof as totheiridentity. Furthermore,theycannotbesanctioned, matters. Publicemployeesactingas“whistle-blowers”areprotected of suchlegislationisverybroadandcanalsocoverenvironmental Italy hasenactedspecificlegislationfor“whistle-blowing”. The scope 8.4 de facto company intheabsenceofinvestitureisconsideredanadministrator and 2462CivilCode). According tocaselaw, anyonemanagingthe of itsinsolvency, butonlyunderspecificconditionsasperarts2325 responsible fortheobligationsassumedbycompanyinevent those casesdefinedbythelaw(e.g.soleshareholderis The shareholderhasalimitedliabilityinstockcompaniesexceptfor 8.3 Ambientalex -StudioLegaleAssociato © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM caused byaforeignsubsidiary/affiliate? damages available? report environmentalviolations/matters? environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing Are thereanylawstoprotect“whistle-blowers”who liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent andcanbeheldliable. The holdingandthecontrolled

Suprema Corte diCassazione

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System (hereinafter, “ Emission quotatradingissubjecttotheEuropeanEmissions Trading 9.1 para. 6-bis,LegislativeDecreeno.115/2002). nature are,however, exemptfromthestandardcourtfee(art.13, interests. Applications foraccesstoinformationofanenvironmental from liabilityinlitigationbroughttosafeguardenvironmental The Italianlegalsystemdoesnotprovideforanyspecificexemption 8.6 which areimplementedinItalyby thelegislativesystem. energy efficiency and mobility)areregulatedbyEUDirectives, people andgoods. The maintopics(renewableenergy sources, to operatemotorcars,busesor trucks forthetransportationof towards thereductionofCO2levels alsoliesinthemethodsadopted energy efficiency. An importantaspectofthecontributionmade legislation linkedtoincentivesforrenewableenergy resourcesand transport, agricultureetc.).Concretemeasuresrelatetoallthe the “Effort Sharing”Directive applyingtonon-ETSsectors(e.g. implementation ofCommunityregulationsonETSbutalsoinclude Concrete measurestocombatclimatechangearenotlimitedthe 9.3 ETS Directive)ismanagedbyISPRA. (not onlythoseoriginatingfromindustrialplantscoveredbythe the previouscalendaryear. The nationalinventoryofallemissions number ofquotascorrespondingtotheCO2emissionsreleasedin monitoring andsubsequentlysurrendering,onanannualbasis,a plant startstooperate. The ensuingobligationsconsistof permit totheMoEatleast90dayspriordateonwhich to emitgreenhousegas.Operatorsmustmakeanapplicationfora permitted toengageinactivitiessubjecttheETSwithoutapermit Legislative Decreeno.30/2013establishesthatnoplantinItalyis 9.2 Italian legalsystem(JointSections,no.16601/2017). stated thatpunitivedamageisnotinitselfincompatiblewiththe entitled toallowancesfreeofcharge. purchase quotastocovertheirneeds.Manufacturingplantsare surrendered tocovertheemissions.Since2013,powerplantsmust allowances, thedifference canbesoldoncequotashavebeen covering itsemissions.Iftherealemissionsarelowerthanset assigned, theoperatormustpurchasequotastobesurrendered (CO2 quotasintons).Iftherealemissionsexceed mechanism, emissioncapsareallocatedtoeachplantoraircraft establishes thefundamentalrules. According tothe“capandtrade” 9 market developingthere? pursuing environmentallitigation? regulation inyourjurisdiction? to monitorandreportgreenhousegasemissions? Emissions Trading andClimateChange your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation any exemptionfromliabilitytopaycostswhen Do individualsorpublicinterestgroupsbenefitfrom What istheoverallpolicyapproachtoclimatechange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned ETS”), forwhichDirective2003/87/EC

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authorities (localhealthservice– Regulations (e.g.Milan). The ownermustnotifythelocalhealth orientation andmonitoring,aswellindividualMunicipal 81/2008, integratedbyregionallawsandplansdealingwith Ministerial Decreedated6September1994,Legislativeno. levels. GeneralsourcesincludeLawno.257/1992andthe the operationscarriedoutareregulatedatdifferent legislative The obligationsimposedontheownerorpersonresponsiblefor 10.2 Joint SectionsoftheItalianSupremeCourt. victims andtheirassociations,isyettobeconsolidatedbeforethe recent rulings. The latestapproach,morefavourabletoasbestos to beadvantageousemployers,hasbeendisprovedbyanumberof experienced bythevictimdevelops. The previousapproach,proving effects ofexposuretoasbestosatthetimecarcinogenicprocess Appeal frequentlydiffer. The maindifficulty liesinestablishingthe outcome ofdisputesbeforethecourtsatfirstinstanceandCourt and familiesofvictimsexposuretoasbestosisincreasing. The The numberofactionsbeingbroughtbeforethecourtsbyassociations 10.1 Ambientalex -StudioLegaleAssociato ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 requests forenvironmentalinsurance cover. However, according to There arecurrentlynocomprehensive dataondevelopmentsinthe 11.2 criteria (e.g.activitieslikelytocauseanenvironmentalimpact). must belodgedforanamountcalculatedonthebasisofpre-set State andregionallawsprovidethatincertaincasesaguarantee policies areenvisaged,dependingonthetypeofactivityconducted. offers insuranceproductstocoverdamagebypollution. Various An associationofinsurersandreinsurers( 11.1 involve asbestos-containingmaterials. controlling andcoordinatingallmaintenanceoperationsthatmay Index. The ownermustalsoappointapersonresponsiblefor conservation whichisassessedbyapplyingaso-calledDegradation Actions tobeundertaken(includingtiming)dependonthestateof Certification orEMASregistrationpayreducedinsurancefees. acknowledged bythefactthatbusinessesobtainingISO14001 market. Environmentalinsurancecoverisinconstantexpansion, products asalternativestothosegenerallyavailableontheItalian Inquinamento isalsoavailable. These companies offer insurance Cover frominsurancecompaniesthatdonotformpartofthe © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 11 10 in relationtoasbestoson-site? jurisdiction? experience inyourjurisdiction? risks insuranceplayinyourjurisdiction? What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour What istheenvironmentalinsuranceclaims in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable Environmental InsuranceLiabilities Asbestos ATS ) ofthepresenceasbestos.

Pool Inquinamento

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environmental damage,isstillconsideredaproblematicarea. the degreetowhichenvironmentalinsuranceschemescover requests forinsurancecover–areconstantlyincreasing.Nevertheless, damage, itcanbeassumedthatthemeasurestaken–andtherefore Given theincreasednumberofreportedcasesenvironmental of thischapter. Urso), aswellSebastianoSerra,forcontributingtothepreparation Fonderico, Francesca Allocco, ElettraMonaciand Anna Deborah Fonderico, Maria Valeria Vecchio, OmarHagiKassim,Ermanno The authorswouldliketothanktheteamof Ambientalex (Francesco coordinated, withpublicprosecutors. environmental protection,incollaboration,thoughnotalwaysfully an increasinglyimportantroletotheregionalagenciesfor A new criminalsanctionssystemintroducedin2015isdesignating products). confused economicoperatorsevenmore(e.g.end-of-waste,by- uncertainty regardingthelegislation,includingEuropeanlaws,have number ofrulingsregardingwaste,thoughtheresultobjective conservative stance,firmlybasedonoutdatedperceptions. A The approachtakenbythecourtsis,attimes,anexpressionofa example ofthisisthenewEIA regulations. centralisation offunctions,unlikewhatwehaveseeninthepast. An On theotherhand,wearewitnessingatrendtowards medium-sized businesses,notenvisagedataEuropeanlevel). the so-called permit mechanism(e.g.grantingtheSingleEnvironmentalPermit– administrative proceduresbycreatinga“single”,orall-encompassing, At alegislativelevel,ontheonehand,objectiveistosimplify procurement) –andthisseemslikelytocontinueinthefuture. at asupranationallevel(forexample,dealingwithgreenpublic environmental standardshigher(gold-plating)thanthoseestablished the EUwithoutanysignificantdeviation–attimesevensetting years, Italyhascompliedpromptlywiththeconditionslaiddownby clear guidelinesforfuturelegislativeinitiatives.Overthelastfew The implementationofEuropeanlegislation,however, provides interpretation andenforcement. introduction ofnewlaws,andtheassociatedproblems characterised byamarkedfragmentationofregulationsandthe The developmentofenvironmentallawintheItalianlegalsystemis 12.1 Acknowledgment the MoE,217casesofenvironmentaldamagearoundcountry. and thevariouslocalenvironmentalagenciesinvestigated,onbehalfof damage arecontinuallyincreasing.Between2017and2018,ISPRA ISPRA datareportedinNovember2018,incidencesofenvironmental 12 in environmentlawyourjurisdiction. summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a Updates Autorizzazione Unica Ambientale

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137 Italy 138 Italy Ambientalex -StudioLegaleAssociato © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM Business isconductedinItalian,English,GermanandFrench. Ambientalex lawfirmhasoffices inMilan,RomeandFlorence. experience inthespecificareasconcerned. withproven In ordertoensurethatitsclientsreceivethemostcomprehensiveandexpertservices,firmalsoworkswithexternalconsultants Clients of Ambientalex lawfirmincludeItalianandforeignmultinationalcompanies,tradeassociations as welllawfirms. courts. which include,whereappropriate,legalcounsellingandconsultancyservicesaswellassistanceinfrontofanycompetentItalian wherever possible,alsotakingintoconsiderationanylegislationabouttobeissued. The firmprovidescustomised One oftheinspiringprinciples expertadvice,and Ambientalex lawfirmistopreventanyconflictsordisputesarising byvirtueofaccurateand environmental law, includingenergy. Founded bylawyersboastingconsolidatedprofessionalexperience,thepracticeareasof sectorsof Ambientalex lawfirmfocusonthevarious and trainingcoursesonenvironmentallaw. topics, andfrequentlytakespartasaspeakerinconferences,workshops David istheauthorofmanyarticlesandpublicationsonhisspecialised Secretariat. In 2012/2013,hewaspartoftheMinisterforEnvironment’s Technical circular economypackage,adoptedbytheEUin2018. commission nominatedforthetransposition,intoItalianlaw, ofthe 2017. As ofJanuary2019,DavidisamembertheMinisterialexpert relating toILVA-Steel-works, setupaccordingtoDPCM29September Furthermore, heisarepresentativewithinthePermanentObservatory Authorisation (IPPC)withintheItalianMinistryforEnvironment. He isamemberoftheCommissionforIntegratedEnvironmental to otherlawfirms. assistance tomultinationalcompaniesandtradeassociationsaswell David isspecialisedinenvironmentallaw, providingextrajudicial managerial roleinaleadingItalianmultinationalcompany(PirelliGroup). Freshfields BruckhausDeringer(Milan).Subsequentlyhehelda Prior tosettingup Ambientalex lawfirmin2008,Davidworkedwith David Röttgenisthefoundingpartnerof Ambientalex lawfirm. URL: Email: Fax: Tel: Italy 20122 –Milan Via Visconti diModrone,1 Ambientalex -StudioLegale Associato David Röttgen www.ambientalex.com [email protected] [email protected] +39 02795358 +39 0277807411 /7490 ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

Master’s, PhDandprofessionalspecialistcoursesinItalyabroad. Master’s, He publishesregularlyandalsotakespart,asaspeaker, invarious Administrative Law. He hasobtainedthenationalqualificationasan Associate Professorin Assunta (LUMSA)inRome. the UniversityofRomeIIIandalsoatLiberaUniversitàMariaSs. Andrea isaProfessorofEnvironmentalLawattheFaculty related environmentaloffences. Parliament’s Inquiryintoillegalactivitiesrelatedtothewastecycleand He isalsoaconsultanttotheBicameralCommissionofItalian Environment intheprevioustwolegislatures. Ministry forEnvironment,andlegalcounseltotheMinister Andrea hasbeenDeputyHeadoftheLegalDepartmentItalian He isspecialisedinadministrativeandenvironmentallaw. Andrea Farìisapartnerof Ambientalex lawfirm. URL: Email: Fax: Tel: Italy 00187 –Rome Via V. Veneto, 108 Ambientalex -StudioLegale Associato Andrea Farì www.ambientalex.com [email protected] [email protected] +39 0656561604 +39 0642014545 ad hocservicesandsolutions Italy

Chapter 20 Japan Hajime Kanagawa

Kanagawa International Law Office Yoshiko Nakayama

1 Environmental Policy and its The national governmental body in charge of administering and enforcing environmental laws is the Ministry of the Environment. Enforcement Local governments also have a role in administering and enforcing environmental law, as further explained in this section. 1.1 What is the basis of environmental policy in your jurisdiction and which agencies/bodies administer 1.2 What approach do such agencies/bodies take to the and enforce environmental law? enforcement of environmental law?

The basis of Japanese national environmental policy is the Basic According to the Fifth Basic Environment Plan, the following Environment Law of 1993 (the “BEL”). Under the BEL, the approaches satisfy specific policy objectives of the Japanese government must establish a Basic Environmental Plan, and this plan governmental agencies/bodies: is subject to a regular six-year review (please see https://www. (i) a direct regulation approach, whereby direct regulation env.go.jp/policy/kihon_keikaku/plan/plan_5.html). In April 2018, specifies certain goals to be achieved and the government the Fifth Basic Environment Plan was adopted by the National enforces the law to achieve those goals. This approach is Cabinet. The Fifth Basic Environment Plan set six major strategic effective for prevention of environmental pollution and land goals for future environmental policy, i.e. (i) formulation of a use control to protect the environment; “green” economic system for achieving sustainable production and (ii) a regulatory framework approach, whereby the government consumption, (ii) improvement of the value of national land as stock, presents a framework as a goal with mandatory actions and (iii) development using local resources, (iv) processes to achieve it. This approach is aimed at preventing realisation of a healthy and prosperous life, (v) development and new environmental pollution in areas when quantitative dissemination of technology supporting sustainability, and (vi) target or specific compliance matters cannot be set; demonstration of Japan’s leadership through international (iii) an economic approach, which seeks certain policy objectives contribution and building strategic partnerships. by using economic incentives such as subsidies, tax benefits or fines. An example of this approach is feed-in-tariffs (“FIT”). Various national laws provide specific regulations that, together with This approach is effective for those to whom direct regulation the general policy declared in the BEL, form the system of Japanese or a regulatory framework may not be efficient, by changing environmental law. These laws include: (i) laws addressing general market prices to incentivise various stakeholders to take environmental policy, including the Environment Impact Assessment measures that would reduce environmental burdens/costs; Act (1997) (“EIA”); (ii) laws addressing specific environmental (iv) a voluntary approach, whereby the government only issues, such as (a) laws concerning global environmental issues, (b) encourages businesses to set voluntary targets to achieve policy laws preventing public nuisance and pollution, (c) laws restricting objectives. This approach is effective in cases where businesses polluting substances, and (d) laws protecting or preserving natural have widely expressed their commitment to society; resources; (iii) laws concerning who bears the burden of expenses (v) an information approach, whereby the government promotes necessary for the protection of the environment; (iv) laws providing the disclosure and provision of information so that private judicial or administrative solutions for pollution or other sectors actively engaging in environment-friendly actions, environmental issues; and (v) laws concerning environmental products and services can be selected for investment and administrative organs. In addition, there are other environment- procurement; related laws governing nuclear facilities and radiation, regulation of (vi) a procedural approach, whereby certain environmental urban development and protection of cultural assets, which are not considerations are included in the decision-making process, necessarily covered by the legal system under the BEL. such as the EIA or Release and Transfer Register (“PRTR”); and Japanese environmental policy is also realised through various local (vii) an action approach, whereby public bodies such as national or ordinances and regulations enacted by each local government. In local governments directly implement the actions necessary to addition to the local ordinances introduced for the purposes of achieve policy objectives. enforcing national laws considering the characteristics of local areas, local governments may also enact their own local environmental ordinances (i) regulating those legal areas not covered by national laws, or (ii) expanding the scope of regulations or providing more stringent rules than national laws.

ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 WWW.ICLG.COM 139 © Published and reproduced with kind permission by Global Legal Group Ltd, London 140 Japan and/or criminalsanctions inthecaseofbreach). subject tocertainregulatoryobligations carryingadministrative are obligatedtonotifythegovernment andthenotifyingpartyis parties holdingacertainamountof potentiallyhazardousmaterials does functionasapermitinsome sense (i.e.certainpartiessuchas unilateral actionanddoesnotrequire administrativepermits,butit Various lawsalsoprovide“notification” requirements. This isa and chemicalshavingpotentialenvironmentalimpact. importing, orconstructingproductionplantsofhazardouschemicals Control Act andtheCSCL)requireapermitbeforeproducing, substances (includingthePoisonousandDeleteriousSubstances waste treatmentplant.Certainstatutescontrollingchemical example, the WMCA requiresapermit forbuildingandoperatinga operate plantshavingcertainkindsofenvironmentalimpact.For Other statutesimposerequirementsforpersonswhoconstructand/or government. specified hazardouschemicalstoobtainapermitfromthenational person intendingtoconductbusinessthatwillproducecertain etc. (or. ChemicalSubstancesControlLaw;“CSCL”)requiresany Evaluation ofChemicalSubstancesandRegulationManufacture, collection, transportation,and/ordisposalofwaste. Also, the Act on local governmentsbeforeconductingbusinessinvolvingthe requires businessownerstoobtainpermitsfromrelevant For example,the Waste ManagementandCleaning Act (“WMCA”) having certainkindsofenvironmentalimpact. substantial environmentalimpact,orconstructsoperatesplants conducts certaindesignatedbusinessesordevelopmentworkhaving Generally, environmentalpermitsarerequiredwhenaperson 2.1 governmental entitiesandtonotifythepublicaboutsuchinformation. The governmentisalsorequiredtocollectinformationfromnon- results undercertainlaws(e.g.the Air PollutionPrevention Act). public aboutenvironmentalstandardsandpollutionmeasurement environmental policiesandplansundertheBEL andnotifyingthe certain environment-relatedinformation,includingpublishing Government authoritiesarerequiredtoproactivelymakepublic 1.3 Kanagawa InternationalLawOffice © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM all localgovernmentshavesimilarordinances. competitive positionofaprivateperson(corporation),etc.). Almost the government,informationhavinganegativeimpacton where disclosurewouldhaveaharmfulinfluenceontheoperationof information (suchaspersonallyidentifiableinformation, any person,unlesstherequestedinformationisnon-disclosable organisations mustdiscloseinformationuponspecificrequestfrom the UnitedStates).Underthisact,nationalgovernmental Administrative Organs (similartotheFreedomofInformation Act in information underthe Act on Access toInformationHeldby The nationalgovernmentisalsostatutorilyrequiredtodisclose Enhancement Act. of theOECD,andGreenhouseEffect GasMeasurement Transfer Register, whichwasenactedbasedontherecommendations Such requirementsincludetheLawConcerningPollutantReleaseand 2 persons (includingmembersofthepublic)? person toanother? Environmental Permits environmental permitsbetransferredfromone When isanenvironmentalpermitrequired,andmay To whatextentarepublicauthoritiesrequiredto provide environment-relatedinformationtointerested

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effective overatransfereeofthesubjectforestedland). the Forest Act, ingeneral,apermittodevelopforestedlandis attached topropertyirrespectiveoftransferownership(e.g.under permission areusuallylessstringent.Othertypesofpermitsremain as amerger orcompanysplit,therequirementsfortransferof review. However, incaseofasuccessionbyoperationlaw, such licence, andthereforemaynotbetransferredwithoutanother or plantsaregrantedbasedonareviewoftheoperatorhaving review. Forexample,permitsrelatingtotheoperationofbusinesses Many environmentalpermitsarenottransferrablewithoutfurther permit. planning toconstructandoperateanyfactoryin Tokyo toobtaina For example,the Tokyo MunicipalGovernmentrequiresanyperson Local governmentsalsoimposeapermitsystemforcertainconduct. suspend thelitigationprocessuntil ACRA processisconcluded. ACRA. However, wherebothprocessesarepending,thecourtmay may filelitigationatthesametimeaschallengingadecisionthrough in somecases,theregulatormaybeorderedtograntapermit.Parties regulator’s decisionmaybecancelled(andthepartyreapply)or, board systemwasintroducedin2016).Ifaclaimissuccessful,the towards apro-userapproach(forexample,moreindependentreview many caseswerenotneutral,buttheprocesshasbeenmoving under ACRA hadoftenbeencriticised,claimingthatthereviewersin erroneous orinappropriateadministrativedecisions. The process ACRA providesthegovernment’s internalprocessforcorrecting provides specialrulesbasedoncivillitigationprocedurallaw). litigation), pursuanttothe Administrative CaseLitigation Act (which when thecomplainantfilesan ACRA complaintinadvanceof deadline willbeextendedforthetimespentin ACRA process decision (orwithinoneyearfromthedateofdecision)(thelitigation months fromthedaywhencomplainantbecomesawareof within oneyearfromthedateofdecision),or(ii)litigationsix when theapplicantbecomesawareofregulator’s decision(or Complaint Review Act (“ACRA”)withinthreemonthsfromtheday regulator byfiling(i)acomplaintunderthe Administrative Applicants forregulatorypermitsmaychallengethedecisionof 2.2 Pollution Prevention Act andthe Water PollutionControl Act). reporting obligationsdependingon thetypeofpollution(e.g. Air There areadditionalstatutoryaudit requirementsforrecordingand that arenotcoveredundertheEIA. their ownassessmentrequirementsforcertaindevelopmentplans requirements aresatisfied.Manyprefecturalgovernmentsalsohave exceeds certainprescribedthresholds,and(ii)additionalstatutory disposal plantsandcertaintypesofpowerplants,if(i)thesize activities, includingtheconstructionofhighways,airports,waste before beginningcertaintypesofconstructionanddevelopment mandatory environmentalassessmentprocess(orscreeningprocess) The EnvironmentImpact Assessment Act (“EIA”)requiresa 2.3 contained inanenvironmentalpermit? polluting industriesorotherinstallations/projects? environmental permitorinrespectoftheconditions an environmentalregulatornottogrant What rightsaretheretoappealagainstthedecisionof environmental impactassessmentsforparticularly Is itnecessarytoconductenvironmentalauditsor

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administrative measuressuchascancellationofpermitsmayfollow. is notdulycompliedwith,thencriminalcharges suchasfinesor suspend permittedbusinessortocorrectoperations,andifsuchorder Once aviolationisidentified,theregulatormayissueanorderto more informationoninvestigatorypowers). any violationofrelevantstatutes(pleasealsoseesection6hereinfor a violationhasoccurred,anditstatutoryauthoritytoinvestigate The regulatormaymonitorcomplianceorinvestigateastowhether compliance withsuchinquiriesorguidance. unreasonably treatingaprivatepersonunfavourablyduetonon- inquiries arenotcompulsory, andtheregulatorisprohibitedfrom any inappropriateconduct,withinthescopepermittedbylaw. Such or amenableinstructionstopotentialviolatorsvoluntarilycorrect making inquirieswithpotentialviolatorsand/orprovidingguidance The initialactionstakenbytheenvironmentalregulatorareoften 2.4 Kanagawa InternationalLawOffice ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 must bedocumented andonlycertainprescribedeligible persons,such Producers. Those regulationsinclude:(i)outsourcingagreements for thepurposeofclarifying responsibility ofIndustrial Waste regulations, andtherearealsoregulations onoutsourcingagreements companies areprescribedindetail underthe WMCA andrelated Industrial Waste andthestandards ofoutsourcingforlicensedservice The standardsofstorage,collection, transportation,anddisposalof (c) government maymanagetheIndustrial Waste. licensed servicecompaniesand,undercertaincircumstances,alocal Producers mayoutsourcetheirmanagementofIndustrial Waste to and shouldbearthecostsofmanagingit.However, Industrial Waste Producers”) areresponsibleforthemanagementofIndustrial Waste Business operatorswhoproduceIndustrial Waste (“Industrial Waste General Waste (includingSpeciallyManagedGeneral Waste). Local governmentsarebasicallyresponsibleforthemanagementof (b) Waste”, respectively. “Specially ManagedGeneral Waste” or“SpeciallyManagedIndustrial waste thatisexplosive,poisonousorinfectioussub-categorisedas Within thecategories ofGeneral Waste andIndustrial Waste, any waste plastic,andcertainkindsofimportedwaste. activities, suchascinders,sludge,wasteoil,acid,alkali, Waste encompassescertaintypesofwasteproducedfrombusiness General Waste meansanywastethatisnotIndustrial Waste. Industrial and “Industrial Waste”. in general,wasteisdividedintotwomaincategories:“General Waste” unnecessary matter”otherthanradioactivewaste.Underthe WMCA, Cleaning Act (“WMCA”),andgenerallyincludesany“filthy “Waste” isdefinedunder Article 2of the Waste Managementand (a) 3.1 investigation process. make aformalrequesttothepolicecommencecriminal by thepoliceindependentlyfromregulator, ortheregulatormay without apermit). The processforacriminalcharge maybeinitiated a personwhoproducescertainspecifiedpoisonoussubstances Certain permitstriggercriminalcharges directlyuponviolation(e.g. © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 3 waste involveadditionaldutiesorcontrols? have inconnectionwiththeviolationofpermits? Duties andcontrols over Industrial Waste Responsible partiesfor management ofwaste Definition ofwaste Waste What enforcementpowersdoenvironmentalregulators How iswastedefinedanddocertaincategoriesof

agreements with service companies,(ii)improperly monitoringthe standards, suchasby(i)entering intoimproperoutsourcing imprisonment and/orfinesifthey breachcertainoutsourcing For example,Industrial Waste Producersmaybesubjectto transferring wastetoanotherperson undercertaincircumstances. Industrial Waste Producers mayhaveresidualliabilityevenafter 3.3 Producers canstoreGeneral Waste underthe WMCA. storage quantityandlengthoftheperiodforwhichIndustrial Waste On theotherhand,thereisnospecificallyprescribedcapon local environmentuntilthewasteisremoved. Waste Producersmuststoresuchwastesoasnottointerferewiththe Industrial Waste orSpeciallyManagedIndustrial Waste, Industrial When Industrial Waste Producersoutsourcethemanagementof by 14). processing/disposal abilityperdayofthedisposalplantmultiplied quantity is,ingeneral,theproductof period andthequantityareregulated(e.g.caponstorage Industrial Waste orSpeciallyManagedIndustrial Waste, thestorage When Industrial Waste Producersthemselvesprocess/disposeof Waste Produceritselforoutsourcedtoathirdparty. Waste generallydependsonwhetheritisdonebyanIndustrial Under the WMCA, thestorageandprocessing/disposalofIndustrial 3.2 become subjecttothe WMCA regulations. sold asvaluableitems,butthehandlingofthesematerialshas materials maynotfallunderthedefinitionof“waste”astheycanbe certain regulationsinthestorageanddisposalofthem. These scrap storage andhandlingofthesescrapmaterials,(ii)complywith noxious substancesto(i)notifythelocalgovernmentabouttheir requires businessoperatorsdealingwithscrapmaterialincluding The amended WMCA, whichcameintoforcein April 2018, (d) the standardsforIndustrial Waste, butaregenerallymorestrict. The standardsforSpeciallyManagedIndustrial Waste aresimilarto prefectural governor. plan andreporttheimplementationstatusofto plan forreducingtheamountanddisposalofwaste,submit business thatproduceagreatdealofIndustrial Waste mustmakea management. Also, Industrial Waste Producerswhohaveplacesof facilities mustdesignateapersonincharge ofIndustrial Waste Industrial Waste Producershavingtheirownprocessing/disposal up untilitsfinaldisposal. the Industrial Waste isproperlyhandledthroughtheprocesschain Waste, Industrial Waste Producershaveadutytomonitorwhether When outsourcingthetransportand/orprocessingofIndustrial processing/disposal companies. that collectandtransportIndustrial Waste andintermediateand/orfinal Waste Producersmustenterinto contractsseparatelywithcompanies unless anIndustrial Waste Producerapprovesit.Moreover, Industrial re-outsourcing bylicensedservicecompaniesisbasicallyprohibited as licensedservicecompanies,canmanageIndustrial Waste; and(ii) bankrupt/disappears)? produced? the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore Regulation ofscrapmaterial

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141 Japan 142 Japan such pollutionhas resultedfromtheintentional actionorthe operator maybeliableforenvironmental damagestotheextentthat Yes, notwithstanding compliancewithregulatorypermitlimits,an 4.2 regulatory laws. breach occurswouldbesufficient asanintentionalbreachofthe because, inmostcases,mereknowledgeofthesituationwherea not intentional.However, suchadefenceisrarelysuccessful One possibledefenceagainstcriminalcharges isthatabreachwas civil liabilitycases. measures, andtheamountofdamagestobecompensatedinrelated criminal offence, thenecessity oftakingsevereadministrative discovering thebreach. These defencesinfluencethedegreeof assertion thatthepartyhastakenremedialmeasurespromptlyafter party hasmadereasonableefforts topreventbreach,and(iii)an breach againsthumanlife/body/property, (ii)anassertionthatthe claims include(i)lackorlimitationoftheactualimpact Typical defencesrelatingtocriminal,administrativeandcivil a breachingpartymaybesubjecttocontractualsanctionsaswell. tort claim.Ifacontractrequirescompliancewithenvironmentallaws, Civil liabilityforbreachofenvironmentallawswouldtypicallybea remedial stepsorseektorecovercostsfromabreachingparty. orders orsuspensioncancelpermits,andmayalsotake As foradministrativemeasures,aregulatormaymakecorrective administrative orders. sanctions wouldbebroughtonlyafterapartydidnotcomplywith (including imprisonmentandfines)and,inothercases,criminal In certaincases,abreachwoulddirectlytriggercriminalsanctions criminal charges, administrativemeasures,andcivilliability. Breaches ofenvironmentallawsand/orpermitsaresubjectto 4.1 Please seequestion3.3above. 3.4 outsourcee becomesbankrupt. the situation;(iv)anoutsourcee’s licenceisrevoked;or(v)an Producer doesnotproperlynotifyauthoritiesorotherwiseremedy outsourcee illegallydumpsIndustrial Waste andtheIndustrial Waste Producer continuestooutsourcesuchoutsourcee;(iii)an dumping orstoringIndustrial Waste, buttheIndustrial Waste becomes awarethatoneofitsoutsourceeshasbeenillegally processes/disposes ofitillegally;(ii)theIndustrial Waste Producer Industrial Waste atanunusuallylowpricetosomeonewhothen Industrial Waste Produceroutsourcestheprocessing/disposalof Industrial Waste orpaythecostofremoval,forexample,if:(i) Also, anIndustrial Waste Producermaybeorderedtoremove management tounlicensedservicecompanies. the finalprocessing/disposal,or(iii)outsourcingIndustrial Waste handling oftheIndustrial Waste throughtheprocesschainupuntil Kanagawa InternationalLawOffice © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 4 within permitlimits? what defencesaretypicallyavailable? regarding thetake-backandrecoveryoftheirwaste? Liabilities notwithstanding thatthepolluting activityisoperated Can anoperatorbeliableforenvironmental damage breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa To whatextentdowasteproducershaveobligations ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

4.4 conditions. policies aresubjecttomaximumpaymentamountsandvarious arising fromacompany’s misconduct(i.e.D&Oinsurance)butsuch Insurance policiesareavailabletocoverliabilityofthedirectors done inthenameofacompanyinsteaditsdirectorsorofficers. results indeathorinjury, regardlessofwhetherthewrongdoingwas on directorsorofficers ifthewrongdoingisextremelyharmfuland personal regulatoryobligations.Criminalcharges maybeimposed imposed ondirectorsorofficers unlessthedirectororofficer has other directorsfromdoingso. Administrative sanctionsmaynotbe wrongdoings orhavefailedtoproperlypreventtheirpersonnel and theCompanyCodeiftheyhavedirectlycausedenvironmental Directors andofficers maybepersonallyliableunderciviltorttheory 4.3 Contamination Countermeasures Act (“SCCA”). Water PollutionPrevention Act (“WPPA”) and theSoil Contamination ofsoilorgroundwater ismainlygovernedunderthe 5.1 potentially seriousenvironmentalrisks. Japanese banksmayhesitatetolendmoneyentitiesholding social (notlegal)liabilityastohowloanedfundsareused,and and/or contamination.Ithasbeenargued thatbanksshouldbear such courtcaseprecedentrelatedtoenvironmentalwrongdoing may bedeemedtoajointoffender, butwe arenotawareofany funds wouldbeusedforenvironmentalcontamination,suchlender borrowed funds.Intheory, ifalenderwasawarethatborrowed Lenders arenotliable,inprinciple,forhowaborroweruses 4.5 in principle,betransferredtothepurchaserofsuchassets. charges alreadyimposedonthesellerrelatedtosuchassetswillnot, liability ofsuchassets.However, anyadministrativeorcriminal A purchaser ofassetsacompanywillbeartheenvironmental see section8below). are usuallynotliablefordamagescausedbythecompany(please shareholders solelybecauseoftheirshareholding,and that administrative/criminalsanctionsarenotimposedon company. However, liabilityofashareholderisgenerallyindirect in A purchaser ofsharescannotcarveoutspecificriskorliabilitya not takingamoreprudentapproach. cases, theregulatorybodysettingsuchalimitmayalsobeliablefor and scopeofliabilitybutitisnotacompletesafeharbour. Incertain limit isoneofthemajorconsiderationsinassessingexistence negligence ofthepolluter. Compliancewiththeregulatorypermit 5 indemnity protectioninrespectofsuchliabilities? groundwater? environmental wrongdoingand/orremediationcosts? the onehandandanassetpurchaseonother? Contaminated Land environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract (including historiccontamination) ofsoilor What istheapproachtoliability forcontamination To whatextentmaylendersbeliablefor

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to thepurchaser(butnot On theotherhand,theseliabilityrisksmaytransferfromseller orotherlegalgrounds. previous owneroroccupierwhocausedcontaminationbywayof removal, thecurrentownermaybeabletoclaimsuchcostsfrom take measurestoremovecontaminationorpaythecostsof For example,undertheSCCA,ifcurrentownerisorderedto contamination. identified, thenthelandownersoroccupantsareliableforany However, ifthepersonswhocausedcontaminationarenot are determinedtohaveindividuallycaused. be orderedtotakemeasuresremovethecontaminationthatthey they areseverallyliableundertheSCCA.Eachofpolluterswill If thepersonswhocausedcontaminationareidentified,then 5.2 contaminated soilisalsoregulated. measures toremovecontamination. The transportationof inspections. The landowneroroccupantmaybeorderedtotake suspected threatofhealthhazardsbasedontheresults Contaminated areasaredesignatedaccordingtowhetherthereisany have contaminatedsoilorwherecontaminationhasbeendiscovered. The SCCA providesforinspectionoflandhavingfacilitieslikelyto substances affects groundwater. remediate pollutiontogroundwaterifwatercontainingharmful the governmenttoorderpersonsresponsibleforfactories substances, imposesalimitonemissionofpollution,andauthorises The WPPA identifiesandregulatesfactoriesthatproduceharmful Kanagawa InternationalLawOffice ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 worthy oflegalprotection. Accordingly, assumingthatascenicview (in thiscase,harmtoascenicviewcaused byalarge building)may be The SupremeCourtofJapanhasexpressed aviewthataestheticharm 5.5 agree thatthesellersellsland“asis”. caused bycontaminationthepreviouslandowneroroccupier. A land ownermayhavetherighttoseekcompensationfordamages 5.4 fulfil thetechnicalstandards. contamination removalandamendmentoftheplanifitdoesnot the regulatormayordersubmissionofmeasurementplanfor 2019, ifenvironmentalremediationhasbeenorderedbyaregulator, However, under new legislationthatwillbeenforcedfrom April 1, regulators aboutaprogrammeofenvironmentalremediation. There iscurrentlynosystemfor“agreement”withenvironmental 5.3 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London can athirdpartychallengetheagreement? is responsibleforthecontamination? public assets,e.g.rivers? contaminated landliabilitytoapurchaser? How isliabilityallocatedwheremorethanoneperson possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof polluter, monetarydamages foraestheticharmsto Does thegovernmenthaveauthority toobtainfroma Does apersonhaveprivaterightofactiontoseek regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis vis-à-vis anyotherthirdparties)ifthey

of practiceunderthecurrentcaselawsituation. that causesaestheticharm,althoughthisisfairlydifficult asamatter the government’s authoritytoobtainmonetarydamagesforpollution may, dependingonongoingdevelopmentsincaselaw, acknowledge actually damagedbyapolluter, “theoretically”speaking,futurecourts of publicassets(i.e.thepropertyownedbygovernment)is 7.1 cancellation ofpermits). (including imprisonmentandfines)orcivilsanctions(suchas provision offalseinformationissubjecttocriminalsanctions In mostcases,unreasonablerejectionoftheseinvestigationsor inspections andrequeststoprovidereportsotherinformation. by specificregulatorystatutes. These powersincludeon-site Environmental regulatorshavethepowertoinvestigateasprovided 6.1 3,000 m a changeoftheshapeorquality of thelandacertainsize(i.e. be hazardoustohumanhealthwhen theownersgivenotificationof local governorconsidersthatthere isapossibilitythatthesitecould hazardous tohumanhealthduecontamination,and(iii)whenthe governor considersthatthereisapossibilitythesitecouldbe factories haveceasedoperationsontheland,(ii)whenlocal contamination incertaincases;i.e.(i)whenhazardous using certaindesignatedinvestigationinstitutesandreportonsoil The SCCA requiresownersandoccupiersoflandtoinvestigate 7.2 impose anyobligationonaprivatepersontoinvestigate. possible futureinvestigationorder. Again, thissystemdoesnot facilitate theprocessofeliminatingcontamination,ifany, toavoida regulator (localgovernment)theresultsofinvestigationto voluntarily investigateanycontaminationandmaysubmittothe 2018, anypartywhomodifiesthelandscapeofacertainareamay Also, accordingtotheamendedSCCA whichbecameeffective in inadvertently foundonasite. way, theregulatoryregimeisrelativelylenienttowardspollution notification, noristhereanypenaltyfornon-compliance.Inthis investigation, butthereisnolegalobligationrequiringsuch anyone discoversanysoilcontaminationthroughtheirvoluntary the SCCA alsoprovidesforavoluntarynotificationsystemwhen results shallbereportedtotherelevantauthority. Ontheotherhand, statutorily requiredinvestigationundertheSCCA,such In caseswhereanysoilcontaminationisidentifiedduetothe 7 6 conduct siteinspections,interviewemployees,etc.? contamination? parties? Reporting /DisclosureObligations Powers ofRegulators environmental regulatororpotentiallyaffectedthird migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe require productionofdocuments,takesamples, What powersdoenvironmentalregulatorshaveto have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson 2 ormore). WWW.ICLG.COM

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143 Japan 144 Japan company tocompletelyescapeliability arisingfrompollutedassets. subsidiary. However, in mostcases,itisdifficult for theparent transfer pollutedassetstoasubsidiary and,thereafter, dissolvethe In ordertoshelterenvironmental liabilities, itmaybepossibleto 8.2 offence andthenecessityof takingsevereadministrativemeasures. payment tothevictim)mayinfluencedegreeofcriminal indemnifier hastakenremedialmeasures(includingtheindemnity mitigated byanindemnitypayment;however, thefactthat administrative sanctionsorcriminalcharges, cannotbeeliminatedor In general,liabilityunderstatutoryregulations,including negligence. damages arecausedthroughaparty’s wilfulmisconductorgross contracts, thoughitisalsocommontoimposeunlimitedliabilityif Indemnity andlimitationofliabilityarecommonlyusedin 8.1 subject landisdesignatedascontaminatedundertheSCCA. including possiblesoilcontaminationand(ii)thefactthat items thatmayhaveamateriallyadverseeffect onthepurchaser regulations applicabletothem,disclosethepurchaser(i)any Further, professionalbrokersoflandareobligated,underthe deemed tohavecommittedacriminaloffence (i.e.fraud). assets uponthesale,dependingonsituation,sellermaybe intentionally concealsthefactofmaterialcontaminationsold use thatmaypotentiallyresultincontamination. Also, iftheseller sellers todiscloseknowncontaminationoranyhistorymannerof after thesale. There aresomecourtprecedentswhichrequired decrease inpricewhencontaminationisdiscoveredbythepurchaser In aprivatesale,purchasermaycancelthesaleorrequest 7.3 or thesites. materials andotherdesignatedinformationregardingthefactories stated in(i)abovebyprovidingrelevantdataregardinghazardous cooperate withtheinvestigativebodyintypeofinvestigation parties havingoperatedhazardousfactoriestomakeefforts to The amendedSCCA,whichcameintoforcein2018,requires Kanagawa InternationalLawOffice © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM For example,assumingthatthe parent companyistheoriginal claimants. the courtwillbedecreasedbyamountvoluntarilypaidto punishment. Also, incivilcases,theamountofdamagesorderedby possible improvementinthefuture,andpossiblymitigate regulators andprosecutorsmayconsidersucharrangementsasignof For example,ifdamagesarecompensatedtothevictimsthemselves, 8 takeover transactions? order toescapeenvironmentalliabilities? potential liabilityforthatmatter? General matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff Is itpossibletouseanenvironmentalindemnity To whatextentisitnecessarytodisclose

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8.4 is overseas. feasor withthesubsidiary. This applieswhetherornotthesubsidiary pollution suchthattheparentcompanycanbedeemedajointtort- controlled subsidiaryinconnectionwiththerelevantbreachesand/or wilful intenttoevadeliability, or(ii)theparentcompanyhasafully- pierced becauseofdeceptiveincorporationwithoutsubstanceand/or there areexceptionalcaseswhere(i)thecorporateveilmaybe connection withasubsidiary’s environmentalliability. However, In general,aparentcompanydoesnotoweany“legal”obligationin 8.3 There isnosystemforexemption from suchliability. 8.6 suffered. must stilleachestablishthedamagesthattheyhaveindividually are intheoryonlya complainants oftenuniteinfilingthelawsuit,but When alawsuitinvolveslarge numberofcomplainants,the pollution. compensation fordeathorpersonalinjuryclaimsarisingfrom connection withconsumer-related contracts,anddoesnotinclude scheme, butthislawonlycoversmonetaryclaimsaccruedin Recently, anewlawwasenactedtointroducekindofclassaction damages arenotavailable. Japan doesnothaveageneralclassactionschemeandpunitive 8.5 under this Act everyyear;e.g.in2018,sixnewlawswereadded. protection underthis Act. Newlawsareaddedtothosecovered other requirementsmustbemetinorderforwhistle-blowerstogain made inrelationtocertainspecifiedcriminaloffences, andcertain blowing. This Act, however, requiresthewhistle-blowingtobe from punishmentorunfavourabletreatmentinretaliationforwhistle- whistle-blowers whoreportthebreachofsuchdesignatedstatutes including environmentallaws(e.g.CSCL, WPPA) andprotects The Whistle-blowers Protection Act designatescertainstatutes company. counterparties havingactualorpotentialclaimsagainsttheparent transferring themtothesubsidiarywithoutobtainingconsentfrom or not,itislegallyimpossibletobereleasedfromthoseliabilitiesby subsidiary, regardlessofwhetherthoseliabilitiesareactuallyclaimed have actuallyaccruedbeforetransferringpollutedassetstothe be subjecttotortclaims.Inaddition,iftheenvironmentalliabilities polluter, itwillcontinuetobeliableastheoriginalpolluterandcould report environmentalviolations/matters? caused byaforeignsubsidiary/affiliate? pursuing environmentallitigation? damages available? Are thereanylawstoprotect“whistle-blowers”who company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld any exemptionfromliabilityto pay costswhen Do individualsorpublicinterestgroupsbenefitfrom environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing de facto unityofindividualpartiesandactually Japan

business placestoachievesuchtarget, wereintroducedin2011. places, andanemissionstradingschemetobeutilisedforlarge-scale reductions oftheamountGHGemissionsfromlarge-scale business amount ofGHGemissionsin Tokyo. InSaitama,“targeted” the amountofGHGemissionstobereducedisabout20%total that mustreducetheamountofGHGemissionsisabout1,300,and were introducedin2008. The numberoflarge-scale business places from large-scale businessplacesandanemissionstradingscheme In Tokyo, mandatoryreductionsoftheamountGHGemissions integrate thestrengthsofbothschemes. Japan’s verifiedemissionsreduction)Scheme,andwasdesignedto Clean DevelopmentMechanismandtheOffset Credit(J-VER; The J-CreditSchemewascreatedin2013byintegratingtheDomestic on PromotionofGlobal Warming Countermeasures(“APGWC”). amounts undertheGHGemissionsreportingsystembasedon Act Purchased “credit”canbeutilised,forexample,toadjustemission does notinterveneintransactionsandthepriceof“credit”isfixed. between projectparticipantsandusersof“credit”. The government devices and/ormanageforestsas“credit”.“Credit”isfreelysold through efforts byprojectparticipantswhointroduceenergy-saving amount ofgreenhousegas(“GHG”)emissionsreducedorremoved called theJ-CreditScheme,wherebygovernmentcertifies Currently, thereisanemissionstradingschemeatthenationallevel 9.1 Kanagawa InternationalLawOffice ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 companies thatusedormanufactured asbestos. Asbestos litigationhasbeenfiled against boththegovernmentand 10.1 The APGWC hasareportingrequirementasdescribedinquestion9.2. 9.3 emissions everyfiscalyearandreporttothegovernment. large amountsofGHGmustcalculatetheamount reporting ofGHGemissions,wherebybusinessoperatorswhoemit In the APGWC, thereisarequirementforthecalculationand 9.2 the achievementofcertaingoalsbasedonParis Agreement. Moreover, the APGWC wasrevisedin2016withtheaimofpromoting also encouragingthemtotakereductionmeasurementsthemselves. importance ofefforts toward areductionintheemissionofGHGand making suchbusinessoperators(andalsocitizens)realisethe especially frombusinessoperatorswhoemitagreatdealofGHG,by The purposeistoachieveareductionintheemissionofGHG, The reportsfromthebusinessoperatorscanbedisclosedtopublic. © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 9 10 to monitorandreportgreenhousegasemissions? market developingthere? jurisdiction? regulation inyourjurisdiction? Emissions Trading andClimateChange your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation What istheexperienceofasbestos litigationinyour What istheoverallpolicyapproachtoclimatechange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned Asbestos

liability. tort liability. There havebeenjudgmentsthataffirm suchemployers’ produced orsoldasbestos-containingbuildingmaterialsbasedon a failuretomaintainemployeesafetyandfromcompaniesthat Plaintiffs havealsoclaimedcompensationfromemployersbasedon in relationtoformerworkersandtheirbereaved. power torequiretheinstallationoflocalexhaustventilationsystems the illegalityofinactiongovernmenttouseitsregulatory Prefecture andtheirbereaved,theSupremeCourtaffirmed in2014 asbestos productionplantsintheKonanareasouthernOsaka In anactionappealedbyformerworkersandpeoplelivingnear or therequirementtoinstalllocalexhaustventilationsystems. regulatory powers,suchastherequirementtoweardustrespirators claimed thatthegovernmentdidnotproperlyexercisecertain people livingneartheplantsaswelltheirbereaved. They have production plantsorintheconstructionindustries,andalsoby engaged injobswheretheydirectlydealtwithasbestos hazards ordeathhavebeenfiledbyformerworkerswhowere Compensation claimstothegovernmentfordamagesduehealth prevention measuresagainstdissemination ofasbestosandlauncheda In 2018,theMinistryofEnvironment formedacommitteetodiscuss asbestos. the regulationstoenhanceprevention measuresagainstexposureto The MinistryofHealth,Labourand Welfare hascontinuedtoreview asbestos inactivitiesinvolvingthe demolitionofsuchabuilding. in 2005.Itprescribespreventionmeasuresagainstexposureto the OrdinanceonPreventionofHealthImpairmentdueto Asbestos Moreover, theMinistryofHealth,Labourand Welfare established undertaking suchconstructionwork. has thepowertomakesupervisorydispositionspersons compliance withthestandardsofactivity. The prefecturalgovernor submit anotificationtotheprefecturalgovernorandshow undertake constructionworkassociatedwithsuchactivitiesmust Specified Particulates”.Furthermore,apersonwhowishesto factories thatusethemaredefinedas“Activities That Emit,etc. involving thedemolition,alteration,orrepairofbuildings are designatedas“SpecifiedBuildingMaterial”,andactivities Therefore, underthe APCA, buildingmaterialsthatcontainasbestos Earthquake of1995,dispersalasbestosbecameaseriousproblem. hazard. Forexample,atthetimeofGreatHanshin-Awaji managed, asbestosisdispersedwidelyandthismaycauseahealth buildings aredemolished,unlessthisdemolitionisproperly a buildingthatcontainsasbestos-containingmaterial. When such Facilities That GenerateSpecifiedParticulates. A typicalexampleis However, asbestos issometimesemittedorusedotherthanin in theatmosphereatsiteboundariesofafactoryorworkplace. Specifically, theregulatorystandardis10fibresofasbestosperlitre concentration) isprescribedintheordinance. standard ofproductiontobecompliedwith(regulations defined as“Facilities That GenerateSpecifiedParticulates”andthe The facilitiesofninetypesmachinesoveracertainscaleare Particulates”. regulated as“SpecifiedParticulates”,distinguishedfrom“Ordinary In the Air PollutionControl Act (“APCA”),asbestosisspecially asbestos, includingdispersalofasbestosintotheenvironment. for asbestoslevelsintheatmosphereandtopreventexposure Owners andoccupiershavethedutytomeetregulatorystandards 10.2 in relationtoasbestoson-site? What arethedutiesofowners/occupierspremises

