Penalties and enforcement under the new Victorian Environment Protection laws

What you need to know

• The proposed Environment Protection Regulations under the Environment Protection Act 2017 (Vic) contain new offences, attracting significant penalties, including, in some instances, imprisonment. 
• Some of these new offences can be dealt with via infringement notices, which give offenders an opportunity to pay a reduced penalty in order to avoid further prosecution in relation to the offence.
• New powers will enable the EPA to make orders to clarify duties and obligations under the Act and Regulations, including Environmentally Hazardous Substance Orders and Obligations on Managers of Land and Infrastructure.

What you need to do 

• Consider how the new penalties and enforcement provisions may impact your organisation and what amendments may be needed to your practices, policies and procedures to comply with these new laws before their anticipated commencement in July 2020.  
  
• Consider whether your organisation wishes to comment on the exposure draft Regulations and Standard.
• Watch out for our future publications on Environmentally Hazardous Substance Orders and Obligations on Managers of Land and Infrastructure, which will be released once these new subordinate instruments are available for public comment.
• Consider attending our upcoming seminar about the new regime.

Penalties and enforcement under the new Victorian Environment Protection laws

This edition of our Victorian Environmental Alert series expands upon our high level overview of the enforcement regime that will be contained in the Environment Protection Act 2017 (Vic) (New EP Act) and proposed Environment Protection Regulations (Regulations) and Environment Reference Standard (Standard). 

In addition to the Regulations and Standard, additional new subordinate instruments will be introduced by the Victorian EPA including Environmentally Hazardous Substance Orders (EHSOs), Obligations on Managers of Land and Infrastructure (OMLIs), as well as compliance codes.  These additional subordinate instruments are not yet available for public comment. 

Penalties and infringement notices

A key intention of the New EP Act and Regulations is to enable the EPA to effectively hold polluters to account through stronger sanctions and penalties.  This will be bolstered by the introduction of civil penalty provisions by the New EP Act, which will enable the EPA to pursue a civil penalty in respect of an offence instead of having to undertake a criminal prosecution.

In addition to the range of offences and penalties under the New EP Act, the Regulations contain a number of offences that attract reasonably significant penalties (the maximum financial penalty for an offence is 300 penalty units (currently $49,566) for a body corporate). The offences attracting this maximum penalty vary in nature, but include: 

• a person who has the management or control of soil sourced on-site from contaminated land that is industrial waste who fails to correctly classify that soil (Regulation 62);
• a person who has the management or control of priority waste who mixes, blends or dilutes the priority waste with other wastes which results in a change to the waste classification of the priority waste (Regulation 70);
  
• a brand owner who fails to comply with requirements to recover, re-use and recycle materials and review packaging design (Regulation 95);
• a person who processes, stores or uses particular types of chemical substances without notifying and receiving approval from the EPA, and/ or fails to comply with any conditions of the EPA (Regulation 102);
• a person who deposits or discharges waste produced or located on a vessel into the surface water or marine water environment without it meeting certain requirements (Regulation 132); and
• a regulated petrol producer who produces petrol with excess vapour pressure (Regulation 152).

In Edition 5 of this Series, we discussed how the Regulations provide for infringement notices in relation to 72 offences under both the New EP Act and Regulations.  Of the examples listed above, infringement notices will be able to be issued in relation to Regulations 70, 132 and 152.  Infringement notices are typically 10-20% of the maximum penalty for the offence and if an infringement notice is paid, no further prosecution action can be taken in relation to that offence. 

The offence created by Regulation 62 is new, and builds on the duty to manage contaminated land introduced by the New EP Act.  This requirement to correctly classify contaminated soil reflects not only the increased emphasis on appropriate waste disposal practices in Victoria during the waste "crisis", but also seeks to support an increased emphasis on the appropriate reuse of contaminated soils rather than relying on disposal to landfill.

We were particularly interested to see proposed Regulation 132, which reflects increasing international concern (given a new international convention which came into force on 8 September 2019 which affects all shipping and ports worldwide) in relation to the chemical treatment of ballast water to manage aquatic pests that pose a biosecurity and environmental risk.  Not only are these aquatic pests a concern, but there is increased attention on whether the chemical treatment of ship related waters is going to create different and additional issues for aquatic environments. 