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145 Japan 146 Japan insurance companiesandisrarelypubliclyavailable. However, information abouttheseclaimsiskeptconfidentialby The numberofenvironmentalinsuranceclaimsseemstobesmall. 11.2 say iftheyareplayingabigroleinJapan. These typesofinsurancearenotwidespreadsofar, anditishardto (iv) (iii) (ii) (i) (iv) industrialwasteproducerliabilityinsurance: costs insurance,(iii)medicalwasteproducerliabilityand contamination liabilityinsurance,(ii)soilpurification The typesofenvironmentalinsuranceavailableare(i) 11.1 again withinafewyearsafterdiscussionamongthecommittee. of asbestos. The above-mentionedregulatorystructuremaybeformed new committeewhichwillreviewmeasurestorestrictdissemination Kanagawa InternationalLawOffice © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 11 risks insuranceplayinyourjurisdiction? experience inyourjurisdiction? WMCA andrelatedregulations. measures orpayremovalcostsinaccordancewiththe dumping, andwheretheyarefurtherorderedtotake dumped, despiteefforts madebyproducerstopreventillegal contaminated soilwherewastefromproducersisillegally the costsforremovalofwasteorpurification the liabilityforhealthhazardscausedbydumpedwasteand industrial wasteproducerliabilityinsuranceprotectsagainst regulations; and Management andCleaning Act (“WMCA”)andrelated measures orpayremovalcostsinaccordancewiththe Waste dumped andthemedicalinstitutionisorderedtotake soil wherewastefromamedicalinstitutionisillegally costs forremovalofwasteorpurificationcontaminated liability forhealthhazardscausedbydumpedwasteandthe medical wasteproducerliabilityinsuranceprotectsagainst indemnification clausesinlandsalecontracts; against costswherepolicyholderspaysuchunder insurance forsoilcontaminationpurificationcostsprotects managed bypolicyholders; contamination producedbythefacilitiesowned,usedor against liabilityofdamagesarisingfromenvironmental insurance forenvironmentalcontaminationliabilityprotects What istheenvironmentalinsuranceclaims in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable Environmental InsuranceLiabilities

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for damages. affirmed oneofthehighcourtdecisionsthatadmittedcompensation compensate fordamages.InDecember2018,theSupremeCourt Japanese governmentand Tokyo ElectricPowerCo.,Inc.to town, andseveraldistrictcourtshighorderedthe by agroupofpeoplewhowereforcedtoevacuatefromtheirhome there aremanycasesinresponsetoakindof“classaction”initiated Regarding thedamagescausedby2011 Fukushima Accident, of thedamages,harmandlosseswhichmaybesuffered bycitizens. the reoccurrenceofanucleardisastergivenpossiblemagnitude considered indetailthepossibility(thoughitmaybeveryslim)of Fukushima Accident, or, evenadmittingthat,whetherthecourts taking intoaccountvarious“lessons”learnedthroughthe2011 new standardsintroducedafterthe2011 Fukushima Accident by concluded thatthesafetyofnuclearpowerplantssatisfied weight tothefactthatadministrativeagencies“reasonably” between theresultsofthesejudgmentsiswhethercourtsgave since the2011 Fukushima Accident, itseemsthatthedifference Though therehasbeennoSupremeCourtjudgmentonthisissue courts havediffered. prevent theplantsfromrestarting.However, thejudgmentsof injunction cases(includingpreliminaryones)havebeenfiledto power plantsinJapantemporarilystoppedoperations.Many accident inMarch2011 (“2011 Fukushima Accident”), allnuclear Japan isnuclearpower. After theFukushimanuclearpowerplant One ofthemostimportantrecenttopicsinenvironmentallaw 12.1 Tel: +81362066816/Email: Advisor atKanagawaInternationalLawOffice. colleague BrianBakerinthepreparationofthischapter. Brianisan The authorswouldliketoacknowledgetheassistanceoftheir Acknowledgment 12 in environmentlawyourjurisdiction. summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a Updates [email protected]

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Kanagawa InternationalLawOffice ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London headed byMr. HajimeKanagawa. Kanagawa InternationalLawOffice isaglobally-mindedlawfirmofferinglegal matters, specialisedknowledgeandexperienceininternational California (LL.M.,2004).Bar Admissions: JapanandNew York. Education: Universityof Tokyo (LL.B.,1995);UniversityofSouthern renewable powerprojectsunderthefeed-in-tariff regimeinJapan. extensive experienceinacquisitionandfinancingofmultiple transactions andcorporatefinancetransactions.Healsohas acquisitions, projectfinancetransactions,acquisition broad rangeofcorporateandfinancialmatters,includingmergers Law Office. HerepresentsJapaneseandmultinationalclientsina Hajime KanagawaisthefoundingpartnerofInternational URL: Email: Tel: Japan Tokyo, 105-0001 1-16-4 ToranomonMinato-ku 7F, Urban Toranomon Bldg. Kanagawa InternationalLawOffice Hajime Kanagawa www.k-ilo.com [email protected] +81 362066651

knowledge ofenvironmentalregulations. Office. Shehasbroadexperienceinregulatorypracticeandin-depth Yoshiko NakayamaisaCounselatKanagawaInternationalLaw URL: Email: Tel: Japan Tokyo, 105-0001 1-16-4 ToranomonMinato-ku 7F, Urban Toranomon Bldg. Kanagawa InternationalLawOffice Yoshiko Nakayama www.k-ilo.com [email protected] +81 362066458 WWW.ICLG.COM Japan

147 Japan Chapter 21 Mexico Luis Alberto Esparza Romero

LAER Abogados, S.C. David Huerta Ruiz

1 Environmental Policy and its 1.2 What approach do such agencies/bodies take to the Enforcement enforcement of environmental law?

At the Federal level, PROFEPA is authorised to conduct administrative 1.1 What is the basis of environmental policy in your acts identified as Inspection and Surveillance Visits, which are jurisdiction and which agencies/bodies administer implemented through an inspection proceeding with the aim of and enforce environmental law? determining the extent to which a person complies with the applicable environmental legislation. Mexican environmental law is based on a separation-of-powers system, whose legal foundation is foreseen at the constitutional Authorities are bound to comply with the principle of legality deriving level and by the General Law of Ecological Balance and from Article 16 of the Mexican Constitution (enshrining the due Environmental Protection (“LGEEPA” by its acronym in Spanish) process to be followed by authorities to avoid acts of disturbance). and by the legislation of the States integrating the Federal Pact. The PROFEPA is bound to serve a written order indicating that an normative framework is complemented by International Treaties, inspection act will take place at the corresponding facility; the order the case law of the Inter-American Court of Human Rights, must provide, in an accurate and non-generic way, the visit’s purposes, Regimes, Mexican Official Standards and Agreements issued by the areas and the environmental vectors which are the object of inspection. Executive Power and the Federal States. If an irregularity is detected, PROFEPA is entitled to initiate an Administrative Procedure that may conclude with the imposition of The legal foundation for environmental protection is foreseen in administrative sanctions, which can be challenged either by an appeal article 4 of the Mexican Constitution, which imposes on the Mexican for review or before an Administrative Justice Court and, at the final State the obligation to guarantee to all persons a healthy environment stage, through an Amparo Action before Federal Courts. for their development and well-being. The constitution also foresees the international environmental principle, establishing that damage Another faculty vested in PROFEPA is the ability to impose and environmental degradation will incur responsibility for those administrative penalties derived from a procedure known as Popular who provoke it in terms of the applicable Law. Complaint, by the terms of which any interested party may file an indictment requesting the intervention of said authority to protect the The Mexican environmental protection system arises from the environment. In these cases, PROFEPA must comply with the distribution of powers. Environmental protection is considered a Precautionary Principle. Additionally, this entity has been empowered concurrent power that must be exercised by the Federation, States to initiate actions claiming responsibility for environmental damage, or and Municipalities. Articles 5 and 8 of LGEEPA establish exclusive to initiate class actions. jurisdiction vested in each level of government. Nowadays, PROFEPA lacks inspection faculties regarding compliance There are offices in charge of environmental protection at each level with Mexican environmental laws. The previous Federal Congress of government. In the Federal sphere, the design of the environmental submitted for analysis an initiative to amend the Administrative policy and its instruments lies in the Ministry of Environment and Procedure of Environmental Inspection, including powers of Natural Resources (“SEMARNAT” by its acronym in Spanish). An investigation and foreseeing the hardening of the amount of economic agency in charge of monitoring and sanctioning compliance with penalties. Said modifications have not yet been approved. environmental legislation and acts issued by SEMARNAT has been endowed with the rank of Federal Attorney Office for Protection of Environment (“PROFEPA” by its acronym in Spanish). At the State 1.3 To what extent are public authorities required to level, this scheme is duplicated. provide environment-related information to interested persons (including members of the public)? Within the framework of the 2014 Energy Reform, an agency under SEMARNAT’s scope (the Agency for Energy and Environmental The authorities of the three levels of government are required, by the Security) has exclusive competence in oil and gas activities, and is Transparency and Access to Public Information Federal Act, to entitled to issue and create environmental policy instruments within provide all the information generated, obtained or in possession of its jurisdiction, including inspection, surveillance and penalties. said authorities; however, it is essential to note that certain

148 WWW.ICLG.COM ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 © Published and reproduced with kind permission by Global Legal Group Ltd, London of thetransfereesinordertocreditlegaltransmissionrights. authorisation, itisnecessarytoverifythetechnicalandlegalcapacity transmission asperformed;inothercases,priortothetransfer-of-rights notice totheresponsibleentitywillberequiredconsider procedures arerelativelysimple,and,inspecificscenarios,amere making thecorrespondingtransfertootherpersons. Transmission few casesinwhichtheLawhasestablishedimpossibilityof administrative acts,throughatransfer-of-rights procedure. There are permits allowsthetransmissionofrightsassociatedtothese In mostcases,theLawthatgovernsauthorisations,concessionsor Regulation, Standardor Agreement thatgovernsitwillberequired. compliance withvariousrequirementsestablishedbytheLaw, Prior totheissuanceofauthorisation,concessionorpermit, regulated activity. by whichaprivateindividualisentitledtoperformorexercise most cases,theprocessingofpolicyisdrivenbygoverninglaw, the obligationtoobtainauthorisations,concessionsorpermits.In Mexican environmentalpolicycontainsmechanismswhichestablish 2.1 created, throughwhichanypersoncanrequestpublicinformation. national security. A NationalOnline Transparency Platformhasbeen information, intellectualproperty, amatterofpublicinterestor disclosed tointerestedparties,dueitbeingeitherconfidential information willremainclassifiedorreserved,sothatitcannotbe LAER Abogados,S.C. ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 public )willresultfromthe presence ofhazardousmaterials. inclusion oftheaforementionednotification ofthepollution(in stems fromalandpollutedwith hazardouswaste,whilethe The assumptionofobtainingthe authorisation fromSEMARNAT way willdeterminewhoberesponsible forremediation. SEMARNAT toundertakethe transmissionoftheproperty. Either pollution withinthepublicdeedorobtainanauthorisationfrom property, theownermusteithernotifybuyerofexistence (“LGPGIR” byitsacronyminSpanish),priortothesaleofa by theGeneralLawforPreventionandIntegralHandlingof Waste nevertheless, itisbecomingcommonpractice. As itisestablished pollution inapropertybyphaseIorIIassessment; Legally speaking,thereisnoneedtodeterminetheexistenceof 2.3 obtain remedy. Administrative Justice. The Law alsoforeseesthefacultytochallengebeforeaFederalCourtof appeal foraReviewmustbefiledbeforetheissuingauthority; the resolutionissuedbyenvironmentalauthorities.Firstly, an In allcases,peopleareempoweredtochallenge(partiallyortotally) 2.2 The presenceofpollutioninaproperty incurstheliabilitytohave © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 2 contained inanenvironmentalpermit? person toanother? polluting industriesorotherinstallations/projects? Environmental Permits environmental permitsbetransferredfromone When isanenvironmentalpermitrequired,andmay Is itnecessarytoconductenvironmentalauditsor What rightsaretheretoappealagainstthedecisionof environmental impactassessmentsforparticularly environmental permitorinrespectoftheconditions an environmentalregulatornottogrant

Amparo Action isthelaststageto

handling wasteandsolidurbanwaste. responsibility relatedtothegenerationandmanagementofspecial criterion ofsharedresponsibilityisincontrasttotheextended It shouldbenotedthat,unlikemanycountries,inMexico,the and submitaManagementPlan. identification andstorage;and,inspecificcases,theneedtoprepare generator; monitoringthegeneration;specificconsiderationsfor generator isboundtospecificobligations,including:registryasa both theyearlygeneratedvolumeandtypeofwaste, States andMunicipalitiesrespectively. Taking intoconsideration Federation, whilethesecondandthirdareresponsibilityof handling; andsolidurban. The firstareunderthejurisdictionof Wastes areclassifiedintothreecategories:hazardous;special final disposalinaccordancewithLGPGIR. susceptible toappraisal,orisrequiredbesubjectedtreatment liquid orgascontainedincontainerstanks,andthatcanbe possessor, andthat isfoundinasolidorsemi-solidstate, Waste isdefinedasamaterialorproductdiscardedbyitsowner 3.1 subprojects; and/orthesuspensionorrevocationofauthorisations. arrest forupto36hours;confiscationofinstruments,productsor fine (temporaryordefinitive);totalpartialclosure;administrative well astoimposepenaltiesprovidedbylaw, suchas:aneconomic damages whichstemfromanactivitycontrarytothepermits,as PROFEPA isentitledtoimposecontrolmeasurescontain 2.4 their operations,whichremain independent ofthatwhichthe waste, whofromthemomentofits delivery, willberesponsiblefor to provideservicesofmanagement andfinaldisposalofhazardous grave, asreferredtoinLGPGIR. The generatorcanhirecompanies The hazardouswastegeneratorisresponsible fromthecradleto 3.3 establish specificguidelinesforthestorageofwaste. may berequested.Statelegislationandmunicipalregulations regulation ofthisLawstatesthatanextensionuptosixmonths stored inthegenerationsiteforaperiodofuptosixmonths. The As regardshazardouswaste,LGPGIRestablishesthatitmaybe 3.2 procedures. Sanctions willresultfromtheinspection,monitoringandpenalty of authorisationtoremediatearenecessary. the siteapproved,forwhichaninitialsamplingandobtainment 3 waste involveadditionaldutiesorcontrols? permits? bankrupt/disappears)? produced? Waste How iswastedefinedanddocertaincategoriesof regulators haveinconnectionwiththeviolationof What enforcementpowersdoenvironmental the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore WWW.ICLG.COM Mexico

149 Mexico 150 Mexico the stateinwhich itwasbeforetheeffect and, incaseofnotbeing a systemthatseekstherepairof damage,returningthethingto liability isregulatedbyLGEEPA andbytheCivilFederalCode;itis Federal PenalCode;thedefenceoccurs throughanoraltrial.Civil from thecommissionofenvironmental crimesstatedwithinthe Judgment andthe through the Appeal forReview, theContentious Administrative faculty thatPROFEPA hastoimposepenalties,whichcanbesought environmental. Administrative responsibilityderivesfromthe Responsibility canbeadministrative,civil,criminaland 4.1 the waste. reduction ofwastegeneration,includingtake-backorrecovery potential useorexploitationofthewasteinotheractivitiessuchas are boundtoformulateitmustincorporatetheidentificationand the formulationofthesetypesinstrument,inwhichpersonsthat 161-SEMARNAT-2013 establishestheelementsandproceduresfor and maximisethevaluation. The MexicanOfficial Standard NOM- Management Plans,whosepurposeistominimisethegeneration Valorisation andsharedresponsibilityprinciplesexistthroughthe productive processes. materials thatmakeupthewasteforitsreincorporationinto whose objectiveistorecoverthevalueorcalorificof objects oftherelevantpolicyisvaluation(appraisal,evaluation) collect theirwaste;however, LGPGIRestablishesthatoneofthe From alegalstandpoint,generatorsarenotobligedtorecoveror and usersofby-products. differentiated participationofproducers,distributors,consumers social co-responsibilitythatrequiresthejoint,coordinatedand and notextendedresponsibilityschemeinthesematters. There isa special managementwaste. As defined,inMexicothereisashared Regarding thispoint,weareinthepresenceofsolidurbanand 3.4 by these,ifthosearetheresultofachanceeventor activities willnotbejointlyresponsibleforthedamagesgenerated of athirdpartyauthorisedfortheconfinementorfinaldisposal by theFederalLawofsaidmatter, thepersonswhoavailthemselves Additionally, undertheconceptofenvironmentalliabilityforeseen up to20years. insurance tosupporttheiractivities,extendingthesameforaperiod subjects authorisedtoprovidemanagementservicesmusthave cradle tothegrave(dueexistenceofanobjectiveliability), In sum,althoughitistruethatthegeneratorresponsiblefrom will beextendedfor20yearsaftertheclosingoftheiroperations. of it.Byinjunctionlaw, theresponsibilityofserviceproviders caused duringtheprovisionofauthorisedservice,andatend of wastemustoffer aguaranteethatcoversthedamagesmaybe transportation, storage,reuse,recycling,treatmentandfinaldisposal According toLGPGIR,thoseinterestedinprovidingservicesof the damagescausedbytheirmanagement. SEMARNAT forsaidactivities,generatorswillberesponsible generator preserves.Ifthehiredcompaniesarenotauthorisedby LAER Abogados,S.C. © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 4 what defencesaretypicallyavailable? regarding thetake-backandrecoveryoftheirwaste? Liabilities breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa To whatextentdowasteproducershaveobligations Amparo Action. Criminalresponsibilityarises force majeure ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

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limits providedbyenvironmentallawshavenotbeenexceeded. modifications ordeterioration,ifitisverifiedthatthepermissible of sanction. the inflictionofothersmayattenuateorloweramounttype case thattheyresultfromtheLiabilityforEnvironmentalDamage, These responsibilitiesarenotmutuallyexclusive;however, inthe courts. type ofprocedureistakenintheformatrialbeforeFederalcivil when thisisimpossible,thepaymentofaneconomicsanction; this responsibility, thedamagerepairwillalwaysbesoughtand party, butrathertorestoretheenvironment,wasestablished.Due a schemethatdoesnotseektorepairthepropertyofaffected With thecreationofEnvironmentalResponsibilityFederalLaw, patrimony, derivedfromanenvironmentaldamage. proven bydemonstratingthatthereisaneffect onthepersonorhis possible, thepaymentofdamages;however, theabovecouldbe damage willnot develops. Inthesamevein,itisestablishedthatenvironmental be supportedbytheenvironmentalsystemwhereitislocatedand any otherelementthatascertainsuptowhichlevelsanactivitycan acting withintheboundariesestablishedinOfficial Standardsor We cannotspeakoftheexistence ofenvironmentaldamage,when 4.2 a pollutedproperty oreventheobligationtocarryout saidactivities, transmission ofresponsibilityregarding theobligationtoremediate or throughtheprocessingofnew authorisations. There may bea relevant authorisationseitherthrough atransferofrightsorpermits, sale ofassetsentailsanobligation ontheacquirertoobtain of past,presentandfutureresponsibility fortheactivity, whilethe An operationassociatedwithasale ofsharesimpliestheassumption 4.4 contrary toenvironmentallegislation. insurance isthepreventionoforderingorauthorisingactivities damage. Criminalmattersaredealtwithseparately, forwhichthebest obviously thiscanbeusedtorespondincaseofenvironmental have environmentalinsurance,dependingontheregulatedactivity; Emanating fromvariousenvironmentallaws,thereisanobligationto commission oftheactivityconstitutingacriminaloffence. management, areattributabletothepeoplewhoorderorauthorise associated withcrimesagainsttheenvironmentandenvironmental the damagesgenerated.Incriminallaw, thetypesofactivity carry outenvironmentaldamagewillbejointlyandseverallyliablefor harmful conduct).Bythesametoken,peoplewhouseathirdpartyto by omissionorwhenorderingconsentingtotheperformanceof representatives, administrators,managers,directors,employees(either responsible fortheenvironmentaldamagecausedbytheir when notpossible,topayanenvironmentalredress.Legalentitiesare causes environmentaldamage,willbeboundtorepairthedamageand, Any personwho,throughactionoromission,directlyindirectly 4.3 within permitlimits? the onehandandanassetpurchaseonother? indemnity protectioninrespectofsuchliabilities? notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract legally exist,evenwhentherearedamages,

Mexico

baseline condition. includes removingcontaminantsandrestoringthewaterbodytoits environmental damagecausedbywastewaters. The procedure Commission) imposestheobligationtorepairorcompensatefor Regarding water, thepertinentauthority(theNational Water human health,whileestablishingspecificremediationlevels. to determineifthepollutionrepresentsariskenvironmentand absence ofaspecificregulation,riskassessmentstudywillbeneeded only oneforhydrocarbonsandanotherheavymetals).Inthe must beassociatedwithaMexicanOfficial Standard(currentlythereis technology, schedulesandrestorationparameters,whichgenerally and aproposalmustbesubmittedtoSEMARNAT, including contamination, acharacterisationofthecontaminantsshouldbemade remediation procedureoftheproperty. Inthecaseofhistorical pollution mustbeimplemented,tosubsequentlycarryoutthe immediately andimperativemeasurestopreventthespreadof In thecaseofenvironmentalemergencies, PROFEPA mustbenotified or anenvironmentalliability(historicalcontamination). Mexican law, pollutioncanderivefromanenvironmentalemergency must beobtainedpriortorealisinganyactivity. As definedby taken, anauthorisationgrantedbySEMARNAT foraremediationplan When thereispollutionofthesoilandremediationactionsmustbe 5.1 remediation work. right toobtainremunerationfortheexpensesincurreddue severally liablefortheremediationofapollutedproperty, withthe In termsofLGPGIR,theownerandpossessorarejointly 4.5 the damage. recovery ofremediationexpensesfromthepersonwhohascaused always maintainingtherighttosueincivilproceduresfor LAER Abogados,S.C. ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 remediation proposal, whichcannotbemodifiedby theauthorityin Under Mexicanlegislation,authorisation mustbeobtainedforthe 5.3 for theremediation. of propertytransfer, thepartieswilldefinewhoberesponsible compensation forthecostsincurredthroughacivillawsuit.Incases possessor willberesponsible,safeguardingtherighttoobtain been responsibleforthepollution;bylaw, thecurrentowneror the casethatpreviousownersorofpropertyhave associated withtheremediation. The sameassumptionappliesto carried outtherestorationactivitiesmayrequireotherexpenses may berequiredfromanypersoninvolved. The partythathas The responsibilityisjoint,meaningthattheremediationactions 5.2 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 5 groundwater? environmental wrongdoingand/orremediationcosts? can athirdpartychallengethe agreement? is responsibleforthecontamination? Contaminated Land What istheapproachtoliabilityforcontamination To whatextentmaylendersbeliablefor (including historiccontamination)ofsoilor regulator comebackandrequire additionalworksor “agreed” withanenvironmental regulator, canthe If aprogrammeofenvironmental remediationis How isliabilityallocatedwheremorethanoneperson

modification oftheremediation. the parametersmustbereached. A thirdpartycannotrequestthe can makemodificationstothemethodortimewithinwhich terms ofitsscope. The partyincharge ofdeployingtheremediation environmental fund. damage orthepaymentofeconomiccompensationdestinedtoan cannot requestmonetarydamages,butrathertherepairof procedure ofliabilityforenvironmentaldamage;nevertheless,it of constitutingenvironmentalpollution,PROFEPA caninitiatea If theaestheticdamagestranscendsuchcharacterisationtopoint 5.5 situation thatshouldbeincludedinthesale’s deed. the personwhowillimplementremediationofproperty–a the remediationofpollutedpropertieswillcontaindeclaration activities. Indeed,theauthorisationfromSEMARNAT toconduct remediation toseektherecoveryofexpensesincurredonrestoration As mentionedbefore,LGPGIRempowersthepersonincharge of 5.4 person. may requestcivilremediesfordamage totheirpropertyor third partysuffers alossorimpairmentintheirproperty, thelatter remediation withinitspremises.If, asaresultofthemigration, be notifiedtothethirdpartyinorder tocarryoutthesamplingsand authority withinthesameprogramme orremediationplan,andmust Yes, migrationofpollutionmustbenotified totheenvironmental 7.1 mechanisms. with theStandardProceduresandclearlyestablishchain-of-custody When samplingsaretobeheld,theyshoulddoneinaccordance limits towhichitisbound. samplings maybeheldtodeterminecompliancewiththepertinent authorised personnelorthroughaccredited Verification Units, environmental legislation. Within theinspectionvisitsandthrough any typeofevidencetoestablishtheexistenceaviolation the informationrelatedtopurposeofvisit,aswellgather Within theinspection visits,thevisitoriscompelledtoprovideall 6.1 7 6 public assets,e.g.rivers? contaminated landliabilitytoapurchaser? parties? conduct siteinspections,interviewemployees,etc.? Reporting /DisclosureObligations Powers ofRegulators polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek environmental regulatororpotentiallyaffectedthird migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe require productionofdocuments,takesamples, What powersdoenvironmentalregulatorshaveto WWW.ICLG.COM Mexico

151 Mexico 152 Mexico Mexican law;however, caselawhas determinedthepossibilitytouse “Piercing thecorporateveil”isnot aninstitutionestablishedby 8.3 environmental matterspendingclosure. a PROFEPA reportisrequiredtodeterminetheexistenceof the liquidationofcompanytomeetitsobligations.Insomecases, period, aswellitsobligationstomaintaininformation,maylimit the Law’s provisionsthatmandateittoremaininforceforacertain The obligationtoobtaininsurancecarryoutcertainactivities,and could putatriskthecontinuityofcompany. Financial Regulationsistodiscloseanytypeofinformationthat to partnersandshareholdersofthecompany. The principleofthe derived fromtheeffect, orcarryoutthedisclosureofcontingency financial statements,makeareservationtocovertheexpenses impact, itwillbedeterminedifisnecessarytomakeanoteinthe Standards mustbecontemplated.Dependingonthedegreeof In thefinancialauditsofcompanies,FinancialInformation 8.2 compensation willbetheonethatfacesenvironmentalresponsibility. existence ofpollutiononthepremises,sopersonreceiving reduction inthetransactionpriceduetoimpairmentcausedby is agreedmayincludeapaymentforenvironmentalliabilityor historical orcurrentdamages;thecontractofsaleinwhichtransfer Currently, theinsurancemarketinMexicooffers coveragefor 8.1 be madeknowntothepurchaserorinpurchaser’s prospectus. of transmissiontheownershipproperty, andshouldalways The onlyspecificcaseforeseenbytheLawanditsRegulationisthat 7.3 property. his responsibilitywithrespecttotheexistingcontaminationin generates abaselinethatallowspersontoestablishtheextentof purchase orleaseofthepropertyisintended,foregoing If anenvironmentalemergency arises,oratthetimewhenanactof 7.2 LAER Abogados,S.C. © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 8 takeover transactions? contamination? caused byaforeignsubsidiary/affiliate? order toescapeenvironmentalliabilities? potential liabilityforthatmatter? General matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto liable forbreachesofenvironmental lawand/or Can apersonwhoholdssharesincompanybeheld balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff Is itpossibletouseanenvironmentalindemnity To whatextentisitnecessarytodisclose have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson company besuedinitsnational courtforpollution pollution causedbythecompany, andcanaparent

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

assets. creation ofanautonomousentitywithlegalpersonalityanditsown in thenationalcourts,sinceCorporateLawestablishes resulted inpunitivedamages. closures orarrest);somedecisionsissuedbytheSupremeCourthave sanctions inordertocreatedissuasivebehaviour(excessivefines, Currently therearetheoriesthatsupporttheimpositionofexemplary or itsrescission,respectively. in somecases,ajudicialclaimfortheforcedfulfilmentofcontract on anindividualbasistothemembersthatmakeupgroupand, respondent issoughttorepairthedamage,aswellcompensation strict sense”;or“individualhomogeneous”.Bythese,the Yes, currentlytherearethreetypesofclassactions:“diffuse”; “in 8.5 determine ifawhistle-blowerexists. reveals theenvironmentalviolation.Inthisevent,thereisnowayto maintained forthepersonwhoispresentinginformationthat Popular complaintscanbefiledrequestingthatanonymity 8.4 of tonsCO2equivalent. Yes, the Annual EmissionsInventoryrequirestheannualreporting 9.2 Mexican StockExchangethroughavoluntarycarbonmarket. System fortheyear2020. The marketwillbeoperatedbythe period, therewillbeatransitiondateforanEmissions Trading 2019, whichwilllastforthreeyears. At theconclusionofthis has announcedthatthecarbonmarketwillstartwithapilotphasein Stemming fromtheGeneralLawonClimateChange,SEMARNAT 9.1 negotiations. judgment, theexpensesandcostsshouldbeincludedin agreement isreachedbetweentheparties,beforeissuanceof the feesarecalculatedbasedonamaximumlevy;incasethatan as wellthefeesofitsrepresentatives.Incaseclassactions, Each partyassumestheexpensesorcostsderivedfromitsactions, 8.6 In thecaseof in thatcase,theresponsibilitycouldreachshareholders. used withthesolepurposeofnotcomplyingitslegalobligations; said conceptwhenitisproventhatacorporationwasconstitutedor 9 damages available? report environmentalviolations/matters? to monitorandreportgreenhouse gasemissions? market developingthere? pursuing environmentallitigation? Emissions Trading andClimateChange environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing Are thereanylawstoprotect“whistle-blowers”who in question9.1above,isthere any otherrequirement Aside fromtheemissionstrading schemesmentioned your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation any exemptionfromliabilitytopaycostswhen Do individualsorpublicinterestgroupsbenefitfrom parent company,thereisnopossibilityofsuingthem

Mexico

the 2000emissions),andbyupto50%year2050. emissions by30%2020withrespecttothebaseline(related indicative commitmentoraspirationalgoalofreducingCO2 There are12regulationsthatcontemplateclimatechange,withan 10.2 country therehasbeennopublichealthcrisisassociatedwithitsuse. Asbestos ismanagedasHazardousMaterialsor Waste; inthis 10.1 Mexico hasbeenaparticipantinthereductionofCO2emissions. 9.3 LAER Abogados,S.C. ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 liability asaresultofcarryingoutindustrialactivities,well There isinsuranceagainstpre-existingandgeneratedenvironmental 11.1 Organization onthemanagementofasbestos. has notratifiedConvention162oftheInternationalLabour sanitary requirementsfortheprocessanduseofasbestos.Mexico NOM-125-SSA1-2016 andNOM-010-STPS-2014whichsetoutthe Owners/occupiers mustcomplywithMexicanOfficial Standards © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 11 10 risks insuranceplayinyourjurisdiction? in relationtoasbestoson-site? jurisdiction? regulation inyourjurisdiction? What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour What istheoverallpolicyapproachtoclimatechange in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable Environmental InsuranceLiabilities Asbestos

terms ofenvironmentalimpactarethemostrelevant. for compliancewiththetermsandconditionsofauthorisationsin In recenttimes,ithasbeentakenoutmorefrequently;however, bonds the responsibilityderivedfromtransportofwaste. perform highlyriskyactivities.Similarly, thereisinsurancetocover insurance forgeneratorsofhazardouswasteandcompaniesthat access tojusticeoverenvironmentallosses. The Escazú Agreement representsanewparadigminrespectof scheme derives. There havebeensomecasesofclimatelitigation. and fromwhichtheresponsibilityofpersontohaveaforecasting with aspecialcategoryofprotectionregardingactsthatmayoccur environment. The environmentalcaselawinparticularstandsout, of asupralegalprotectionlife,healthandanadequate Human rightsandenvironmentalcaseshavebroughtconnotations 12.1 PROFEPA. Federal Treasury, withthepossibilitythattheymaybedemandedby have agreateracceptance,sincetheseareissuedinthenameof context, bondstoensurecompliancewithenvironmentalobligations element todealwithenvironmentalemergencies quickly;inthis The advantageofbuyinginsuranceisthatithasbeenusedasan 11.2 12 in environmentlawyourjurisdiction. experience inyourjurisdiction? summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a What istheenvironmentalinsuranceclaims Updates WWW.ICLG.COM

Mexico

153 Mexico 154 Mexico LAER Abogados,S.C. © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM ■ ■ ■ ■ ■ ■ ■ ■ ■ social risks,fortheintegrationorimprovementofanenvironmentalmanagementsystem.Ourservicesinclude: environmental and scheme offeasibleimplementation.Ourportfolioincludesthedesignmethodologiesthatmakedetermination asustainable from normativenon-compliance;orthroughthestrategicimplementationofprogrammesthatallowthemtoobtainadvantage of legalliabilityderived that allowtheregularisationoftheiractivitiesoroperations,andimplementingmeasurespreventlimitemergence schemes and regulatorymatters.Ourmainmissionistohelpourclientsintheidentificationofenvironmentalmanagementneeds,byestablishing S.C. LAER Abogados, administrative lawasatooltomeettheirneeds. towards designingandimplementingcomplexstrategies,using fulfilment oftheEquatorPrinciples.Heisexperiencedinguidingclients Environmental Law, providingcounselontheimplementationand of numeroustypesindustriesandactivitiesinthefieldInternational matters coveringenvironmentallegalaspects,andattendstotheneeds compliance strategies.Hehasbeeninvolvedinseveralprojectfinance and ForestryLaw. Heisskilledinthedesignandimplementationof Water Law, Waste Management,SoilContamination,ClimateChange recognised inhandlinglegalmattersrelatedtoEnvironmentalImpact, Abogados, S.C.).Mr. Esparzahas20yearsofexperienceandiswidely dedicated toEnvironmental, Administrative andRegulatoryLaw(LAER 12 yearsinGonzalezCalvillo,S.C.,hehasinitiatedaprivatepractice Mr. EsparzaspecialisesinEnvironmentalLawandSustainability. After Standards onEnvironmentalandSocialResponsibility). Environmental aspectsofprojectfinance(specialistsintheEquatorPrinciplesandInternationalFinanceCorporation’s Per Environmental audits. Permits. International environmentallaw. Emissions totheatmosphereandclimatechange. Soil. Waste. Water. Environmental impact. iscreatedfromtheconcerntooffer anintegralandnon-conventionalsetoflegalservicesinenvironmental,administrative URL: Email: Tel: Mexico Mexico City 05330 CuajimalpadeMorelos Colonia El Yaqui /SantaFe Carretera Mexico Toluca 5420,Suite2203 S.C. LAER Abogados, Luis Alberto EsparzaRomero www.laerabogados.com [email protected] +52 5588807646 ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

Law. areas ofEnvironmentalLawandisdevelopingourpracticeinEnergy graduated, hehasbeenworkingatLAER Abogados, S.C.indiverse Mr. HuertahasinitiatedhispathonEnvironmentalLaw;recently URL: Email: Tel: Mexico Mexico City 05330 CuajimalpadeMorelos Colonia El Yaqui /SantaFe Carretera Mexico Toluca 5420,Suite2203 S.C. LAER Abogados, David HuertaRuiz www.laerabogados.com [email protected] +52 5588807646 Mexico formance

Chapter 22 Netherlands

Gaastra attorneys at law André H. Gaastra

1 Environmental Policy and its (administrative) enforcement measures, apart from some exceptions, including that the situation can be legalised or that enforcement would Enforcement be disproportionate, taking into account the interests of the party violating the law in relation to the general interest that is served with enforcement. This leads to a quite active approach of the enforcement 1.1 What is the basis of environmental policy in your jurisdiction and which agencies/bodies administer agencies. The performance of industrial, waste handling and other and enforce environmental law? facilities under environmental law are closely monitored. Next to this, environmental law can lead to prosecution under criminal law. In According to article 21 of the Netherlands Constitution, government view of this, the public prosecutor’s office has instituted a department care is focused on the habitability of the country and the protection and with specialised prosecutors and support staff. improvement of the environment. The Environmental Management Act (Wet milieubeheer), the Environmental Permitting (General 1.3 To what extent are public authorities required to Provisions) Act (Wet algemene bepalingen omgevingsrecht) and the provide environment-related information to interested subordinate decrees and regulations form the general regulatory persons (including members of the public)? framework for environmental control, permitting and enforcement. A significant part of the specific environmental rules that apply in the The Aarhus Convention on access to (environmental) information, Netherlands are established by the European Union and laid down in public participation in decision-making and access to justice in European Regulations or Directives that are implemented in environmental matters in the EU is implemented in the Government Netherlands law by means of reference legislation. Information (Public Access) Act (Wet openbaarheid van bestuur). Some fields of interest are dealt with by specific laws, such as the Soil Public authorities must provide environmental information on request. Protection Act (Wet bodembescherming), which deals with soil The requestor does not need to have a specific quality or title, as pollution and remediation, the Water Act (Waterwet), which deals with anyone is entitled to file a request for environmental information. The water quality and water quantity control and permits to discharge and grounds for denial are limited to quite specific public and private the Noise Abatement Act (Wet geluidhinder), which deals with the interests. prevention of . A large legislative operation is on its way, which should lead to the integration of all environmental laws 2 Environmental Permits into one, this being the Environmental Act (Omgevingswet), which is supposed to enter into force in 2021. Since 2017, environmental law has been administered on a national 2.1 When is an environmental permit required, and may level by the Minister of Infrastructure and Water Management environmental permits be transferred from one (ministerie van Infrastructuur en Waterstaat) and the Minister of person to another? Economical Affairs and Climate (ministerie van Economische Zaken en Klimaat). Most of the permitting and environmental enforcement is In the past decade, the legislator has transferred some notable permit the competence of the provincial and municipal executives. Given that requirements into the general notification requirements under an the extent and complexity of environmental law has increased in the environmental decree. Specific permitting requirements remain for, past few decades, most of the local governments have taken part in amongst others, activities requiring a permit in the sense of the regional execution bodies (Regionale Uitvoeringsdiensten). These European Industrial Emissions Directive (integrated pollution bodies employ the staff of the provincial or municipal executive, who prevention and control). In such cases, a permit is granted under the prepare the decisions based on environmental law and conduct fulfilment of certain conditions and is required for the erection, environmental inspections on the basis of a mandate. modification and operation of a facility. General rules apply to specific permitted and non-permitted 1.2 What approach do such agencies/bodies take to the activities, specifying, for instance, the maximum load of emissions enforcement of environmental law? into the ambient air, how the facility should limit and deal with their waste and other aspects of environmental control, including the In the Netherlands, the principle of the duty to enforce (beginselplicht prevention of noise pollution, soil pollution, external risk and tot handhaving) applies. Case law provides that, in case of a violation energy reduction. In some cases, exemptions or tailor-made permit of environmental law, the competent authority must take conditions may be granted.

ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 WWW.ICLG.COM 155 © Published and reproduced with kind permission by Global Legal Group Ltd, London 156 Netherlands Directive onStrategicEnvironmental Assessments (2001/42/EC). installation, adam,motorwayor airportoronthebasisof (2011/92/EU) forindividualprojects,suchasanintegratedindustrial European DirectiveontheEnvironmentalImpact Assessments actual permitapplication.EIA requirementsfollowfromthe would beaseparatepartofthepermittingprocedurethatprecedes requirement ofanEnvironmentalImpact Assessment (EIA). This Some applicationsforanenvironmentalpermitaresubjecttothe authority. obligation toforwardacopyoftheauditreportscompetent to environmentalpermits. These conditionsmaycontainthe environmental audits.However, relatedconditionsmaybeattached Netherlands lawdoesnotcontainageneralrequirementtoconduct 2.3 have aparticularinterestinorderforhisappealtobeadmissible. Other thantheapplicant,personorentityfilinganappealmust appeal againstanamendmentofthedecision. the publicinspectionperiod,incasetheywouldhavegroundsforan by interestedpartiesagainstachangeofthepermittingdecisionafter them, thentheirappealisnotadmissible. Appeals canalsobebrought not abletodemonstratethatthiscouldreasonablybeheldagainst permitting procedure.Iftheywouldnothavefiledanopinionandare opinion duringthepublicinspectionperiodwhichispartof appeal isrestrictedtointerestedthirdpartieswhohavefirstfiledtheir appeals willallbedealtwithinthesamecase.However, therightto interested partiesagainstthegrantingofapermitarepossible. These of thepermitoragainstconditionsifgranted,andappeals courts withinsixweeks.Bothanappealoftheapplicantagainstdenial Appeals againstpermittingdecisionscanbefiledwiththeregional 2.2 authority atleastonemonthbeforethetransfer. the permitholdershouldnotifytransfertocompetent Environmental Permitting(GeneralProvisions) Act providesthat transferred onthebasisofoperationlaw. However, the another operator, theenvironmentalpermitisautomatically to thepermitholder. When afacility( attached totheactivitiesforwhichpermitisgrantedratherthan Energy Act) aresubjectto Environmental permits(otherthanundertheNuclear Gaastra attorneysatlaw © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM key featureofenvironmental assessmentprocedures. to theirapprovalorauthorisation. Consultationwiththepublicisa environment aremadesubjecttoan environmentalassessment,prior programmes andprojectslikelyto havesignificanteffects on the The commonprincipleofbothDirectives istoensurethatplans, matters intheNetherlands). Court oftheCouncilState(thehighestcourtforadministrative After averdictofthecourt,partiesmayappealto Administrative purpose oflitigationincourt. not beadmissibleiftheenvironmentalgroupwasjustcreatedfor of association,meaningthattheenvironmentalgroups’ appealwill involved inactivitiesservingthegoalsthataredetaileditsarticles association andprovidedthattheenvironmentalgroupactuallyis appeal relatestoasubjectthatiscoveredintheirarticlesof Environmental groups’ appealsareonlyadmissibleifthegroundof contained inanenvironmentalpermit? polluting industriesorotherinstallations/projects? Is itnecessarytoconductenvironmentalauditsor What rightsaretheretoappealagainstthedecisionof environmental impactassessmentsforparticularly environmental permitorinrespectoftheconditions an environmentalregulatornottogrant droit desuite inrichting , meaningthattheseare

) istransferredto

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

and enforcement. preparation ofanygovernmentdecisiononwaste,includingpermitting and bestavailabletechniques. This planmustbeappliedinthe the nationalpolicyonwasteprevention,management,recycling adopted anationalpolicyonwaste(theNational Waste Plan)holding Environmental Management Act. The nationalgovernmenthas The handlingofwasteonthenationallevelisregulatedby or intendsisrequiredtodiscard),recyclingandrecovery. definitions ofwaste(anysubstanceorobjectwhichtheholderdiscards waste management. This Directiveprovides,amongstothers, (2008/98/EC) whichsetsthebasicconceptsanddefinitionsrelatedto accordance withtheEuropean Waste FrameworkDirective The Netherlandsdefinitionofwasteisentirelybasedonandin 3.1 related activitiessuchasthetransboundarymovementofwaste). Infrastructure and Water Managementwithrespecttonon-facility- Executive inrelationtofacilitiesoractivitiesandtheMinisterof the competentadministrativebody(theMunicipalorProvincial Environmental administrativeenforcementpowersareprovidedto 2.4 have handedover theirwastetoapermittedandlawful landfillcan under theEnvironmentalManagement Act. Producersofwastewho on thedutyofcareandotherobligations withrespecttowastehandling a licensedwastemanagementcompany. Suchliabilitymaybebased liability maybelimitedifandafterthey havetransferredtheirwasteto Producers mayretainresidualliability fortheirwastestreams. This 3.3 bound bystringentrequirements. period ofoneyear. Permitstostoreforlongerstorageperiodsare be regardedasarecoveryoperationifthestorageislimitedto landfills. Temporary storage beforeremovalisallowed.Itcanonly current nationalpolicy, however, isagainsttheerectionofnew Disposal withinafacilitycanonlybeallowedwhenpermitted. The 3.2 leading tothepossibilityofprosecutionbypublicprosecutor. Next tothis,theviolationofenvironmentallawisacriminaloffence, het openbaarbestuur). ( Public Authorities denial offuturepermits,basedonthe Act ontheIntegrityControlby form, thissanctioncouldbethewithdrawalofpermitor administrative punitivesanctionsarepossible.Initsmostextensive administrative force( penalty ( The competentauthoritycanissueordersunderthethreatofa 3 waste involveadditionaldutiesorcontrols? have inconnectionwiththeviolationofpermits? bankrupt/disappears)? produced? Waste How iswastedefinedanddocertaincategoriesof What enforcementpowersdoenvironmentalregulators the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore last onderdwangsom)orordersunderthethreatof

Wet bevordering integriteitsbeoordelingen door last onderbestuursdwang).Insomecases, Netherlands

under theEnvironmentalManagement Act. implemented intheNetherlandsbyspecificrulesandregulations batteries, carwrecksandpackagingmaterials. These obligationsare such asforwasteelectricandelectronicequipment(WEEE), European environmentallawcontainsvarioustake-backobligations 3.4 operational phaseofthelandfill. levies thatshouldbecollectedbythelandfillcompanyduring surrounding environment. These obligationsarefinancedbywaste the purposeofwhichisperpetualcontrolinordertoprotect obligations fortheprovincialauthoritiesthatapplyafterclosure, probably beclosed. The EnvironmentalControl Act holdsaftercare landfill. After all,atthatmomentintime,thelandfillwillmost the obligationofcompetentauthoritytakingcontrolover After terminationoftheinsolvencyperiod,thiswillinfactbecome relevant environmentalandwastelawsistransferredtothetrustee. If thetransfereegoesbankrupt,obligationtocomplywith substances presentinthelandfillonbasisofcivillaw. disculpate themselvesfromliabilityfordamagethatwascausedbythe Gaastra attorneysatlaw ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 held personallyliable dependingontheirparticularinvolvement inthe environmental wrongdoing. They may, apartfromthecompany, be Yes. Directors andofficers may attractpersonalliabilitiesfor 4.3 claims mayalsobebasedontortoutsideofthepermitrequirements. limits. OnthebasisofNetherlandscivillaw, (environmental) damage evenwhenthepollutingactivityisoperatedwithinpermit would meanthatanoperatorcouldbeliableforenvironmental environmental liabilitybasedonthe‘polluterpays’ principle. This which appliesintheNetherlands,establishesaframeworkof regard tothepreventionandremedyingofenvironmentaldamage, Yes. EUDirective2004/35/CEonenvironmental liabilitywith 4.2 between anallegedunlawfulactoromissionbreachofcontract. actions aregenerallypronetothelackofproofonacausalconnection the suspectorthattherewasnoharmdonetoenvironment.Civil with theapplicablestandards),thatviolationcannotbeattributedto alternative causesorthatmeasurementswerenotdoneinaccordance manner (forinstance,lackofproofinthesensethatthereare to theallegedaction,thatviolationwasnotdeterminedinright Typical defencesmayberelatedtothesubjectrulenotbeingapplicable on tortorbreachofcontract. described above),orcouldinsomecasesleadtocivilactionsbased sanctions asdescribedabove,tocriminalprosecution(also A breach ofenvironmentallawcouldleadtoadministrative 4.1 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 4 what defencesaretypicallyavailable? regarding thetake-backandrecoveryoftheirwaste? indemnity protectioninrespect ofsuchliabilities? within permitlimits? Liabilities To whatextentdowasteproducershaveobligations to whatextentmaytheygetinsurance orrelyonother personal liabilitiesforenvironmental wrongdoing,and Can directorsandofficersofcorporationsattract notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa

due diligenceandtheinformationdisclosurerequirements. transaction mayalsohaveimplicationsforthelevelofdetailin financial damage. against theeffects ofgovernmentordersorimprisonmentotherthan pursuing thedirectororofficer. Furthermore,thereisnoinsurance authority, apublicprosecutororthirdpartyincurringdamagesfrom generally beinsured.However, thiswillnotavoidthecompetent Financial damageonthebasisofdirectors’ orofficers’ liabilitycan to someextent. albeit thatthecriteriaforliabilityundertheselegislativeschemesdiffer case. This isapossibilityunderadministrative,civilandcriminallaw, of futureliabilities pollution, certainmeasurescouldbetakeninviewoftheavoidance caused damagetotheassetsthatweretransferred.Incaseofsoil then historicalliabilitieswouldbeleftbehind,unlessthishave acquired. Ifonlytheassetsofcompanywouldbetransferred, remains withthecompanyandwouldbeattachedtoshares company canbeheldliablehaspollutedthesoil,thenthisliability liabilities. Ifthecompanyoranypersonentityforwhich shareholder wouldacquirethecompanywithitsenvironmental from oneshareholdertoanother. This wouldmeanthatthenew A sharesaleimpliesthatthecapitalinacompanyistransferred 4.4 turn totheowner ofthepollutedpropertyaswell. accountable forthesoilpollution. The competentauthority may and notjustdependingontheresponsible entitythatcanbeheld Protection Act isansweredbytheenforcing competentauthority The questiononwhoshouldremediate onthebasisofSoil liability. Joint andseveralliabilitycaningeneralnotbeexcluded. case. Contractclausesmayalsohave aneffect onthedistribution of The allocationofliabilitywilllargely dependonthemeritsof 5.2 provisions in,orattachedto,leaseagreementsdutiesofcare. 1987). Apart fromthis,liabilitymaybebasedon(general) non-historic caseofsoilpollution(i.e.causedbefore,inorafter liability maydependonwhetheristobequalifiedasahistoricor lease holderofapollutedproperty. Nexttothis,the(extentofthe) pollution, theentityusingpollutedpropertyandownerorlong liabilities forthepartywhohascausedsoilorgroundwater The provisionsoftheSoilProtection Act implyresponsibilitiesand 5.1 Netherlands lawdoesnotprovideadirectliabilityforlenders. 4.5 environmental pollution. responsibilities oflendersandcollateralsmaybeaffected by However, there mayberelevantcontractualobligationsor 5 the onehandandanassetpurchaseonother? is responsibleforthecontamination? groundwater? environmental wrongdoingand/orremediationcosts? Contaminated Land environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman How isliabilityallocatedwheremorethanoneperson (including historiccontamination)ofsoilor What istheapproachtoliabilityforcontamination To whatextentmaylendersbeliablefor

vis-à-vis thecompetentauthorities. The typeof WWW.ICLG.COM Netherlands

157 Netherlands 158 Netherlands environmental orpropertydamagelaw. seem tobeanobvioussolebasisforaclaimunderNetherlands to dropinvaluebecauseofdisfiguration. This doesnot,however, or nottheenvironmentalpollutionwouldalsocausepublicproperty province orwaterboard)mayhaveaclaiminthesenseofwhether The ownerofthepublicassets(forinstance,amunicipality, such aclaim. Purely aestheticharmstopublicassetswouldnotformabasisfor needed inviewof(thepreventionof)harmtotheenvironment. title ifnoactionsweretaken,orincasethetakennot remediate thesituation. The competentauthorityhas,however, no case thecompetentauthorityhadtotakemeasurescontrolor competent authoritytoclaimfinancialdamagesfromthepolluter, in relating toadministrativeenforcementprovideabasisforthe specific reportingrequirements, depending onthenatureofits The operatorofanindustrialfacility usuallyhassomegeneralor 6.1 ( Law Act General Administrative Both theEnvironmentalManagement Act andthechapterin 5.5 purchase agreement. pollution and/orawarrantyforunknowninthesaleand a claim.Itiscustomarytoagreeonanindemnityforknown details oftheknownpollution,purchasermayhavenobasisfor from theseller. Ifthesellerprovidedbuyerwithallrelevant amongst others,therightofpurchasertoseekacontribution violate hisobligationtodiscloseandbeliable. This couldleadto, ownership ofmaterialknownsoilorgroundwaterpollution,hemay If asellerofpollutedpropertydoesnotinformhissuccessorin 5.4 a changeofcircumstancesandcannotbeexcluded. different thanthedraftdecision.Laterchangesshouldbebasedon developments inlaw. This couldcausethefinaldecisiontobe objection mustbebasedonthelatestknowledgeoffactsand objections andappealagainstthesedecisions. The decisiononthe authority beforeitcanbeexecuted.Interestedpartiesfile polluted soilorgroundwaterneedstobeapprovedbythecompetent A remediationprogrammeinvolvingtheexcavationortreatmentof 5.3 Gaastra attorneysatlaw © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 6 can athirdpartychallengetheagreement? conduct siteinspections,interview employees,etc.? public assets,e.g.rivers? contaminated landliabilitytoapurchaser? Powers ofRegulators possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof What powersdoenvironmentalregulatorshaveto polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma Does apersonhaveprivaterightofactiontoseek regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis require productionofdocuments, takesamples, Algemene wetbestuursrecht

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

)

their property. These partiesmustallowtheseactionstobetaken. must benotifiedinviewofanymeasuresthatneedtotakenon this mustbenotifiedtothecompetentauthority. Affected parties pollution hasmigratedoff-site. Ifsuchisfoundtobethecasethen investigation intothefrontofplume. That willrevealwhetherthe case ofsoilorgroundwaterpollution. This wouldentailan competent authoritymayrequiretheoperatortofurtherinvestigatea measures tocontrol,mitigateorremovethepollution. The duty ofcarerequirestheoperatortotakeimmediatereasonable certain activitiesmustbereportedtothecompetentauthority. The The SoilProtection Act providesthatpollutionfoundinrelationto 7.1 of sharesinacompanyowningpolluted property. would notbedifferent ifthesaleandpurchaseconcernstransfer problems toaprospectivepurchaser ofpollutedrealestate. This The sellerhasageneralobligationtodiscloseknownenvironmental 7.3 the typeofleaseagreementandgeneraltermsthatwouldapply. may bewiseinviewofthepreventionfutureliabilitydependingon investigations priortoenteringintoaleaseaswell.However, such transfer ofownership. There isnolegalobligationtoperformsoil The lawdoesnotrequirethesoiltobeinvestigatedincaseofa subject reporttothecompetentauthority. termination ofthepermittedactivitiesandtoprovideacopy conditions mayalsorequiresoilinvestigationstobecarriedoutafter basis ofanenvironmentalpermitconditionandthese soil investigationreport. A zerosoilreportcanberequiredonthe certain environmentallyhazardousactivitiesmustincludearecent Applications forpermitstobuildorenvironmental 7.2 different incaseofcriminalinvestigations. enforcement, thereisanobligationtocooperate. This maybe inspections andtointerviewemployees.Incaseofadministrative Inspection agenciesalsohavetherighttotakesamples,conductsite emissions intotheambientairorwastewaterdischarge). analysed andtoreportonpermitviolations(e.g.whereitconcerns include therequirementtotakesamples,havesamples information asrequiredbylaw. Insomecases,thepermitconditions competent authorityassoonpossible,providingspecific ( permit grantedforthefacility. Incaseofanunusualincident activities andtheconditionsthatareattachedtoenvironmental ongewoon voorval),theoperatoroffacilitymustnotify 7 parties? takeover transactions? contamination? Reporting /DisclosureObligations environmental regulatororpotentiallyaffectedthird migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto To whatextentisitnecessarytodisclose have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson

Netherlands

control measuresregardlessoftheexistenceanindemnity. polluted industrialrealestatecanbeforcedtoremediateortake present intherealestateaftertransfer. The newownerof government enforcementactionsincaseofpollutionfoundtobe will not,however, limittheexposureofnewownerto providing abasisforclaimincaseoffinancialdamagesuffered. It In general,environmentalliabilitiesmaybesubjecttoanindemnity 8.1 Gaastra attorneysatlaw ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 (Wet Huisvoorklokkenluiders was enactedinJuly2016. The Act ontheHousefor Whistleblowers New legislationontheprotectionofpositionwhistle-blowers 8.4 to belimitednationalparentcompanies. enforcement actionsagainstparentcompanies. This doesnotseem broadened thepossibilityoftakingadministrativeenvironmental parent companies.However, administrativecaselawseemstohave unless theyhaveundertakenactionsofcontrol. This alsoappliesto Shareholders assucharenotliableforactionsofthecompany, 8.3 the environment,including,butnotlimitedto,officers anddirectors. enforcement actionsagainstthepersonsthatwereinvolvedinharming liabilities maynotpreventadministrative,civilorcriminal bankrupt inviewofthelimitationoravoidanceenvironmental means ofasaleandleasebacktransaction.Causingcompanytogo Some environmentalliabilitiesmaybeshelteredoff balancesheetby 8.2 House for Whistleblowers. specifically mentionedasreportable mattersunderthe Act onthe violation ofenvironmentallawandrisksfortheenvironmentare whistle-blowers policyaccordingtominimumstandards. The Organisations with50ormore employeesmusthaveadopteda employee orhashadanalikepositioninrelationtothecompany. competent authorityhasdecidedtoadoptaregionalapproach. in caseoflarge-scale complexgroundwaterpollution,wherethe take controlmeasuresifhewasthepolluter. This maybedifferent the indemnifiergiventhathemayalsobeforcedtoremediateor Payment toanotherpersonunderanindemnitywouldnotdischarge © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 8 order toescapeenvironmentalliabilities? potential liabilityforthatmatter? report environmentalviolations/matters? caused byaforeignsubsidiary/affiliate? General matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- Is itpossibletouseanenvironmentalindemnity Are thereanylawstoprotect“whistle-blowers”who liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent ) protectsanypersonwhoisorwasan

9.1 rates thathardlyrepresentthereallegalcostsinvolved. to thecounterpartyincaseofanegativeverdictaresetatlump-sum However, inadministrativeandcivilproceedings,thecostspayable exemption. with lowerincomes.Publicinterestgroupsdonotbenefitfromthis There isalegalreductioninliabilitytopaycostsforindividuals 8.6 certain classesofpartieswhohavesuffered damages. with fulllegalcapacitymayinitiateproceedingsonbehalfof The NetherlandsCivilCodeprovidesthatfoundationsorassociations 8.5 realisation ofcarbon captureandstorage. well asonclosingdownanumber of -firedpowerplantsandthe shore andonshorewindfarms,bio-energy andgeothermalenergy; as sources ofsustainableenergy, amongst whicharesolarpower, near- The overallnationalpolicyonclimate changeisfocusingonvarious 9.3 monitor andreporttheirgreenhousegasemissions. these nationalreports.Inviewofrequirements,theymust The emittingindustrieshavethelegalobligationtoprovideinputfor report. provide therequirementofissuinganannualnationalinventory Convention onClimateChangeandtheKyotoProtocol,which The Netherlandsisapartyto,amongstothers,theUnitedNations 9.2 market. on backloadingandthemarketstabilityreservemayimprove investments, giventherelativelylowmarketprice. The EUdecision work optimallybuthascontributedmajoremissionreduction The Netherlandsmarketforemissionallowancesdoesnotseemto those intheenergy andchemicalsectors. produce amajorpartoftheemissionsinNetherlands,specifically The facilitiesthathavejoinedtheEUETSonamandatorybasisdo of results. (NOx). However, thatsystemwasabandonedin2014,giventhelack for theyear2020. A similarsystemwassetupfornitrogenemissions the targets arebasedontheEuropeanlimitsemissionsthatapply at firstsettingnationaltargets innationalallocationplans.Currently Emission Trading Scheme forCO2emissionsasof2005(EUETS), The Netherlands,asaMemberState,participatesintheEuropean 9 market developingthere? pursuing environmentallitigation? damages available? regulation inyourjurisdiction? to monitorandreportgreenhousegasemissions? Emissions Trading andClimateChange your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation any exemptionfromliabilitytopaycostswhen Do individualsorpublicinterestgroupsbenefitfrom environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing What istheoverallpolicyapproachtoclimatechange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned

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159 Netherlands 160 Netherlands exposed. statute oflimitationsisextendedto30yearsaftertheclaimantwas In civilcasesconcerningtheexposureofemployeesto ACM, the asbestos inbuildingsandconstructionsfacingextracosts. exposure, and(iii)civilclaimsofpartieswhowereconfrontedwith to soundasbestosinventorisationsandthepreventionof enacted andleadtoanobligationremovesuchroofsbefore2024. As discussedabove,theobligatoryremovalofasbestosroofsmaybe employees toasbestos. The HealthandSafety Act requiresthepreventionofexposure asbestos removalcompanies. Netherlands. Asbestos removalmustbedonebyspecialisedcertified to anyworksinvolvingthepossibleexposureasbestosin An asbestosinventorymustbedraftedbyacertifiedcompanyprior 10.2 of theHealthandSafety Act ( criminal enforcementactionsagainstemployersallegingtheviolation asbestos-related disease(mesothelioma),(ii)administrativeand employees whowereexposedto ACM inthepastanddevelopedan Asbestos litigationoccursinmanyaspects,like(i)claimsfromformer 2024, includingasupportingsubsidyscheme. legal obligationtoremoveasbestosroofsfrombuildingsbefore 1993. Legislativeactionisbeingtakeninordertoimplementthe (ACM) inproducts,buildingsandconstructions,effective since There isatotalbanontheuseofasbestos-containingmaterials 10.1 sustained onappeal. least 25%lowerthan1990levels.In2018,thisverdictwas achieving areductioningreenhousegasemissions2020ofat action basedontorttotakethenecessarymeasuresinviewof In theso-calledUrgenda case,theStatewasconvictedinacivil opposed tothe80–95%levelsin1990. resulting inareductiontheemissionofgreenhousegasesas that nearlyallsourcesofenergy shouldbesustainablein2050, sustainable energy in2023. The nationalenergy agendaprovides This shouldleadto14%sustainableenergy in2020and16% Gaastra attorneysatlaw © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 10 jurisdiction? in relationtoasbestoson-site? What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour Asbestos Arbeidsomstandighedenwet ) inrelation

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

12.1 larger claims. involved insettlementnegotiations,especiallywhereitconcerns insurance claims.Insomecases,thecompanyisactively courts andtheofappeal. These mayincludeenvironmental Legal proceedingsininsuranceclaimsaredealtwithbytheregional 11.2 the sellerunderenvironmentalwarranties. instrument thatcanbeusedtocaptheenvironmentalliabilitiesof mergers andacquisitions,asitmayincertaincasesbeanadequate Netherlands inthepastcoupleofyears,particularrelationto Environmental insurancehasincreasinglybecomecustomaryinthe 11.1 needed forcontaminationsrelatingtoPFOSorcomponents. concern. Newpolicies,technologiesandlegislativemeasuresare very highconcernsuchaspersistentorganic pollutantsisagrowing The remediationandcontrolofsoilpollutionwithsubstances and forthedisposalofwaste. criteria fordistinguishingbetweenproducts,by-productsandwaste simplifying theerectionoftestfacilities.Furthermore,itcontains it aimstofacilitateinnovationsinviewofthecirculareconomyby quantitative targets forrecyclingandwastereduction.Furthermore, facilitating thetransitionintoacirculareconomy. Itcontainsnew document mustbeappliedinpermittingproceduresandisaimedat issued (theNational Waste ControlPlan2017–2029). This policy Just daysbeforethestartof2018,anewnationalwastepolicywas substances rulesandregulations. environmental enforcementauthoritiesinmattersoffoodsafetyand of focus. Alongside this,wehaveseenanincreasinginterestofthe shipment ofwaste,andexternalsafety. These continuetobeareas ground cylindricalstoragetanks,thehandlingandtransboundary been onthesafestorageofhighlyhazardouschemicalsinabove- In thepastfewyears,focusofenvironmentalauthoritieshas 12 11 experience inyourjurisdiction? risks insuranceplayinyourjurisdiction? in environmentlawyourjurisdiction. summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a What istheenvironmentalinsuranceclaims in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable Updates Environmental InsuranceLiabilities Netherlands

Gaastra attorneysatlaw ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London advantage andyourdedicationpersistencehaveinfactledtotheknown endresult. “We usaserious arehappytohavefoundinyouapassionatelawyerandprofessional,withexperienceourbranche. Ourchoiceforyougave The focusofthefirmisdirectedatprovidinghigh-qualitylegalservices.Client feedbackatteststothis: authorities fromtheinside. The firmhasexcellentlawyerswithavarietyofbackgrounds. andjudicial Clients whohaveworkedwithGaastraattorneysatlawmoreoftengainthe benefit ofalawyerwhoknowsthebusiness,government law firmLoyens&Loeff. attheinternational founded thefirmin2006afterworkingforanumberofyearschemical industry(GeneralElectric)andworkingasalawyer studied marine engineering prior to and is skilled in understanding complex matters of both a technical and legal nature. Mr studied marineengineeringpriortolawschoolandisskilledinunderstandingcomplexmattersofbothatechnicallegalnature. André H.GaastraisrecognisedasoneoftheleadingenvironmentallawspecialistsinNetherlandsby lawyers. Gaastra attorneysatlawisspecialisedinEnvironment,RegulatoryandRealEstate. The firmhasasmallteamofhighlyskille others. the on aspectsofenvironmentallaw, andanauthorofarticlespublishedin Amsterdam (ORAM).Heisaspeakeronstudydaysandsymposiums general committeeoftheEntrepreneurs Association, Regionof National BarintheDistrictofNoordHollandandisamember Mr. Gaastrawasalsotreasurerofthesupervisorycommittee , administrativelawandcriminalcases. negotiations. Hehasatrackrecordinfindingsolutions,environmental Mr. Gaastraspecialisesinthetacticsofenvironmentallitigationand government institutions. of anenvironmentallawspecialist.Fromtimetohealsoadvises M&A firmsteamupwithhimfortransactionsthatrequiretheinvolvement occupational healthandsafety. Hisprimaryfocusisonindustry. Top-tier pollution, airemissions,wastewater, wastehandlingandrecycling, associations onmatterspertainingtopermitsandcompliance,soil environmental law. Hehascounselledcorporationsandbranch In thepast19years,Mr. Gaastrahasdealtwithallaspectsof advantage inthehandlingofcomplexenvironmentalmatters. admitted totheBar. Clientsviewhisbroadexperienceasadefinite and safetyleadershippositionswithGeneralElectricbeforehewas attorney atlawandsixyears’ experienceinvariousenvironmental,health in generaladministrativelaw. Hehasover19yearsofexperienceasan in marineengineeringandcompletedtheGrotiusspecialisationtraining regulated markets.Inadditiontograduatinginlaw, hehasabackground specialised inenvironmental,healthandsafetylaw, realestateand André H.Gaastraleadsattorneysatlaw, aNetherlandslawfirm Journal forEnvironment&Law URL: Email: Tel Netherlands 1118 BJ Schiphol Schiphol Boulevard345 World TradeCenter Gaastra attorneysatlaw André H.Gaastra www.gaastra-attorneys.com [email protected] +31 206549644 , theWaste ProductsJournal and

” Who’s WhoLegal–Environment WWW.ICLG.COM Netherlands d andresponsive . Gaastra . He

161 Netherlands Chapter 23 Russia Vitaly Mozharowski

Bryan Cave Leighton Paisner (Russia) LLP Tatiana Khovanskaya

1 Environmental Policy and its 1.3 To what extent are public authorities required to Enforcement provide environment-related information to interested persons (including members of the public)?

1.1 What is the basis of environmental policy in your The Russian Constitution guarantees everyone’s right to reliable jurisdiction and which agencies/bodies administer information about the state of the environment. Authorities collect and enforce environmental law? environmental information from regular reports submitted by businesses impacting on the environment, and conduct ongoing Russia’s state environmental policy is designed to ensure protection, environmental monitoring. reproduction and sustainable use of natural resources as the Much environmental information is published in the media and on prerequisites for a healthy environment and environmental safety. the Internet. Any environmental information is accessible to anyone The right of Russian citizens to a healthy environment is guaranteed upon request. Also, the law requires that the public be informed of by the Constitution of the Russian Federation. The principles any degradation in the environment to an extent endangering human underlying the country’s environmental law are: health. ■ presumption of environmental hazard;

■ a compulsory environmental impact assessment for planned activities; and 2 Environmental Permits ■ a research-backed combination of environmental, economic and social interests of people, society and the state to ensure 2.1 When is an environmental permit required, and may sustainable development and a healthy environment. environmental permits be transferred from one Russia’s Ministry for Natural Resources and the Environment is the person to another? main authority administering the government policy for nature management and environmental protection. It coordinates and The main types of adverse environmental impact are: controls the activities of its subordinate agencies: ■ pollutant emissions into the atmosphere from stationary ■ Federal Service for Hydrometeorology and Environmental sources; Monitoring (RosGidroMet); ■ pollutant discharges into water bodies (including underground ■ Federal Supervisory Service for Nature Management waters); and (RosPrirodNadzor); ■ waste disposal (storage and/or landfill). ■ Federal Water Resource Agency (RosVodResursy); Each of these impacts requires a specific permit. ■ Federal Forestry Agency (RosLeskhoz); and Environmental permits may only be transferred from one person to ■ Federal Mineral Resource Agency (Rosnedra). another along with the relevant source of impact, i.e. while taking In addition, the Russian Constitution refers nature management, over/acquiring an operating facility. environmental protection and safety matters to the joint competence of the Russian Federation and the regions (constituent entities), each 2.2 What rights are there to appeal against the decision of of them having their own authorities administering the state an environmental regulator not to grant an environmental policy. environmental permit or in respect of the conditions contained in an environmental permit? 1.2 What approach do such agencies/bodies take to the enforcement of environmental law? It is not for the environmental regulator to determine the level of adverse environmental impact requiring a permit, but for the applicant, relying on its design documentation; the conditions to be The government authorities develop and approve binding environ- contained in an environmental permit are set by the applicant itself. mental protection rules and standards, carry out environmental monitoring, prosecute those violating environmental laws, elaborate The environmental regulator may refuse a permit if the declared environmental protection and improvement measures and procure extent of the impact will result in an unhealthy environment. Such financing for them. refusal to issue an environmental permit may be appealed by an applicant through the state courts.

162 WWW.ICLG.COM ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 © Published and reproduced with kind permission by Global Legal Group Ltd, London be heldcriminallyliable. If thepermitviolationcausesharmtohumanhealth,offenders may form ofafineorsuspensionoperations. factor of5to25. Administrative liabilitymightalsofollowinthe a permitisviolated,theimpactfeecalculatedwithscale-up A feeischarged foreachtypeofadverseenvironmentalimpact.If 2.4 impact assessmentmustbecarriedoutforanyplannedoperations. Under Russianenvironmentallaw, preliminaryenvironmental 2.3 Bryan CaveLeightonPaisner(Russia)LLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 Producers ofwaste retainnoliabilityinrespectoftransferred waste. 3.3 WDFs issubjecttocompulsorystateenvironmentalexpertreview. on thegovernmentregisterof WDFs. Designdocumentationfor waste disposalfacilities(WDFs). All suchfacilitiesareregistered fully prohibitsburialofwasteanywhereotherthanatdesignated storage (accumulation)ofwasteonthesitewhereitisproducedand The Russianlegislationpermitsonlytemporary(upto11 months’) 3.2 relevant wastetypeandhazardcategory. waste compositionandcertifyingitsclassificationwithinthe Waste categoriesI–IV alsorequireawastepassportindicatingthe facilities, takingintoaccountthelocalenvironmentalsituation). manner andforaspecifiedperiodoftime,atwastedisposal of aspecifictypewasteallowedfordisposal,inspecified Authority permitsettingthewastedisposallimit(maximumamount per unitofproduction)approvedandobtainanEnvironmental generation rates(asetamountofaspecifictypewastegenerated Each producerofwasteanyhazardcategorymusthave requires aspeciallicence. being virtuallynon-hazardous).HandlingofcategoriesI–IV In Russia,wasteisdividedintofivehazardcategories(category V distinguishes wasteisthatitunwantedandneedstobegotridof. intended tobedisposedoforrequiredof. What production, work,servicesorconsumptionthataredisposedof, In Russia,wasteisdefinedassubstancesorobjectsgeneratedduring 3.1 In industrialoperations,environmentalmonitoringisalsorequired. review tobeperformedaspartoftheprojectdesigndocumentation. In somecases,thelawalsorequiresastateenvironmentalexpert © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 3 waste involveadditionaldutiesorcontrols? have inconnectionwiththeviolationofpermits? polluting industriesorotherinstallations/projects? bankrupt/disappears)? produced? Waste What enforcementpowersdoenvironmentalregulators Is itnecessarytoconductenvironmentalauditsor environmental impactassessmentsforparticularly another personfordisposal/treatment off-site(e.g.if respect ofthewastewherethey havetransferreditto Do producersofwasteretainany residualliabilityin and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore How iswastedefinedanddocertaincategoriesof the transferee/ultimatedisposer goes

amount ofthetransferredwaste. environmental impactfeecalculatedwithreferencetothetypesand transferred fordisposal(storageand/orlandfill)istopaythe The onlyliabilityretainedbywasteproducersinrespectof waste handlingthroughlicensing. party licensedtohandlewaste.Inthisway, thegovernmentcontrols Even so,wasteinhazardcategoriesI–IV istobetransferreda 4.1 a specialwastehandlinglicence. of hazardcategoryI–IV wastecontainingusefulcomponentsrequires producers andmaybeperformedbyothertransferees. Also, recycling containing usefulcomponentsisnottheexclusiveliabilityofwaste components inthestreamofcommerce.Evenso,recyclingwaste components. Suchwastesaretoberecycledkeepuseful Russia prohibitslandfillingofcertaintypeswastecontaininguseful third parties. Waste producershavenoobligations regardingwastetransferredto 3.4 Officers of corporations,includingdirectors, may beheldliablefor 4.3 environmental impactunderthe‘userpays’ principle. and shouldratherbeseenasasetconditionforthepermitted scale-up factors. This feecannot becalledliabilityforguiltyacts must payonlytheenvironmentalimpactfee,calculatedwithout If thepollutingactivityisoperatedwithinpermitlimits,operator 4.2 within itscontroltodoso. violated, triggeradministrativeliability, yetfailedtotakeeverystep that itcouldhavecompliedwiththerulesandregulationsthat,if party isfoundguiltyofanadministrativeoffence ifitisestablished To avoidadministrativeliability, absence ofguiltmustbeproven;a confirm thatthepollutingactivityisoperatedwithinpermittedlimits. environmental controlexercisedbytheoperator, whichmight The mostcommondefenceisprovidedbymaterialsofindustrial be madetosuspendoperationscausingdamagetheenvironment. offences triggeringsubstantialfines;insomecases,adecisionmay Also, someenvironmentalwrongdoingsconstituteadministrative statute oflimitationsinenvironmentaldamagescasesis25years. to makecompensationfortheenvironmentaldamageinfull. The Environmental incidentsnotcoveredbypermitsrequiretheoffender factors rangingfrom5to25. an increasedenvironmentalimpactfee,calculatedwithscale-up pollution, emissionandwasteexceedingthelimits. They resultin The mostcommontypesofenvironmentalwrongdoingare 4 regarding thetake-backandrecoveryoftheirwaste? indemnity protectioninrespect ofsuchliabilities? within permitlimits? what defencesaretypicallyavailable? Liabilities breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa To whatextentdowasteproducershaveobligations to whatextentmaytheygetinsurance orrelyonother personal liabilitiesforenvironmental wrongdoing,and Can directorsandofficersofcorporations attract notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage

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163 Russia 164 Russia entitled todemand discharge ofobligations fromeitherall In thiscase,jointandseveralliability ariseswherebytheregulatoris 5.2 the partywhoseoperationsresulted insuchcontamination. Liability forunderground water contaminationmaybeimposedon which casethecontaminantmustalsocarryoutlandremediation. accidental oilspills,othercontaminantsreleasedonthesoil),in is establishedonlyforactualinstancesofcontamination(e.g. For otherlandcategories(e.g.farm,industrial,forest,etc.),liability remediation costsfromthecontaminant(ifany). contamination. Ownersareentitledtoclaimcompensationforland must performlandremediation,irrespectiveofwhocausedthe contaminants areestablished.Ownersofcontaminatedlandplots For urbanland,maximumallowableconcentrationsofsoil 5.1 in theeventofviolations. require thatborrowersconfirmsuchcomplianceandsuspendlending borrower’s compliancewithenvironmentalrequirements,lenders for narrowlyspecifiedpurposesanddisbursementisconditionalonthe environmental wrongdoings.Evenso,inpractice,ifaloanisgranted general ruleisthatlendersmaynotbeheldliablefortheborrower’s The Russianlegislationisbasedonthepersonalliabilityprinciple. The 4.5 wrongdoings. purchase only. The newownerisnotliableforthepreviousowner’s liabilities relatingtouseofthepurchasedassetsfromtime In theeventofsaleassets,newownerassumesenvironmental Target remainsliable. Target) doesnotentailachangeoftheresponsibleperson,i.e. Sale ofsharesinacorporationwithenvironmentalliabilities(the 4.4 indemnity protectionsintheeventoftheiradministrativeliability. Such officer’s employmentcontractmightprovideforvarious one andthesamewrongdoing. hold bothanofficer andthecorporationadministrativelyliablefor of minorenvironmentalwrongdoings.Evenso,ithasthepowerto impose liabilityonofficers ratherthanoncorporationsintheevent corporations. Consequently, theenvironmentalauthoritywould It istobenotedthatfinesforofficers areconsiderablylowerthanfor officer. corporation’s internaldocuments,itsCEOwillbetheresponsible the eventofviolations.Ifnosuchofficer isdesignatedbythe environmental matters,whowouldbeheldadministrativelyliablein In practice,corporationsappointaspecialofficer tobeincharge of environmental wrongdoingsconstitutingadministrativeoffences. Bryan CaveLeightonPaisner(Russia)LLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 5 is responsibleforthecontamination? groundwater? environmental wrongdoingand/orremediationcosts? the onehandandanassetpurchaseonother? Contaminated Land How isliabilityallocatedwhere morethanoneperson What istheapproachtoliabilityforcontamination To whatextentmaylendersbeliablefor environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman (including historiccontamination)ofsoilor

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5.4 demand additionalworkstobeperformedattainthem. samples and,ifthespecifiedqualityindicatorsarenotattained, examine thelandremediationreport,takeremediedquality environmental remediationprogramme. They may, however, Third partieshavenolegalgroundsforchallenginganagreed required qualityindicators. programme bechangedandworkscontinuedinordertoachievethe environmental regulatormaydemandthatthepreviouslyapproved completion ofanenvironmentalremediationprogramme,the If specifiedlandqualityindicatorsarenotachievedfollowing 5.3 nor setsanyrulesforrecoveryofdamagesaestheticharms. Russian legislationneithercontainstheconceptof‘aestheticharm’ 5.5 principle applies. contamination doesnotevenaffect itsprice;the‘takeorgo’ If apubliclyownedlandplotissoldintoprivatehands,its contamination ofthelandplot. purchaser takesonallconsequencesandpotentialrisksrelatedto agrees totakeownershipofthelandplot‘asis’.Inthiscase, contamination ofthelandplot,lawpresumesthatpurchaser the SPA. IftheSPA containsnospecifictermsregarding previous landplotownermayonlybebroughtwithinthetermsof seek contributionfromapreviousowner. Any claimsagainstthe The lawdoesnotprovideanindependentprivaterightofactionto plot istobereduced. passes tothenewowner, orthatthepriceofcontaminatedland parties mightagreethatthelandplotistobecleanedupbeforeit between thesellerandpurchaser. Followingnegotiations,the The actualstateofthelandplotbeingsoldisamatternegotiation of bothchemicalandsurfacecontamination(physicallittering). about itsstate,includingchemicalcompositionofthesoilandlevels to inspectthelandplotandobtainfullexhaustiveinformation resolved onexecutionoftheSPA. The landpurchaserhastheright under asaleandpurchaseagreement(SPA), allissues andclaimsare If aprivateowneracquireslandplotfromprevious until theobligationisdischarged infull. or inpart.Jointlyandseverallyresponsiblepersonsremainliable responsible personsjointlyoranyofthemseparately, eitherinfull account ofaestheticharm. administrative offence punishablebyfixedfinesthattake no Contamination ofpublicassets, land, forests,rivers,etc.isan cannot bedetermined. aesthetic harm,somonetarydamages arisingfromaestheticharms Russia hasnorulesforassessing anddeterminingtheextentof contaminated landliabilitytoapurchaser? can athirdpartychallengetheagreement? public assets,e.g.rivers? possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma

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authority’s decisiontoholdtheoffender liable. inspection reportmaybeusedasabasisforgovernment drawn uprecordingallidentifiedviolations(ifany).Later, this inspection bytheoperator. Followingtheinspection,areportis the issuestobecheckedanddocumentsprovidedfor the inspectionandnamesofauthorisedinspectorslisting (Scheduled/Unscheduled InspectionOrder)indicatingthetimeof regulator sendstheoperatorawrittenconfirmationofdecision Following adecisiontoconductaninspection,theenvironmental adverse impactcausedbyitsoperation. the environmentonoperator’s territoryandtheextentofany operator toobtainthefullestpossibleinformationaboutstateof The environmentalregulatorsmayalsointerviewemployeesofthe territory anddetermineactualpollutantconcentrations. operator’s officers, takewater, airandsoilsamplesontheoperator’s engaging independentlaboratoriesandinthepresenceof In addition,theenvironmentalregulatorsmaythemselves,by atmospheric airandwastewatersofitsvariousunits. operator andmeasuredvaluesofpollutantconcentrationsinthe documents, includingindustrialenvironmentalcontrolmaterialsofthe regulators request,obtainandanalyseenvironmentalprotection affecting theenvironment.Duringsuchinspections,environmental stakeholder applications)inspectionsoftheoperationsenterprises power toconductregular(scheduled)andunscheduled(triggeredby The governmentauthoritiesforenvironmentalprotectionhavethe 6.1 Bryan CaveLeightonPaisner(Russia)LLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 individuals toinvestigate landforcontamination. The RussianFederationhasnever imposedanobligationon 7.2 the populationandarrangeforevacuation,ifnecessary. municipalities, which,inturn,musttakeactionstopromptlynotify civil defence,emergencies anddisasterrelief,aswell environmental regulatorbutalsothegovernmentauthoritiesfor an emergency requiringprompt notificationofnotonlythe in fatalitiesorharmtohumanhealth,suchanincidentisclassifiedas triggers anadverseenvironmentalimpactthatresultsormightresult At thesametime,ifanaccidentand/orunforeseenactofnature preventing uncontrolledoff-site migrationofpollutants. Each productionsitemustbeequippedwithastormdrain an environmentalregulator. and disposal)constitutesgroundsforregularquarterlyreportingto atmospheric airordischarges intowaterbodies,wastegeneration Any adverseenvironmentalimpact(pollutantemissionsintothe 7.1 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 7 6 conduct siteinspections,interviewemployees,etc.? contamination? parties? Reporting /DisclosureObligations Powers ofRegulators What powersdoenvironmentalregulatorshaveto require productionofdocuments,takesamples, have anaffirmativeobligationto investigatelandfor When andunderwhatcircumstances doesaperson migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe environmental regulatororpotentiallyaffectedthird

condition oflandinRussia. obligation, ofcitizensandNGOstoexercisepubliccontroloverthe municipalities. Also, thelawprovidesforright,ratherthanan exclusively tothecompetenceofgovernmentauthoritiesand Today, allformsofcontrolovertheconditionlandarereferred this obligationwascancelled. the conditionoflandanditscontaminationlevel.In2015,however, owning landplotstoexerciseindustrialcontrol,includingover The statutoryprovisionspreviouslyineffect obligedoperators adverse impactontheenvironment. diligence inrespectofproductionfacilitiesthathaveasubstantial so, itisadvisablealsotocarryouttechnicalenvironmentaldue existing environmentalpermitsaspartoflegalduediligence.Even In commonpractice,thesellerdisclosesallinformationabout in thelaw. statutory obligationsforpartiestomerger and/ortakeovertransactions environmental informationistobedisclosed. There arenospecific purchaser areentitledtodecideforthemselveswhatextent merger and/ortakeovertransactiondocuments. The sellerandthe Environmental informationmustbedisclosedtotheextentsetforthin 7.3 authorities’ recordsindependentlyfrom the balancesheet. Environmental liabilitiesareregistered onthegovernment 8.2 calculated onthebasisofactualimpactdataforpreviousyear. The statutoryEIFpaymentprocedureenvisagesadvancepayments for environmentaldamage. fees (EIFs)payabletothetreasuryand/oracceptedascompensation an indemnitybeoffset against compulsoryenvironmentalimpact government authorities.Norwillpaymentstoanotherpersonunder will bedisregardedintherelationsbetweenanoperatorand Any environmentalindemnitytermsofM&A orassettransactions may notbelimitedbyanylegaltools. full, sotheamountofcompensationpayabletostatetreasury The lawrequiresthatenvironmentaldamagebecompensatedforin adverse impactonand/ordamagetotheenvironment. always lieswiththeoperatorwhoseacts(activities)resultinan principles. The responsibilityforcompensatingthedamage environmental lawisbasedonthe‘userpays’ and‘polluterpays’ Environmental protectionmattersfallunderpubliclaw. Russian 8.1 do notlimitliability. to paythedifference atthe end ofthatyear. Soadvancepayments actual impactcharge foragiven year, theoperator willberequired If, however, suchadvancepaymentsturnouttobelessthanthe 8 takeover transactions? order toescapeenvironmental liabilities? potential liabilityforthatmatter? General prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto To whatextentisitnecessarytodisclose balance sheet,andcanacompany bedissolvedin Is itpossibletoshelterenvironmental liabilitiesoff matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- Is itpossibletouseanenvironmentalindemnity

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165 Russia 166 Russia Russian) parent. this companythatwillbesued,independentlyofits(foreignor If aRussiancompanycommitsbreachofenvironmentallaw, itis of environmentallawcommittedbyitsbranchorrepresentativeoffice. representative office, itmightbesuedinRussiancourtsoverbreaches If aforeigncompanyoperatesinRussiathoughitsbranchor and heldliableforthebreach. instructions, suchashareholdermaybetreatedascompanyofficer committed bythecompanyresultedfromshareholder’s express of thecompanyandifitisproventhatbreachenvironmentallaw shareholder toissueinstructionsbindingontheCEO(generaldirector) Even so,ifthecompany’s corporatedocumentsauthorisea company itself. held liableforbreachesofenvironmentallawcommittedbythe Generally, companyshareholderswhoarenotitsofficers maynotbe damage totheenvironmentcompensateforsuchinfull. claims. Russianenvironmentallawrequiresoperatorscausing Russian courtsrecognisegroupactionspursuingenvironmental 8.5 environmental supervisionagencies. and liaisewithpubliccouncilsofthegovernmentforestry and freeofcharge aspublic inspectors forenvironmentalprotection authorities intheirenvironmentalprotectionefforts actvoluntarily whereby individualsdesiringtoassistthegovernmentsupervisory The lawalsosetstherulesforpublicenvironmentalcontrol, regulator ofanyenvironmentalviolations/matterstheyidentify. NGOs, whichcarryoutpublicenvironmentalcontrolandinformthe Federation. The exerciseofthisrightinRussiaisfacilitatedby environment isenshrinedintheConstitutionofRussian No, thereisnosuchlaw. Evenso,therightofcitizenstoahealthy 8.4 The Russianlegislationisbasedonthepersonalliabilityprinciple. 8.3 normal courseofbusiness. have priorityoverothermonetaryclaimsbythirdpartiesinthe liabilities arepayableinthesamepriorityastaxliabilities,i.e.,they proceedings. Inthiscase,monetaryclaimswithinenvironmental state environmentalauthorities,itmaybeputintobankruptcy on itsaccountstosatisfysuchclaims,includingthosebroughtbythe prior towindingup.Ifthecompanydoesnothavesufficient funds monetary claimswithinenvironmentalliabilitiesaretobesatisfied mandatory notificationofallitscreditorsviathemedia. Any If adecisionismadetodissolvecompany, thelawstipulates Bryan CaveLeightonPaisner(Russia)LLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM environmental protectionauthorities. the disruptedenvironment. This isafunctionofthegovernment compensation forenvironmentaldamage mustbedirectedtorestore any directcompensationpayments toclaimants.Monetary Even so,compensationforenvironmental damagedoesnotimply caused byaforeignsubsidiary/affiliate? damages available? report environmentalviolations/matters? environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing Are thereanylawstoprotect“whistle-blowers”who liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent

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9.2 of pollutantsandquantityemissions. environmental impactfeecalculatedwithreferencetothemakeup pollution sourcesmusthaveitsownemissionpermitandpaythe There isnoemissionstradingmarketinRussia.Eachownerofair 9.1 healthy environment. litigation andactinsupportofcollectiveintereststherighttoa they havenopersonalfinancialinterestintheoutcomeof funds awardedinenvironmentaldamages,ifany. Consequently, (individuals orpublicinterestgroups)donotthemselvesreceivethe damage payssymboliccourtfees.Evenso,suchinitiators A partyinitiatinganactionforcompensationenvironmental 8.6 held liable. owners ofpremisesand/orasbestos dustemissionsourcesmaybe maximum allowableconcentration ofasbestosdust;ifitisexceeded, carcinogenic andfibrogenicsubstance. Russiahasestablisheda Asbestos dust,includingchrysotile asbestos,isconsidereda 10.2 Russian courts. We arenotawareofanyasbestoslitigationhavingbeenheardby 10.1 Emissions Monitoring,Reportingand Verification. Government hasapprovedtheConceptforGreenhouseGas aimed atreducinggreenhousegasemissions. The Russian Russia hasratifiedtheKyotoProtocol. The governmentpolicyis 9.3 for theentireterritoryofRussianFederation. air monitoringandcalculatinggreenhousegasemissionquantities gas concentrationsattheemissionsourceincarryingoutatmospheric measurements ofambientairqualitycharacteristicsandgreenhouse government authoritiesrelyonthesereportsandregular greenhouse gasemissions(ifany),tothegovernmentauthority. The reports onthecompositionandquantityofemissions,including Each ownerofairpollutantemissionsourcesmustsubmitregular 9 10 market developingthere? pursuing environmentallitigation? in relationtoasbestoson-site? jurisdiction? regulation inyourjurisdiction? to monitorandreportgreenhousegasemissions? Emissions Trading andClimateChange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation any exemptionfromliabilitytopaycostswhen Do individualsorpublicinterestgroupsbenefitfrom What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour What istheoverallpolicyapproachtoclimatechange Asbestos

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may notexceed0.06fibres/ml. dust, themaximumdailyaverageconcentrationofasbestosdust For communityairwithupto10%chrysotileasbestoscontentinthe asbestos cement,bakeliteandrubberdust). complicated premiumcalculationsandhighpriceofsuchinsurance. possible intheorybutisnotcommonRussiabecauseofthe against environmentalrisks. Voluntary environmentalinsuranceis At thisstage,however, therearenostatutoryrequirementstoinsure introduction ofcompulsorystateenvironmentalinsurance. against environmentalexposureandprovidesforpotential protecting thepropertyinterestsofindividualsandcorporations Environmental lawdeclaresenvironmentalinsuranceameansfor 11.1 asbestos dustmaynotexceed2mg/m For workingzoneair, themaximumone-timeconcentrationof Bryan CaveLeightonPaisner(Russia)LLP ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 dust) andtheshift-averageconcentration–0.5mg/m © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 11 risks insuranceplayinyourjurisdiction? in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable Environmental InsuranceLiabilities 3 (6mg/m 3 forasbestoscement 3 (4mg/m 3 for

villages wherecategoryIproductionsitesarelocated. substantial improvementintheenvironmentalsituationcitiesand response to‘burstreleases’ ofairpollutants,therebypromotinga detailed informationaboutenvironmentalimpactandforprompt These newdevelopmentswillprovideforacontinuousflowofmore monitoring systems(CEMS). also berequiredtoinstallautomatedcontinuousemission those withsubstantialadverseeffects ontheenvironment. They will types ofadverseimpactwillbeintroducedforcategoryIfacilities– From 2019,comprehensiveenvironmentalpermitscoveringall 12.1 such insurance. because ofthecomplicatedpremiumcalculationsandhighprice practice. EnvironmentalinsuranceisnotcommoninRussia We havenotencounteredanyenvironmental insuranceclaimsinour 11.2 12 in environmentlawyourjurisdiction. experience inyourjurisdiction? summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a What istheenvironmentalinsuranceclaims Updates WWW.ICLG.COM

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167 Russia 168 Russia Bryan CaveLeightonPaisner(Russia)LLP © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM Russian industry-leadingcompanies. multinational investorsoperatinginRussia(including130 major well asmultinationalsimplementinglarge-scaleinvestmentprojectsinRussia.Clientsincludeover1,700companies,amongthem 100 lawyers,qualifiedunderRussianandEnglishlaw, businesses,as hasover20yearsofexperienceinprovidinglegal supportformajorRussian one ofthebiggestteamsRussianlawyersandmajorUKlawfirmBerwinLeightonPaisner(BLP). teamofover The highlyrespectedMoscow a mergerbetween The RussianpracticeofBryanCaveLeightonPaisner(beforethemerger–GoltsblatBLP)wasestablishedin2009asaresult 500 EMEA, the Year, accordingto Construction Lawyerofthe Year and2014–2015RealEstateLawyerof Vitaly wasnamed2017EnvironmentalLawyerofthe Year, 2016 advising onsubsoiluse,environmentallawandothermatters. Russian companiesbyforeigndirectinvestors,projectfinanceand and forestrylands,landotherrealtyprivatisation,acquisitionsof and purchase,lease,mortgage),commercialdevelopmentofagricultural construction projects,transactionsinvolvinglandandrealestate(sale experience ofrenderinglegalsupporttoinvestment,infrastructureand Bryan CaveLeightonPaisner(Russia)LLP, hasover20years’ Vitaly Mozharowski,PartnerandHeadofRealEstate&Constructionat by CommercialRealEstateMagazine the LegalPracticechapter(oneofbest-knownrankingsheldannually of thetopthreeadvisorsaccordingto‘CRE100–MarketMakers’ in expert (Band1).Formorethan10years,Vitaly hasinvariablybeenone Vitaly asatop-rankedrealestate,constructionandenvironmentallaw Chambers &Partners Best Lawyers.Formanyyearsrunning,TheLegal URL: Email: Tel: Russia Moscow, 123100 8, PresnenskayaNab.,Bldg.1 Moscow CityBusinessCentre Capital CityComplex Bryan CaveLeightonPaisner(Russia)LLP Vitaly Mozharowski www.gblplaw.com [email protected] +7 49528744 andWho’s WhoLegal ). havelisted Forbes Global ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

clients),Russianandinternationalbanksfinancialinstitutions, conducted bystateauthorities,etc. the executionofenvironmentalsafety, participationininspections regulations, reimbursementforenvironmentaldamage,controlover monuments, waterprotectionregulations,sanitary including regulationsonspeciallyprotectedareasanduniquenatural subsoil use;industrialsafetyoperations;andenvironmentalissues, support in:theoil&gassphere;naturalresourcesmanagement; real estate. Tatiana hasextensiveexperienceinprovidinglegal involving thecreation,acquisitionanduseofindustrialcommercial and theoil&gasindustry, includinglegalsupportfortransactions industrial facilities,thepowersector, theconstructioninfrastructure Russian Federationandrelatingtosubsoiluse,constructionof investment projectsimplementedprimarilybyforeigninvestorsinthe professional focusisonprovidinglegalsupportforlarge-scale Construction atBryanCaveLeightonPaisner(Russia)LLP. Her Tatiana Khovanskayaisthe Associate DirectorofRealEstate& URL: Email: Tel: Russia Moscow, 123100 8, PresnenskayaNab.,Bldg.1 Moscow CityBusinessCentre Capital CityComplex Bryan CaveLeightonPaisner(Russia)LLP Tatiana Khovanskaya www.gblplaw.com [email protected] +7 49528744 Russia

Chapter 24 Slovakia Marián Bošanský

URBAN FALATH GAŠPEREC BOŠANSKÝ Ján Falath

1 Environmental Policy and its In administrative proceedings, public authorities may take various measures such as giving warnings, imposing fines as well as Enforcement ordering the shutdown of wrongful activities. In criminal proceedings, the offender may be sentenced to 1.1 What is the basis of environmental policy in your imprisonment and/or a monetary fine. The most serious felonies jurisdiction and which agencies/bodies administer against the environment are subject to imprisonment of up to twenty and enforce environmental law? (20) years and the fines may be as high as EUR 1.6 million.

The cornerstone of the Slovak environmental policy is the 1.3 To what extent are public authorities required to Constitution of the Slovak Republic (the “Constitution”), pursuant provide environment-related information to interested to which everyone shall be entitled to a favourable environment and persons (including members of the public)? is obliged to protect and enhance the environment. Slovakia has not adopted a uniform environmental code, but each specific area of the The Constitution provides that everyone shall be entitled to timely Slovak environmental policy is governed by special laws and and complete information about the state of the environment and regulations. about the causes and consequences thereof. Despite the fact that EU directives and regulations strongly shape our national these rights are fundamental, public authorities often act in direct environmental policy and are transposed into national legislation conflict with them. (e.g., the new Waste Act No. 79/2015 Coll., as amended, adopted in The general source of information about the environment is the 2015, transposed ten (10) EU directives). Report on the State of the Environment, prepared by the Ministry in The Ministry of Environment of the Slovak Republic (the cooperation with other state administration authorities. The Report “Ministry”) is the supreme body which administers our is published annually by the Ministry. environmental policy and legislation. The Ministry has various Apart from the Constitution, the obligation to provide the public administrative, regulatory and compliance competences at the with environment-related information derives from the Act on national level. There are other state authorities which administer, Collection, Storage and Broadening of Environmental Information execute and enforce the Slovak environmental policy and legislation; No. 205/2004 Coll., as amended. The Act is based on EU in particular, district offices (seventy-two (72) in total) and the legislation, in particular on the Regulation concerning the Slovak Environmental Inspectorate (in Slovak: Slovenská inšpekcia establishment of the European Pollutant Release and Transfer životného prostredia). In case the environmental laws and Register (the “E-PRTR Regulation”). regulations are violated, both the district offices and the Inspectorate The National Pollution Register, which was established by the may impose fines in order to protect the interests safeguarded by law. above Act, is a database created on the basis of mandatory periodic The system of public authorities is effectively completed by reports containing data about the release of pollutants from municipalities and special agencies created in order to protect the operators whose activities are listed in Annex 1 to the E-PRTR individual environmental domains. For instance, the Fishing Guard Regulation. was established under the Fishing Act No. 216/2018 Coll., as In order to fully harmonise national legislation regarding amended, to protect the performance of fishing rights in fishing environmental impact assessment with the EU legislation, Slovakia grounds. Also, a special department for detection of dangerous has adopted the Act on Environmental Impact Assessment No. materials and was set up at the Criminal Police 24/2006 Coll., as amended, which introduced a comprehensive Office for the purpose of effective prevention and detection of information system for environmental and strategic impact environmental criminality. assessment (the “EIA/SEA Information System”). The EIA/SEA Information System gathers data about all relevant 1.2 What approach do such agencies/bodies take to the procedures in assessing the impact of strategic documents and enforcement of environmental law? proposed activities on the environment, including their changes, and is accessible to the public and other participants in the Aiming to effectively protect the environment, compliance with environmental impact assessment process. legislation is enforced by means of administrative, civil and criminal laws.

ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 WWW.ICLG.COM 169 © Published and reproduced with kind permission by Global Legal Group Ltd, London 170 Slovakia activities orprojects. preparing andapprovingstrategic documentsandcontemplated environmental protectionandintegrating environmentalaspectsin The EIA/SEA proceduresareaimedatensuring ahighstandardof prior totheirapprovalorpermission. impacts ofbuildings,projectsandother activitiesontheenvironment strategic documentssuchaszoningplans,welltheassessmentof governs theprocessofexpertassessmentexpectedimpacts assessment (“SEA”). The Act on Environmental Impact Assessment environmental impactassessment(“EIA”)andstrategic Yes. Slovaklegislationincludes EU directivesconcerning 2.3 Administrative Procedure. general rulesonadministrativeproceedingsunderthe Act on proceedings undersuchlaws,whichtakeprecedenceoverthe Coll., asamended)containtheirownproceduralrulesapplicableto Protection ofSpecies Wild Faunaand Wild FloraNo.15/2005 review. Moreover, certainspecificlaws(e.g.,the Act onthe appeal isexcludedandtheapplicantmustdirectlyfileforjudicial above generalrule(e.g.,the Waste Act), whentheadministrative Slovak legislation,however, containssomeexceptionsfromthe Supreme CourtoftheSlovakRepublic. courts. A first-instancecourtdecisionmaybereviewedbythe shall beentitledtosubmititforjudicialreviewbeforetheSlovak decision isupheldbyanappellateadministrativebody, theapplicant excluded bylaw).Intheeventthatfirst-instanceadministrative exceptions wheretwo-instanceadministrativeproceedingsare shall beentitledtofileanadministrativeappeal(saveforcertain applicant whoseapplicationwasdeniedornotgrantedasrequested, statute governingadministrativeproceedingsinSlovakia,an Pursuant tothe Act on Administrative Procedure,asthegeneral 2.2 the majorityofauthorisationsarenon-transferable. use ofwatertothirdparties.Notwithstandingtheaforementioned, example, the Water Act allowsthetransferofapermitforspecial the respectivestatutegoverningissuanceofsuchpermit.For from agrantedpermitispossibleonlyifitexpresslyallowedby As ageneralrule,transferringtherightsandobligationsresulting Environmental Impact Assessment, the Act on Air Protection,etc. mud; apermittoconstructwaterbuildings),the Waste Act, the Act on permit forspecialuseofwater;atoextractsand,gravelor granted underthe Water Act No.364/2004Coll.,asamended(e.g.,a specific statute.Forinstance,varioustypesofauthorisationare permit isalwaysgrantedexclusivelyfortheactionregulatedbya range ofactivitiesrequireaspecificenvironmentalpermit. The Pursuant toSlovakenvironmentallawsandregulations,abroad 2.1 URBAN FALATHGAŠPERECBOŠANSKÝ © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 2 person toanother? polluting industriesorotherinstallations/projects? contained inanenvironmentalpermit? Environmental Permits environmental permitsbetransferredfromone Is itnecessarytoconductenvironmentalauditsor What rightsaretheretoappealagainstthedecisionof When isanenvironmentalpermitrequired,andmay environmental impactassessmentsforparticularly environmental permitorinrespectoftheconditions an environmentalregulatornottogrant

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industrial accidents. programme inordertocontrolthehazardswhichcanleadmajor out ariskassessmentandsubsequentlydevelopprevention undertaking whichoperateswithdangeroussubstancesmustcarry human health,theenvironmentandproperty. Forthispurpose,an of dangeroussubstancesandforlimitingtheirconsequenceson prevention ofseriousindustrialaccidentsonsiteswiththepresence Accidents No.128/2015Coll.,asamended,setsoutrulesforthe In addition,forexample,the Act onPreventionofMajorIndustrial ■ ■ lead tothefollowingpunitivemeasures: both administrativeandcriminallaw. The violationofpermitscan Compliance withenvironmentalpermitsissafeguardedbymeansof 2.4 waste holdercanstoreorgather foramaximumofone(1) Waste maybestoredorgatheredonlybyanauthorisedperson. A is notwastestorage. (waste producer)priortofurthermanagement thereof,aslongit waste, whichisthepreliminarystorage ofwastebyaholder Besides wastestorage,the Waste Act alsodefinesthegatheringof operations atthesitewherewasteistoberecoveredordisposedof. storage ofwastepriortoanytherecoveryordisposal Pursuant tothe Waste Act, wastestorageisdefinedasthetemporary 3.2 recycling orotherrecoveryofwaste. produce productsinordertopreventwasteorenhancethere-use, responsibility (“EPR”),involvingspecificadditionalduties,e.g.,to devices, tyresandvehicleshaveaso-calledextendedproducer non-packaging products,batteriesandaccumulators,electric Moreover, pursuant tothe Waste Act, producersofpackagingand relating theretoaresetoutinspeciallawsandregulations. these kindsofwaste,thespecificcontrolmechanismsandduties situ) includingunexcavatedcontaminatedsoil,etc. The disposalof waste suchasfrompreciousmetals,radioactivewaste,soil( However, the Waste Act doesnotapplytocertaincategoriesof to discardunderthe Waste Act orunderspeciallawsandregulations. substance thattheholderdiscards,intendstodiscardorisrequired Pursuant tothe Waste Act, wasteisamovablepropertyor Directive No.2008/98/EC. general definitionofwasteundertheEU Waste Framework The definitionofwasteunderthe Waste Act isfullyinlinewiththe 3.1 3 permits? produced? waste involveadditionaldutiesorcontrols? monetary fineofuptoEUR1.6millionforseriousfelonies. Criminal –imprisonmentofuptotwenty(20)yearsanda cause damage). permanent suspensionoftheactivitythatcausedormay totheoriginalstate,orderfortemporaryor Administrative –amonetaryfineorothermeasures(e.g., Waste regulators haveinconnectionwiththeviolationof What enforcementpowersdoenvironmental and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore How iswastedefinedanddocertaincategoriesof Slovakia

in

3.4 possession. nutshell, thecurrentwasteholderisliableforthatinhis as theoriginalwasteholder, remainsliableforsuchwaste.Ina under whichthetransfereebecomesawasteholder, thetransferor, waste holder. Ifthetransferofwastedoesnotmeetcriteria transferred toanotherperson,providedthatthispersonbecomesa No. Waste producers(wasteholders)arenotliableoncethewasteis 3.3 management authority. its recovery, unlessalongerperiodisgrantedbycompetentwaste year priortoitsdisposalorforamaximumofthree(3)years URBAN FALATHGAŠPERECBOŠANSKÝ ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 law anddamagesuffered bythirdparties. negligent), andthelackofcausality betweentheallegedbreachof damages, culpability(i.e.,that the perpetratorwasnoteven perpetrator maychallengetheallegedbreachoflaw, theamountof caused byapermitholdermayclaimdamagesundercivillaw. A In caseofcivilliability, thirdpartieswhohavesuffered damage criminal liability. of environmentallaws,comprisingcivil,administrative,and There arethree(3)typesofliabilitiesthatmayariseduetoviolation 4.1 products. producers arerequiredtotakebackorrecoverthewastefromtheir electronic equipment)towhichtheEPRapplies,respective Furthermore, withrespecttocertainproducts(e.g.,electricand waste onlytoapersonauthorisedcarryoutmanagement. Waste producers(wasteholders)arealsorequiredtohandoverthe (iv) (iii) (ii) (i) waste treatmentfollowsthemanagementsystemhierarchy: However, suchwaste producers(wasteholders)mustensurethatthe required totakebackthewastethattheyproduce. Waste producers,aslongthey qualify aswasteholders,arenot © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 4 regarding thetake-backandrecoveryoftheirwaste? bankrupt/disappears)? what defencesaretypicallyavailable? impossible orimproper. disposing ofthewaste,ifrecyclingorrecoveringitis waste forrecoverybyathirdparty;and recycling isimpossibleorimproper, andoffering unused recovering thewastewithinscopeoftheiractivities,if unused wasteforrecyclingbyathirdparty; preparing itforre-useisimpossibleorimproper, andoffering recycling thewastewithinscopeoftheiractivities,if by athirdparty; activities andoffering unusedwasteforpreparationre-use preparing thewasteforre-usewithinscopeoftheir Liabilities To whatextentdowasteproducershaveobligations another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin the transferee/ultimatedisposergoes breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa

offices, butitisnotamassproductyet. insurance policiescoveringpersonalliabilityofdirectorsand There areseveralinsurancecompanieswhichoffer special and professionalcare. damage causedbytheviolationoftheirobligationtoactwithdue In caseofacivilliability, directorsandofficers areresponsiblefor (20) yearsandthefinesmaybeashighEUR1.6million. against theenvironmentaresubjecttoimprisonmentofuptwenty imprisonment and/oramonetaryfine. The mostseriousfelonies environmental laws. The offender maybesentencedto Criminal liabilityistriggeredintheeventofaseriousviolation arguing similarlyacivildefence. proving thattheenvironmentwasnotdegradedbyitsactivity, or(ii) permits arebreached. A wrongdoercouldbaseitsdefenceon(i) and regulations,or(ii)termsconditionsofenvironmental Administrative liabilityariseswhere(i)specificenvironmentallaws 4.3 operating thepollutingactivitywithinpermitlimits. duty isbreached,theoperatorcouldbeheldliable,regardlessof the environmentoccurs.Ineventthatgeneralprevention act insuchamannerthatnodamagetohealth,property, natureand general preventionduty, requiringthateveryoneshallbeobligedto permit limits.Nevertheless,theoperatormustalsoabideby for environmentaldamage,aslongtheactivityiswithin an environmentalpermitshouldrelievetheoperatorfromliability As ageneralrule,thecompliancewithtermsandconditionsof 4.2 influence ontheaffiliate. proven thatthemothercompanycarries outadirectorcommanding parent companymaybeheldliable insteadofitsaffiliate when itis liable forenvironmentalwrongdoing and/orremediationcosts. The According toSlovaklegislation,inprinciplethelendersarenot 4.5 shareholder. purchase, theenvironmentalliabilityremainswithsellerandits which theshareswerepurchased.Onotherhand,inanasset including theenvironmentalones,remainwithcompanyin retains itsassetsandliabilities. As aconsequence,allliabilities, in acompany, butnottheassetitself. Therefore, thecompany In asharesale,thebuyerpurchasessharesoranownershipinterest 4.4 offence ispunishablebyamonetaryfineorevenimprisonment. criminal law. Incaseofacriminalliability, anenvironmental Directors andofficers maybeheldpersonallyliableundercivilor within permitlimits? environmental wrongdoingand/orremediationcosts? the onehandandanassetpurchaseonother? indemnity protectioninrespectofsuchliabilities? to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage To whatextentmaylendersbeliablefor environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman WWW.ICLG.COM

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171 Slovakia 172 Slovakia achieved bytheprimaryremedial measures. of thedamagednaturalresources ortheirfunctionshasnotbeen Additional remediesareremedialactionstobetakeniftherecovery natural resourcesortheirfunctionstotheoriginalstate. Primary remediesareremedialmeasurestorestorethedamaged and bycompensatoryremedies. different ways,i.e.,byprimary remedies,byadditional lays downthattheremediationplanmaybecarriedoutinthree(3) The Act onPreventionandRecoveryofEnvironmentalDamage 5.3 individual liability, allofthemshallbeliablejointlyandseverally. contributed tocausingit.Ifitisimpossibledeterminetheir burden, eachofthemshallbeliabletotheextentthattheyhave there aremorepersonsresponsibleforcausinganenvironmental for causinganenvironmentalburden,notonlytobusinesses.If No. 409/2011 Coll.,asamended,appliestoanypersonresponsible The Act onCertainMeasuresRegardingEnvironmentalBurdens liable jointlyandseverally. determined clearlyorwithoutunduecost,theoperatorsshallbe extent. Iftheextentofliabilityeachoperatorcannotbe authority shalldecidewhichofthemisresponsibleandtowhat about theextentofliabilityeachoperator, acompetentstate extent oftheirinvolvementincausingthedamage.Incasedoubt one (1)operator, eachofthemshallbeliablefordamageonlytothe out thatiftheenvironmentaldamagehasbeencausedbymorethan The Act onPreventionandRecoveryofEnvironmentalDamagesets 5.2 possible. measures attheexpenseofapersonresponsiblefordamage,if environment, acompetentstateauthorityshalltakeappropriate is ariskofdeteriorationthestatewateror damage isunknownorunabletoremedysuchdamage,andifthere costs incurredtherewith.Ifapersonresponsibleforcausing thereto shallbeobligedtoremedysuchdamageorreimbursethe surface waterortogroundwatertheenvironmentadjacent Similarly, underthe Water Act, anyone whocausesdamageto substitute performance,asorderedbyacompetentstateauthority. shall providemonetarycompensationand/oranotherformof oritspart.Ifitisimpossibleineffective, thepolluter shall berequiredtorestorethenaturalfunctionsofdisrupted damage byharmingtheenvironmentorotherunlawfulbehaviour a generalprinciplethatpolluterwhohascausedenvironmental The Act onEnvironmentNo.17/1992Coll.,asamended,addresses 5.1 URBAN FALATHGAŠPERECBOŠANSKÝ © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 5 groundwater? can athirdpartychallengetheagreement? is responsibleforthecontamination? Contaminated Land regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis How isliabilityallocatedwheremorethanoneperson What istheapproachtoliabilityforcontamination (including historiccontamination)ofsoilor

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state authoritymayrequireadditionalworks. temporary lossesofnaturalresourcesortheirfunctions.Indeed,a Compensatory remediesareremedialactionstocompensate concerning thetransferofland. authority andthecontractingpartiesmustsubmitasalecontract such transfermustbenotifiedinwritingtoacompetentstate affirmative geologicalsurveyrelatedtothislandispresented. Any such personmaytransferthelandtoanotheronlyafteran damage oritslegalsuccessoristheownerofburdenedland, Environmental Burdens,ifapersonresponsibleforenvironmental Furthermore, underthe Act onCertainMeasuresRegarding belonging totheacquirer(againstpreviousowner). contractual basisbyspecifyingtheindemnitytermsandconditions on damagesundertheCivilCode. The claimcanalsobebasedona caused thecontamination,inaccordancewithgeneralprovisions to compensationfromapreviousowneroranoccupieroflandwho As ageneralrule,anysubsequentacquireroflandshallbeentitled for environmentaldamageshallbetransferredtoitslegalsuccessor. owner ofthecontaminatedland.Moreover, theoperator’s liability damage isalwayslinkedtoaspecificbusinessactivityorthe Recovery ofEnvironmentalDamage,theliabilityforenvironmental “polluter pays”principle.Underthe Act onPreventionand The responsibilityforenvironmentaldamageisbasedonthe 5.4 Criminal PoliceOffice. materials andenvironmentalcrime hasbeenestablishedatthe In addition,aspecialdepartment forthedetectionofdangerous submission ofnecessarydataandexplanations. samples, totakephotosandmakevideos,requestthe to carryoutnecessaryinvestigations,includingthecollectionof conduct siteinspections,toexaminerecordsandotherdocuments, laws. They are,inparticular, entitledto enter premisesandto wide rangeofpowerstosafeguardcompliancewithenvironmental The EnvironmentalInspectorate(inSlovak: 6.1 environmental damagecausedbyapolluter. recovery ofcostsincurredinrelationtothepreventionorremedy environmental damage,thecompetentstateauthoritiesmayseek In theeventofenvironmentaldamageoranimminentthreat 5.5 životného prostredia 6 contaminated landliabilitytoapurchaser? conduct siteinspections,interviewemployees,etc.? public assets,e.g.rivers? Powers ofRegulators possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek require productionofdocuments,takesamples, What powersdoenvironmentalregulatorshaveto polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma ) andothercompetentstateauthoritieshavea Slovenská inšpekcia Slovakia

7.2 the publicwithoutunduedelay. environment (e.g.,asaresultofanaccident,fire,etc.)mustinform Moreover, anyonewhocausedaseriousthreatordamagetothe would endangerhumanlifeorhealth. the consequencesthereofmustbetaken,unlesssuchintervention the sametime,necessarymeasurestoavertdamageormitigate threat ofsuchdamageisreportedtocompetentstateauthorities. At require thattheoccurrenceofenvironmentaldamageoranimminent The majorityoftheSlovakenvironmentallawsandregulations 7.1 URBAN FALATHGAŠPERECBOŠANSKÝ ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 should notbefeasible. Fromourexperience,however, environmental regulations, shelteringenvironmental liabilitiesoff balance sheet As longastheaccountsarekept in linewithapplicablelawsand 8.2 criminal liability. wrongdoing partycannotberelievedfromitsadministrativeor shall bebindinguponthecontractualpartiesonlyand environmental lawsandregulations.Suchagreement,however, environmental claimorishandedamonetaryfineforbreaching that oneofthemsuffers damage asaresultofthird-party Parties toacontractmayagreeindemnifyoneanotherintheevent 8.1 disclose them,apurchasermaybringclaimsagainsttheseller. significantly impactthefunctioningofatarget companyandfailsto However, ifaseller isawareofenvironmentalissueswhichcan transaction documentation. agreed bythecontractingpartiesandtoextentstipulatedin takeover transaction. The informationmustbedisclosedonlyif problems byasellertoprospectivepurchaserinmerger ora There isnostatutoryrequirementtodiscloseenvironmental 7.3 There isnosuchaffirmative obligationintheSlovaklegislation. © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 7 8 takeover transactions? contamination? parties? order toescapeenvironmental liabilities? potential liabilityforthatmatter? Reporting /DisclosureObligations General have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto environmental regulatororpotentiallyaffectedthird balance sheet,andcanacompany bedissolvedin Is itpossibletoshelterenvironmental liabilitiesoff Is itpossibletouseanenvironmentalindemnity To whatextentisitnecessarytodisclose

other notificationofanti-socialactivity. complaint, alawsuit,motiontoinitiatecriminalprosecutionor whistle-blowing legislationagainsttheiremployersforfilinga environmental matters,whistle-blowersareprotectedundergeneral Although therearenospeciallawsregardingwhistle-blowingin 8.4 affiliates. company, whichcannotbeheldliableinsteadofitssubsidiariesor caused bythecompany. The sameprincipleappliestoaparent shareholder cannotbeheldliableforbreachesofenvironmentallaw Unless ashareholdermanagesor 8.3 surplus ofairemissionsaccount(“AEA”) allowancesby2020. emission allowancetradingscheme, theSlovakRepublicpredictsa estimates ofgreenhousegasemissions fromsectorsoutsidethe certain limitationsintheaviation industry. Basedoncurrent trading schemeappliestoenergy-demanding heavyindustries with Trading Act No.414/2012Coll.,asamended. The nationalemission transposed intoSlovakia’s legislationthroughtheEmissions The EUEmission Trading Scheme(the“EUETS”)hasbeen 9.1 initiate suchlawsuits. protect publicinterestareexemptedfrompayingacourtfeeto environmental litigation,whereasecologicalorganisations actingto Individuals donotenjoyanybenefitswheninvolvedin 8.6 damages arenotavailable. up forthepurposeofenvironmentalprotection.Penalorexemplary available throughnon-profitorganisations orcivicassociationsset Yes. A public“class”actionconcerningenvironmentalissuesis 8.5 occasions toescapeenvironmentalliabilitiesinthepast. liabilities. Therefore, dissolutionhascertainlybeenusedonseveral prove thattheliquidationwasaimedatescapingenvironmental liabilities wouldbeunlawful.However, itcanbeverydifficult to Dissolving acompanybyliquidationinordertoescapeenvironmental distortions intheaccounts. liabilities aresometimeswithheldfromthebalancesheet,causing 9 report environmentalviolations/matters? caused byaforeignsubsidiary/affiliate? market developingthere? pursuing environmentallitigation? damages available? Emissions Trading andClimateChange Are thereanylawstoprotect“whistle-blowers”who company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation any exemptionfromliabilitytopaycostswhen Do individualsorpublicinterestgroupsbenefitfrom environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing de facto WWW.ICLG.COM runsacompany, such Slovakia

173 Slovakia 174 Slovakia to Annex 1totheOrdinanceofMinistryEnvironment public healthisstillendangeredduetoitswidespreaduse.Pursuant Although theproductionofasbestoshasalreadybeencancelled, 10.2 only afewminorcases,whicharenotofnationalrelevance. Case lawrelatedtoasbestosisnotcommoninSlovakiaandthereare 10.1 pollutants areexpectedtodecreasebyup57%from20202029. valid for2020andsubsequentyears.Emissionsfromselected as amended,establishesnationalemissionreductioncommitments In ordertoprotecttheenvironment, Air Act No.137/2010Coll., agriculture andothereconomicactivities. indirect measuresbyreducingthenegativeimpactsofenergy, direct measuresaimedatreducinggreenhousegasemissions;and risks andnegativeimpactsofclimatechangeisacombinationof: A solutionthatwouldultimatelypreventoratleastminimisethe 9.3 “UNFCCC”) andtheKyotoProtocol. United NationsFrameworkConventiononClimateChange(the amount ofproducedgreenhousegasemissions,pursuanttothe emissions. Inaddition,Slovakiaisboundtoannuallyreportthe 601/2012 onthemonitoringandreportingofgreenhousegas standards inaccordancewithCommissionRegulation(EU)No. monitoring greenhousegasemissionsaswellwithreporting granted onlyiftheapplicantcomplieswithrequirementsfor gases fromitsfacilitymustholdavalidpermit,whichmaybe In someindustries,anyoperatorthatintendstoemitgreenhouse 9.2 URBAN FALATHGAŠPERECBOŠANSKÝ © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM approval bytheGovernmentofSlovakRepublic. programme totheEUCommissionby1 April 2019,followingits greenhouse gases. The Ministryshallsubmitthenational pollution withtheaimoflimitinganthropogenicemissions The Air Act hasalsoestablishedanationalprogrammetocontrolair 10 to monitorandreportgreenhousegasemissions? in relationtoasbestoson-site? jurisdiction? regulation inyourjurisdiction? What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour What istheoverallpolicyapproachtoclimatechange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned Asbestos ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

claims intheSlovakjurisdiction. There isnoparticularexperienceconcerningenvironmentalinsurance 11.2 such damage. to takeoutcommercialinsurancepoliciescovertheirliabilityfor business insectorswhereenvironmentaldamageislikelytooccur, Besides that,itiscommonforenterpriseswhichoperatetheir environmental damage. hold amandatoryinsurancepolicytocovertheirliabilityfor Prevention andRecoveryofEnvironmentalDamage)arerequiredto Certain operators(enterprisesofBcategorypursuanttothe Act on 11.1 the future. significantly affect thecreation ofsimilarairqualityprogrammesin improvement ofairqualityinBratislava. The courtrulingshould particular, toadopteffective measuresinorder tocontributethe now obligedtofundamentallyreworktheprogrammeand,in resulted inthedefendantlosingcaseandstateauthorityis despite thenationalandEUlegislativerequirements. The suit the defendant,wastoovagueandcontainednospecificgoals argued thattheprogrammeforairqualityimprovement,createdby authority forinsufficient airprotectioninBratislava. The plaintiffs Cycling Coalition,andotherinvolvedcitizenssuedthelocalstate Centre forSustainable Alternatives (the“CEPTA”), ClientEarth,the Last year, several non-governmentalorganisations suchasthe seem tobeanessentialelementintheSlovakenvironmentalfield. Recently, variousactivitiesofnon-governmentalorganisations 12.1 decides todoso,itmustberemovedbyanauthorisedperson. is foundon-site,itsremovalnotmandatory, butiftheowner asbestos areclassifiedashazardouswaste.Inthecasethat establishing the Waste Catalog,allconstructionmaterialscontaining 11 12 experience inyourjurisdiction? risks insuranceplayinyourjurisdiction? in environmentlawyourjurisdiction. What istheenvironmentalinsuranceclaims in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a Environmental InsuranceLiabilities Updates

Slovakia

URBAN FALATHGAŠPERECBOŠANSKÝ ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London Education &Qualifications: major lawfirmsactiveinSlovakiaandtheCzechRepublic. Over manyyearsofpracticelaw, Mariánhasworkedatseveral (M&A). of holdinggroupsand,lastbutnotleast,mergersandacquisitions supervisory bodies(corporategovernance),cross-borderrestructurings structures, relationshipsandrulesamongmanagement,executive companies andotherformsofbusiness,includingsettingupcorporate On adailybasis,Mariánalsofocusesonprovidinglegaladviceto area ofenvironmentlaw, inparticularwastemanagementlaw. GAŠPEREC BOŠANSKÝ(UFGB),whoisresponsibleforthepractice Marián isoneofthefoundingpartnerslawfirmURBANFALATH throughout manyyearsofpractisinglaw. experience Environmental lawalongwithwastemanagementarekeypracticeareasofUFGB.Ourlawyershavegainedsubstantialknowledgeand life. We combineawide range ofpracticeareaswithprecision,persistenceandcommitmenttodothejobproperly. of boththeirworkandprivate Our clientsinparticularappreciatethatatasinglepointtheycangethighlyqualifiedandprofessionaladviceallareas environment. We havea clear goalofprovidingourclientswithnotonlystandardlegaladvicebutalsoexceptionalservice. URBAN FALATH GAŠPERECBOŠANSKÝ(UFGB)isafull-servicelawfirmwithsolidvaluesandstablepositioninstrongcompetitiv ■ ■ Degree). Pan-European UniversityinBratislava,FacultyofLaw(Master’s Pan-European UniversityinBratislava,FacultyofLaw(Doctorate). URL: Email: Tel: Slovak Republic 811 04Bratislava Havlíčkova 16 URBAN FALATH GAŠPERECBOŠANSKÝ Marián Bošanský www.ufgb.sk [email protected] +421 904539495

■ ■ Education &Qualifications: law firmsactiveinSlovakiaandtheCzechRepublic. Over manyyearsofpracticelaw, Jánhasworkedatseveralmajor rights, andunfaircompetition. primarily developmentprojectsandconstruction,pharmacy, personality has gainedvaluableexperienceinaddressingcomplexcasesinvolving As alitigator, includingincommercialandinvestmentarbitrations,Ján matters, draftingandnegotiatingawiderangeofbusinesscontracts. property, technologyandmedia.Onadailybasis,hecoverscontractlaw As atransactionlawyer, Jánprimarilyfocusesonrealestate,intellectual matters involvingenvironmentlaw. area ofrealestateandconstruction.HealsosupportsMariánin GAŠPEREC BOŠANSKÝ(UFGB),whoisresponsibleforthepractice Ján isoneofthefoundingpartnerslawfirmURBANFALATH ■ Entrepreneurship (BusinessEconomicsandManagement). Pan-European UniversityinBratislava,FacultyofEconomicsand Pan-European UniversityinBratislava,FacultyofLaw(Doctorate). Degree). Palacký UniversityinOlomouc,FacultyofLaw(Master’s URL: Email: Tel: Slovak Republic 811 04Bratislava Havlíčkova 16 URBAN FALATH GAŠPERECBOŠANSKÝ Ján Falath

www.ufgb.sk [email protected] +421 905866438 WWW.ICLG.COM Slovakia

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175 Slovakia Chapter 25 Spain

Del Pozo & De la Cuadra Covadonga del Pozo

1 Environmental Policy and its 1.3 To what extent are public authorities required to Enforcement provide environment-related information to interested persons (including members of the public)?

1.1 What is the basis of environmental policy in your The right of access to environment-related information has been jurisdiction and which agencies/bodies administer deeply developed in the Spanish jurisdiction by Law 27/2006, and enforce environmental law? which transposes EU Directives 2003/4/CE and 2003/35/CE and establishes that the general public is entitled to access Spanish environmental policy has its basis in article 45 of the Spanish environmental information held by public authorities with no need Constitution, which sets out the right to enjoy an environment that is to demonstrate any specific interest, as well as to be informed about adequate for the development of people and the obligation to protect their rights, to be helped during their search for information, to it. Following this constitutional dictate and the framework developed receive the required information within certain terms and formats by the EU Directives, Spanish Law 26/2007 on Environmental (or to be informed of the reasons it is denied), and to know the list of Liability sets prevention and “polluter pays” principles as the applicable fees and prices. guidelines of environmental law in Spain.

The Spanish system foresees three levels of competences for bodies in charge of the enforcement of environmental law: national; regional; 2 Environmental Permits and local. The National Administration (specifically, the Ministry for Ecological 2.1 When is an environmental permit required, and may Transition – of Energy and Environment) is entitled to enact basic environmental permits be transferred from one legislation (developing laws approved at the Parliament) and to set the person to another? main coordination and supervision mechanisms. The Autonomous Regions develop basic legislation in their territorial scope and The Spanish system of environmental permits is quite complex. approve environmental plans; they are usually the authorities who Usually, activities that have an environmental impact will need a grant environmental permits and carry out most environmental permit for each element of the environment that may be affected procedures. Finally, municipalities have competence in certain (waste, water supply, wastewater discharge, air pollution, etc.). sectors which are of particular incidence at a local level (e.g. noise or However, since the enactment of Law 16/2002 on Integrated urban waste collection). Pollution Prevention and Control (IPPC), which has been Besides this three-level outline, there are other national and regional subsequently substituted by the consolidated text approved by bodies and agencies which take part in the enforcement of Royal Legislative Decree 1/2016 of December 16th, most of these environmental law within specific sectors, such as hydrographic individual authorisations have been unified into a single permit for confederations, the OECC (the Spanish Climate Change Office), certain activities: the integrated environmental authorisation SEPRONA (the Police in charge of the protection of the (“autorización ambiental integrada”). environment), etc. Depending on their object, environmental permits are granted to facilities and/or to the titleholder of the activity. Most of the permits 1.2 What approach do such agencies/bodies take to the can be transferred, generally requiring notification to the competent enforcement of environmental law? authority. In some exceptional cases, the transfer of permits requires prior administrative authorisation. Spanish authorities are strict in their role of supervision of compliance with environmental obligations. Permits usually contain 2.2 What rights are there to appeal against the decision of technical conditions that have to be met by the operators; inspections an environmental regulator not to grant an are carried out periodically and disciplinary proceedings are quite environmental permit or in respect of the conditions frequent. Serious infringements may even be communicated to the contained in an environmental permit? Public Prosecutor for the initiation of criminal proceedings. Permit applicants can challenge both the decision denying them and the inclusion of detrimental conditions of mandatory observance.