In our upcoming publications, we will more closely examine the new regulatory regime around contaminated land and waste.

Imprisonment for prohibited persons who undertake a prescribed permission activity 

It is an offence for "prohibited persons" to engage in "prescribed activities" (sections 88-89 of the New EP Act).
"Prohibited persons" are certain persons who: 

• have been convicted or found guilty of fraud, dishonesty, or indictable offences under particular legislation; 
• have had a "permission" (or equivalent licence or permit) revoked by the EPA; or
• are insolvent;
• in the case of a body corporate, one of more officers is a person referred to above, or one or more officers is or was an officer of another body corporate that is or was a person referred to above.

The court may impose a penalty of up to two years imprisonment, in addition to, or in place of the penalty included under sections 45, 46 or 47 of the New EP Act if: 

• a prohibited person (who is a natural person) commits an offence against the "permission activity" sections of the New EP Act by engaging in an "operating activity" without an operating licence (s45), a "permit activity" without a permit (s46) or a "registration activity" without a registration (s47); and 
• the permission activity is a "prescribed permission activity" under the Regulations (refer to discussion below).

Regulation 53 now specifies the "prescribed permission activities" for the purpose of section 89 of the New EP Act, being: 

• storing, treating, or reprocessing, containing or disposing of any reportable priority waste, generated at another location without the required permission;
• storing more than 40 tonnes or 5000 Equivalent Passenger Units (EPU) of waste tyres on a site at any time and for any purpose; and
• storing less than or equal to 40 tonnes or 5000 EPU of waste tyres on a site at any time and for any purpose unless the amount is less than 5m³ or the waste tyres are stored in accordance with a declaration of use.

Although section 89 only applies to "natural persons", a sentence of imprisonment could be imposed on the officer of a body corporate (for the purpose of Part 11.8 of the New EP Act) if:

• the officer commits an offence against the permission activity sections of the New EP Act and is convicted or found guilty of committing such an offence; and
• the body corporate was prohibited from engaging in the prescribed permission activity that was the subject of the offence because the officer is a prohibited person for the purpose of section 88 of the New EP Act.

Enforcement 

Although much of the enforcement under the New EP Act and Regulations is undertaken by the EPA, the Regulations also provide for municipal council to prosecute certain offences.
Specifically, regulation 166 provides that a council may prosecute specified offences relating to on-site wastewater management systems (ie. septic tank systems).  For example, a council can prosecute a failure to obtain a permit to construct, install or alter a septic tank system, or a breach of a condition in a permit related to a septic tank system

Timeline 

The Regulations and Standard are open for public comment via the Engage Victoria website until 31 October 2019.

Public submissions will be reviewed in late 2019, with a view to the final Regulations and Standard being made in early to mid-2020.  The EPA/DELWP's response to public comments will also be released around this time.

It is intended that the new regime will come into force from 1 July 2020.

How to make a public submission

Feedback on the Regulations and Standard can be provided in the online form on the Engage Victoria website, or uploaded via the online form or sent by email or post.  There is an option to identify submissions as confidential, in which case DELWP/EPA will not publish the submission.

Other articles in our New Victorian Environment Protection Laws series

In the previous editions of this alert series we have discussed some of the key changes resulting from the New EP Act.  A link to our previous publications is below.
Over the coming weeks, we will be providing more detailed updates in relation to some of key items contained in the Regulations and Standard.  

Environment Alert: The end of Victoria's environmental law as we know it? (22 June 2018)

New Victorian Environment Protection Laws  - A new environmental duty in Victoria – all you need is a risk of harm – Edition 1 (9 July 2018) 

New Victorian Environment Protection Laws - Reformed review rights under the Environment Protection Amendment Bill 2018 (Vic) - Edition 2 (24 July 2018)

New Victorian Environment Protection Laws – A three-tiered approach to environmental approvals: licences, permits and registrations – Edition 3 (7 August 2018)

New Victorian Environment Protection Laws: New duties for the reporting and management of contaminated land – Edition 4 (17 September 2018)

New Victorian Environment Protection Regulations and Environment Reference Standard released for public comment – Edition 5 (5 September 2019)

Authors: Jane Hall, Senior Associate; Tess Birch, Lawyer.