176 WWW.ICLG.COM ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 © Published and reproduced with kind permission by Global Legal Group Ltd, London (14001:2015) system. Management and Audit Scheme(EMAS)ortheUNE-ENISO regions). They areusuallyconductedthroughtheEUEco- Environmental auditsaregenerallyvoluntary(exceptinsome ambiental”). an environmentalimpactassessment(“ (WEEE), batteries andaccumulators,construction and demolition can findusedindustrialoils,wasteelectrical andelectronicequipment obligations, usuallydenominated“special waste”. Among these,we management oftenhavetheirown regulationssettingparticular In addition,therearespecifictypes ofwastewhoseproductionor regulations donotinfringeLaw22/2011. certain aspectsofthelegalregimeforwaste,providedthattheir municipalities areentitledtodevelopandreinforcethedutieson local regulationsmustalsobechecked,sinceregionsand stricter thanthoseestablishedfornon-hazardouswaste.Regionaland Obligations setbyLaw22/2011 regardinghazardouswastearemuch industrial), andespeciallyontheirhazardousornon-hazardousnature. waste producedand/ormanaged(domestic,commercialand Duties ofproducersandmanagerswastedependonthetype accordance withDirective2008/98/EC. the holderdiscards orintendstoisrequired todiscard”, in (“evaluación ambientalestratégica programmes aresubjecttoastrategicenvironmentalevaluation list ofactivitiesandconditionsunderwhich(i)plans Assessment anditssubsequentdevelopingregionalregulationsseta environmental impact.Specifically, Law21/2013onEnvironmental Particularly pollutingactivitieswillrequireapriorassessmentof 2.3 and/or throughacontentious-administrativeappealbeforethecourts. depending ontheauthoritywhoissuedchallengedresolution), administrative appeal(whichwillbemandatoryorvoluntary The aforementioneddecisionsmaybechallengedthroughan Del Pozo&DelaCuadra ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 22/2011, ofJuly28 The definitionofwastewithintheSpanishjurisdictionisstatedbyLaw 3.1 and seriousinfringementsmayevenleadtocriminalproceedings. activity. The operatorwillalsohavetorepairthedamagecaused even disqualificationofitsholderfromcontinuingtocarryoutthe closure ofthefacilitywithsuspensionorreversalpermit, infringement andthedamagecaused),temporaryorpermanent significant fines(ofuptoseveralmillioneuros,dependingonthe may initiatedisciplinaryproceedings.Penaltiesinclude etc. Iftheydetectinfringementsofenvironmentalregulations, inspections, requireinformationanddocumentation,takesamples, Environmental regulatorsarepublicauthoritiesentitledtocarryout 2.4 aforementioned lawdefineswasteas“ © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 3 permits? polluting industriesorotherinstallations/projects? waste involveadditionaldutiesorcontrols? Waste Is itnecessarytoconductenvironmentalauditsor regulators haveinconnectionwiththeviolationof environmental impactassessmentsforparticularly How iswastedefinedanddocertaincategoriesof What enforcementpowersdoenvironmental th , on Waste andContaminatedSoils. The ”), and(ii)projectsaresubjectto any substanceorobjectwhich evaluación deimpacto

generate thesetypesofwaste. responsibility oftheproducerisgenerallyapplicabletodeviceswhich waste, packagingsanitaryetc. The extended 3.3 who recoverordisposeofiton-site. management authorisationforproducersofnon-hazardouswaste operations. However, Law22/2011 setsanexemptionofthis who willberesponsibleforcarryingoutthecorrespondingdisposal activity. They havetodelivertheirwasteauthorisedmanagers, unless theyaredulyauthorisedtocarryoutthistypeofmanagement Generally, producerscannotdisposeoftheirwastethemselves reasons. exceptionally modifiedbythecompetentregionalbodyforjustified hazardous wasteisalwayssixmonths. These termsmightbe is duetobedisposedof,whilethemaximumstoragetermfor production siteifitisgoingtoberecoveredanduponeyear Non-hazardous wastecanbestoredforuptotwoyearsinits safety conditions. waste generatedintheirfacilitiesstoredtherighthealthand According toLaw22/2011, producersofwaste havetokeepthe 3.2 criminal; andadministrative. Nevertheless,sincethe enactmentof Traditionally, therehavebeenthreetypesoflegalliabilities:civil; 4.1 of producers ofwaste,buttotheextendedresponsibility Obligations totakebackandrecoverwastearenotlinked 3.4 them totheproducers. batches ofwastewhichdonotmeetlegalspecificationsandreturn be liableforthoseinfringements.Infact,managerscanreject hazardous wastemixedwithsubstances),theywillstill authorised manager(forexample,incaseaproducerdeliversnon- production andstorageofwastepriortotheirtransferan However, ifproducers infringetheirlegalobligationsconcerning provided thatthedeliveryisproperlydocumented. waste toanauthorisedmanagerforitsdisposalortreatmentoff-site, The responsibilityofwasteproducersendsoncetheytransfertheir or agreedspecificationsofdelivery. authorised managerrejectstheirwasteduetoinfringementoflegal waste backandensureitscorrectrecoveryordisposalwhenan in themarket.Producersofwasteareonlyforcedtoaccepttheir 4 products withregardtothewastegeneratedbytheirarticlessold produced? what defencesaretypicallyavailable? regarding thetake-backandrecoveryoftheirwaste? bankrupt/disappears)? Liabilities the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore breach ofenvironmentallawsand/or permits,and What typesofliabilitiescanarise wherethereisa To whatextentdowasteproducershaveobligations

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177 Spain 178 Spain corresponding preventionandreparationmeasures. caused. Inallthesecases,operatorsarestillobligedtocarryoutthe state ofsciencedidnotenableforesightthedamagethatwouldbe specific objectofanadministrativeauthorisation,oriftheexisting no faultornegligenceanddamagederivedfromtherealisationof Operators willnothavetobearreparationcostseitheriftherehasbeen mandatory orderorinstructionissuedbyacompetentpublicauthority. the damagewascausedbyconductofathirdpartyor prevention, avoidanceandreparationmeasuresiftheyevidencethat Nevertheless, theoperatorswillavoidassumingcostsof (iv) (iii) (ii) andprevention ofenvironmentalcosts. exoneration causeeither, theoperatorbeingobliged tobearthe regulations orestablishedinthe corresponding permitsisnotan requirements, precautionsand other conditionssetbythe operator hasnotcommittedfault ornegligence.Fulfilmentof 26/2007 isstrict:therenoexoneration ofliabilityevenwhenthe Environmental liabilityforactivities listedin Annex IIIofLaw 4.2 (i) not wellcoveredbytheregulationspreviouslyinforce. whose purposeistocoverthoseareasoftheenvironmentthatwere has unfolded,resultinginafourthcategory:environmentalliability, Law 26/2007onEnvironmentalLiability, “administrative”liability Del Pozo&DelaCuadra © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM operator. does notdependontheexistenceoffaultornegligence categories ofactivities,environmentalliabilityisstrict,soit estuaries, andland). With regardtodamagecausedbycertain habitats andwildspecies,water, seashoresandbanksof prevent, avoidandrepairenvironmentaldamage(damageto Environmental liability infringement). correspondence betweentheconductandlegal term expiration,orevidencingtechnicalinaccuracies(lackof involve formalgrounds,irregularitiesduringtheproceedings, Defence inadministrativedisciplinaryproceedingsusually also implyfinesorrestrictionsontheactivity. Penalties tobeimposedaftertheperceptiveproceedingsmay administrative infringementsenvisagedbyregulations. within permitlimits? Administrative liability the crime. supervise corporatecomplianceissetandexecutedtoprevent exempt fromcriminalliabilityifanadequatesystemto behalf ofthecompany. Inthesecases,thecompanymaybe committed bytheirlegalrepresentativesandemployeeson possibility ofcriminalliabilitylegalentitiesduetocrimes The lastreformsoftheSpanishCriminalCodealsoenvisage as possibletorepairthedamagecaused. allegeable defences,aswelltocarryoutmanymeasures Lack ofparticipationorintentionalityaretwothemain as welltheobligationtorepairdamagecaused. facilities andactivities,disqualification,imprisonment,etc., Code. Itmayentailhighpecuniarysanctions,closureof environmental crimesestablishedintheSpanishCriminal Criminal liability party duetoitsownrecklessnessorfault. damage, orthatthedamagehasbeenproducedbyinjured the lackofacause-effect relationbetweenconductand elements. The maindefencesavailablewouldimplyproving environment andthereisacausalitylinkbetweenthesetwo damaging actionoromissionwithharmfulresultsforthe corresponding compensationprovidedthattherehasbeena damage tothirdparties,whowillbeentitledobtainthe Civil liability notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage

derivesfrominfringementswhichcause isaconsequenceofthecommission comprisestheoperators’ dutiesto derivesfromthecommissionof

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or applicableregulationsatthemomentofgenerationdamage. that theoperatorhasnotinfringedanyofconditionspermit of thespecificobjectanadministrativeauthorisation,provided his behaviourandthedamagederivesdirectlyfromperformance recover thereparationcostswhenthereisnofaultornegligencein However, asstatedinquestion4.1above,theoperatorwillbeableto does notusuallycoverdamagescausedintentionally. administrative andcivilliability, butitmustbenotedthatinsurance Directors andofficers ofcompaniescouldgetinsurancefor liability duetotheirillegalorrecklessbehaviour. also makeaclaimagainstitsdirectorsorofficers regardingcivil imposed onthecompany. The companyoritsshareholdersmay regarding theprevention,avoidanceandreparationobligations the causationofenvironmentaldamagewillhavesubsidiaryliability those managersoflegalentitieswhoseconducthasbeendecisivefor In addition,Law26/2007onEnvironmentalLiabilityprovidesthat such person. offence iscommittedbytheactionsofacompanyrepresented legal entitieswillattractpersonalcriminalliabilityincasea The SpanishCriminalCodeenvisagesthatdirectorsandofficers of 4.3 face thedecontaminationcosts. borrower whocausedcontamination cannotbeidentifiedor where thelender(owner)has subsidiary liabilityincasethe This generalrulehasanexception in thecaseofsoilcontamination, power overtheactivitycarriedoutbyformer. that canbebroughtagainstthelenderunlesslatterhadcontrolor causes environmentaldamage,ingeneraltermsthereisnoaction damages andreparation. Therefore, iftheborrowerofafacility damage isliableandshallassumethecostsofavoidancemore According toLaw26/2007,thepersonwho 4.5 ownership orintheexerciseofitsactivity, havesubsidiaryliability. substitute thepersonwhocausedenvironmentaldamageinits enactment ofLaw26/2007onEnvironmentalLiability, thosewho contamination orhiddendefectsinthepurchase).However, sincethe purchase (exceptforsomespecialcasessuchashistoricalland infringements), andwouldonlybeliablefordamagescausedafterthe keep anyliabilityforthepreviousactivity(exceptincasesofcontinued When theobjectofsaleisanasset,buyerdoesnotgenerally activity beforeandafterthetransaction. environmental liabilityderivedfromthedamagecausedbyits If sharesofanoperatoraresold,suchwillkeepthe 4.4 practice yetandmaybedifficult toget. environmental liabilities,althoughthiscertificateisnotcommon competent authoritystatingthatthesellerhadnopending Subsidiary liabilitycanbeavoidedbyobtainingacertificatefromthe indemnity protectioninrespectofsuchliabilities? environmental wrongdoingand/orremediationcosts? the onehandandanassetpurchaseonother? to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract To whatextentmaylendersbeliablefor environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman

causes environmental

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EU states’ parameters(e.g.Dutch). practice, technicalexpertsongroundwaterremediationapplyother parameters tolegallyconsidergroundwaterdecontaminated.In opposition tosoilcontamination,Spainhasnotyetapprovedthe without foreseeingany“cascadesystem”ofsubsidiaryliability. In also setsoutthatthedamagehastoberepairedbypolluter, but With regardtogroundwatercontamination,RoyalDecree849/1986 and theownerwouldbeliablethirdly). concession, wheretheconcessionairewillbeliableinsecondplace will havesubsidiaryliability(exceptincaseofpublicdomainunder that theowneroflandaffected oritscurrentholder, inthisorder, the foregoing,Lawon Waste andContaminatedLandenvisages pollution andwillassumethedecontaminationcosts.Notwithstanding The personorentitywhichcontaminatessoilisliableforsuch 5.1 Del Pozo&DelaCuadra ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 against theformer. contamination, itscurrentownerwill beentitledtoclaimitscosts holder. Therefore, ifapreviousownerofthelandcausedits such obligationsfallontheowner ofthelandoronitscurrent polluter cannotbeidentifiedordoes nothaveenoughresourceswill land isthepersonwhocaused contamination.Onlywhenthe The subjectwhohastoassumedecontamination costsofpolluted 5.4 legitimate interest. between pollutersandpublicauthorities,providedthattheyjustifya Third partieswillbeentitledtochallengecollaborationagreements additional measurescouldalsoberequireduntillandisfullyrepaired. under acooperationagreementsubscribedwiththeauthorities, defects arefoundafterthedecontaminatingactivitiescarriedout after checkingtheresultofrecuperationactivities. Thus, ifany decontaminated untilthecompetentregionalauthoritydeclaresitso contaminated, statesthatcontaminatedlandwillnotbedeemed potentially contaminatingsoilandthecriteriatodeclarelandas Royal Decree9/2005,whichestablishesthelistofactivities 5.3 obligations. responsible inregardtothedecontaminationandrecuperation been causedbytwoormorepeople,theywillbejointlyandseverally some exceptionsapply. Inparticular, when common liabilitysharedinproportiontotheirparticipation.However, The generalrulesetbyLaw26/2007forenvironmentaldamageis 5.2 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 5 can athirdpartychallengetheagreement? is responsibleforthecontamination? groundwater? contaminated landliabilitytoapurchaser? Contaminated Land What istheapproachtoliabilityforcontamination possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof (including historiccontamination)ofsoilor Does apersonhaveprivaterightofactiontoseek regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis How isliabilityallocatedwheremorethanoneperson

soil contaminationhas

situation, whichshallincludeitsaestheticelements. Law 26/2007istherestorationofnaturalresourcestotheirprimary Additionally, themainpurposeofreparationmeasuressetby infringement whichcanbepunishedwithmonetaryfines. remediation planisproposeddirectlybytheownerofland. to carryoutthedecontaminationoflandunlessavoluntary parties butnotbeforetheauthorities,whowillrequirerealpolluter from apreviouscontaminationwillonlybeenforceablebetweenthe and itsbuyerexoneratingthesellerfromanyresponsibilityarising In thisregard,aprivateagreementbetweenthesellerofpieceland 6.1 impacts inprotected naturalzones “ Yes. Law42/2007onNaturalHeritageandBiodiversityconsiders 5.5 potentially contaminating activitywascarriedout inthepastare case ofextensionorclosurethe activity. Ownersoflandwherea submitted withtheperiodicitysetby thecompetentauthorityandin require landinvestigation,likethe reportsthatalsohavetobe term oftwoyears. This isanon-intrusivereportwhichdoes not situation ofthelandwhereactivity islocatedwithinamaximum have theobligationtosubmit a preliminaryreportaboutthe Those whocarryoutanactivitydeemedaspotentiallysoil-polluting 7.2 already beencausedbythemorthatcouldeventuallybecaused. the existenceofenvironmentaldamageorimminentthreatthathas Liability specifiesthatoperatorshavetoimmediatelycommunicate leak orenvironmentalaccident. The LawonEnvironmental inform thecompetentauthoritiesimmediatelyincaseofapollution Most environmentalregulationsinSpainsettheobligationto 7.1 opposite). presumed tobetrue(withoutdetrimentthepossibilityprove authorities initiateadisciplinaryproceeding,theirtestimoniesare an administrativeinfringementanditmustbenotedthatincasethe documentation, etc.Obstructionofinspectionsisgenerallyconsidered inspections offacilities,takesamples,askforinformationand activities withenvironmentalimpact. They areabletocarryout authorities withimportantpowersofsupervisionandcontrolover Almost everyenvironmentalregulationinSpainprovidespublic the installationofpublicityorproduction of sensitivelandscape 6 7 conduct siteinspections,interviewemployees,etc.? public assets,e.g.rivers? contamination? parties? Powers ofRegulators Reporting /DisclosureObligations require productionofdocuments,takesamples, What powersdoenvironmentalregulatorshaveto polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson environmental regulatororpotentiallyaffectedthird migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe ”, asevereadministrative WWW.ICLG.COM

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179 Spain 180 Spain only equalsthevalue ofhisshares. company thatcausedtheenvironmental damage,hisresponsibility Unless ashareholderhasdirectlyparticipated inthebehaviourof 8.3 to beattributedthem. enables thecorrespondingadministrativeandcriminalresponsibility evidence offraudbytheirmanagers,the“liftingveil”doctrine own resourcesduringthedissolutionprocess,andincasethereis Environmental liabilitiesofthecompanywillbeliquidatedwithits accounts. be includedinthereportthatissubmittedjointlywithannual contain aspecificitemforenvironmentalcontingencies,whichhasto According toSpanishlaw, itisnecessaryforthebalancesheetto 8.2 will alwaysfallonthepolluteraccordingtoLaw26/2007. will onlybeenforceablebetweenthem,butenvironmentalliability seller inexchangeforapricereduction).However, suchindemnities purchase wherethebuyeracceptsanindemnityintroducedby Indemnities canbeusedbetweenprivateparties(forexample,ina 8.1 Good faithhastoberespectedineverytransactionSpain. 7.3 case ofclosuretheactivity. thresholds setbyRoyalDecree9/2005;andiii)insomeregions, is awareoftheexistencepollutingparametersabove examination ofthepreliminaryreport;ii)ifholderactivity following cases:i)ifthecompetentauthorityrequiressoafter On theotherhand,landinvestigationreportshavetobefiledin non-contaminating activityortochangetheuseofland. the landincasetheyapplyforapermitorauthorisationtodevelop also obligedtosubmitanon-intrusivereportaboutthesituationof Del Pozo&DelaCuadra © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM declaration willberegisteredinthePropertyRegistry). the correspondingpublicdeedfortransferofland(this activity hasbeencarriedouthavetodeclaresuchcircumstancein Additionally, ownersoflandwhereapotentiallycontaminating the nullityofpurchaseduetovitiatedconsentbuyer. subsequent claimsforcompensationduetohiddendefectsoreven environmental problemsthatheisawareofinordertoavoid Moreover, thesellershouldinformprospectivepurchaserofany 8 takeover transactions? caused byaforeignsubsidiary/affiliate? order toescapeenvironmentalliabilities? potential liabilityforthatmatter? General matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff Is itpossibletouseanenvironmentalindemnity To whatextentisitnecessarytodisclose company besuedinitsnational courtforpollution pollution causedbythecompany, andcanaparent

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criminal andciviljurisdictions). to beunderstoodaslimitedenvironmentallitigation,excluding are entitledtoobtainfreepublicaid(givenitsgrounds,thisrighthas legitimated toexercisethepublicactionforenvironmentalmatters Law 27/2006specificallystatesthatnon-profitentitieswhichare abusive useoftheaffiliate orlegalfraud. could beextendedtotheparentcompanyiftherehasbeenan companies, Law26/2007establishesthatenvironmentalliabilities However, inthecasethatcompanybelongstoagroupof can alsodefendcollectiveinterests. which meetcertainrequirements.Moreover, consumerassociations profit organisations dedicatedtotheprotectionofenvironment Law 27/2006establishesapublicactionthatcanbeexercisedbynon- 8.5 into forcetookplaceonOctober2 Administrative ProceedingofPublic Administrations andwhoseentry Article 62.4ofLaw39/2015,whichregulatestheOrdinary 8.4 set bytheCommission Regulation601/2012on Monitoring and According toLaw1/2005,which alsoincorporatestheprovisions 9.2 emissions. activities inordertopushthemfurtherreductionstheir on eachnewphase,withlessfreeallowancesallocatedtoindustrial As isoccurringinotherEUMemberStates,ETSgettingstricter commitment periodoftheKyotoProtocol. third phase(2013–2020),whichisconsistentwiththesecond pursuing thereductionofgreenhousegas. We arecurrently inthe Trading System(ETS),themostimportantEuropeanmeasure Through Law1/2005,SpainhasimplementedtheEUEmissions 9.1 requirements andconditionstoexercisetheaforementionedright. no costforthosewholackresourcestofinanceitandsetsthe Law 1/1996,onFreeLegal Aid, establishesthatlitigationwillhave 8.6 provided thatsomeotherrequirementsaremetaswell. evidence thatenablestheinitiationofadisciplinaryproceeding, other peoplebutarethefirsttoprovidepublicauthoritieswith those complainantswhohavetakenpartinaninfringementalongwith proportional reduction)offinesandothernon-monetarysanctionsfor 9 damages available? report environmentalviolations/matters? to monitorandreportgreenhouse gasemissions? market developingthere? pursuing environmentallitigation? Emissions Trading andClimateChange environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing Are thereanylawstoprotect“whistle-blowers”who in question9.1above,isthere any otherrequirement Aside fromtheemissionstrading schemesmentioned your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation any exemptionfromliabilitytopaycostswhen Do individualsorpublicinterestgroupsbenefitfrom nd 2016,envisagesanexemption(or

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may alsoimposeadditionalconditionsinexceptionalcases. scope ofLaw1/2005,andintegratedenvironmentalauthorisations requirements forgreenhousegasesotherthanthoseincludedunderthe Additionally, therearedifferent regulationsinSpainwhichsetspecific year. The Paris Agreement mayhaveasignificantinfluenceinthisregard. future projectsandactivitiestothenear-future climatechangeimpacts. prevention perspective,theadoptionofafocusonadaptation set bytheEU,whosecurrentapproachentails,inadditiontoa Spain’s currentpolicyregardingclimatechangeistofollowthepath 9.3 annual reporttothecompetentauthoritiesbeforeFebruary28 conditions oftheiremissionsauthorisation,andmustsubmitan monitoring systemofgreenhousegasincompliancewiththe Reporting, ownersoffacilitieshavetoimplementandmaintaina Del Pozo&DelaCuadra ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 who carryoutthemostpotentially pollutingactivitiesneedtocarry According toLaw26/2007onEnvironmental Liability, operators 11.1 disposing ofitfollowingtherequirementssetforhazardouswaste). workplace assoonpossible,dulypackedandlabelled,before (specifically, collectingandtransportingasbestosoutofthe that theasbestosisremovedincompliancewithwasteprovisions prevention oflabourrisks,holdersactivitieswillhavetoensure to theneedcomplywithapplicableobligationsregard 2002 isalloweduntiltheendoftheirusefullife. Without detriment forbidden inSpain,buttheuseofproductscreatedbeforeJune14 Commercialisation ofasbestosandproductscontainingis 10.2 Court onMarch2 relevant indemnifications,suchastheoneissuedbySupreme example istheUS),therearerecentSpanishrulingswhichgrant asbestos arenotashightheyinotherjurisdictions(theclearest matter. Evenwhencompensationsawardedtoworkersaffected by jurisdiction, whichalreadyhasquitealarge bodyofcaselawonthis Asbestos claimsarestillquitefrequentwithintheSpanish 10.1 asbestos beforetheirfinalusershasbarelybeenexploredinSpain. On theotherhand,liabilityofproducersarticlescontaining to compensatetheiraffected workers. also includesseveralrulingsobligingdifferent Public Administrations due tohisprofessionalexposureasbestos. The existingcaselaw million eurostotheheirsofashipyardworkerwhoeventuallydied © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 10 11 jurisdiction? regulation inyourjurisdiction? risks insuranceplayinyourjurisdiction? in relationtoasbestoson-site? What istheoverallpolicyapproachtoclimatechange in themarket,andhowbigarole doesenvironmental What typesofenvironmentalinsurance areavailable What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour Asbestos Environmental InsuranceLiabilities nd 2016grantingcompensationofclosetohalfa

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enforceable. crucial, astheobligationsetbyLaw26/2007isbecominggradually entities havealreadybenefitedfromit;nowadaysitisbecoming Environmental insuranceisalreadyrelevantinSpainandmany October 2019respectively. 1 &2activities(mostpollutantactivities)sinceOctober2018and ■ during 2018. according totheCircularEconomypackageapprovedatEUlevel under development,asaconsequenceofthelegislativeworkand term. Also, severalamendmentsonthecurrentwastelegislationare our environmentalandenergy sourceslandscapeinthemedium of itslawonenergy andclimate changethatwillcompletely for 2019. Among others,theGovernmenthasreleasedafirstdraft of importantdevelopmentsarecurrentlyongoingthatprojected In additiontothenewdispositionsapprovedduring2018,anumber ■ October 23 public sector. PursuanttoMinisterialOrder APM/1040/2017, of activity withmaterialisationonfinancialinvestmentsbackedbythe fund createdtocovertheeventualenvironmentaldamageof financial entity;ortheconstitutionofatechnicalreservethrough subscription ofaninsurancepolicy;obtainingendorsementbya three categoriesoffinancialguaranteesavailableforoperators:the eventual environmentalliabilitylinkedtotheiractivity. There are out ariskanalysisandconstitutefinancialguaranteetofacethe ■ ■ company islimitedinSpain. policyholder ortheinsuredpartyduetoconflictswithinsurance normally. Environmentalinsurancelitigationinitiatedbythe general termsofcivilliabilityinsurance,whereithasfunctioned Environmental insurancehasusuallybeenmaterialisedwithinthe 11.2 ■ during 2018inSpain,ofwhichwewouldhighlightthefollowing: A number ofnewenvironmentalregulationshavebeenenacted 12.1 12 Marine waters:RoyalDecree1365/2018,ofNovember2 large combustionfacilities. regulating nuclearsafetyonfacilities. Water: RoyalDecree902/2018,ofJuly20 approving themaritimestrategiesforSpain. Nuclear energy: RoyalDecree 1400/2018,ofNovember23 of plasticbaguseandcreationtheProducersRegistry. Waste: RoyalDecree293/2018,ofMay18 method specifications. 140/2003 onhealthcriteriafordrinkingwaterandanalysis experience inyourjurisdiction? in environmentlawyourjurisdiction. Industrial emissions:RoyalDecree818/2018,ofJuly6 29 polluting substances;andOrder TEC/1171/2018, ofOctober measures toreducenationalemissionsforcertainair- What istheenvironmentalinsuranceclaims summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a th , ontheinformation,control,follow-upandassessmentof Updates rd , theseguaranteesshallbemandatoryforprioritylevel WWW.ICLG.COM th , onthereduction th , amendingRD

Spain th , on nd rd , ,

181 Spain 182 Spain Del Pozo&DelaCuadra © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM motivated andenthusiasticlawyersfullydedicatedtotheirclientsinaveryproactivemanner. closeness, quickresponse,cost-efficiency ofateamvery andbusinessunderstandingofasmallerstructure.DelPozo&DelaCuadraisformed largelawfirmwiththe The firmisprobablyuniqueinitsclassSpain,perfectlycombiningthetop-qualifiedandhighlyspecialisedadviceofavery of theenvironmentalandenergypracticesinMadridoffice ofCuatrecasas(thesecond-largestlawfirminSpain). partnerandhead and internationalclientsstandsitsfounderlegalexpert,Mrs.CovadongadelPozo,withover20yearsofexperience,aformer practicestonational September 2012.Behindtheprojectofcreatingahighlyspecialisedlawfirmtogivefullcoverageontheseinterrelatedlegal inSpain Del Pozo&DelaCuadraisanenvironmental,naturalresourcesandenergylawboutiquethatinitiateditsprofessionalactivities in Spain,amongothers. businesses, publiclyownedcompanies,andthemajorfinancialentities has advisednationalandinternationalcorporategroups,Ibex processes). Duringovertwodecadesofprofessionalexperience,she proactive perspective(includingenvironmentalcorporatecompliance general, advisingclientsonregulatorycompliancefromavery big industrialactivities,M&A operations,litigationprocessesandin in different matters,includingthedevelopmentandimplementationof and oil&gas(aswellasmining).Sheprovideslegaladvicetoclients the regulatedenergysectors:electricity(conventionalandrenewable); the legalareasofenvironmentandnaturalresources,aswellin environmental andenergylawissues.Shehaswideexperienceinall where sheworkedforalmost15years.Covadongaadvisesonall for thepracticesofenvironmentalandenergylawatMadridoffice, Covadonga delPozowasapartneratCuatrecasas,withresponsibility Before becomingthefoundingpartnerofDelPozo&DelaCuadra, URL: Email: Tel: Spain Madrid, 28003 Ríos Rosas36,6ºD. Del Pozo&DelaCuadra Covadonga delPozo www.dpdc.es [email protected] +34 915757817 ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

Spain

Chapter 26 Sweden

Wistrand Law Firm Rudolf Laurin

1 Environmental Policy and its impact on the environment are not licensable but can nevertheless be supervised. Enforcement In environmental permit proceedings, various authorities act as counterparties to the applicant upholding public interests. 1.1 What is the basis of environmental policy in your jurisdiction and which agencies/bodies administer 1.3 To what extent are public authorities required to and enforce environmental law? provide environment-related information to interested persons (including members of the public)? The main Swedish environmental legislation consists of the Swedish Environmental Code (SFS 1998:808), which entered into force on 1 The main rule is that the public has access to official documents January 1999. The Environmental Code brought together 15 existing submitted to or drawn up by the authorities. In case of environment- central environmental laws. The aim of the Environmental Code is to related information, some parts can be subject to confidentiality; for promote sustainable development. The Environmental Code is instance, information regarding the location of sensitive species. further elaborated and specified in the form of ordinances, regulations issued by public authorities and decisions taken in individual cases. As far as environmental policies are concerned, the Swedish 2 Environmental Permits Parliament has adopted national environmental quality goals. Being a member of the European Union (EU), the EU environmental policy is in many aspects part of Swedish environmental law. 2.1 When is an environmental permit required, and may environmental permits be transferred from one The agencies/bodies enforcing environmental law consist of the person to another? national environmental agencies, such as the Swedish Environmental Protection Agency and the Swedish Agency for Marine and Water Environmentally hazardous activities and water operations are Management as well as regional authorities, such as the Country examples of activities that require an environmental permit. Even if Administrative Boards and local municipal authorities. an activity does not require a permit, the supervisory authority may In Sweden, the courts handling environmental law matters consist of order an operator to apply for a permit where the activity involves five Land and Environmental Courts, the Superior Land and the risk of significant pollution or other significant detriment to Environmental Court and the Supreme Court. As far as permitting human health or the environment. There is also the option for the procedure is concerned, most permits are, depending on what kind operator of a non-licensable environmentally hazardous activity to of operation the permit concerns, issued either by the County apply for a voluntary permit. Administrative Boards or the Land and Environmental Courts. An environmental permit is decided for an operation at a certain When it comes to supervision, the County Administrative Boards location and may be transferred to a new operator. A new operator and the municipal authorities are the main authorities. As far as needs to notify the supervisory authority about the transfer in order criminal law is concerned, the district courts, the Courts of Appeal to become the new permit-holder. and the Supreme Court handle those issues.

2.2 What rights are there to appeal against the decision of 1.2 What approach do such agencies/bodies take to the an environmental regulator not to grant an enforcement of environmental law? environmental permit or in respect of the conditions contained in an environmental permit? The supervisory authorities have a central role in ensuring that environmental permits, decisions and environmental laws are met. An applicant may appeal a decision by the County Administrative They have the mandate to issue orders, prohibitions and, to some Board to the regional Land and Environmental Court if a permit is extent, penalties or a fine. The supervisory authorities are obliged to denied or if the applicant is not satisfied with the permit conditions. report infringements of the provisions of the Environmental Code or A judgment by the Land and Environmental Court may be appealed rules issued in pursuance thereof to the police or public prosecution to the Superior Environmental Court if a leave to appeal is granted. authorities where there are grounds for suspicion that an offence has For operations of such significance that the regional Land and been committed. It can further be noted that all activities having an Environmental Court is the first instance for issuing the permit, a

ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 WWW.ICLG.COM 183 © Published and reproduced with kind permission by Global Legal Group Ltd, London 184 Sweden municipality toprovideacollection systemforfoodwaste. the Waste Ordinance,which meanscreatinganobligationforthe the collectionsystems).Inaddition, amendmentswillbemadeto market willbetransferredtotheproducers (insteadofthosewhorun amount ofpackagingandnewspaper releasedontheSwedish shape ofthepackaging.Furthermore, theobligationtoreport by thecollectionsystemsandclarifyrequirementsregarding The newOrdinancessharpentherequirementsofservicegiven Responsibility for Waste Paper(2018:1463)willenterinto force. for Packaging(2018:1462)andanewOrdinanceonProducer As of1January2019,anewOrdinanceonProducerResponsibility batteries andpharmaceuticalsissubjecttoproducerresponsibility. storage, etc. Waste frompackaging,glass,paper, tyres,cars, WEEE, general issubjecttostricterprovisionsregardingcollection,transport, Waste Ordinancecontainsthewastecatalogue.Hazardousin disposes oforintendsisrequiredtodisposeof. Appendix 4ofthe or substancebelongingtoaspecificwastecategorywhichtheholder Under theEnvironmentalCode,wasteisdefinedasanyobject,matter Ordinance (2011:927). in SwedishlegislationthroughtheEnvironmentalCodeand Waste Waste Framework(2008/98/EC). The directivehasbeenimplemented The Swedishlegislationconcerningwasteislargely basedontheEU 3.1 10,000,000, maybeimposed. responsibility, corporatefines,rangingbetweenSEK5,000and may alsobeheldliableundercriminallaw. Inadditiontopersonal An operatorwhoneglectstocomplywithconditionsofapermit must notbemoreintrusivethannecessary. other decisionsissuedinpursuancethereof. The measurestaken provisions oftheEnvironmentalCodeandrules,judgments that arenecessaryinindividualcasestoensurecompliancewiththe A supervisory authoritymayissueanyinjunctionsandprohibitions inconsiderable. conditions havenotbeenmetandthediscrepancyis A licensingauthoritymaywithdrawapermitwhereorits 2.4 to makeasmallerenvironmentalimpactassessment. does nothaveasignificantenvironmentalimpact,itisonlynecessary regarding whattheEIA shalladdress. When theactivityoroperation impact. Ifthatisthecase,therearemoreformalrequirements required whenanactivityoroperationhasasignificantenvironmental impact assessment(EIA)isinsomecasesrequired. An EIA is In ordertoapplyforanenvironmentalpermit, 2.3 appeal, aleavetoappealisneeded. Court, canbeappealedtotheSupremeCourt.Evenforsuchan judgment, afterbeingappealedtotheSuperiorEnvironmental Wistrand LawFirm © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 3 polluting industriesorotherinstallations/projects? waste involveadditionaldutiesorcontrols? permits? Waste regulators haveinconnectionwiththeviolationof How iswastedefinedanddocertaincategoriesof What enforcementpowersdoenvironmental Is itnecessarytoconductenvironmentalauditsor environmental impactassessmentsforparticularly

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

3.3 Storage ofcleanmasseswasconsideredasdepositwaste. contamination andthereforetheactivitycouldnotbepermitted. declared thattheimportationofexternalcleanmassesentailsarisk handling ofcleanmassesfromsoilandexcavationmasses. The Court purposes. Inthiscase,theproducerappliedforapermit case ofprincipalinterestregardingdisposalwasteforrecovery Last year, theSuperiorLandandEnvironmentalCourtdecidedona health. handled inanacceptablemannerfortheenvironmentandhuman the producerofwasteisalwaysobligedtoensurethat method, thetypeandvolumeofwaste. As ageneralobligation, normally requireapermitornotification,dependingonthe tonnes ofdangerouswaste). The treatmentordisposalofwastewill requires apermitinspecificsituations(storageofmorethan50 that thestorageofwasteonsitewhereithasbeenproducedonly redrafted asfrom1January2017.Ingeneral,ithasbeenclarified The provisionregardingstorageand/ordisposalofwastehasbeen 3.2 criminal law. Some offences consideredtobeminorarenotpunishableunder corporate fines,thatacrimecanbe showntohavebeencommitted. requires thatanindividualperson may beheldliableor, incaseof requirement forenvironmentalsanction charges. Criminalliability Where criminalliabilityrequiresintent ornegligence,thisisnota under criminallaw. between SEK1,000and1,000,000sometosanctions infringements canleadtoenvironmentalsanctioncharges ranging with environmentallawsmaygiverisetocriminalliability. Some regarding permits,pleasealsonotethatevenotherincompliance Please seequestion2.4above.Inadditiontowhatismentioned 4.1 producer’s responsibilityiscurrentlyunderreview. found intherelevantgovernmentordinance. The extentofthe depending onthecategoryofwaste.Specificprovisionsaretobe pharmaceuticals). The responsibilitymaybeactualorfinancial waste (packaging,glass,paper, tyres,cars, WEEE, batteriesand Producer responsibilityhasbeenintroducedforcertaincategoriesof 3.4 factual operatorofthetreatmentfacility. liability wouldberetainedincasetheproducerisconsideredas the producerofwastewillnotretainaresidualliability. Sucha Normally, iftransferredtoapersonholdingthenecessarypermits, 4 produced? what defencesaretypicallyavailable? regarding thetake-backandrecoveryoftheirwaste? bankrupt/disappears)? Liabilities the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa To whatextentdowasteproducershaveobligations Sweden

4.4 preclude criminalresponsibility. environmental issuesisoftendelegated.Insurance,ifany, doesnot company toliabilityforissuesoutsidetheircontrol, is personal.InordernottoexposetheCEOorboardofa Yes; pleasealsoseequestions2.4and4.1.Criminalresponsibility 4.3 contamination orenvironmentaldamage. Yes. An environmentalpermitdoesnotprecludeliabilityfor 4.2 Wistrand LawFirm ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 liable, theoperator’s actualoperationneedstohavecontinuedafter 30 contributed tothecontamination(the operator).Inordertobeheld legal person(s)whopursuesorhas pursuedanactivitythathas environmental damagesthereforeprimarily restsontheperson(s)or are basedonthe“polluterpays”principle;liabilityfor and chapter10oftheSwedishEnvironmentalCode. The provisions Liability forcontaminatedareasisregulatedinchapter2paragraph8 negligence, liabilitycanarise. according totheEnvironmentalCode.Incaseofintentor that arenotinsignificantisconsideredtobeacriminaloffence which involvesriskstohumanhealthordetrimentfloraandfauna As farascriminallawisconcerned,contaminationinamanner 5.1 operator oftheoperationperformedbyborrower. lender mustactinsuchawaythatthecanbedeemedto linked totheborrowingcompany. Inordertobeheldliable,the of money, forenvironmentalwrongdoingsorremediationcosts A lender ofmoneycannotbeheldliable,merelyduetothelending 4.5 January 1999.Seefurtherquestion5.1. There aresecondaryresponsibilitiesforpropertiesacquiredafter1 performed bythesellingcompany. regarded asanewoperatorofthepreviouspollutingactivities connected withtheassetsandmay, underenvironmentallaw, be When assetsareacquired,thepurchaserwilltakeonliabilities environmental liabilityfollowsthecorporateidentitynumber. In caseofasharessaleregardinglimitedliabilitycompany, the © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 5 environmental wrongdoingand/orremediationcosts? the onehandandanassetpurchaseonother? indemnity protectioninrespectofsuchliabilities? within permitlimits? groundwater? Contaminated Land environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage What istheapproachtoliabilityforcontamination To whatextentmaylendersbeliablefor (including historiccontamination)ofsoilor

5.3 responsible forthepollutionandotherrelevantcircumstances. reasonable withregardtotheextentwhicheachofthemwas made bytheliablepersonsshallbesharedbetweenthemasappears in chapter10oftheEnvironmentalCode).However, thepayment liability isjointandseveral(subjecttosomelimitationsasspecified If severaloperatorshavecontributedtothecontamination, 5.2 possible, tocompensateforanyloss. primarily obligedtorestorethe environment and,ifthisisnot In caseofseriousenvironmentaldamage, theresponsiblepolluteris 5.5 the parties). operator (ifnothinderedtheretoaccordingtoanagreementbetween property ownerandanoperatorcanonlyseekrecoursefromanother owner can,undertheserules,onlyseekrecoursefromanother recourse underchapter10oftheEnvironmentalCode. A property A propertyownercannotactagainstanoperatorwhenitcomesto to aspecificparty. cannot hinderanauthoritytoactinacertainwayorissueorders situation betweenthecontractingpartiesandtoanagreement purchase agreement.Civilagreements,however, onlyaddressthe Liability forcontaminatedlandcanbehandledandtransferredina 5.4 to beindividuallyaffected bythedecisionmorethanmarginally. A third partycanchallengesuchadecisionifthisisconsidered all futureclaims. authority. Itwillnotgainlegalforceinthesensethatitpreclude The formofwhatis“agreed”willbetakenfromadecisionbythe discovered it. purchaser hadknowledgeaboutthecontaminationoroughttohave applies topropertiespurchasedasfrom1January1999wherethe the ownerofapropertycansecondarilybeheldresponsible. This If therearenooperatorsthatcanremediatethecontaminatedarea, serious environmentaldamage,specificprovisionalregulationsapply. must beaneedtoremediatethecontaminatedarea. With respectto Environmental Codeenteredintoforce(1January1999),andthere June 1969,theeffect oftheoperationmuststillbeapparentwhen several liability. Property ownersthataresecondarilyresponsiblealsohavejointand can athirdpartychallengetheagreement? is responsibleforthecontamination? public assets,e.g.rivers? contaminated landliabilitytoapurchaser? regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis How isliabilityallocatedwheremorethanoneperson polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek WWW.ICLG.COM Sweden

185 Sweden 186 Sweden indemnity doesnotlimitorbindthe authorities. indemnity areonlyvalidbetween thecontractingparties. The transfer agreementsofdifferent kinds.However, provisionson The agreementonenvironmental indemnity iscommonlyusedin 8.1 require disclosure. Swedish environmentallawtoapurchaser. However, civillawmay There isnoobligationtodiscloseenvironmentalproblemsunder 7.3 contaminated, therewillbeaneedtoinvestigate. grounds. Inthecaseofexploitationanareawhichmaybe supervisory authority. Suchanordermustbebasedonsubstantial An operatororlandownerisobligedtoinvestigateifsoorderedbythe 7.2 offence. Third partiesneednottobenotified. serious environmentaldamage.Failuretonotifyisacriminal environment, orifthereisariskthattheoperationsmaycause that maycausedamageordetrimenttohumanhealththe supervisory authorityifanypollutionisdiscoveredontheproperty The owneroruserofapropertyisobligedtoimmediatelynotifythe 7.1 of supervision. investigations oftheoperationsthatarenecessaryforpurposes information anddocumentstotheauthorityorcarryoutany supervisory authoritymayalsoorderanoperatortosubmitany order toperformtheirtaskspursuanttheEnvironmentalCode. A purpose ofcarryingoutinvestigationsandtakingothermeasuresin Authorities havetherighttobegivenaccesspropertiesfor 6.1 Wistrand LawFirm © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 8 7 6 conduct siteinspections,interviewemployees,etc.? potential liabilityforthatmatter? takeover transactions? contamination? parties? General Reporting /DisclosureObligations Powers ofRegulators matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto Is itpossibletouseanenvironmentalindemnity To whatextentisitnecessarytodisclose have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe What powersdoenvironmentalregulatorshaveto environmental regulatororpotentiallyaffectedthird require productionofdocuments,takesamples,

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

its activitiesthrougheconomicsubsidy. the factthatparentcompanyenabledsubsidiarytocontinue held liableforcontaminationcausedbyasubsidiarysolelydueto shareholder. Inrecentcaselaw, however, aparentcompanywas by thecompany, solelyduetothefactthatpersonisa be heldliableforbreachesofenvironmentallaworpollutioncaused As amainrule,shareholderinlimitedliabilitycompanycannot 8.3 ends environmentalliability. procedure incertaincases.Bankruptcyandsubsequentdissolution does notpreventtheauthoritiesfromrevivingdissolvent apply. Recentjurisprudencesuggeststhatdissolutionofacompany includes environmentalliabilities.Generalaccountingprinciples respect ofliabilitiesthatareknowntoariseinthefuture,whichalso As ageneralrule,balancesheetreservationsshouldbemadein 8.2 (2003/87/EC) throughthenational Emissions Trading Act Sweden hasimplementedtheEU Emission Trading Directive 9.1 water operationswhereliabilitytopaycostsoccursonappeal. under theEnvironmentalCode,withsomeexceptionsregarding No personisliableforcostsoccurringduringapermittingprocedure 8.6 environmental law. Penal orexemplarydamagesarenotrewardedunderSwedish requests onprohibitionofoperationsandprecautionarymeasures. Group actionsareavailableforenvironmentaldamageclaimsand 8.5 law. There isnoprotectionfor“whistle-blowers”underenvironmental 8.4 winning party. provisions, normallyleadingtothelosingpartycompensating Environmental litigationregardingdamagesissubjecttothegeneral 9 caused byaforeignsubsidiary/affiliate? order toescapeenvironmentalliabilities? market developingthere? pursuing environmentallitigation? damages available? report environmentalviolations/matters? Emissions Trading andClimateChange company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff your jurisdictionandhowisthe emissionstrading What emissionstradingschemes areinoperation any exemptionfromliabilitytopaycostswhen Do individualsorpublicinterestgroupsbenefitfrom environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing Are thereanylawstoprotect“whistle-blowers”who

Sweden

Asbestos is,whendisposedof,consideredhazardouswaste. greenhouse gasesbytheyear2045. Climate Change Act. The goalistoobtainzeronetemissionsof Government hasrecentlyproposedtheadoptionofacomprehensive United NationsFrameworkConventiononClimateChange. The impact ontheclimate. The goalissetupinaccordancewiththe One ofthegoalsSwedishenvironmentalpolicyistoreduce 9.3 produced inthecountry. record andestimatetheamountofgreenhousegasemissions Climate ChangeandtheKyotoProtocol,isthereforeobligedto Sweden isapartytotheUnitedNationsFrameworkConventionon There arenootherobligationsontheoperators.Regardingstate, 9.2 Swedish Energy Agency. regulations fromtheEnvironmentalProtection Agency andthe (2004:1199), theEmissions Trading Ordinance(2004:1205)andthe Wistrand LawFirm ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 also used,andmaycoversuddenunforeseenleakagesofoil persons’ orthirdparties’ property. Propertydamageinsurancesare liability topaydamagesforsuddenandunforeseen General andproductliabilityinsuranceprovidescoveragefor 11.1 general recommendationsconcerningasbestos(AFS2006:1)). rules (Swedish Work Environment Authority’s provisionsand asbestos isnotmandatory, butwhenremoved,issubjecttostrict The useofasbestosisprohibitedinSweden. The removalof 10.2 This isnotapplicableinSweden. 10.1 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 10 11 in relationtoasbestoson-site? jurisdiction? regulation inyourjurisdiction? to monitorandreportgreenhousegasemissions? risks insuranceplayinyourjurisdiction? What istheoverallpolicyapproachtoclimatechange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour Asbestos Environmental InsuranceLiabilities

to alimitedextent. recent years,insurancesolutionshavebeenusedduringtransactions exist, andwillcovergraduallyincurredenvironmentaldamage.In other liquids.Stand-aloneenvironmentalliabilityinsurancesalso windfarm, etc.,arealsoofimportance. sites arenotexclusivelydecisive;flightroutesandtheshapeof assessment oftheareamustbemade.Distancestoreproduction and batsinthearea. The Courthasdeclaredthatanoverall permitted locationsofwindfarmsinthecaseexistencebirds Finally, theCourthasdecidedonseveralcasesregarding is relatedtothecentralcommitmentsinagreement. However, thisonly appliesprovidedthattheenvironmentaldamage concerning environmentaldamagesinrelationsbetweentheparties. precedence overtheprovisionsinEnvironmentalCode In thesecondcase,Courtclarifiedthatanagreementtakes investigate theland. the ownerwasnotobligedtomakeinquiriesauthoritiesor due totherebeingnovisiblesignsofsuchactivityorotheractivity, of theactivityconductedbypreviousowneratpropertyand declared thatduetothefactownerdidnothaveknowledge the obligationforanownertomakeinvestigations. The Court Environmental Court(“Court”). The firstcaseisaboutthescopeof interest havebeenhandeddownbytheSuperiorLandand Regarding contaminatedland,twonewjudgmentsofprincipal and spreadofinvasivealienspecies. EU regulationonpreventionandmanagementoftheintroduction Further, legislative amendmentshavebeenmadetoimplementthe with theregulationregardingenvironmentalqualitystandards. considerations rules,maynotleadtoapermitthatisincompatible also requiresthatareasonabilitycheck,accordingtothegeneral environmental permitswillneedtobereviewed. This legislation environmental conditions”.Consequently, alarge numberof connected toproductionofhydroelectricpowermusthave“modern Directive (2000/60/EC)aremet. Accordingly, wateroperations that therequirementsaccordingtoEU Water Framework As of1January2019,newlegislationwillapplyaimingtoensure 12.1 insurance claimsarenotparticularlycommon. solutions. To ourknowledge,litigationsregardingenvironmental As describedabove,thereisamarketforenvironmentalinsurance 11.2 12 in environmentlawyourjurisdiction. experience inyourjurisdiction? summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a What istheenvironmentalinsuranceclaims Updates WWW.ICLG.COM Sweden

187 Sweden 188 Sweden Wistrand LawFirm © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM the firminvestsinunderstandingitsclients’ face. organisations,operatingcontextaswelltheopportunitiesandchallengesthey Wistrand drawsontherangeanddepthofitsexpertisetodevelopcommercial,effective providetailoredadvice, solutionsforitsclients.Inorderto Stockholm andGothenburg. Who’s WhoLegal Rudolf appearsin permitting procedures,includingtheSupremeCourt. practice, hehassuccessfullyrepresentedclientsinalltypesof manufacturing, papermillsandrockquarries.Duringhis23yearsof has in-depthknowledgeofindustrysectorssuchaswastehandling, natural gas,biogas,andwind,includingoff-shore windfarms.Healso inter alia Rudolf advisesontheenvironmentalaspectsofprojectsregarding, partner inWistrand’s energyandenvironmentaldepartmentin1999. and headsWistrand’s Environment&Energypractice.Hebecamea Rudolf Laurin(Partner)haspractisedenvironmentallawsince1994 in Swedenandinternationally. The firmisoneofSweden’sand of leading,full-servicebusinesslawfirmswithnearly200employees andpublicindustry Since itsfoundationin1915,Wistrandhasfocusedonprovidingqualitylegaladvicewithinallareasofcommerciallawtoprivate , powerandheatgenerationfrombiomass,peat,waste, . Expert Guides, URL: Email: Tel: Sweden 404 39Gothenburg Lilla Bommen1 Wistrand LawFirm Rudolf Laurin www.wistrand.se [email protected] +46 317712120 Chambers , The Legal500 ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 and

fices inboth Sweden

Chapter 27 Switzerland

Bär & Karrer Ltd. Prof. Dr. Markus Schott

1 Environmental Policy and its According to article 74 para. 3 BV, the Cantons are responsible for the implementation of the relevant federal regulations, except where the Enforcement law provides otherwise and determines that the Confederation is competent for implementation. This principle is replicated in article 36 USG. Accordingly, the Confederation supervises the execution of 1.1 What is the basis of environmental policy in your jurisdiction and which agencies/bodies administer environmental law by the Cantons and coordinates their activities and enforce environmental law? (article 38 para. 1 and 2 USG). In some areas, the federal government is itself responsible for the enforcement of environmental legislation, According to article 73 of the Federal Constitution (“BV”), the such as import and export of waste (article 41 USG). In general, the Confederation and the Cantons shall endeavour to achieve a Federal Council enacts the implementing provisions (article 39 para. balanced and sustainable relationship between nature and its 1 USG). capacity to renew itself, and the demands placed on it by the On the federal level, the Federal Office for the Environment (“BAFU”) population. Pursuant to article 74 BV, the Confederation is is generally responsible for the execution of environmental law, but responsible for the legislation on the protection of the population there are also some special agencies, which are competent in specific and its natural environment against damage or nuisance and it shall areas such as the Swiss Federal Nuclear Safety Inspectorate (“ENSI”). ensure that such damage or nuisance is avoided. The Cantons are In addition, each Canton has its own authority responsible for the primarily responsible for the execution of the relevant federal execution of environmental law. regulations, but they may also enact implementing rules where federal law so provides. The Federal Constitution contains further 1.2 What approach do such agencies/bodies take to the provisions regarding protection of the water, forests as well as enforcement of environmental law? natural and cultural heritage (articles 76, 77 and 78 BV). There are numerous acts and ordinances implementing the Switzerland has a rather strict approach to enforcing environmental constitutional mandate regarding environmental protection. The law. Apart from authorisations and inspections, the agencies also following acts are the most important: the Environmental Protection have the power to impose fines for various violations of Act (“USG”); the Ordinance on Avoidance and Disposal of Waste environmental law (article 61 USG). Severe violations may even be (“VVEA”); the Ordinance on Contaminated Sites (“AltlV”); the punished by a custodial sentence of up to three years (article 60 Chemicals Act (“ChemG”); the Act on Reduction of CO2 (“CO2 USG). Other sanctions include the order to discontinue illegal Act”); as well as the Nuclear Energy Act (“KEG”); and the activities, the re-establishment of the lawful conditions and the Ordinance on the Environmental Impact Assessment (“UVPV”). withdrawal of authorisations. The Swiss environmental policies and the implementation of environmental laws are based on the following main principles: 1.3 To what extent are public authorities required to ■ The “precautionary principle” (Vorsorgeprinzip) states that provide environment-related information to interested early preventive measures must be taken in order to limit persons (including members of the public)? effects which could become harmful or a nuisance (article 1 para. 2 USG). The authorities are obliged to inform the public adequately about ■ The “” (Verursacherprinzip) states that environmental protection and levels of environmental pollution any person who causes measures to be taken due to (article 10e para. 1 USG). If it is in the public interest, the endangering, polluting or causing damage to the environment authorities may also inform interested persons about the results of must bear the costs related to avoidance or clean-up (article 2 inspections and conformity-assessments, after having consulted the USG). persons concerned. Furthermore, any person has the right to inspect ■ The “principle of abatement of pollution at source” (Prinzip environmental information in official documents and information der Bekämpfung von Umweltbeeinträchtigungen an der relating to energy regulations that relate to the environment and to Quelle) that originates from the precautionary principle and states that environmental impact must be abated at its source. request information from the authorities about the content of these documents (article 10g para. 1 USG).

ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 WWW.ICLG.COM 189 © Published and reproduced with kind permission by Global Legal Group Ltd, London 190 Switzerland ultima ratio activities, andthere-establishment ofthelawfulconditions. As an can alsoconfiscateobjectsororder thediscontinuationofillegal custodial sentenceofthreeyearsor a monetarypenalty. The regulator Regulators canimposeafine,andtherearecriminalsanctionsupto 2.4 environmental protectionagenciesorderthenecessarymeasures. impact report.Basedonthisreportanditsowninvestigation,the environmental impactassessmentmustsubmitan construct ormodifyaninstallationthatissubjectto project orsite(article10a protection canonlybeensuredthroughmeasuresspecifictothe it isprobablethatcompliancewithregulationsonenvironmental cause substantialpollutiontoenvironmentalareas,theextentthat environmental impactassessmentappliestoinstallationsthatcould their impactontheenvironment. The requirementofan modification ofinstallations,thecompetentauthoritymustassess Before takinganydecisionontheplanning,constructionor 2.3 Federal SupremeCourtforviolationoffederallaw. tribunal hasdecided,itsdecisionmaybeappealedbeforethe violation oftheapplicablelaw. After theadministrative courtor possible toinvokeafalseestablishmentofthefactscaseor a federalauthorityimplementstheenvironmentallaw).Itis the environmentallaw)oratFederal Administrative Tribunal (if administrative court(incaseofCantonalauthoritiesimplementing appeal hastobedirectedeitheratthecompetentCantonal environmental permit,usuallywithinaperiodof30days. The There isapossibilitytochallengetherefusalorprovisionsofan 2.2 changes. These permitsgenerallyremaininplaceiftheownershipofobject cases, permitscanbelinkedtoanobject( transferable ( Usually, apermitisboundtoperson/companyandthereforenot ff. KEG,article9 specific substancesorspecialwaste(e.g.,article30eUSG,12 plants, aswellfortheplacingonmarketorhandlingof for constructionsortheoperationof,e.g.,landfillsnuclearenergy Environmental permitsarecommoninSwisslawandrequired 2.1 Bär &KarrerLtd. © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM

2 person toanother? permits? polluting industriesorotherinstallations/projects? contained inanenvironmentalpermit? Environmental Permits regulators haveinconnectionwiththeviolationof environmental permitsbetransferredfromone What enforcementpowersdoenvironmental Is itnecessarytoconductenvironmentalauditsor What rightsaretheretoappealagainstthedecisionof When isanenvironmentalpermitrequired,andmay environmental impactassessmentsforparticularly environmental permitorinrespectoftheconditions an environmentalregulatornottogrant , theregulatorscanrevokeenvironmental permits. personenbezogene Bewilligung ff. ChemG). ff. USG). Any personwhowishestoplan, sachbezogene Bewilligung ). However, insome

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3.2 as welllicencerequirementsforimportandexport. obligations forthehandlingofspecialwasteapply, suchasmarkings measures qualifiesasspecialwaste(article30fUSG). Additional Waste whoseenvironmentallycompatible disposalrequiresspecial USG) andmustbearthecostofitsdisposal(article32para.1USG). holds (article31cpara.1inconnectionwitharticle31b the waste. This personhasthedutytodisposeofwastethathe obligations. The ownerorholderiswhoeverhasactualcontrolover The ownerorholderofwastehastocomplywithanumberlegal biological modificationofthewaste)(article7para.6 transport, storageandtreatment(i.e.anyphysical,chemicalor in alandfill,aswellthepreliminarystagesofcollection, para. 6USG). The disposalofwasteincludesitsrecoveryordeposit or thedisposalofwhichisrequiredinpublicinterest”(article7 Waste isdefinedas“anymoveable materialdisposedofbyitsholder 3.1 environment lessthanotherforms ofdisposalandthemanufacture recovered ifthisiseconomically feasibleandharmsthe The FederalCouncilmayrequire certaintypesofwastetobe 3.4 initial holderaswell. of theappointedthirdpartyfallswithinresponsibility instances alsotheinitialholder. This isthecaseifwrongdoing party, asinterrupter, responsibleforsuchcosts,butinsome recovery measures(article2and59USG),notonlyisthethird it qualifiesasaninterrupter). As thepolluterhastobearcostsfor its obligations,itbecomesliablefortherecoverymeasures(because third partyqualifiesastheholderofwaste.Ifviolates it (article31cpara.1USG).Incaseofsuchexternaldisposal,the The holderofwasteisentitledtoinstructthirdpartiesdispose 3.3 environmentally compatibleprocessforitsdisposal(article30a manufacturers toavoidproductionwastewherethereisnoknown possible (article30para.1USG). The FederalCouncilmayrequire As aprinciple,theproductionofwasteshouldbeavoidedwherever operating alandfill(article30epara.2USG). The disposalofwasteonasiterequirespermitforsettingupand apply totheburningofnaturalforest,fieldandgardenwaste). waste mustnotbeburnedotherthaninincinerationplants(exceptions (article 30epara.1USG)and,accordingtoarticle30c2USG, USG). All otherwastemaybestoredanddisposedofonlyinlandfills 3 produced? waste involveadditionaldutiesorcontrols? regarding thetake-backandrecoveryoftheirwaste? bankrupt/disappears)? Waste and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore How iswastedefinedanddocertaincategoriesof To whatextentdowasteproducershaveobligations the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin Switzerland bis USG).

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for batteriesandelectricaldevices. glass, polyethyleneterephthalate(“PET”)andaluminium,aswell Act onNon-HumanGene Technology, “GTG”). USG) orofgeneticallymodifiedorganisms (article30oftheFederal activities, suchashandlingofpathogenicorganisms (article59a There arealsospecialliabilityprovisionsregardingspecific para. 3USG). the injuredpartyorofathirdisrelievedliability(article59a was causedbyforce majeure orbygrossnegligenceonthepartof intent. However, anypersonwhoprovesthatthelossordamage this threatmaterialises. There isnorequirementofnegligenceor liable forthelossordamagearisingfromeffects thatoccurwhen installation thatrepresentsaspecialthreattotheenvironmentis According toarticle59aUSG,theoperatorofanestablishmentor 4.1 obligations exist, of newproducts(article30dpara.1USG).Suchrecovery Bär &KarrerLtd. ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 may notbecoveredbyinsurance. There isalsoacriminallawliability ofdirectorsandofficers, which injury anddamagetoproperty. claims areexcludedfromtheD&Oinsurance,aswellpersonal against insuredpersons.Normally, intentandinternaldamage liability insurance(“D&Oinsurance”)coveringalldamageclaims personally liable.Itiscommontohavedirectors’ andofficers’ obligations regardingenvironmentalaffairs, hemaybecome negligent breachoftheirduties. Therefore, ifanofficer breacheshis bankruptcy) foranylossesordamagearisingfromintentional shareholders (andtothecompany’s creditorsincaseofits management, areliablebothtothecompanyandindividual Members oftheboard,aswellallpersonsengagedinbusiness interest ofthecompany. company isliableforallactivitiesofitsbodies,whichareinthe environmental wrongdoingofthecompanyitself.Furthermore, principle, directorsorofficers arenotsubjecttocivillawliabilityfor According toSwisscompanylaw, whichisbasedontheseparation 4.3 the applicableenvironmentallawandconditionsofpermit. been operatedortheactivityhascarriedoutwithinlimitsof the liabilityisnotexcludedifestablishmentorinstallationhas provide forastrictliability, thereisnopermitdefence.Consequently, Yes; astheapplicableliabilityprovisionsofenvironmentallaw 4.2 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 4 within permitlimits? what defencesaretypicallyavailable? indemnity protectioninrespectofsuchliabilities? Liabilities breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage inter alia , fordisposablepackagingconsistingof

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liability isexcluded. company caused. As longasthelenderdoesnotcausepollution, environmental wrongdoingand/orremediationcoststhatthe the separationprinciple,lendercannotbeheldliablefor In Switzerland,thereisnoconceptoflenderliability. According to 4.5 with thesellerdueto“polluterpays”principle. environmental damage. The liabilityforpreviouspollutionremains liable asthenewowneroflandorinstallationforanyforthcoming If apurchaseracquirestheassets(assetdeal),willbe is notaffected bythechangeofownership. costs duetothe“polluterpays”principle. The environmentalliability still remainsliablefortherecoveryofpollutionandcorresponding If aninvestoracquiresallsharesofacompany(sharedeal),thetarget 4.4 objectives havebeenachieved(article 19 AltlV). measures carriedoutanddemonstrate thattheremediation remediation measuresmustnotify the authoritiesofremediation remediation (article17 AltlV). Persons requiredtocarryout project ispreparedwithinatimeframe appropriatetotheurgency of The authoritiesrequirethatforcontaminatedsites,aremediation of remediation(article13para.2 AltlV). a reasonableperiodandthatthesitebemonitoreduntilcompletion authorities requirethatadetailedinvestigationbecarriedoutwithin For sitesthatareinneedofremediation(contaminatedsites),the shall beapplieduntilthereisnolongeranyneedformonitoring. become evident(article13para.1 AltlV). The monitoringmeasures detect arealdangerofharmfuleffects ornuisancesbeforethese monitoring plantobedrawnupandsuitablemeasurestaken For pollutedsitesinneedofmonitoring,theauthoritiesrequirea 7 and8 AltlV). are definedasinneedofneithermonitoring,norremediation(articles of airpollutionorthesoil. All otherinvestigatedsites to groundwaterprotection,protectionofsurfacewatersorprevention the pollutedsiteisinneedofmonitoringorremediationwithregard Based onapreliminaryinvestigation,theauthoritiesassesswhether remediation (article2para.3 AltlV). para. 2 AltlV). Contaminatedsitesarepollutedinneedof or wherethereisarealdangerthatsucheffects mayarise(article2 remediation arepollutedsitesthatcauseharmfuleffects ornuisance and accidentsites(article2para.1 AltlV). Sitesinneedof restricted areas. They comprisewastedisposalsites,industrialsites as siteswhosepollutionoriginatesfromwaste,andwhichare Contaminated SitesOrdinance,“AltlV”).Pollutedsitesaredefined accessible tothepublic(article32cpara.2USGandarticle5 Each Cantonisobligedtohavearegisterofpollutedsites,which 5.1 5 environmental wrongdoingand/orremediationcosts? the onehandandanassetpurchaseonother? groundwater? Contaminated Land To whatextentmaylendersbeliablefor environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman (including historiccontamination)ofsoilor What istheapproachtoliabilityforcontamination WWW.ICLG.COM Switzerland

191 Switzerland 192 Switzerland costs oftheexpectedmeasures. authorisation isgranted, according totheirshareofresponsibility(article32dpara.2USG). persons areresponsibleforthepollution,theybearcosts In accordancewiththe“polluterpays”principle,iftwoormore 5.4 have alegitimateinterestinitscancellationoralteration. previous proceedings,areparticularlyaffected bytherulingand Challenges bythirdpartiesarepossibleiftheytookpartinthe can requireadditionalworks(article19 AltlV). that theremediationmeasurescarriedoutwerenotsuccessful,they 18 AltlV). Iftheauthoritiesconcludeinevaluationofresults charges andconditionsfortheprotectionofenvironment(article assessment ofresultsandthetimeframetobeadheredfurther the remediation,remediationmeasures,aswell this assessmenttheyissuearulingdefiningthefinalobjectivesof The authoritiesassesstheremediationprojectandonbasisof 5.3 allocation ofcostsfromtheauthority(article32dpara.4USG). USG). Any oftheresponsiblepersonsmayrequestarulingon costs accordingtotheirsharesofresponsibility(article32dpara.2 para. 1USG).Iftwoormorepersonsareresponsible,theybearthe to investigate,monitorandremediatepollutedsites(article32d responsible forthepollutionbearscostsofmeasuresrequired (article 20para.2and3 AltlV). Fundamentally, theperson the detailedinvestigation,aswellremediationmeasures carry outthepreliminaryinvestigation,monitoringmeasuresor was causedbytheactionofthirdparties,theymayrequirethemto If theauthoritieshavereasontobelievethatpollutionofsite 5.2 20 AltlV). remediation projectandperformthemeasures(article require these,withtheapprovalofholder, topreparethe site wascausedbytheactionofthirdparties,authoritiesmay carried outbytheholderofpollutedsiteor, ifthepollutionof The investigation,monitoringandremediationmeasuresshallbe Bär &KarrerLtd. © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM by thecompetentauthorityisrequired (article32d located thatislistedintheregisterofpollutedsites,anauthorisation For thesaleordivisionofimmovablepropertyonwhichasiteis pollution. costs, whiletherestisallocatedtopersonwhocaused allocation. Usually, thesiteownerhastobearonly10–30%of para. 4USG)andcanappealitifhedoesnotagreewiththecost A privatepersoncandemandarulingregardingcosts(article32d is responsibleforthecontamination? contaminated landliabilitytoapurchaser? can athirdpartychallengetheagreement? possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis How isliabilityallocatedwheremorethanoneperson inter alia , ifsecurityisprovidedforthe bis USG).Such

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Gene Technology andarticle59a responsible community(article31Federal Act onNon-Human measures thatthesituationcallsfor, thedamagesareawardedto with afineofuptoCHF20,000. 61 USG,non-compliancewiththeseobligationscanbesanctioned conduct ofenquiries(article46para.1USG). According toarticle required toenforceenvironmentallawandconductortoleratethe Everyone isobligedtoprovidetheauthoritieswithinformation 6.1 object ofaright the destroyedordamagedenvironmentalcomponentsarenot components, ortoreplacethemwithcomponentsofequalvalue.If are takentorepairdestroyedordamagedenvironmental also reimbursethecostsofnecessaryandappropriatemeasuresthat organisms orpathogenicorganisms, theresponsiblepersonmust In caseofdamagecausedbythehandlinggeneticallymodified 5.5 surface waterorpreventionofair pollution orofthesoil. or remediationwithregardtogroundwater protection,protectionof authorities assesswhetherthepolluted siteisinneedofmonitoring accessible tothepublic.Basedonapreliminaryinvestigation, Each Cantonisobligedtohavearegisterofpollutedsites,which 7.2 significant impact. Cantonal notificationbodyofanyextraordinaryeventwhichhas or pathogenicmicroorganisms arecarriedout)havetonotifythe exceeded, orwherecertainactivitiesinvolvinggeneticallymodified thresholds forsubstances,preparationsorspecialwasteare (“StFV”), operatorsofcertainestablishments(e.g.where Based ontheOrdinanceProtectionagainstMajor Accidents (article 10USG). immediately reportanyextraordinaryeventtothecompetentagency seriously damagepeopleortheirnaturalenvironmentmust appliances, machines,vehicles,shipsandaircraft)thatcould fixed facilities,aswellmodificationsoftheterrainand Operators ofinstallations(i.e.buildings,traffic routesandother 7.1 6 7 conduct siteinspections,interviewemployees,etc.? public assets,e.g.rivers? contamination? parties? Powers ofRegulators Reporting /DisclosureObligations require productionofdocuments,takesamples, What powersdoenvironmentalregulatorshaveto polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson environmental regulatororpotentiallyaffectedthird migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe in rem oriftheeligiblepersondoesnottake bis para.9USG). Switzerland

such problemsinshareorassetpurchaseagreements. practice toincluderepresentationandwarrantyclausescovering compensation basedonthelawofsalescontracts.Itisalsostandard environmental problems,thepurchasermaybeabletoclaimfor seller failstoinformthepurchaseraboutanyexistingorsuspected environmental problemstoapotentialpurchaser. However, ifthe There isnoobligation,basedonenvironmentallaw, todisclose 7.3 for thenecessaryinvestigation(article32dpara.5USG). not tobeapollutedsite,thecompetentcommunitywillbearcosts has topayfortheinvestigation.Ifauthoritydeterminesland qualified asapollutedsiteandifmeasuresmustbetaken,thepolluter investigation, monitoringandremediationmeasures.Ifthelandis according toarticle20 AltlV, theholderofsitehastocarryout of landforcontaminationistriggeredbytheauthorities,but monitoring norremediation(article7and8 AltlV). The investigation All otherinvestigatedsitesaredefinedasinneedofneither Bär &KarrerLtd. ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 damage arisingfrom anyintentionalornegligentbreach ofhisduties. company’s creditorsincaseofitsbankruptcy) foranylossesor liable bothtothecompanyand the othershareholders(andto If ashareholderisengagedinthebusiness’s management,hemaybe principle isanabuseofrights. (Durchgriffshaftung) ispossibleifthecallingon separation circumstances, aso-called“piercing ofthecorporateveil” environmental wrongdoingofthecompanyitself.Undercertain principle, shareholdersarenotsubjecttocivillawliabilityfor According toSwisscompanylaw, whichisbasedontheseparation 8.3 claims havetobefulfilledbeforedissolutioncancompleted. as eithertheseareshiftedtothelegalsuccessor, ortherespective of thecompanyisnosolutiontoescapingenvironmentalliabilities, asset. However, itremainsliableasahistoricpolluter. Dissolution to asubsidiaryorothercompanybytransferringtherespective A company maytransferenvironmentalliabilitieslinkedtoanasset 8.2 modified orexcludedbywayofsuchagreement. indemnity. However, liabilityunderenvironmentallawcannot be It ispossibleforprivatepartiestoagreeonanenvironmental 8.1 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 8 potential liabilityforthatmatter? takeover transactions? caused byaforeignsubsidiary/affiliate? order toescapeenvironmentalliabilities? General prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto To whatextentisitnecessarytodisclose matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff Is itpossibletouseanenvironmentalindemnity company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent

community (article31GTGandarticle59a situation callsfor, thedamagesareawardedtoresponsible This rulealsoapplieswithregardtoassociations’ rightofappeal. rem damaged environmentalcomponentsarenottheobjectofaright to replacethemwithcomponentsofequalvalue.Ifthedestroyedor taken torepairdestroyedordamagedenvironmentalcomponents, reimburse thecostsofnecessaryandappropriatemeasuresthatare organisms orpathogenicorganisms, theresponsibleperson mustalso In caseofdamagecausedbythehandlinggeneticallymodified (articles 56and57USG). and havealegitimateinterestinhavingthemreversedoramended municipalities havearightofappealiftheyareaffected byaruling Cantonal authoritiesregardingenvironmentalmatters,andthe of appealunderfederalandCantonallawsagainstrulingsbythe Also, theFederalOffice fortheEnvironment(“BAFU”)hasaright Federal Act onNon-HumanGene Technology (“GTG”). organisms intendedforlawfuluseintheenvironmentbasedon authorisations forputtingintocirculationgeneticallymodified Protection ofNatureandCulturalHeritage(“NHG”),to rights ofappealrelatetodecisionsbasedontheFederal Act onthe pathogenic organisms (articles55and55fUSG).Otherassociations’ environmental impactassessmentortheplacingonmarketof organisations canappealprojectswhichneedtoundergo the Verbandsbeschwerde”). Forexample,nationalenvironmental specific projects(so-calledassociations’ rightofappeal,“ Environmental organisations areentitledtoappealdecisionsregarding liability provisionsworthmentioninginthiscontext. available. However, therearesomespecialrightsofappealand So far, therearenoclassactionsorpenalexemplarydamages 8.5 in thecontextofemploymentlaw. Swiss CodeofObligation,whichshouldregulatewhistle-blowing federal governmentiscurrentlypreparingadraftprovisionofthe So far, thereisnolawwhichprotects“whistle-blowers”. The 8.4 to the“cap-and-trade” principle. The quantity of emissionallowances The Swissemissionstradingscheme (“ETS”)isdesignedaccording 9.1 relating totheactionandonesincurredbyopposingparties. judicial proceedingsisthatthelosingpartymustbearcosts with regardtolitigationproceedings. The generalprinciplefor and liabilityforsuchfeesindividualsorpublicinterestgroups Swiss lawdoesnotprovideexemptionfromcostssuchascourtfees 8.6 9 oriftheeligiblepersondoesnottakemeasuresthat damages available? report environmentalviolations/matters? market developingthere? pursuing environmentallitigation? Emissions Trading andClimateChange environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing Are thereanylawstoprotect“whistle-blowers”who your jurisdictionandhowisthe emissionstrading What emissionstradingschemes areinoperation any exemptionfromliabilitytopaycostswhen Do individualsorpublicinterestgroupsbenefitfrom bis para.9USG). WWW.ICLG.COM Switzerland

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193 Switzerland 194 Switzerland technology fund. With the technologyfund,theConfederation standards aswellcompensation forCO2emissionsandthe greenhouse gasaretheCO2levy, emissionstrading,building on reducingSwitzerland’s domesticemissions. Measurestoreduce of limitingglobalwarmingtotwo degrees. The CO2 Act isfocused reducing greenhousegasesandcontributes totheinternationalgoal (e.g. theParis Agreement), Switzerland pursuesanactivepolicyon In additiontoitsparticipationinworldwideclimateprogrammes 9.3 billion. and thecompensationoffices. The annualrevenueisaboutCHF1 to thepublicandbusinesscommunitythroughhealthinsurers Around twothirdsoftherevenuefromCO2levyisredistributed purchases ofthermalfuels. has notbeenreached. The CO2levyisindicatedoninvoicesfor can increasetherateoflevyifinterimtarget forthermalfuels levy amountstoCHF96.00pertonneofCO2. The FederalCouncil biomass becausetheseenergy sourcesareCO2-neutral.In2018,the heat-power cogenerationplants.Nolevyisimposedonwoodand installations fortheproductionofelectricityoroperation thermal fuelsareusedtoproduceheat,generatelight,in oil, naturalgas,butnotmotorfuels). The levyisimposedwhenthe The CO2levyisimposedonallthermalfossilfuels(e.g.,heating exempt fromtheCO2levy. companies participateintheemissionstradingschemeandarealso commit toreducingemissionsinreturn.Large energy-intensive intensive companiescanbeexemptedfromtheCO2levyifthey more carbon-neutralorlowcarbonenergy sources.Energy- it createsanincentivetousethemmoreeconomicallyandchoose has beenleviedsince2008.Inmakingfossilfuelsmoreexpensive, levy oncombustiblefossilfuels,suchasheatingoilandnaturalgas, a keyinstrumenttoachieveCO2emissiontargets. This steering There istheso-calledCO2levyonthermalfuels. The CO2levyis 9.2 trade system(“EU-ETS”)sothatthetwosystemscanbeconnected. The ETSisorganised tobecompatiblewiththeEuropeanemission in theETS(“opt-in”). defined inannex7oftheCO2Ordinance)mayvoluntarilyparticipate between 10and20MW thatareengagedinaspecificactivity(as obligation (“opt-out”).Companieswithaninstalledcapacityof year, thecompanycanapplyforanexemptionfromETS in thepreviousthreeyearsarebelow25,000tonnesofCO2each the Swissemissionstradingscheme.Ifacompany’s totalemissions defined inannex6oftheCO2Ordinance)areobligedtoparticipate tradable (“trade”).Companiesthatexercisespecificactivities(as are allocatedfreeofcharge annuallytoETScompaniesandare emission allowancesneededforgreenhousegas-efficient operation been reducedeachyearby1.74%oftheinitial2010quantity. The (“cap”). This capwas5.63milliontonnesofCO2for2013andhas determined inadvance,representingthemaximumquantityavailable available islimited. The totalquantityofemissionallowancesis Bär &KarrerLtd. © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM and shouldenterintoforcenolaterthan2020. in November2017. The treatyissubjecttoratificationbybothsides technical negotiationswereconcludedandtheagreementwassigned beneficial forbothenvironmentalpolicyandtheeconomy. The Linking theSwissandEUCO2emissionsmarketswouldbe regulation inyourjurisdiction? to monitorandreportgreenhousegasemissions? What istheoverallpolicyapproachtoclimatechange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned

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workers havetobe protectedadequately, whichmaybecostly. Obligations). Also, ifabuildingisrenovated ordemolished,the liability ofpropertyowners(article 58oftheSwissCode obliged torenovate,otherwisethe ownerbecomesliableduetothe threatened duetoreleasedfibres. Ifthisisthecase,owner containing asbestosfrombuildings unlessthehealthofpeopleis So far, ownersofpremisesarenotobligedtoremovematerials 10.2 force. Council hasyettodecidewhentherevisedprovisionswillenterinto out ofasbestosdamagesshallbeextendedto20years. The Federal of limitation. Accordingly, thelimitationperiodforclaimsarising Parliament hasrecentlypassedarevisionoftheapplicablestatutes decision oftheECHRandadapteditspractice. The Federal come intoexistence. The Federal SupremeCourtacceptedthe claims forlatedamagesmaybecometime-barredbeforetheyeven section 1oftheEuropeanConventiononHumanRightsbecause 2014 thatthelimitationperiodofonly10yearsviolatesarticle6 the EuropeanCourtofHumanRights(“ECHR”)decidedinMarch years afterthe(last)breachofemploymentcontract.However, be broughtbeforecourtbecausetheclaimbecomestime-barred10 10 ormoreyearsafterworkinginanasbestosenvironmentcannot case lawoftheFederalSupremeCourt,healthdamageswhichoccur contract byexposureoftheworkerstoasbestos). According tothis reference dateoftheinfringement(e.g.violationemployment start fromtheoccurrenceofloss(e.g.disease)but Federal SupremeCourtdecidedthatthelimitationperioddoesnot concerning thelimitationperiodofasbestosclaims.In2010, in theUS.However, therehavebeenanumberofproceedings any waycomparabletotheextentofasbestoslitigationtakingplace Switzerland doesnothaveanasbestoslitigationindustrythatisin 10.1 January 2018. in areferendumbytheSwisspeople,anditenteredintoforceon1 September 2016.InMay2017,thenewEnergy Act wasapproved respective statutewasadoptedbytheFederalParliamentin potentials ofhydropowerandnewrenewableenergy sources. The existing energy efficiency potential,andonthebalanceduseof Council’s newstrategyfocusesontheconsistentexploitationof based onthenewenergy perspectives.Essentially, theFederal developed along-termenergy policy(“Energy Strategy2050”) replaced bynewones.Inthisrespect,theFederalCouncilhas they reachtheendoftheirsafeservicelife,andwillnotbe existing fivenuclearpowerplantsaretobedecommissionedwhen Fukushima andtostrengthentheamountofrenewableenergy. The nuclear energy onastep-by-stepbasisasreactiontotheincidentin In 2011, theSwissgovernmentdecidedtowithdraw fromtheuseof the FederalParliament. obligations. The revisedCO2 Act iscurrentlyunderdiscussionin under revisioninordertoimplementthenewinternational linkage oftheSwissETSwithEUETS,CO2 Act iscurrently and increaseenergy efficiency. DuetotheParis Agreement andthe consumption ofresources,increasetheuserenewableenergies, promotes innovationsthatreducegreenhousegasorthe 10 in relationtoasbestoson-site? jurisdiction? What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour Asbestos Switzerland

environmental insuranceclaimsinSwitzerland. To ourknowledge,therearenoknowncourtcasesregarding 11.2 claims againstthecompany. of thesoilorwaterotherenvironmentaldamagethatathird-party chemicals. These policiesprotectagainst,forexample,contamination particularly forcompaniesinthebuildingindustryorhandling Environmental insurancepoliciesareverycommoninSwitzerland, 11.1 Bär &KarrerLtd. ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 requirements whicharedefinedbytheFederalCouncil. the Swissmarketiftheymeetcertainecologicalorsocial allowed todesignatesuchbiogenicfuelsthatmayonlybeplacedon conditions isplacedontheSwissmarket,FederalCouncilnow If asubstantialamountofbiogenicfuelsthatdonotmeetcertain On 1 August 2016,apartialrevisionoftheUSGenteredintoforce. discussed togetherintheFederalParliament2018. revision oftheCO2 Act andtheSwiss-EUagreementwillbe regarding thelinkageofbothETStoFederalParliament. The revision oftheCO2 Act anditsreportontheSwiss-EUagreement In December2017,theFederalCouncilpresenteditsreporton ratified theParis Agreement. following theapprovalbyFederalParliament,Switzerlandhas global temperaturerisetofewerthantwodegrees.InOctober2017, climate summitCOP21inParis. This agreementaimstolimitthe an agreementconcerningtheinternationalclimatepolicyat On 12December2015,Switzerlandand194othercountriespassed 12.1 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London market leadersintheirjurisdictions. whichareall broad experiencehandlingcross-borderproceedingsandtransactions.Our extensivenetworkconsistsofcorrespondentlawfirms, multinational corporations to private individuals in Switzerland and around the world. Most of our work has an international component. W multinational corporationstoprivateindividualsinSwitzerlandandaround the world.Mostofourworkhasaninternationalcomponent. rangefrom on innovativeandcomplextransactionsrepresentingtheminlitigation, arbitrationandregulatoryproceedings.Ourclients ourclients Bär &KarrerisarenownedSwisslawfirmwithmorethan150lawyersinZurich, Geneva,LuganoandZug.Ourcorebusinessisadvising 12 11 in environmentlawyourjurisdiction. experience inyourjurisdiction? risks insuranceplayinyourjurisdiction? What istheenvironmentalinsuranceclaims in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a Updates Environmental InsuranceLiabilities

and protocolsintheenvironmentalfield. central instrumentforfinancingandimplementingtheconventions 147m arededicatedtotheGlobalEnvironmentFund(“GEF”),a environment. The majorityofthetotalfundsamountingtoCHF environmental fundsinordertosupporttheprotectionofglobal regarding Switzerland’s financialcontributionstointernational On 5September2018,theFederalCouncilreleaseditsreport entered intoforceon1January2018. step oftheimplementation“Energy Strategy2050”and in apopularreferendum. The revisedEnergy Act marksthefirst On 21May2017,theSwisspeopleapprovedrevisedEnergy Act growing ofGMOwouldbepossible. creation ofgrowingareasforGMOinwhichtheconcentrated regarding thecoexistenceofGMOandnon-GMOaswell adopt theFederalCouncil’s proposalforalegalframework for anotherfouryears.However, theFederalParliamentdidnot genetically modifiedorganisms (“GMO”)foragriculturalpurposes GTG. Inessence,therevisedGTGextendsmoratoriumtogrow On 16June2017,theFederalParliamentadoptedarevisionof degree fromHarvardLawSchool. degree fromtheUniversityofBaselandaMasterLaws(LL.M.) Universities ofBaselandNeuchâtel.HeholdsaDoctorLaws(Dr. iur.) publishes regularlyinhisfieldsofinterest.Markusstudiedlawatthe He teachespubliceconomiclawattheUniversityofZurich,andhe well asinternationaladministrativeandlegalassistanceproceedings. representing clientsinadministrativeandcivillawcourtproceedings,as expert opinionsinthesefields.Markusisalsospecialised insurance, transportationandinfrastructuresectors.Healsodrafts represents clientsinthelifescience,food,banking,financeand public procurement,andadministrativesanctions.Headvises and administrativelawmatters,includinggovernmentalsupervision, Prof. Dr. MarkusSchotthasbroadexperienceinallkindsofregulatory URL: Email: Tel: Switzerland 8027 Zurich Brandschenkestrasse 90 Bär &KarrerLtd. Prof. Dr. MarkusSchott www.baerkarrer.ch [email protected] +41 582415477 WWW.ICLG.COM Switzerland e have

195 Switzerland Chapter 28 Uganda Fred Businge Kiiza

Katende, Ssempebwa & Co. Advocates Edwin Buluma Wabwire

1 Environmental Policy and its environment through education and outreach programmes and to also prepare a District State of the Environment Report every year. Enforcement

2 Environmental Permits 1.1 What is the basis of environmental policy in your jurisdiction and which agencies/bodies administer and enforce environmental law? 2.1 When is an environmental permit required, and may environmental permits be transferred from one The basis for the environmental policy in Uganda is to ensure that person to another? all people living in the country enjoy the fundamental right to an environment adequate for their health and well-being while The question of transferability of an environmental permit is conserving the environment and natural resources of Uganda dependent on the conditions of the permit itself. In practice, most equitably and for the benefit of both present and future generations, permits are transferable upon seeking written approval from NEMA taking into account the rate of population growth and the and payment of transfer fees of UGX 300,000 (=USD 80). The productivity of the available resources respecting the principle of owner of the permit must be compliant with the conditions of the optimum in the use of natural resources. The permit before a transfer can be permitted. Environmental Law is enforced by the National Environment Management Authority (“NEMA”) under the National Environment 2.2 What rights are there to appeal against the decision of Act, CAP 153 of the Laws of Uganda. an environmental regulator not to grant an environmental permit or in respect of the conditions contained in an environmental permit? 1.2 What approach do such agencies/bodies take to the enforcement of environmental law? NEMA has a duty to inform an aggrieved person of his/her right to NEMA usually enforces environmental law by filing an action in appeal to the High Court against any decision. court for an Order against any person whose activities or omissions have or are likely to have a significant impact on the environment, 2.3 Is it necessary to conduct environmental audits or to prevent, stop or discontinue any act or omission deleterious to the environmental impact assessments for particularly environment, or requiring that any ongoing activity be subjected to polluting industries or other installations/projects? environmental monitoring. In Uganda, it is a legal requirement for a Project Developer to undertake an Environmental Impact Assessment where the Lead 1.3 To what extent are public authorities required to provide environment-related information to interested Agency in consultation with NEMA is of the view that the project persons (including members of the public)? may have an impact on the environment, is likely to have a significant impact on the environment or will have a significant NEMA has a function to promote public awareness through formal, impact on the environment. Where the project requires an non-formal and informal education about environmental issues, environmental impact study, after completing the study, the undertake research and disseminate information about the developer is required by law to make an environmental impact environment once every two (2) years for both public and private statement. In executing the project, the developer is required to take users. NEMA can delegate any of these functions to a Lead Agency, all practicable measures to ensure that the requirements of the a Technical Committee, the Executive Director of NEMA or any environmental impact statement are complied with. Owners of other Public Officer. A Lead Agency mentioned herein means any premises/operators of projects for which an environmental impact Government Ministry, Department, Parastatal Agency, Local statement has been made, are required to keep records and also Government or Public Officer in which or in whom any law vests make annual reports to NEMA describing how far the project functions of control or management of any segments of the conforms in operation with the statements made in the environment. NEMA is also assisted by the District Environment environmental impact statement. In case of undesirable effects not Committee and the Local Environment Committee, which are contemplated in the environmental impact statement, the law required to promote the dissemination of information about the requires the owner of the premises/operator of a project to take all

196 WWW.ICLG.COM ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 © Published and reproduced with kind permission by Global Legal Group Ltd, London addition totheEnvironmentalRestorationOrder. promotes theprotectionorimprovementofenvironment,in in addition,requiretheoffender todocommunityworkwhich permit, orotherauthorisationsmadeunderthelaw. The Courtmay, Court isempoweredtomakearecancellationofthelicenceor be bornebytheaccused. The otheradditionalOrderswhichthe State andbedisposedofasCourtdirectsthecostdisposalto appliance usedinthecommissionofoffence beforfeitedtothe Court haspowerstoorderthatthesubstance,equipmentand more thanUGX3,000,000(=USD803)ortoboth.Inaddition,the months ortoafineofnotlessthanUGX30,000(=USD8)and conviction toimprisonmentforatermofnotlessthanthree(3) which nootherpenaltyisspecificallyprovidedliableon Generally, anypersonwhocontravenesprovisionofthelawfor (=USD 3,214)ortoboth. UGX 120,000(=USD32)andnotmorethan12,000,000 a termnotexceedingtwelve(12)monthsortofineoflessthan commits anoffence andisliableonconvictiontoimprisonmentfor comply withanenvironmentaleasementissuedunderthelaw, Environmental RestorationOrdermadeunderthelaw;or(b)failsto In addition,anypersonwho:(a)failsorrefusestocomplywithan competent jurisdiction. of thatpowerasacivildebtfromtheculpritinanycourt fit andrecovertheexpensesnecessarilyincurredbyitinexercise that Orderrelates,andotherwisetoenforceasmayseem entitled totakeallnecessaryactioninrespectoftheactivitywhich Restoration Orderfails,refusesorneglectstotakeaction,NEMA is decision ismade.IfthepersonservedwithanEnvironmental Restoration Ordertheopportunitytobeheardorallybeforea the personwhohasrequestedareconsiderationofanEnvironmental Environmental RestorationOrder. ItismandatoryforNEMA togive reconsideration ofthecase,confirm,vary, suspendorwithdrawthe writing, torequestNEMA toreconsider. NEMA may, after person hasaright,withintwenty-one(21)days,bygivingreasonsin Environmental RestorationOrderhasbeenissued,theaffected has nodutytohearthepersonbeinginvestigated.However, oncean decision tobemadeonanEnvironmentalRestorationOrder. NEMA scientific advicewhichitconsiderstobedesirableforasatisfactory powers toseekandtakeintoaccountanytechnical,professional or nottoserveanEnvironmentalRestorationOrder. NEMA alsohas the evidenceobtainedfrominspectioninanydecisiononwhether that activityisharmfultotheenvironment,andmaytakeintoaccount inspect orcausetobeinspectedanyactivitydeterminewhether The ExecutiveDirectorofNEMA haspowerstoenteranyland 2.4 submit theauditreportstoNEMA. premises isrequiredtocarryoutannualenvironmentalauditsand contemplated intheenvironmentalimpactstatement. An ownerof reasonable measurestomitigateanyundesirableeffects not Katende, Ssempebwa&Co.Advocates ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 matter, whetherliquid,solid,gaseous,orradioactive, whichis Waste isdefinedtoincludeanymatterprescribedbewasteand 3.1 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 3 permits? waste involveadditionalduties orcontrols? Waste regulators haveinconnectionwiththeviolationof What enforcementpowersdoenvironmental How iswastedefinedanddocertain categoriesof

3.2 handed toanunlicensedoperator. take-back andrecoveryofwaste isonlyapplicablewhereit obligation totakebackorrecover the saidwaste. The obligation of of awastetreatmentordisposalsiteplant,he/shehasno Once aproducerofwastehashandeditovertolicensedoperator 3.4 is notlicensedtooperateawastetreatmentordisposalsiteplant. waste, theirliabilityceasesunlesstheentitytowhichitishanded transfers ittoanotherpersonwhoislicenseddisposeofortreatthe state intotheenvironment.However, oncetheproducerofwaste consultation inNEMA beforeitisdischarged ordisposedofinany facility andinamannerapprovedbytheLead Agency in A producer ofwasteisunderadutytotreatanyintreatment 3.3 who contravenessuchadutycommitsanoffence. of wastethroughtreatment,reclamationandrecycling. Any person generate wasteisrequiredtoemploymeasuresfortheminimisation person ordamagetotheenvironment. A personwhoseactivities direction insuchamannerthathe/shedoesnotcauseillhealthtothe activities ortheofthosepersonsworkingunderhis/her A person hasthedutytomanageanywastegeneratedbyhis/her composition ormannerastocauseanalterationoftheenvironment. discharged, emittedordepositedintheenvironmentsuchvolume, UGX 36,000,000(=USD9,662)ortoboth. fine ofnotlessthanUGX360,000(=USD96)andmore imprisonment foratermofnotlessthanthirty-six(36)monthsor substances, commitsanoffence andisliableonconvictionto (i) aidsorabetstheillegaltraffic inwastes,chemicalsorradioactive the managementofwastes,chemicalsorradioactivesubstances; chemicals orradioactivesubstance;(h)withholdsinformationabout waste contrarytothelaw;(g)knowinglymislabelsanywaste, accordance withthelaw;(f)disposesofanychemicalorhazardous with thelaw;(e)failstomanageanyradioactivesubstancein contrary tothelaw;(d)failsmanageanychemicalinaccordance which hasnotbeendeterminedashazardouswastewithoutapermit imports anyhazardouswastecontrarytothelaw;(c) fails tomanageanyhazardouswasteinaccordancewiththelaw;(b) licence giventohimorhercommitsanoffence. Any personwho:(a) Regulations madeinUgandaortoanyconditionsspecifiedthe environment withoutalicenceissuedbyNEMA orcontrarytoany or amixturecontainingoilintoanywatersothersegmentofthe person whodischarges anyhazardouswaste,substance,chemical,oil prescribed byNEMA inconsultationwiththeLead Agency. Any segment oftheenvironmentexceptinaccordancewithguidelines chemical, oilormixturecontaininginanywatersother No personisallowedtodischarge anyhazardoussubstance, regarding thetake-backandrecoveryoftheirwaste? bankrupt/disappears)? produced? and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore To whatextentdowasteproducershaveobligations the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin

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197 Uganda 198 Uganda required uponwritten instructionsfromtheExecutive Directorof A generatorofwaste(whichhasbeencharacterised ashazardous)is officers. would accruetothecompanyandnot personallytoitsdirectorsand/or person”, whichdefinitionincludesa company. The liabilitytherefore environmental penaltiesprescribed underthelawareagainst“a depends onthepenaltyprescribedunderrelevantlaw. Mostofthe The personalliabilityofdirectorsandofficers ofcorporations 4.3 largest burdeninpayingfor cleaning theenvironment. i.e. thepersoncontributinggreateramountofpollutionbears operator willbeliableonthebasisof“polluterpays”principle, standards prescribedbylaw, theoperatorcanbeheldliable. The In theeventthatpollutingactivityexceedspermitlimitsor with thepollutionlicence. standards orguidelinesprescribedunderthelawexceptinaccordance which islikelytopollutetheair, waterorlandinexcessofany permit limits. The lawforbidsanypersontocarryoutactivity notwithstanding thatthepollutingactivityisoperatedwithin Yes, theoperatorcanstillbeliableforanyenvironmentaldamage 4.2 he/she hascompliedwiththelaw. comply withtheLaw. Itisthereforeadefenceforonetosaythat Regulations, takesintoaccountthemeasurestakenbythatpersonto The Court,inconvictingapersonofanoffence underthe necessary measuresandotherremedialrestorationmeasures. storage facility, motorvehicleorvesseltomeetthecostsoftaking taken, NEMA may, uponaCourtOrder, disposeoftheproductionor reasonable timeinallcircumstances,thenecessarymeasuresarenot seize theproductionfacility, motorvehicle,vessel,etc.If,aftera If thesaidprescribedmitigationmeasuresarenottaken,NEMA may as NEMA may, fromtimetotime,prescribe. best availableclean-upmethods;andcomplyingwithsuchdirections officers; immediatelybeginningtheclean-upoperationsusing immediate noticeofthedischarge toNEMA andotherGovernment is requiredtomitigatetheimpactofdischarge by:giving vehicle orvesselfromwhichadischarge occurscontrarytothelaw, The owneroroperatorofaproductionstoragefacility, motor compensation asmay, fromtimetotime,bedeterminedbyNEMA. third partiesintheformofreparation,restoration,restitutionor damaged ordestroyedasaresultofthedischarge; andthecostsof Government Agency ororgan intherestorationofenvironment of theremoval,includinganycostswhichmaybeincurredby in additiontoanyothersentenceimposedbytheCourt–paycost chemical, oiloramixturecontainingintotheenvironmentmay– Upon conviction,thepersondischarging ahazardoussubstance, 4.1 Katende, Ssempebwa&Co.Advocates © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 4 what defencesaretypicallyavailable? indemnity protectioninrespectofsuchliabilities? within permitlimits? Liabilities to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa

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5.1 so farastheenvironmentisconcerned. lending institutionsandtheirclientswhereliabilitiesareincurredin The EnvironmentalLawissilentabouttherelationshipbetween 4.5 liability. if theliabilityisoncompany, thebuyerofsharestakeson buyer ofthesharestakeswithoutliability. However, sells his/hershares,theliabilityremainswithindividualand liability toanindividualandpenalinnature. Where anindividual Most oftheoffences undertheEnvironmentalLawareofastrict 4.4 bear thelargest burdeninpayingforcleaning theenvironment. the personcontributinggreater amount ofpollutionisrequiredto In allocatingliability, NEMA usesthe“polluterpays”principle,i.e. 5.2 compensation asisspecifiedintheOrder. (h) depositwasteinaplacespecifiedtheOrder;or(i)paysuch remove anywasteorrefusedepositedonlandspecifiedintheOrder; the environmentcontiguoustolandspecifiedinOrder;(g) fauna in,on,underoraboutthelandspecifiedinOrder the landorenvironment,aquifersbeneathandflora the environmentortoamenitiesofarea;(f)preventdamage environmental hazard;(e)removeoralleviateanyinjurytoland is causingormaycausecontributetopollutionan cause ofanenvironmentalhazard;(d)ceasetotakeanyactionwhich take suchactionaswillpreventthecommencement,continuationor the landorareacontiguoustospecifiedinOrder;(c) be, ofoutstandinggeological,archaeologicalorhistoricalfeatures replanting oftreesandotherfloratherestoration,asfarmay pollution; (b)restoreland,includingthereplacementofsoil, action aswillpreventthecommencement,continuationorcauseof may alsorequirethepersononwhomitisservedto:(a)takesuch The saidImprovementNoticeorEnvironmentalRestorationOrder which isthesubjectofOrder. whose environmentorlivelihoodhasbeenharmedbytheaction awarding compensationtobepaidbythatpersonotherpersons would orisreasonablylikelytodoharmtheenvironment;(c) the Order;(b)preventingpersonfromtakinganyactionwhich which itwasbeforethetakingofactionissubject person torestoretheenvironmentasnearitmaybestatein Restoration Orderforthefollowingpurposes:(a)requiring NEMA mayissueanImprovementNoticeorEnvironmental The approachgenerallyisforimprovementand/orrestorationfirst. that waste. NEMA, tosubscribeaninsurancePolicycoverriskscausedby 5 environmental wrongdoingand/orremediationcosts? the onehandandanassetpurchaseonother? is responsibleforthecontamination? groundwater? Contaminated Land (including historiccontamination)ofsoilor What istheapproachtoliabilityforcontamination To whatextentmaylendersbeliablefor environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman How isliabilityallocatedwhere morethanoneperson

Uganda

environment orland. have beenharmedorintheenvironmentlandcontiguoustosuch or interestin,theproperty, intheenvironmentorlandallegedto It isnotnecessaryforathirdpartytoshowthathe/shehadrightof, harmed, isharmingorreasonablylikelytoharmtheenvironment. an EnvironmentalRestorationOrderagainstanypersonwhohas Environmental Law, anypersoncanbringanactioninCourtseeking A thirdpartycanchallengethesaidagreementsinceunder involved, itcanimposemoreobligations. remediation agreedupondoesnotcoveralltherisksanticipated/ If NEMA establishesthattheprogrammeofenvironmental 5.3 pollution. environment bycharging smallerfeesforactivitiesthatreduce Licence Feesareusedtopromotebehaviourthatconservesthe Katende, Ssempebwa&Co.Advocates ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 the polluterisliable toimprisonmentforaterm notexceeding The LawallowsNEMA toprosecutethe polluterandiffoundguilty, Operator hasbecomeahabitualoffender. issued undertheEnvironmental Law, ifitissatisfiedthatthe provisions oftheEnvironmentalLaw andcancelapollutionlicence responsible forenvironmentalpractice thatisinbreachofthe confiscate thedepositbondifitissatisfiedthatOperator NEMA may, aftergivingtheOperatoranopportunitytobeheard, as securityforgoodenvironmentalpractice. a refundabledepositbondintheNationalEnvironmentFundtoact This requirestheoperatorsofsuchindustriesoractivitiestodeposit with goodenvironmentalpractice. the environmentwhenoperatedinamannerthatisnotconformity which haveoraremostlikelytoasignificantadverseeffect on to identifyandcreatearegisterforactivitiesindustrialplants According totheenvironmentallawsofUganda,NEMA isrequired 5.5 company toanother, orwithachangeofownershiptoanother. liability caneasilybetransferredwiththesaleofsharesin However, incase theliabilityisonalimitedcompany, the offences andthereforenoteasilytransferable. environmental offences arepenalinnature,strictliability This thereforemeansthattheprivaterightexistssincemost environment orland. harmed orintheenvironmentlandcontiguoustosuch in, theproperty, intheenvironmentorlandallegedtohavebeen not necessaryforhimtoshowthathe/shehadarightof,orinterest Order againstanypersonwhohasharmedtheenvironment,anditis bring anactioninCourtseekingEnvironmentalRestoration According totheenvironmentallawsofUganda,anypersoncan 5.4 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London contaminated landliabilitytoapurchaser? can athirdpartychallengetheagreement? public assets,e.g.rivers? regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma Does apersonhaveprivaterightofactiontoseek

the decisiontakenbyNEMA. the Operatorisnotsatisfied,he/shecanappealtoCourtagainst (=USD 48)andnotmorethanUGX18,000,0004,822).If eighteen (18)monthsortoafineofnotlessthanUGX180,000 Law. for thepurposeofmonitoringcompliancewithEnvironmental at anytime,installequipmentonland,premisesorvehicle In additiontotheabove,anEnvironmentalInspectorhaspowersto, under theEnvironmentalLaw. arrest anypersonwhomhe/shebelieveshascommittedanoffence deleterious totheenvironment;and(h)causeaPoliceOfficer to manufacturing plantorotheractivitytoceaseanyactivities weeks; (g)issueanimprovementnoticerequiringtheoperatorofany to pollutetheenvironment,foraperiodofnotmorethanthree(3) any manufacturingplantorotheractivitywhichpollutesislikely commission ofanoffence againsttheEnvironmentalLaw;(f)close any otherthingwhichhe/shebelieveshasbeenusedinthe impact ontheenvironment;seizeanyplant,equipment,substanceor distribute oruseanysubstancesthatarelikelytohaveasignificant manufacture, produceasby-products,import,export,store,sell, with; (e)carryoutperiodicinspectionsofallestablishmentswhich examinations andinquiriestodiscoverwhetherthe Act iscomplied substance andsubmitthemfortestsanalysis;(d)make management ofnaturalresources;(c)takesamplesanyarticleor and otherdocumentsrelatingtotheenvironment production of,inspect,examineandcopylicences,registers,records, provisions oftheLawarebeingcompliedwith;(b)require to: (a)enteranyland,premisesorvehicletodeterminewhetherthe Law, withoutawarrantbutaftersuitablyidentifyinghimself/herself, Environmental Inspectorshavepowersunderthe the preparationofstateenvironmentreport. annually, whichisrequiredtokeepthemanduseasabasisfor addition, therecordsaresupposedtobetransmittedNEMA Committee, theBoardorPolicyCommitteeuponrequest.In availed totheEnvironmentalInspector, DistrictEnvironmental It isalegalrequirementthatrecordswhicharekept,bylawtobe that person,theprovisionsoflawhavebeencompliedwith. the activityonenvironment;and(d)howfar, intheopinionof monetary valueoftheproductperyear;(c)observableeffects of economic valueoftheactivityonareacovered,expressedin the activity;(b)extentofhis/heractivities,indicating records of:(a)theamountofwasteandby-productsgeneratedby have asignificantimpactontheenvironmentisrequiredtokeep Every personwhocarriesonanyactivitywhichhasorislikelyto 6.1 biannual reportson theconductoflicensedactivity toNEMA. A personlicensedtocarryoutanyactivity isrequiredtosubmit 7.1 6 7 conduct siteinspections,interviewemployees,etc.? parties? Powers ofRegulators Reporting /DisclosureObligations require productionofdocuments,takesamples, What powersdoenvironmentalregulatorshaveto environmental regulatororpotentially affectedthird migrating off-site,mustitbedisclosed toan If pollutionisfoundonasite,or discoveredtobe

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199 Uganda 200 Uganda an unsecuredcreditor. up, NEMA canclaimfortheunpaidfines andmonetarypenaltiesas escape environmentalliabilities.If acompanyisdissolved/wound A companycanbedissolved/woundup forotherreasonsexceptto UGX 18,000,000(=USD4,822). a fineofnotlessthanUGX180,000(=USD48)andmore assessment toimprisonmentofnotlessthantwelve(12)monthsor to anenvironmentalaudit,impactstudyor would thereforebeliablewherehe/shealtersanyrecordnotlimited who fraudulentlyaltersanyrecordasrequiredbythelaw. A person The NationalEnvironment Act prescribesapenaltyforanyperson 8.2 discharges theindemnifier’s potentialliabilityforthematter. payment madebytheindemnifierinrespectofremediation exposure foractualorpotentialenvironment-relatedliabilities. A It isthereforepossibletousetheenvironmentalindemnitylimit of theactivityforwhichlicenceisrequired. subscribe toaninsurancepolicycoveringtheriskslikelyariseout which hasbeencharacterisedashazardousisunderanobligationto Under theenvironmentallawsofUganda,ageneratorwaste 8.1 environmental issuesoftheseller. to ascertaincompliancewithenvironmentallawsordiscloseany due diligencewithNEMA priortoamerger ortakeovertransaction, However, asaprecautionary measure,apurchasernormallyconducts environmental problemsinthecompany. merger and/ortakeovertransactionsisobligedtodisclose silent onwhetherasellertoprospectivepurchaserinthecontextof Both theEnvironmentalLawandCompanies Act ofUgandaare 7.3 has arighttotakeactionagainsttheoffender atanytime. the provisionsoflawarebeingviolated,anypersonisfreeand When theenvironmentisbeingpollutedorlikelytobe 7.2 a mustunderthelaw. over thesubmissionofbiannualreports. Therefore, disclosureis licence grantedunderthelaw, thoseprocedurestakeprecedence Where specialreportingproceduresaremadetheconditionofa Katende, Ssempebwa&Co.Advocates © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 8 contamination? order toescapeenvironmentalliabilities? potential liabilityforthatmatter? takeover transactions? General matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff Is itpossibletouseanenvironmentalindemnity To whatextentisitnecessarytodisclose have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson

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the Whistleblowers Protection the Whistleblowers Act. violations/matters. The whistle-blowerswouldbeprotectedunder Uganda toprotect“whistle-blowers”whoreportenvironmental There arenospecificprovisionsintheenvironmentallawsof 8.4 of environmentallawand/orpollutioncausedbythecompany. A shareholderofalimitedliabilitycompanyisnotliableforbreaches 8.3 frivolous suits,courtsmayeasilyaward costsagainstthelitigant. government feesbeforefilinganycourtdocument.Incaseof or publicinterestgroups,however, arerequiredtopaytherelevant litigation waspursuedinthebestinterestsofpublic.Individuals conclusion ofenvironmentallitigation. This isonthebasisthat not orderthelitiganttopaycostsofsuitfollowing practice, thecourtsinmattersofpublicinterestlitigationusuallydo The liabilitytopaycostsisamatterfortheCourt’s discretion.In 8.6 contiguous tosuchenvironmentorland. or landallegedtohavebeenharmedintheenvironment he/she hasarightof,orinterestin,theproperty, intheenvironment It isnotnecessaryforthepersonbringingsuittoshowthat harmed, isharmingorreasonablylikelytoharmtheenvironment. Environmental RestorationOrderagainstanypersonwhohas Furthermore, anypersoncanbringasuitinCourtseekingan compensation fromtheHighCourtofUganda. whose rightsarebeinginfringedtoseekredress,whichmayinclude Constitution oftheRepublicUganda,whichpermitsanyperson Group orclassactionsareavailableunder Article 50ofthe 8.5 can enableNEMA tosuetheparentcompanyinanotherjurisdiction. company. There isnoprovisioninourenvironmentallawswhich extent ofthesharesithasorguaranteedtopayinsubsidiary up, onfailuretopay, theparentcompanywouldonlybeliableto it wouldbesuedindividuallytorecoverthedebt.Incaseofwinding case thecompanyinquestionhasincurredanenvironmentalliability, offences committedareofapenalnatureandstrictliability. In Under theenvironmentallawsofUganda, case ofacompanylimitedbyguarantee. limited tothesharesownedbyhim/her, orguaranteedbyhim/herin However, ifthecompanyisfined,ashareholder’s liabilitywouldbe report environmentalviolations/matters? caused byaforeignsubsidiary/affiliate? pursuing environmentallitigation? damages available? Are thereanylawstoprotect“whistle-blowers”who company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld any exemptionfromliabilitytopaycostswhen Do individualsorpublicinterestgroupsbenefitfrom environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing Uganda

substances mustdeclarethem. It isthereforearequirementthatend-usersofozone-depleting controlled substanceorproducttoanyperson,commitsanoffence. declared intheend-userdeclaration,orsellsotherwisesuppliesa controlled substanceorproductforapurposeotherthanthe Therefore, anend-userwhosellsorotherwisesuppliesusesa trading marketswillbegintodevelop. We stronglybelievethatwiththeexpectednewlaw, theemissions enhanced penaltiesforoffences undertheEnvironmentalLaw. establishment ofanEnvironmental Tribunal; andtoprovidefor establish anEnvironmentalProtectionForce;toprovideforthe provide forthemanagementofplasticsandplasticproducts;to environmental concernsarisingoutofpetroleumactivities;to provide forstrategicenvironmentalassessments;toaddress management ofhazardouschemicalsandbiodiversityoffsets; to before theParliamentofUganda.Itsaimsare:toaddress National EnvironmentalBill,No.17of2017whichiscurrently climate change,theGovernmentofUgandahascomeupwith In ordertoprovidefortheemerging environmentalissues,including unsound useofchemicals,amongothers. advancements withtheattendantchallengesofmanaginge-waste;and food security, incomes,healthandlivelihoods;aswelltechnological landslides, whichhavehadseriouseffects onagriculturalproduction, change concernssuchasdrought,floods,storms,heatwavesand best practiceswhichareemerging tomeettheescalationofclimate schemes. However, thereisaneedtoaddressthemdueinternational 1995, doesnottakeintoconsiderationtheissueofemissionstrading Currently, theEnvironmentalLaw, whichcameintoeffect on19May 9.1 Katende, Ssempebwa&Co.Advocates ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 development. in accordancewiththeConstitution andtheprinciplesofsustainable since everyUgandanhasarightto acleanandhealthyenvironment enhance theenvironment,includingdutytopreventpollution, ensure thateveryUgandanhasadutytocreate,maintainand The overallpolicyapproachtoclimatechangeinUgandais 9.3 Environmental Law, areregardedascontrolledsubstances. emissions areozone-depletingsubstanceswhich,underthe degradation oftheozonelayerandstratosphere.Greenhousegas reduction andminimisationofriskstohumanhealthcreatedbythe degradation oftheozonelayerandstratosphere;(c) layer; (b)managementpracticesandactivitieslikelytoleadthe concerning: (a)theeliminationofsubstancesthatdepleteozone to makeRegulations,issueguidelines,andinstituteprogrammes According toourenvironmentallaws,NEMA isunderanobligation 9.2 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 9 to monitorandreportgreenhousegasemissions? market developingthere? regulation inyourjurisdiction? Emissions Trading andClimateChange your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation What istheoverallpolicyapproachtoclimatechange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned

facility andinamannerapprovedbyNEMA. into theenvironment,unlesswasteistreatedinatreatment and recycling;nottodischarge ordisposeofwasteinanystate on siteare:tominimisethewastethroughtreatment,reclamation The dutiesofowners/occupierspremisesinrelationtoasbestos 10.2 programmes, thereiscurrentlynoasbestoslitigation. despite theexistenceoftheseregulations,apartfromawareness offence punishablewithimprisonment,afineorboth.However, treatment, reclamationandrecycling,failureofwhichamountstoan employing measuresfortheminimisationofwastethrough waste throughhis/her/itsactivitiesisunderadutytomanageitby According totheEnvironmentalLaw, anypersonwhogenerates also consideredhazardous. animals; wastescontainingasbestosintheformofdustorfibresare which mayleadtodevelopmentofcancerinhumanbeingsor In Uganda,asbestosislistedasoneofthecarcinogenicwastes 10.1 employer –including educationalinstitutions,hotels orrecreational It isnowanewtrendinourenvironmental regulationstorequireeach 12.1 therefore wehavenotexperiencedenvironmentalclaimsasyet. environmental insurancesectorhasnotyetfullydeveloped,and educational programmes,duetolowdevelopmentlevelsthe lot ofenvironmentalawarenesshasbeencreatedthrough Although theenvironmentallawiswelldevelopedinUgandaanda 11.2 industries whicharelikelytopollutetheenvironment. pollution licencesplayamajorroleforthoseintendingtosetup for whichthelicenceisrequired. Therefore, insurancepolicieson insurance policycoveringtheriskslikelytoariseoutofactivity hazardous, mustsatisfyNEMA thathe/shehassubscribedtoan transboundary movementofwaste;oranywastecharacterisedas (b) operationofawastetreatmentplantordisposalsite;(c) who appliesforalicencefor:(a)transportationorstorageofwaste; In Uganda,itisanenvironmentallegalrequirementthatanyperson 11.1 10 12 11 in relationtoasbestoson-site? jurisdiction? in environmentlawyourjurisdiction. experience inyourjurisdiction? risks insuranceplayinyourjurisdiction? What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour summary ofanynewcases,trends anddevelopments Please provide,innomorethan 300words,a What istheenvironmentalinsuranceclaims in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable Asbestos Updates Environmental InsuranceLiabilities WWW.ICLG.COM Uganda

201 Uganda 202 Uganda being landinthevicinityofbenefitedenvironment. of anyagriculturalactivityorcreationandmaintenanceworks), respect oftheuseburdenedland(suchasprevention/restriction environment, throughtheimpositionofoneormoreobligationsin further principlesofenvironmentmanagementonthebenefited law alsocreatesenvironmentaleasementswhichcanberegisteredto to adisastercompensateanypersonaffected bythedisaster. The duty foranypersonwhonegligentlycarriesoutactivitythatleads taking intoaccountthekindofrisksitfaces. The lawalsolaysdowna impact ontheenvironment–toprepareadisasterpreparednessplan facilities andhospitalswhoseactivitiesarelikelytohaveasignificant Katende, Ssempebwa&Co.Advocates © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM For the18 the necessaryexperience,expertise,personnelandresourcestoassistyou inanylegaloradvisoryenquiryyoumayhave. The firmistheLEX Africa representative forUganda.Lex Africa istheoldestandleadingnetworkoflawfirmson continent.W African Consultants, CommissionersforOath,NotariesPublic, Trademark andPatent Agents, Receivers,LiquidatorsandCompanySecretaries. With 49years’ experience,weprovideworld-classlegaladvisoryservicesasafirmof Advocates, Solicitors, Litigants, Investmentand Arbitrators, boasting over60permanentlegalandsupportstaff. The firmhasaffiliated offices inalltheleadingcapitalsworld. Katende, Ssempebwa&Co. Advocates wasfoundedin1969andhassinceexpandedtobecomeUganda’s now largestandleadinglegalpractice, Resolution (CADER). from theUgandanCentrefor Arbitration and Alternative Dispute Fred isanadeptarbitratorandmediator, havingobtainedcertification advises allourtopclientsoncompliancewithenvironmentallaw. is alsothefirm’s principal expertonallenvironmentalmattersandhe to thedevelopmentofaviationlawinUgandaiswellrespected.Fred He isthefirm’s principalaviation litigationexpertandhiscontribution billion shillingawardsforourclients. litigation casesonbehalfofthefirm,wherehehaswonseveralmulti- arena, handlingsomeofthemostcomplexandgroundbreaking An all-outlitigator, hehasnearlytwodecades’ experienceinthelegal of thefirm,whereheisDeputyDirector. Fred KiizaBusingeisan Associate PartnerintheLitigationdepartment Guide totheWorld’s LeadingFinancialLawFirms2018. Law Firms2018,andisalsorankedasa Tierby theIFLR1000 1firminboththeFinancialandCorporateProjectDevelopmentpracticeareas th yearrunning,thefirmhasbeenrecognisedasaBand1LeadingFirmby URL: Email: Tel: Uganda Kampala P.O. Box2344 Plot 20,KampalaRoad Radiant House Katende, Ssempebwa&Co. Advocates Fred BusingeKiiza www.kats.co.ug [email protected] [email protected] +256 772464532 ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

he/she canappealtotheHighCourt. If theowneroflandisnotsatisfiedwithcompensation, compulsorily acquiringthelandunderConstitutionofUganda. NEMA mayrecommendthattheGovernmentcompensatesby environmental easement.Iftheeasementisofnationalimportance, to thelegalinterestowneroflandthatissubject compensation commensuratewiththelostinterestofuseland environmental easementholderisunderobligationtogive action toenforceanenvironmentaleasement.However, the environmental easementhasbeenregistered,arighttobringan in perpetuityorforatermofyears. A personinwhosenamean Courts havediscretionarypowerstograntenvironmentaleasements mergers andacquisitions,advisingoncorporaterestructuring. department ofthefirm,focusingoncarryingoutduediligence, Edwin isalsoarisinglawyerinthecorporateandcommercial advised oftheimplicationstheiractionsinaccordancewithlaw. law issuesisavaluableresourcetothefirm,asclientsarewell they areincompliancewiththelaw. Edwin’s expertiseinenvironmental Edwin providesadvisoryservicestoallthefirm’s clientstoensurethat . compliance, insolvencyandrestructuring,intellectualproperty litigation, landlaw, employmentlaw, arbitration,environmental lawand Edwin isan Associate inthefirmwhosepracticeprincipallycovers Chambers andPartners URL: Email: Tel: Uganda Kampala P.O. Box2344 Plot 20,KampalaRoad Radiant House Katende, Ssempebwa&Co. Advocates Edwin BulumaWabwire www.kats.co.ug [email protected] +256 785635395 Global GuidetotheWorld’s Leading Uganda e have Tax

Chapter 29 Uruguay Anabela Aldaz Peraza

Guyer & Regules Betania Silvera Perdomo

B) Accumulatively proceed to publicly publish the resolution 1 Environmental Policy and its which sanctioned the offender, when the infringement is not Enforcement considered a minor offence. C) Cumulatively with other penalties, confiscate objects or products used in the illicit activity. 1.1 What is the basis of environmental policy in your jurisdiction and which agencies/bodies administer D) Arrange for the suspension (for up to 180 days) or for the and enforce environmental law? expiration of the permits, authorisations, or concessions of the offender, when the committed infractions are considered to be serious or repeated offences. Environmental policy in Uruguay is based on Section 47 of the Uruguayan Constitution, Law Number 17,283 (Environmental General Law), its regulatory Decree Number 152/013, Law Number 1.3 To what extent are public authorities required to 16,466 and its regulatory Decree Number 349/005. provide environment-related information to interested persons (including members of the public)? Such provisions declare the protection of the environment against any kind of depredation, destruction or pollution of national interest, Public authorities are obliged to provide environment-related which includes the prevention of any negative environmental impact, information to interested persons who require such information, and, as the case may be, the restoration of damaged environments. with the limitation of information that is considered a trade or Law Number 16,112 establishes that the Ministry of Housing, industrial secret (Section 15 of Law Number 16,466). Territorial Planning and Environment (hereinafter, “MVOTMA”) is the main agency that administers and enforces environmental law. Specifically, the main agency is the National Environmental 2 Environmental Permits Agency (“Dirección Nacional de Medio Ambiente”) (hereinafter, “DINAMA”). 2.1 When is an environmental permit required, and may Pursuant to Section 8 of Law Number 17,283, municipal authorities environmental permits be transferred from one are also able to administer and enforce environmental law in certain person to another? delegated aspects. On the other hand, the Ministry of Public Health (hereinafter, “MSP”) Pursuant to Law Number 16,466 and Decree Number 349/005, several (through the “División Salud Ambiental y Ocupacional”) and the environmental permits are required prior to starting certain activities, National Naval Prefecture (through the “Dirección de Protección de constructions and works expressly listed in such regulations. Medio Ambiente”) have sectorial competencies regarding their Those interested in carrying out any of the activities, constructions and commitments. works are subject to the request of a Prior Environmental Authorisation (hereinafter, “AAP” – “Autorización Ambiental Previa”) and shall 1.2 What approach do such agencies/bodies take to the communicate the project to the MVOTMA by submitting certain enforcement of environmental law? information depending on the category of the same. Decree Number 349/005 also establishes that parties interested in In general terms, such agencies impose fines in order to enforce performing certain activities, constructions or works included in environmental law. The fines depend on the kind of infringement, Section 20 of said Decree shall communicate the location and a but in general vary from 10 R.U. (Readjustable Units – “Unidades description of the area of execution and influence to the DINAMA and, Reajustables”) to 10,000 R.U. (currently: 1 R.U. = Uruguayan as the case may be, include an assessment of the location or section of $ 1,088.52 = US$ 35 approximately). Moreover, they are also the site where the project is to be performed, including an analysis of entitled to impose warnings, confiscations and suspensions. any alternatives. According to Section 6 of Law Number 16,112, MVOTMA will be Some projects that require an AAP must also obtain an Operating in charge of controlling whether public or private activities comply Environmental Authorisation (hereinafter, “AAO”) in order to start with environmental protection standards. Specifically, Section 15 operating. The AAO shall be requested by the interested party and, of Law Number 17,283 allows MVOTMA to: once there has been full verification of the conditions established in the A) Sanction with warnings when the offender lacks any prior AAP, the project is filed before the MVOTMA and the Environmental convictions regarding the commission of minor infringements. Impact Assessment criteria are met, the MVOTMA grants the AAO.

ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 WWW.ICLG.COM 203 © Published and reproduced with kind permission by Global Legal Group Ltd, London 204 Uruguay Company (thetermtofilethelawsuit isfouryears). claim forthedamagesthatrejection ofthepermitcauses before TCA, itcouldfilealawsuitbeforeourjudicialauthorities to permit andtheCompanyisnotwilling tofileanannulmentaction Also, incasetheenvironmentalregulatorrejects may notmodifyitscontent. The TCA mayconfirmorannulthe resolution,asapplicable,butit been tacitlyrejected). administrative action(thatis,afterthehas from theexpirationof200-daytermforresolution the notificationofrejectionadministrativeactionoras The termtofileanannulmentactionbeforethe TCA is60daysfrom favourably resolves(highlyunlikely). suspension oftheeffects of theresolutionand Administration for thecasesinwhichCompanyrequestsimmediate Such actiondoesnotsuspendtheapplicationofresolution,save equivalent toaSupremeCourtinadministrativecases). Contencioso Administrativo action beforethejurisdictionalcourtcalled“ rejected, theCompanyshallhaverighttofileanannulment In thecasethatadministrativeactionisexpresslyortacitly the Administration, theactionshallbedeemedrejected. upon thechallenge.Iftermexpireswithoutanyresolutionfrom a termof200daysasfromthefilingtoissueresolutiondecide Once theadministrativeactionhasbeenfiled, Administration has having receivedsuchgrounds). Administration mayneverthelessdecidethecaseevenwithout Administration toresolveexpires(inthemeantime, administrative action,andmaybefiledlater, beforethetermfor grounds andarguments donotneedtobefiledtogetherwiththe and arguments fortheadministrativeaction.However, such addition toprovingsuchinterest,theyhaveexpressthegrounds and legitimateinterestmayfilesaidadministrativeactionsand,in Only thoseindividualsorlegalentitiesthathaveadirect,personal Gazette oritsnotificationtotheaffected person,asthecasemaybe. the publicationofadministrativeresolutioninOfficial The termtofilesaidadministrativeactionsis10calendardaysfrom before theExecutivePower. recourse beforetheauthorityrejectingpermitandthenanappeal environmental permit,maybechallengedthroughanadministrative environmental permit,orinrespecttoconditionscontainedan In Uruguay, decisionsbyanenvironmentalregulatorrejecting 2.2 transferor hadassumedbefore. provided thetransfereeassumessameobligationsthat Environmental permitscanbetransferredfromonepersontoanother, capacity. 349/005, iftheyexpandthefacilitiesorincreaseproductive (hereinafter, “ the AAP), wouldrequireaSpecialEnvironmental Authorisation it didnotmeettherequirementestablishedinDecreeforobtaining prior totheentryintoforceofDecreeor, whentheactivitystarted, without beingrequiredtoobtainthe AAP (becausetheactivitywas Those activitiesthatwerebuilt,authorisedorputintooperation Guyer &Regules © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM contained inanenvironmentalpermit? What rightsaretheretoappealagainstthedecisionof environmental permitorinrespectoftheconditions an environmentalregulatornottogrant AAE”), includedinSection25ofDecreeNumber ” (hereinafter, “

TCA”) (itistherough Tribunal delo

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

Prefecture. can requesttheassistanceofPoliceandNationalNaval environmental legislation,theregulator(MVOTMA) apart fromthepossibilityofimposingfinesinordertoenforce Furthermore, Section453ofLawNumber16,170establishesthat 10,000 R.U. permits, etc.,forupto180days,cumulativelywithafineof10 products, orevenasuspensionoftheoffender’s authorisations, linked tothecommissionofoffence orthetransitofobjects and/or destructionofvehicles,instrumentsanddevicesdirectly environmental regulatormayimposewarnings,theconfiscation In thecaseofviolationsenvironmentalprotectionregulations, 2.4 Law (Section6). certain activities,constructionsandworksexpresslylistedinsuch necessary toperformanEnvironmentalImpact Assessment for Law Number16,466andDecree349/005establishthatitis environmental auditsforparticularlypollutingindustries.However, Under Uruguayanlaw, thereisnoobligationtoconduct 2.3 of suchwasteshallbeapprovedby the environmentalregulator. The location,kindofwasteandother conditionsrelatedtothedisposal solid wastegeneratedbytheactivity oftheCompany. transport, recycling,recovery, treatmentandfinaldisposalofallthe the samemustincludegeneration,internalmanagement,storage, With regardtothe Waste ManagementPlansofsolidindustrialwaste, of suchwaste. aspects relatedtowasteisnecessarypriorstoringand/ordisposing In generalterms,anapprovedManagementPlanwhichregulatesall 3.2 horticultural andforestrywastes(DecreeNumber152/013). (iii) batteries(DecreeNumber373/003);and(iv)agricultural, Number 152/013);(ii)hospitalwastes(Decree586/09); duties orcontrolssuchas:(i)industrialsolidwastes(Decree There arecertaincategoriesofwastewhichinvolveadditional to bedisposedoforremoved or removed, isintendedtobedisposedoforremoved, orisrequired define “waste”as“ and ResolutionNumber266/014,whichregulateindustrialwastes, However, Decree Number182/013,Resolution1708/2013 Under Uruguayanlaw, thereisnogeneraldefinitionofwaste. 3.1 3 permits? polluting industriesorotherinstallations/projects? produced? waste involveadditionaldutiesorcontrols? Waste regulators haveinconnectionwiththeviolationof What enforcementpowersdoenvironmental environmental impactassessmentsforparticularly Is itnecessarytoconductenvironmentalauditsor and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore How iswastedefinedanddocertaincategoriesof

any substanceormaterialwhichisdisposedof ”. Uruguay

Number 17,220(dated November17,1999),aperson introducing Regarding criminalliability 10,000 R.U.accordingtoLawNumber 16,226(Section67). permits, etc.,forupto180days,cumulatively withafineof10to products, orevenasuspensionof theoffender’s authorisations, linked tothecommissionofoffence orthetransitofobjects or and/or thedestructionofvehicles, instrumentsanddevicesdirectly protection regulations,whichvaryfromawarningtoconfiscation administrative sanctionsinthecaseofaviolationenvironmental 16,466, 16,688and17,283DecreeNumber100/991provide Regarding administrativeliability intention ofcausingthedamageorwithseverenegligence. but theclaimantmustprovethatdefendantactedwithfull means thatsuchliabilityisnotobjectiveorbasedonthemererisk act byactingfraudulentlyorwithseverenegligence. This the harmcausedbysame;andthatpartyhassuchan eventual damage);thatthereisadirectlinkbetweensuchdeedand harmful act;thatsuchanacthascausedrealharm(notpotentialor must giveevidenceofthefollowingissues:thattherehasbeena In general,doctrineandjurisprudencerecognisethattheclaimant all workstoreduceormitigatethedamagecaused. caused. The lawalsoobligestheliablepartytoconductandperform in violationoflawshallbeheldliableforthepaymentalldamages causes depredation,destructionorcontaminationoftheenvironment 3.4 “ Management beingdiscussedinParliament(hereinafter, the Please notethatcurrentlythereisaBillonNational Waste is proven. if adirectlinkbetweensuchdeedandtheharmcausedbysame However, underthegeneraltortrules,producerscanbefoundliable disposal/treatment off-site. regarding wastewhentheyhavetransferredittoanotherpersonfor Uruguayan lawdoesnotestablishdirectliabilityforproducers 3.3 Guyer &Regules ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 Regarding civilliability criminal liability. environmental lawand/orpermits:civil;administrative;and Three different typesofliabilitiesarisewherethereisabreach 4.1 the ManagementPlan. process, theproducershalltakebackand/orrecoversameunder If itisnotpossibletoreintroducethewasteinproduction that regulatesallaspectsrelatedtosuchwastetheMVOTMA. Fundamentally, wasteproducersshallsubmitaManagementPlan different stages. the producerisresponsibleformanagementofwasteatall © Published and reproduced with kind permission byGlobal Legal Group Ltd,London Waste ManagementBill 4 what defencesaretypicallyavailable? regarding thetake-backandrecoveryoftheirwaste? bankrupt/disappears)? Liabilities To whatextentdowasteproducershaveobligations another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin the transferee/ultimatedisposergoes breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa

: Uruguayanlawprovidesthatwhoever ”) whichstipulatesingeneraltermsthat : As statedinEnvironmentalLaw : LawsNumber16,112, 16,170,

environmental management. regarding pollution,crimesagainstbiodiversity, andcrimesagainst crimes whicharepunishableunderthisprojectoflawthose Penal Coderegulating“Crimes Against theEnvironment”. The Bill 2017, abillwaspresentedbeforeParliament(hereinafter, the“ may bepunishedwithupto12yearsinprison. Also, onFebruary1, as ofMarch22,1989)intoazonesubjecttoUruguayanjurisdiction Convention onMovementsofHazardous Wastes and Their Disposal, hazardous wastes(asdefinedin Annex IandIIoftheBasel 4.3 polluter isliableforallofthedamagescaused,withoutexception. Furthermore, Section4ofLawNumber16,466establishesthatthe not tocauseenvironmentalimpacts. Law Number16,466establishthatallpersonshaveanobligation However, ingeneralterms,Section3ofLawNumber17,283and when pollutioniscausedoperatingwithinpermitlimits. Under Uruguayanlaw, thereisnoobligationregardingliability 4.2 parties; or(iii)breach ofPublicOrder. (ii) fraudindetrimentoftherights ofshareholders,partnersorthird prerequisites thatmustbemet:(i) fraudulent avoidanceofthelaw; (hereinafter, the“ corporate veilofaCompany, article189ofLawNumber16,060 raise theveilisquitehigh.Insuch sense,inordertopiercethe veil ispierced,whichunlikelyin Uruguay, sincethestandardto the obligationsofCompany, saveinthecasethatcorporate In principle,underUruguayanlaw, shareholdersarenotliablefor 4.4 cause environmentaldamageareliableforsuchdamage. Moreover, aspreviouslyexplained,ageneralruleallpersonswho gives ahintofthetendenciesUruguayanregulation. environmental crime. Although thishasnotbeenapprovedyet,it have contributedtoanddeterminedthecommissionofsaid people thathaveeffective controloveracorporation,providedthey crimes, andestablishesthatincase,theliabilitywillliewith regulates theliabilityforcorporationsthatcommitenvironmental environmental crimetotheUruguayanPenalCode. The 2017Bill Furthermore, the2017Billaddsachapterreferringto relying onotherindemnityprotectioninrespectofsuchliabilities. provision whichestablishesthepossibilityofgettinginsuranceor for environmentalwrongdoing.However, thereisnoexpress In thatsense,directorsandofficers ofcorporationscouldbeliable against thelaworby-laws. not exclusivetoenvironmentaldamages)theymaycauseifacting the Company, itsshareholdersandthirdpartiesforalldamages(itis Law establishestheliabilityofdirectorsandadministratorsbefore for environmentalwrongdoing.However, theUruguayanCorporate establishes directliabilityfordirectorsandofficers ofcorporations Under Uruguayanlaw, thereisnotyetanyparticularregulationthat ”) whichseekstoincorporateaspecificSectionintheUruguayan within permitlimits? the onehandandanassetpurchaseonother? indemnity protectioninrespectofsuchliabilities? to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman Uruguayan CompanyLaw

WWW.ICLG.COM ”) establishessome Uruguay

2017

205 Uruguay 206 Uruguay may benecessary to remediatethedamagecaused environment. the environmentalregulatorhas powertorequestallworksthat Although thereisnospecificregulation inthisregard,asageneralrule 5.3 where thecrimeswerecommittedbymorethanoneperson. establishes thepossibilityofcriminalliabilitya“group”,incases to theUruguayanPenalCode,andCode Also, asmentionedabove,the2017Billaddsenvironmentalcrimes who haveparticipatedinsuchproject. constructions andworks,butalsotheprofessionalstechnicians contamination; includingnotonlytheownerofaproject, liability whenmorethanonepersonisresponsiblefor Section 11 ofLawNumber16,466establishesajointandseveral 5.2 caused bytoxicsubstances. contamination ofgroundwater, aswelldamagetotheenvironment establishes apenaltyofprisonforuptoeightyearsincase In addition,the2017Bill,whichregulatesenvironmentalcrime, certain limitationsforspillingwasteonsoilandgroundwater. possibility ofimposingfinesincasecontaminationandestablishes mainly byDecreeNumber253/79.Suchestablishesthe Liability forthecontaminationofsoilorgroundwaterisregulated 5.1 damage. all personswhocauseenvironmentaldamageareliableforsuch However, asitis understoodunderUruguayanlaw, asageneral rule environmental wrongdoingand/orremediationcosts. provision orprecedentthatestablishesaliabilitytolendersfor Under Uruguayanlawandjurisprudence,thereisnospecific 4.5 but denouncedbycreditorswithinaspecificterm. from thebalancesheetandthosenotincludedin liability ofthepurchaserwillbelimitedtoobligationsresulting business concern),providedaspecialprocedureisfollowed,the In thecaseofanassetpurchase(thetransferenceongoing liable entity. consequences regardingtheliabilityofCompany, whoisthe Therefore, thetransferofsharesbetweenshareholdershasno special requirementintheevidentiaryfield. have understoodthattheUruguayanCompanyLawconsecratesa the corporateveilinUruguayisquitehigh.Bothscholarsandcourts restrictively andasanexception. The legalthresholdforpiercing any reasonabledoubt. The disregardmechanismshouldbeapplied Company forthepurposespreviouslylistedmustbeprovenbeyond The UruguayanCompanyLawdemandsthattheuseof Guyer &Regules © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 5 can athirdpartychallengethe agreement? is responsibleforthecontamination? groundwater? environmental wrongdoingand/orremediationcosts? Contaminated Land regulator comebackandrequire additionalworksor “agreed” withanenvironmental regulator, canthe If aprogrammeofenvironmentalremediationis How isliabilityallocatedwheremorethanoneperson What istheapproachtoliabilityforcontamination To whatextentmaylendersbeliablefor (including historiccontamination)ofsoilor

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

Law Number17,283. Yes. Aesthetic harmsareincludedunderthedefinitionprovidedby 5.5 under question5.2regardingthe2017Bill). bear theenvironmentalliability(saveforclarificationmade doctrine, itcanbeagreedbetweenthepartieswhichofthemshall without exception.Nonetheless,underthefreedomofcontract Uruguayan tortrules,thepolluterisliableforalldamagescaused caused, inwholeorpart,thecontamination.However, under previous owneroroccupierofcontaminatedlandwhenthat regulates aprivaterightofactiontoseekcontributionfrom Under Uruguayanlegislation,thereisnoregulationthatexpressly 5.4 obligation toinvestigate landforcontamination. However, asall Under Uruguayanlegislation,there isnolawthatimposesthe 7.2 to twoyears. corresponding authorities,whichmayincurapenaltyofprisonforup environmental controlortoprovidefalseinformationthe Furthermore, accordingtothe2017Bill,itisacrimehinder regulation. Administration isconsideredaseriousinfractionofenvironmental information orthesubmissionoffalseincorrectto 34 ofDecreeNumber152/013,theomissionenvironmental disclosed toanenvironmentalregulator. Specifically, underSection However, followingthegeneralrules,suchsituationmustbe situation specifically. Under Uruguayanlegislation,thereisnodirectivethatregulatessuch 7.1 interview employees,etc. production ofdocuments,takesamples,conductsiteinspections, possibility ofimposingwarningsandfines,inordertorequire Environmental regulatorshavedifferent powers,suchasthe 6.1 6 7 public assets,e.g.rivers? contaminated landliabilitytoapurchaser? contamination? parties? conduct siteinspections,interviewemployees,etc.? Powers ofRegulators Reporting /DisclosureObligations polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek have anaffirmativeobligationto investigatelandfor When andunderwhatcircumstances doesaperson environmental regulatororpotentiallyaffectedthird migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe require productionofdocuments,takesamples, What powersdoenvironmentalregulatorshaveto Uruguay

8.1 and mayentaillegalconsequencesregardingliability. disclosing environmentalproblemsmaybeconstruedasbadfaith object ofthenegotiation. Thus, accordingtosuchprinciples,not good faith,avoidfraudanddiscloseanypossiblehiddenfaultsofthe determine theobligationofpartiesinanagreementtoactwith situation inparticular. Nonetheless,generalprinciplesoflaw Under Uruguayanlegislation,thereisnolawthatregulatessucha 7.3 construed thatsuchobligationexists. persons areobligedtotakecareoftheenvironment,itcouldbe Guyer &Regules ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 environmental liabilities. subsidiary iftheforeignCompany hasnocapitaltopayits Moreover, aparentCompanycanbesuedinname ofaforeign veil isquitehigh. However, asmentionedabove,inUruguaythestandard topiercethe shareholders couldbeheldliablefortheCompany’s actions. veil incertainsituations(seequestion4.4).Insuchscenario, Uruguayan lawestablishesthepossibilityofpiercingcorporate precedents statingthecontrary. Nevertheless,aswementioned, liable fortheobligationsofCompany, andtherearenocourt Under Uruguayanlaw, theprincipleisthatshareholdersarenot 8.3 with theshareholders. in suchacase,theCompany’s assetsandliabilitieswillbeallocated sheet. The shareholderscoulddecidetodissolvetheCompany, but It isnotpossibletoshelterenvironmentalliabilitiesoff balance 8.2 accountable accordingtothegeneralrules. liability, providedsuchpersonwasresponsibleforthecrimeand for apersoninUruguayanlegislationtoavoidorlimitcriminal behaviour wouldbeconsideredacrime. Additionally, thereisnoway However, inthe eventthatthe2017Billisapproved,described as wellpaymentsthereof. an environmentalindemnityshouldbeupheldbyUruguayancourts, such situationyet. Therefore, underthefreedomofcontractprinciple, Under Uruguayanregulations,thereisnoprovisionthatregulates © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 8 potential liabilityforthatmatter? takeover transactions? caused byaforeignsubsidiary/affiliate? order toescapeenvironmentalliabilities? General matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- prospective purchaserinthecontextofmergerand/or environmental problems,e.g.byasellerto Is itpossibletouseanenvironmentalindemnity To whatextentisitnecessarytodisclose liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent

from theGlobalEnvironment Facility(GEF). Agency forInternationalCooperation (AUCI).Itsfundingcomes Amparo” –whicharecommonlyusedforenvironmentalprotection. been unanimouslyacceptedforprotectiveactions“ said flexibilityregardingspeciallegitimationrequirementshasnot historical values,anyinterestedpartycanpromotethem.However, that iftheclaimrelatestoenvironmentalprotection,culturaland the SupremeCourtofJustice),itisnowadmittedbyjurisprudence actions againstadministrativeactsorunconstitutionalbefore legitimate interestisrequiredtofiletheclaim(suchasannulment Moreover, insometypesofclaimsonwhichadirect,personaland for theMVOTMA. Furthermore, LawNumber16,112 establishes thesamepossibility to promotetherelevantprocessinorderprotectsuchvalues. indefinite numberofpersons,anyinterestedpartyshallbeentitled cultural andhistoricalvalues,anyothermattersbelongingtoan Code), inthecaseofmattersrelatedtoenvironmentalprotection, Yes. UnderUruguayanlaw(Section42oftheProceduralGeneral 8.5 protected assetoutinDecreeNumber209/000. against theenvironmentincircumstancesofdangerorriskwillbe event thatthe2017Billisapproved,thosewhodenouncecrimes who reportenvironmentalviolations/matters.Nevertheless,inthe No. InUruguay, thereisnolawwhichprotects“whistle-blowers” 8.4 (hereinafter, “ implementation bytheUnitedNations DevelopmentProgramme Management andEnvironment(MVOTMA). Itissupportedinits and Mining(MIEM)the MinistryofHousing,Land system. This projectisexecutedbytheMinistryofIndustry, Energy to promotethereductionofcarbonemissionsinmobility to adaptinstitutionalcapacityandtheregulatoryframeworkinorder and efficient urbanmobility systeminUruguay”,whosepurposeis Besides, 2018sawthelaunchofproject“Towards asustainable renewable sourcesinUruguay. essentially, thebeginningofproductionenergy from wind, solarandbiomass. The developmentofwindprojectswas, related totheproductionofenergy fromrenewablesources;mainly because ofasignificantnumberprojectsthathavebeenpromoted Uruguay hasimplementedamajorchangeintheenergy matrix energy projectsthatwantto besettledinUruguay. Inthissense, The emissionstradingmarketisrelatedingeneraltorenewable 9.1 liability topaycostswhenpursuingenvironmentallitigation. No. Uruguayanlawdoesnotestablishanyexemptionsfrom 8.6 9 damages available? report environmentalviolations/matters? market developingthere? pursuing environmentallitigation? Emissions Trading andClimateChange environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing Are thereanylawstoprotect“whistle-blowers”who your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation any exemptionfromliabilitytopaycostswhen Do individualsorpublicinterestgroupsbenefitfrom UNDP”) andincollaborationwiththe Uruguayan WWW.ICLG.COM Uruguay Acciones de

207 Uruguay 208 Uruguay Protocol onsubstancesthatdeplete theozonelayer. In August 2018,LawNumber19,644 approvedtheMontreal NEC, nationallyandinternationally. related toenvironment,waterand climatechangeagreedinthe which aremembersoftheNES– theexecutionofpublicpolicies tasks istocoordinate–alongside the institutionsandorganisations provide itwithtechnicalandoperationalsupport.Oneofitsmain supervise compliancewiththeagreementsofNEC,aswellto of Environment, Water andClimateChange,whosepurpose isto development. Also, saidDecreeregulatestheNationalSecretariat policy oftheStateforsustainableandterritoriallybalancednational the ExecutivePoweranintegratedandequitableenvironmental “NEC”), whichwillhaveasafunction,amongothers,topropose also createstheNationalEnvironmentalCabinet(hereinafter, matter, whichiscomposedofvariousStateagencies.SaidDecree strengthening, articulatingandcoordinatingpublicpoliciesonthe Environmental System(hereinafter, “ Further, in2016, DecreeNumber172/016createdtheNational Executive Branchintermsofclimatechange. and Hydrologywhich,amongothercommitments,advisesthe Number 19,158foundedtheUruguayanInstituteofMeteorology regulations bymeansofLawNumber17,279.In2013, November 2000,withthesamebeingincorporatedintoUruguayan The KyotoProtocolwasapprovedbytheUruguayanParliamentin 9.3 measures establishedtherein. the overalleffort ofreductionemissionsthroughthemitigation encourages developingcountries,suchasUruguay, tocontribute article 3,paragraph9(Dohaamendment)which,amongotherthings, 1/CMP.8 Amendment totheKyotoProtocolinaccordancewith Finally, byLawNumber19,640,UruguayapprovedtheDecision waste biomassandby-products. development ofdecentralisedenergy generationfromindustrial from fossilfuelsinUruguay, throughthepromotionand reducing greenhousegasemissionsfromthegenerationofelectricity initiative oftheNationalGovernmentandUNDP, hastheaimof Electricity fromBiomassinUruguay(PROBIO)whichisajoint In addition,pleasenotethattheProjectforProductionof monitor andreportgreenhousegasemissions. the operationofcertainactivities,toestablishsomerequirements other words,itiscommonfortheMVOTMA,inordertoauthorise arise fromtheprocessingofanEnvironmental Authorisation. In Obligations oncompaniestomonitortheirgreenhousegasemissions 17,279, contributingtothesustainabledevelopmentofcountry. of theUnitedNationsonClimateChange,approvedbyLawNumber under thetermsofKyotoProtocoltoFrameworkConvention establishes thatitalsoaimstoreducegreenhousegasemissions and regulatingtheproduction,marketinguseofagrofuels, Further, LawNumber18,195,whichhasthepurposeofpromoting substances, wasteintheenvironmentandgreenhousegasemissions. carrying outaquantificationofpollutingemissions,hazardous update theinformationregardingconditionsofenvironment, Nacional Observatory (“ObservatorioAmbiental According toLawNumber19,147,theNationalEnvironmental 9.2 Guyer &Regules © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM to monitorandreportgreenhousegasemissions? regulation inyourjurisdiction? What istheoverallpolicyapproachtoclimatechange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned

NES”) withthepurposeof ”) shallregisterand ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

on-site. The competentauthoritiesmayrequirethesubstitutionofasbestos 10.2 Appeals ofthe7 By wayofexample,JudgmentNo.319/2011 of theCivilCourt Unhealthy Jobs”(“ComisiónHonorariadeTrabajos Insalubres from theMSP priortotheopinionof“Honorary Committeeof asbestos intoUruguay, itisnecessarytorequestanauthorisation The above-mentionedDecreeestablishesthatinordertointroduce asbestos. ation andintroductiontoitsterritoryofanyproductthatcontains Decree Number154/002prohibitsthemanufacture,commercialis- 10.1 contribution oftheprivatesector. Commission fortheProtectionof the Environment,withactive Management Billhasbeendrawn upbythe Technical Advisory Uruguay isthedraftof Waste ManagementBill. The Waste developments regardingthepreservation oftheenvironmentin Aside fromthe2017Bill,currently, oneofthemostimportant 12.1 Uruguay. There arenoprecedentsinenvironmentalinsuranceclaims 11.2 civil liabilityingeneral. liability isusuallycoveredwithingeneralinsurancewhichcovers policies, theyarenotyetcommonlyused,sinceenvironmental Although insurancecompaniesdooffer specificenvironmental against environmentalliabilities. shall havepoliciestocovercivilliabilitywhichincludeprotection Number 413/92stipulatesthatcompaniesprovideportservices companies thatprovideportservices;namely, Section9ofDecree and thereisonlyonecompulsoryenvironmentalinsuranceforthe The marketforenvironmentalinsuranceisnotquitedevelopedyet, 11.1 mentioned Decree. import ofmaterialscontainingasbestos,therebybreachingthe 11 10 12 in relationtoasbestoson-site? jurisdiction? in environmentlawyourjurisdiction. experience inyourjurisdiction? risks insuranceplayinyourjurisdiction? What arethedutiesofowners/occupierspremises What istheexperienceofasbestoslitigationinyour summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a What istheenvironmentalinsuranceclaims in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable Environmental InsuranceLiabilities Asbestos Updates th CircuitrelatestoaCustomsOffence duetothe Uruguay

”).

which thewasteisgenerated,orincreasecurrenttaxrate. the ExecutivePowermayimposeatax(IMESI)onproductsfrom applicable totheproductsfromwhichitisgenerated.Insuchcases, special waste–exceptinthosecaseswheretheSpecificInternal Tax is responsibility ofthemanufacturerandimporterinmanagement One ofthemainfeaturesBillisestablishmentextended the guidelinesprovidedbyNational Waste ManagementPlan. Plans thatwillapplywithintheirjurisdiction,takingintoaccount this, theprovincesshallalsodrawuptheirown Waste Management management thatshallapplyinallthenationalterritory. Along with Waste ManagementPlanthatwill establishtheguidelinesofwaste and employment. The BillprovidesfortheelaborationofaNational as areusableandrecyclableresource,capableofgeneratingvalue generation andmanagementofwastetherecognition through thepreventionandreductionofadverseeffects ofthe environment, promotingamodelofsustainabledevelopment, The purposeofthe Waste ManagementBillistoprotectthe Guyer &Regules ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London service, agreatdegreeoftrust,andunshakable professionalethics. and mostexperiencedgroupofpartners inthecountry, whobecomeclients’ byexcellentdaily trustedadvisors;arolethatisundoubtedly cemented This reputationfindsitsbasisinthedaily commitmenttoexcellenceofthefirm’s andthelargest solidteamofinternationally-trainedprofessionals, the firmhasenjoyedsinceitsincorporation in1911. Guyer &RegulesisconsideredUruguay’swork, apositionthat “blue-chip”firmandfirst choiceforinternationalanddomesticcomplexlegaltax (“Organización deMujeresEmpresarias Currently sheisthePresidentofWomen’s Entrepreneur Association outstanding performanceintheareaofenvironmentallaw. Legal She hasbeenrecognisedbyprestigiousinternationaljournals,suchas occupational healthandsafety. force inUruguayenvironmentalareas,andbeeninvolved foreign companies,participatedinthemechanismsandlegalsystems she hastakenpartinproceduresforadaptationofmajordomesticand Anabela isveryexperiencedinenvironmentalandregulatorymatters– areas relatedtooilpollution. waste management;effluents treatment;persistentpollutants;andin specialties: mattersrelatedtoqualityandenvironmentalprotection; has writtenpapersinnationalandinternationalforumsonher conferences onenvironmentallawandsustainabledevelopment, She hasattendedseveralnationalandinternationalseminars Services GroupEnvironmentalGroup. (American NetworkofEnvironmentalLawSpecialties);andtheWorld Association ofUruguay;theLexMundiEnvironmentalGroup;RIELA organisations: theCommissiononEnvironmentalLawofBar of environmentallaw, sheactivelyparticipatesinthefollowing advising ontradeandinvestmentinthecountry. Specialisinginthearea Anabela Aldaz worksmainlyintheBankingandCorporateDepartment, , Latin Lawyer , andWho’s WhoLegal–Environment URL: Email: Tel: Uruguay 11100 Montevideo Plaza Independencia811 Guyer &Regules Peraza Anabela Aldaz www.guyer.com.uy [email protected] +598 29021515 ”). , forher

method ofbillingforauthorisedplasticbags. may imposetheobligationtocollectandsetaminimumprice the regulation.Furthermore,lawstatesthatExecutivePower has obtainedthecorrespondingcompliancecertificateestablishedby purpose onthenationalterritory, whenthemanufacturerorimporter present lawmayonlybedistributed,soldordeliveredforany not compostableorbiodegradable.Plasticbagsauthorisedbythe distribution, saleanddelivery, inanycapacity, ofplasticbagsthatare forms ofvalorisation. The lawprohibitsthemanufacture,import, discourage theiruseandpromotereuse,recyclingother impact derivedfromtheuseofplasticbags,throughactionsto interest topursuethepreventionandreductionofenvironmental which wasapprovedin2018. The lawstatesthatitisofgeneral Another significantdevelopmentinUruguayisLawNumber19,655, Quiroga, SãoPaulo,Brazil(September2013–February2014). She tookasecondmentatMattosFilho,Veiga Filho,MarreyJr. e Guardia the Young Lawyerofthe Year award–“ Betania hasbeenrecognisedbytheInternationalBar Association with (project finance)ofrenewableenergyandinfrastructureprojects. sponsors, investorsandlendersinthepurchase,salefinancing regulatory issuesandmergersacquisitions.Shealsoadvises She hasrelevantexperienceintheenergyfield,advisingon industrial projects. particular, shespecialisesinadviceforthedevelopmentoflarge-scale Her practiceincludescorporateadviceoncivilandcommerciallaw. In Course inEnergyPolicyattheUniversityofMontevideo(2016). and PoliticalScience–LSE(2012–2013)tookaPostgraduate in InternationalBusinessLaw(LL.M.)atLondonSchoolofEconomics Regulatory andEnvironmental Area. SheobtainedaMasterofLaws Betania SilveraworksintheCorporateDepartment,within ”. URL: Email: Tel: Uruguay 11100 Montevideo Plaza Independencia811 Guyer &Regules Betania SilveraPerdomo www.guyer.com.uy [email protected] +598 29021515ext152 Scholarship Rogeliodela WWW.ICLG.COM

Uruguay

209 Uruguay Chapter 30 USA

Snell & Wilmer L.L.P. Denise A. Dragoo

1 Environmental Policy and its (generally a misdemeanour), resulting in fines and possibly imprisonment. Actions to recover damages can be Enforcement brought in the appropriate state or federal court with jurisdiction over the alleged violation. 1.1 What is the basis of environmental policy in your jurisdiction and which agencies/bodies administer 1.3 To what extent are public authorities required to and enforce environmental law? provide environment-related information to interested persons (including members of the public)? Environmental law and policy in the United States derives from traditional common law notions of trespass and nuisance. Modern Most environmental data filed with state and federal government is U.S. environmental law, however, is primarily based on statutory and publicly available. Information filed with federal agencies can be regulatory enactments. requested by the public pursuant to the Freedom of Information Act. In areas where the federal government has chosen to act, federal State governments generally have similar laws allowing public environmental law pre-empts similar state and local enactments. Thus, access. Confidentiality is the exception, not the rule, but trade federal law serves as a national baseline for environmental secrets and commercially sensitive information that is clearly requirements. Consequently, U.S. environmental law is driven by the marked confidential may be exempt from public disclosure. major federal statutes, and their implementing regulations, including the Clean Air Act, the , the Comprehensive 2 Environmental Permits Environmental Response Compensation and Liability Act (CERCLA) and the Resource Conservation and Recovery Act (RCRA). Additionally, most states, and some Tribes, have been delegated the 2.1 When is an environmental permit required, and may authority to implement aspects of federal law, and their statutory and environmental permits be transferred from one regulatory requirements may exceed the requirements of federal law. person to another? These federal regulatory agencies are also tasked with enforcement of U.S. environmental laws. Because of state delegation, however, the Environmental permits are authorised under local, state and federal bulk of environmental enforcement has also been delegated to the law to assure site-specific compliance with environmental states. performance standards. In some cases, the permits are standardised for an industry and can be issued as a general or nationwide permit. The major federal statutes tend to be fairly general and limited. As In most cases, environmental permits are transferrable upon notice such, the U.S. Congress has authorised the U.S. Environmental to the issuing agency, subject to the transferee’s assumption of Protection Agency (the USEPA), the U.S. Army Corps of Engineers responsibility. The transferee may need to demonstrate the financial and the Department of the Interior, to develop implementing and technical ability to meet permit conditions. A transferee’s poor regulations that provide specific legal requirements. environmental compliance history may block the permit transfer.

1.2 What approach do such agencies/bodies take to the enforcement of environmental law? 2.2 What rights are there to appeal against the decision of an environmental regulator not to grant an environmental permit or in respect of the conditions Civil penalties and criminal fines are authorised by statute to enforce contained in an environmental permit? state and federal environmental laws and permits. Injunctive relief can also be sought in federal or state court. Administrative penalties State and federal agencies generally have an administrative appeal are generally enforced by an agency following inspection, discovery process set by statute or rule. Permit denial or disputed permit of a violation and issuance of a notice of violation and/or a corrective conditions are initially considered by an or action order. The alleged violator may contest the fact of violation or appeals board. After this administrative process is exhausted, the amount of the penalty before the administrative agency and appeal a final agency decision can then be appealed for judicial review. The final decision for judicial review. Larger civil penalties or criminal scope of review depends on the enabling statute and is either a penalties may be prosecuted in court against an alleged violator. review on the administrative record or a trial de novo. Under the Wilful and knowing violations may be prosecuted as a crime federal Administrative Procedure Act (APA), the court may set aside

210 WWW.ICLG.COM ICLG TO: ENVIRONMENT & CLIMATE CHANGE LAW 2019 © Published and reproduced with kind permission by Global Legal Group Ltd, London voluntary self-auditsmayprovideabasisforliability. of civilpenaltiesfornon-compliance. Without theseprotections, result ofself-audit,thesestatutesandrulesmayinthewaiver proceedings. Ifviolationsareproperlyreportedandremediatedasa reports fromdisclosureinstateadministrativeandjudicial legislation andrulesofevidencewhichprotectenvironmentalaudit compliance problems.Somestates,includingUtah,haveenacted allow thepollutingindustrytovoluntarilyidentifyandremediate benefits toenvironmentalself-evaluationandauditswhichmay be preparedtoinformtheagencydecision.Finally, thereare environmental assessmentorimpactstatementmust (NEPA), iftheprojectinvolvesmajorfederalactionorapprovals,an separate matter, undertheNationalEnvironmentalPolicy Act by the American Societyfor Testing andMaterials(ASTM). As a must befollowedwhichmeetsspecifiedindustrystandardsissued (AAI). To meet AAI, anenvironmentalsiteassessmentprocess environmental conditionsbyconducting“allappropriateinquiries” may beprotectedfromliabilityunderCERCLA forcertain context ofCERCLA liability. Prospectivepurchasersofproperty contexts. The term“environmentalsiteassessment”arisesinthe Environmental assessmentshavedifferent meaningsindifferent 2.3 discretion, orotherwisenotinaccordancewithlaw. agency actionfoundtobearbitrary, capricious,anabuseof Snell &WilmerL.L.P. ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 enforce compliance withtheapplicableregulations. the delegatedstateshavesubstantial authorityunderRCRA to are particularlyextensive.Boththe federalregulatoryagenciesand governing thetreatment,storageand disposalofhazardouswastes recycled andhowtheycanbe transported. The regulations specify howhazardouswastesare identified,howtheycanbe requirements forhazardouswastes. Forinstance,theregulations reactivity and/ortoxicity. The RCRA regulationscontainextensive exhibit atleastoneoffourcharacteristics–ignitability, corrosivity, USEPA’s regulationsimplementingRCRA,hazardouswastes their disposal,toensurethattheyarehandledsafely. Underthe Hazardous wastesaretrackedandregulatedfromtheirgenerationto classification, thisuncertaintyisoftenhotlycontested. the dutiesandcontrolsvarysubstantially, dependingonthe with regulators,astotheappropriatewasteclassification.Because waste. Unfortunately, thereisoftenuncertainty, anddisagreement recycling) areexemptfromclassificationaseithersolidorhazardous separate rulesapply. Finally, certainwastes(forinstance, waste. Waste canalsobeclassifiedasradioactivewaste,forwhich waste isclassifiedaseithernon-hazardoussolidorhazardous United Statesdependsonthewaste’s classification(s).Generally, The dutiesandcontrolsrequiredforthedisposalofwastein 3.1 See question1.2,above. 2.4 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 3 permits? polluting industriesorotherinstallations/projects? waste involveadditionaldutiesorcontrols? Waste Is itnecessarytoconductenvironmentalauditsor regulators haveinconnectionwiththeviolationof environmental impactassessmentsforparticularly How iswastedefinedanddocertaincategoriesof What enforcementpowersdoenvironmental

are primarilyimplementedandenforcedbydelegatedstates. reusing, composting,incinerating,orlandfillingwastes. These rules These rulesprimarilyfocusontherequirementsforrecyclingand The RCRA regulationsalsogovernnon-hazardoussolidwaste. throughout theUnitedStates. relatively newexceptiontoarrangerliabilityisnowheavilylitigated responsible partiesarestrictlyliableforthosecosts,thescopeofthis CERCLA sitescancosthundredsofmillionsdollars,andthatthe hazardous substancestooccur. Consideringthatremediationof “arranger” liabilitytothosepartieswhointendedfordisposalof In 2009,however, theU.S.SupremeCourtlimitedCERCLA fault, forreleasesintotheenvironmentofhazardoussubstance. substance isstrictlyliable,jointlyandseverally, withoutregardto arranges forthedisposal,treatmentortransportation,ofahazardous particular, under CERCLA,apartythatdisposesortreats, Yes. This isasubstantialissueunderU.S.environmentallaw. In 3.3 for farmers,andpartiesremediatingcontaminatedsites. permit. There arealsoexceptionsthatmayapplyfortransporters, small quantitygeneratorcandosoforlessthan180dayswithouta store wasteon-siteforlessthan90dayswithoutapermit,and however, exceptions.Forinstance,alarge quantitygeneratorcan including thewastegenerator, mustobtainapermit. There are, Generally, afacilitythattreats,storesordisposesofsolidwastes, 3.2 Primarily, theyrelatetoequipment malfunctionsandemergency There arelimitedstatutorydefences forbreachingenvironmentallaws. damage isparticularlyegregiousand/or theconductwasintentional. history. Criminal liabilitiesgenerallyarereservedforcaseswherethe cooperation ofthepartycausingdamage, andtheirpriorcompliance amount ofdamagecaused,the durationofthedamage, incarceration. The extentofliabilitytypicallywilldepend on the and/or criminalpenalties,damages,injunctionsand(rarely) A breachofenvironmentallawscangiverisetoadministrative,civil 4.1 and recyclethesewastes. municipalities havevoluntaryprogrammesdesignedtotakeback manufacturers anddistributors. Additionally, many businessesand and/or bottlesandcansmustbecollectedrecycledbytheir require thatcertainelectronicwaste,pharmaceuticals,batteries take-back andrecoveryoftheirwaste.Somestates,however, Generally, wasteproducersdonothaveanyobligationregardingthe 3.4 4 bankrupt/disappears)? produced? what defencesaretypicallyavailable? regarding thetake-backandrecoveryoftheirwaste? Liabilities the transferee/ultimatedisposergoes another personfordisposal/treatmentoff-site(e.g.if respect ofthewastewheretheyhavetransferreditto Do producersofwasteretainanyresidualliabilityin and/or disposeofitonthesitewherewas To whatextentisaproducerofwasteallowedtostore breach ofenvironmentallawsand/orpermits,and What typesofliabilitiescanarisewherethereisa To whatextentdowasteproducershaveobligations WWW.ICLG.COM

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211 USA 212 USA range ofpartiesforthedisposal hazardous substances. This strict As discussedinquestion3.3,CERCLA imposesstrictliabilityona 5.1 lender maybecomeliableforenvironmentalremediationcosts. management orenvironmentalcomplianceoftheproperty, the the lenderexercisesdecision-makingauthorityastouse, they donotdirectlyparticipateinmanagementoftheproperty. If are providedalimited“safeharbour”fromCERCLA liability, if mortgage primarilytoprotecttheirsecurityinterestintheproperty by thelenderovercontaminatedproperty. Lenderswhoholda Lender liabilitylargely dependsontheamountofcontrolexercised 4.5 asset purchaseagreementmaybestructuredtolimitorcapliability. or nottoacquirecertainassetsandassociatedliability. Inaddition,the acquired. Through duediligence,thebuyermaydeterminewhether contrast, inanassetsale,environmentalliabilityrelatestotheassets purchased andassumestheenvironmentalliabilityofseller. By In asharesale,thebuyer“stepsintoshoes”ofcompany 4.4 indemnification clausesandinsurancepolicies. criminal orgrosslynegligentactsaregenerallyexcludedfrom participated inorexercisedcontrolovertheoperations.Fraudulent, established whereitisshownthattheofficer anddirectoractively illegal actsthatresultincontamination.Personalliabilitymaybe to discloseknownviolations,andforfraudulent,grosslynegligentor and knowingviolations,intentionalactsincludingfailuretoreportor Yes, corporateofficers anddirectorscanbepersonallyliableforwilful 4.3 specific performancestandardsaddressedbythepermit. operation withinpermitlimitsdemonstratescompliancewiththe pre-empt otherlocal,stateorfederalrequirements.However, Yes. Manyenvironmentalstatutesprovidethatcompliancedoesnot 4.2 Violations mayalsobetime-barredbystatutesoflimitation. matter ofdays,andmustcorrectthesituationasquicklypossible. provide noticeofthebreachtoproperregulatoryauthoritywithina responses. Inordertoqualifyforadefence,anoperatorusuallymust Snell &WilmerL.L.P. © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 5 within permitlimits? groundwater? environmental wrongdoingand/orremediationcosts? the onehandandanassetpurchaseonother? indemnity protectioninrespectofsuchliabilities? Contaminated Land What istheapproachtoliabilityforcontamination To whatextentmaylendersbeliablefor environmental liabilityperspectiveofasharesaleon What arethedifferentimplicationsfroman to whatextentmaytheygetinsuranceorrelyonother personal liabilitiesforenvironmentalwrongdoing,and Can directorsandofficersofcorporationsattract notwithstanding thatthepollutingactivityisoperated Can anoperatorbeliableforenvironmentaldamage (including historiccontamination)ofsoilor

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issue inrecentyears. intended toarrangefordisposalofthewastehasbecomeaprimary disposal ofthewaste. As notedinquestion3.3,whetheraparty remediate thewaste;anddegreeofcaretakentoensureproper of thewaste;degreecooperationwithgovernmentauthoritiesto culpability astothetransportation,treatment,storageand/ordisposal disposed; typeofwaste;toxicityorotherhazardousnature that areusuallyconsideredforeachpartyinclude:volumeofwaste determine theallocationschemeforagivenCERCLA site.Issues As ageneralmatter, usuallythepartiesoraneutralthirdpartywill responsible partiesisalwaysasubstantialissueinCERCLA matters. done. Consequently, allocationofresponsibilitybetweenpotentially There isnodefinitiveCERCLA lawonhowallocationshouldbe 5.2 frequently do,seektorecovernatural resourcedamages. Yes, the federalgovernment,the Tribes, andthestatescan, 5.5 discussed belowinquestion8.1. Additionally, itispossibletotransfertheriskapurchaser. This is action againstpreviousownersandoperatorsofcontaminatedland. Yes, CERCLA,RCRA andstatestatutesallprovide privaterightsof 5.4 agreement. particularly withregardtothird-partychallengesoftheinitial agreement). These opportunities,however, areoftentimelimited, in thecaseofathirdparty, theirownrightsmaybeimpactedbythe unknown contaminationisfound),ortochallengetheagreement(if, to eitherreopentherequiredwork(forinstance,ifadditional Yes, boththegovernmentandthirdpartiesusuallyhaveopportunities 5.3 state. and remediatedanysitecontaminationtotheextentrequiredby industrial propertyifthebuyerandsellerhavenotfirstinvestigated Site Remediation Act permitsthestatetorescindanytransferof of potentiallycontaminatedland.Forinstance,NewJersey’s Industrial Also, somestateshaveadditionalstatutesaffecting thetransferability to payforremediationofcontamination. policy intheUnitedStatesistofindaresponsibleparty, orparties, facilities wherehazardoussubstancesaredisposed. The clearpublic liability alsoappliestothepastandpresentownersoperatorsof

is responsibleforthecontamination? public assets,e.g.rivers? contaminated landliabilitytoapurchaser? can athirdpartychallengetheagreement? How isliabilityallocatedwheremorethanoneperson polluter, monetarydamagesforaestheticharmsto Does thegovernmenthaveauthoritytoobtainfroma possible forapollutertotransfertheriskof or inpart,contamination;andtowhatextentisit contaminated landwhenthatownercaused,inwhole contribution fromapreviousowneroroccupierof Does apersonhaveprivaterightofactiontoseek regulator comebackandrequireadditionalworksor “agreed” withanenvironmentalregulator, canthe If aprogrammeofenvironmentalremediationis

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relationships withtheirregulators. regard, itisprudentforregulatedentitiestomaintaincooperative targets arethemselvescooperative)toobtaininformation.Inthis will workwiththetargets oftheirinvestigations(particularly, ifthe Consequently, itisusuallythecasethatenvironmentalregulators Constitution, andbyfederalstatestatutesregulations. Nevertheless, theirpolicepowersarelimitedbytheUnitedStates arrest sitepersonnelforimpedingtheirinvestigations. interview employees.Moreover, theymay, andsometimesdo, production ofdocuments,takesamples,conductsiteinspectionsand environmental statutes. This meansthattheymayrequirethe Environmental regulatorshaveinherentpolicepowertoenforce 6.1 Snell &WilmerL.L.P. ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 The extentofmandatory disclosureissometimes driven bystate 7.3 Finally, propertyusedascollateralmustusuallybeinvestigated. of courseengagein“allappropriateinquiry”priortopurchase. strictly liableforhazardoussubstances,prudentpurchasersasamatter CERCLA makescurrentownersandoperatorsofcontaminatedland owner toconductanynecessaryfutureremediation.Because changed, therebycallingintoquestionthefinancialabilityof is beingtransferred;or(ii)thefinancialstrengthofownerhas contamination unlesseither:(i)theownershiporoperationofland the casethatthereisnoobligationtoinvestigatelandfor to investigateandremediatethatrelease.Otherwise,itisgenerally Obviously, areleaseofcontaminantswilloftentriggeranobligation 7.2 third partiesareharmed. parties canexposethepropertyownertoneworgreaterliabilitiesif third parties;although,asapracticalmatter, failuretowarnthird As ageneralmatter, pollutiondoesnotlegallyneedtobedisclosed releases atasite. prudent toknowtheserequirementsinadvanceforanypotential timelines (forinstance,asshort15minutesinNewJersey),itis however, somejurisdictions haveextremelyshortmandatoryreporting resolved byalegalpractitionerwithinthejurisdiction.Because, issue, andthecharacteristicsofpollution. This issueisbest depending onthejurisdictionofsite,environmentallaw(s)at regulators. The legalrequirementsvarytremendously, however, On oroff-site pollutionmayneedtobedisclosedenvironmental 7.1 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London 7 6 parties? conduct siteinspections,interviewemployees,etc.? takeover transactions? contamination? Reporting /DisclosureObligations Powers ofRegulators What powersdoenvironmentalregulatorshaveto prospective purchaserinthecontext ofmergerand/or environmental problems,e.g.by asellerto require productionofdocuments,takesamples, To whatextentisitnecessary todisclose have anaffirmativeobligationtoinvestigatelandfor When andunderwhatcircumstancesdoesaperson migrating off-site,mustitbedisclosedtoan If pollutionisfoundonasite,ordiscoveredtobe environmental regulatororpotentiallyaffectedthird

8.2 CERCLA forthedischarge ofhazardoussubstances. responsible partyremainsstrictlyliable,withoutregardtofault,under responsible partiesallocateresponsibilityamongthemselves,each government mayhaveagainsttheindemnitor. Moreover, evenif Payment underanindemnitydoesnotalterclaimsthatthe laws involved. representations andwarranties,theunderlyingenvironmental on thetermsofprovisions,extentanyrelevantdisclosures, liabilities. The efficacy andenforceabilityofsuchprovisionsdepends Parties frequentlyincludecontractualindemnitiesforenvironmental 8.1 connection withfederalcontracts. blowers afinancialincentivetoreport environmentalviolationsin addition, thefederalFalseClaims Act offers environmentalwhistle- is providedunderthefederalCAA, CWA, RCRA andCERCLA.In report environmentalviolationsfrom retaliation.Specialprotection Yes. Federal environmentallawsprotect“whistle-blowers”who 8.4 to hearsuchcases. extent towhichfederalcourtswillexercisetheirgeneraljurisdiction decision fromtheUnitedStatesSupremeCourthaslimited involving foreignsubsidiariesorcompanies,arecent While theUnitedStatesfederalcourtsmayentertainlawsuits hold ashareholderliableifcompanyismerelyanalterego. corporate formisnotmaintainedbyasubsidiary, andcourtsmay courts may“piercethecorporateveil”ofaparentcorporation,if of waysthattheseprotectionsmightbebreached.Forinstance, subsidiary environmentalliabilities. There are,however, avariety liabilities. Parentcorporationsalsoareusuallyprotectedfrom Shareholders areusuallyprotectedfromcorporateenvironmental 8.3 review byanappropriateteamoflegalcounsel. such endeavourshouldonlybeundertaken,ifatall,aftercareful also bycorporate,bankruptcyandsecuritieslaw. Accordingly, any issue, however, that isimpactednotonlybyenvironmentallaws,but Yes, itispossibleto“escape”environmentalliabilities. This isan buyer andseller. law, butitisusuallyamatterofthecontractualtermsbetween 8 order toescapeenvironmentalliabilities? potential liabilityforthatmatter? report environmentalviolations/matters? caused byaforeignsubsidiary/affiliate? General balance sheet,andcanacompanybedissolvedin Is itpossibletoshelterenvironmentalliabilitiesoff matter (e.g.remediation)dischargetheindemnifier’s another personunderanindemnityinrespectofa related liabilities,anddoesmakingapaymentto limit exposureforactualorpotentialenvironment- Is itpossibletouseanenvironmentalindemnity Are thereanylawstoprotect“whistle-blowers”who company besuedinitsnationalcourtforpollution pollution causedbythecompany, andcanaparent liable forbreachesofenvironmentallawand/or Can apersonwhoholdssharesincompanybeheld WWW.ICLG.COM

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213 USA 214 USA was proposedin August 2018and,followingcomment,is scheduled replacement ruleentitled“Affordable CleanEnergy” rule(ACE) and theCPP wasfinallyrepealedonDecember1,2018. A new the EO,USEPA proposed therepealofCPP inOctober2017 stayed implementationoftheCPP inFebruary2016.Inresponseto emissions fromcoal-firedpower plants. The SupremeCourt had previous administrationtoregulate greenhousegas(GHG) the repealofCleanPowerPlan(CPP)rulefinalisedin 2017, President Trump issuedanexecutiveorder(EO)callingfor the Clean Air Act (so-called“anywaysources”).OnMarch28, such reportingtosourcesthatarealreadyregulatedunder Title V of greenhouse gases,buttheSupremeCourtissuedadecisionlimiting required suchreportingfromawidevarietyofmajorsources gas emissions. The USEPA enactedregulationsthatwouldhave Yes, theUSEPA requiresmonitoringandreportingofgreenhouse 9.2 thereby reducingthoseemissions. permitting oftenrequirescreditsofbanked,traditionalairpollutants, reduced nationwideSO2emissions. Additionally, newsourceair The UnitedStatesdoeshaveestablishedtradingofSO2,whichhas such trading,ortoacknowledgingthatclimatechangeisoccurring. States. Indeed,thenew Administration seemsopenlyhostiletoany an openquestionwhethersuchmarketswilldevelopfullyintheUnited greenhouse gases,primarilyinthenortheastandCalifornia.Itremains The UnitedStateshasfragmentedemissionstradingschemesfor 9.1 bear thecostsincurredbyotherstodefendagainsttheirsuits. litigation. Underthosecircumstances,individualsmaybeforcedto countervailing provisionsthatseektopreventthefilingoffrivolous generally abletorecovertheircostsoflitigation.Second,thereare enforce environmentallaws.Ifcitizensprevailinthosesuits,theyare statutes allowforcitizens’ suits,inwhichprivateindividualsseekto There are,however, exceptions.First,manyfederalenvironmental No. As ageneralrule,litigantsmustbeartheirowncostsoflitigation. 8.6 when theybelieveaparty’s conductwarrantspunishment. damages areavailable,andregulatorswillpursuepunitivedamage Penal damagesgenerallyarenotallowed.Punitiveorexemplary laws. Consequently, suchactionsarefairlyrare. lawsuits arenotwell-suitedfortheenforcementofenvironmental practical matter, however, courts havedeterminedthatclassaction for avarietyoflegalclaims,includingenvironmentalclaims. As a The FederalRulesofCivilProcedureprovideforclassactionsuits 8.5 Snell &WilmerL.L.P. © Published and reproduced with kind permission byGlobal Legal Group Ltd,London WWW.ICLG.COM 9 damages available? to monitorandreportgreenhousegasemissions? market developingthere? pursuing environmentallitigation? Emissions Trading andClimateChange in question9.1above,isthereanyotherrequirement Aside fromtheemissionstradingschemesmentioned your jurisdictionandhowistheemissionstrading What emissionstradingschemesareinoperation Do individualsorpublicinterestgroupsbenefitfrom environmental claims,andarepenalorexemplary Are groupor“class”actionsavailableforpursuing any exemptionfromliabilitytopaycostswhen

ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019

asbestos installedintheirpremises. have usedasbestosintheirgoodsorservices,whomayhad have soughtanever-wider arrayofcorporatedefendantswhomay the originalasbestosmanufacturerdefendants. As aresult,plaintiffs litigation. The plaintiffs’ barhasdepleted,orbankrupted,manyof The UnitedStatescontinuestoexperiencesubstantialasbestos 10.1 Clean Air Act, orpassaclimatechangebill,remainsdoubtful. greenhouse gases. Whether afutureCongresswouldamendthe last amendedin1990–isnotwellsuitedfortheregulationof agreement, includingwithintheUSEPA, thattheClean Air Act – implement. Meanwhile,thereseemstobevirtuallyuniversal mostly struckdowntheregulationsthatUSEPA hassoughtto pursuant totheClean Air Act. However, theSupremeCourthas the authorityandobligationtoregulategreenhousegases the UnitedStates. The SupremeCourthasheldthattheUSEPA has There isnooverallpolicyapproachtoclimatechangeregulationin 9.3 Comprehensive general liabilityinsurancepolicies,particularly those 11.2 contaminated sitemustbewellcharacterised. expectations. Currently, toobtainenvironmentalinsurance,a such insuranceinthe1990sexperiencedlossesfarexcessoftheir insurance wasdifficult toobtain. Manyofthecompaniesthatoffered fairly softandgrowing.Untilrecently, however, environmental The environmentalinsurancemarketintheUnitedStatesiscurrently 11.1 disposal offriableasbestos-containingmaterial. for contractorsandotherpersonsengagingintheremoval established asbestosworkpracticesandcertificationprogrammes certification ofcontractorsandworkers.Manystateshave federal Asbestos HazardEmergency Responserequiringthe codes. Asbestos removalfromschoolbuildingsissubjecttothe on arangeoffederal,stateandlocalhealthsafetystatutes The requirementsrelatedtoon-siteasbestosaredeterminedbased 10.2 flexibility tostateregulators. existing electricutilitygeneratingunits. The ruleprovidesmore be usedbystatestodevelopplansaddressGHGemissionsfrom to takeeffect inMarch2019. This rulesetsemissionguidelinesto 10 11 jurisdiction? regulation inyourjurisdiction? experience inyourjurisdiction? risks insuranceplayinyourjurisdiction? in relationtoasbestoson-site? What istheexperienceofasbestoslitigationinyour What istheoverallpolicyapproachtoclimatechange What istheenvironmentalinsurance claims in themarket,andhowbigaroledoesenvironmental What typesofenvironmentalinsuranceareavailable What arethedutiesofowners/occupierspremises Asbestos Environmental InsuranceLiabilities

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including traditionalnavigablewaters,theirtributaries(specifically new proposeddefinitionlimitsjurisdictiontosixcategoriesofwater, adoption, thenew WOTUS rulewouldbeeffective inall states. The including Arizona, Colorado,NevadaandUtah.Uponfinal regulations, issuedinthe1980s,areeffect intheother28states, District ofColumbiaandtheU.S.territories. The previous As aresult,the2015rulesarecurrentlyeffective in22states,the The 2015ruleshavebeenchallengedinlitigationacrossthenation. of theUSEPA andtheCorpsofEngineersover WOTUS. administration inJune2015broadlydefinethescopeofjurisdiction the UnitedStates”(WOTUS).Rulesadoptedbyprevious narrower definitionoftheClean Water Act (CWA) term“watersof 2018, theUSEPA andtheCorpsofEngineersproposedanew, repeal andreplacementoftheCleanPowerPlan.OnDecember11, Clean Water Act andtheClean Air Act. Seequestion9.1regarding expansion oftheUSEPA authorityinrulemakingsunderboththe under theCRA. The Trump administrationhascurtailedaggressive Mining streamprotectionrulesareamongtheregulationsrepealed landscape-scale planningrulesandtheFederalOffice ofSurface by asimplemajority. The BureauofLandManagement’s new2.0 date ofnoticeorpublicationtoissueajointresolutiondisapproval Congress whenrulesareissued.thenhas60daysfromthe previous administration.UndertheCRA,agenciesmustnotify (CRA) hasbeenusedtorepealseveralrulesfinalisedattheendof of thepreviousadministration. The CongressionalReview Act comprehensive reviewoftheenvironmentalregulationsandpolicies that timebothCongressandtheExecutiveBranchhaveundertakena President Donald Trump tookoffice onJanuary20,2017andsince 12.1 coverage isavailable,andtheamountofavailable. adjudicated) candeterminewhetherenvironmentalinsurance policy terms.Consequently, thestateinwhichaclaimisfiled(or have oftenrendereddistinctlydifferent interpretationsofidentical varies dramaticallyfromstatetostate,asthevariousstates’ courts environmental liabilities. The extentofavailablecoverage,however, issued priorto1974,continueprovideextensivecoveragefor Snell &WilmerL.L.P. ICLG TO: ENVIRONMENT &CLIMATE CHANGE LAW2019 © Published and reproduced with kind permission byGlobal Legal Group Ltd,London For moreinformation,visitwww.swlaw.com prospective purchaseragreements,voluntary clean-upagreements,institutionalcontrols,deedandlanduserestrictions. negotiating statements. Ourteamcanalsoadviseclientsregardingcontaminatedproperty andbrownfielddevelopmentincludingdrafting and permitswhichinvolvetheNationalEnvironmentalPolicy Act, theCaliforniaEnvironmentalQuality impact Act andassociatedenvironmental publiclandissues state andlocalenvironmentalenforcementactions.Duetoourlocationinthe SouthwesternUnitedStates,wefrequentlyaddress clientsinfederal, with negotiationofenvironmentalliabilityandoversightduediligenceforcommercial transactions.Ourlitigationteamrepresents Our environmental and natural resources attorneys advise clients on a wide variety of environmental permitting and compliance issues. W Our environmentalandnaturalresourcesattorneysadviseclientsonawide varietyofenvironmentalpermittingandcomplianceissues. in Mexico. The firmrepresentsclientsrangingfromlarge,publiclytradedcorporationstosmallbusinesses, individualsandentrepreneurs. Founded in 1938, Snell & Wilmer is a full-service law firm with more than 425 attorneys practising in 12 locations throughout the UnitedStatesand Founded in1938,Snell&Wilmerisafull-servicelawfirmwithmorethan425 attorneyspractisingin12locationsthroughoutthe 12 in environmentlawyourjurisdiction. summary ofanynewcases,trendsanddevelopments Please provide,innomorethan300words,a Updates .

repealed CPP. provides Stateregulatorswithmoreflexibilitythanthenow- specify themethodofestablishingthosestandards. The ACE rule limits basedonallowablepoundsofCO2/MWh,butdoesnot utility generatingunits. The USEPA requiresthestatestoimpose to developplansaddressGHGemissionsfromexistingelectric March 2019. This rulesetsemissionguidelinestobeusedbystates was proposedin August 2018andisscheduledtotakeeffect in replacement ruleentitledthe“Affordable CleanEnergy” rule(ACE) administration repealedtheCPP asofDecember 1,2018. A new under theClean Air Act. As notedinquestion9.1above,thenew These climatechangemandatesexpandedtheUSEPA’s authority reduced by32percentfrom2005levels2030. fired powerplants.Carbonemissionsfromthesesourcesweretobe August 2015,extendedclimatechangemandatestoexistingcoal- GHG emissions. The USEPA’s CleanPowerPlan(CPP),finalisedin administration hassignificantlychangeditsapproachtocontrolling ponds. The ruleissubjectto60days’ comment. The new waste treatmentsystems,stormwatercontrolsandartificiallakes jurisdictional waters.Elevenexclusionsarespecifiedincluding in tributarywatersandlakes,pondsimpoundmentsofotherwise hydrologic connectiontojurisdictionalwaters),ditchesconstructed excluding ephemeralstreams),adjacentwetlands(musthaveadirect environmental agencies. Appeals, theUtahBoardofOil,GasandMiningstatefederal She practisesbeforetheU.S.DepartmentofInteriorBoardLand National EnvironmentalPolicy Act andrelatedadministrativeappeals. assists clientswithenvironmentalpermitting,compliancethe projects. Manyoftheseprojectsarelocatedonpubliclandandshe focuses onenvironmentalpermittingforminingandenergy-related practice group.Withmorethan30yearsofexperience,her Denise Dragooisanequitypartnerwiththefirm’s naturalresource Denise A. Dragoo Denise A. URL: Email: Tel: USA Utah 84101 Suite 1200,SaltLakeCity 15 W. South Temple Snell &WilmerL.L.P. www.swlaw.com [email protected] +1 8012571900 WWW.ICLG.COM

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