Is your business prepared for its new General Environmental Duty?

Corporate & Commercial 16 June 2021

From 1 July 2021, the new Environment Protection Amendment Act 2018 (Vic) (Act) is intended to come into force which will amend the Environment Protection Act 2017 (Vic) (Principal Act). Under the Act, all individuals and businesses will be subject to the General Environmental Duty. Other changes include increased penalties for non-compliance and enhanced powers given to the Environmental Protection Authority (EPA).

This article outlines these forthcoming amendments to enable you to assess whether you are equipped to comply with your duties and to provide guidance on what you can do to prepare your business.

General Environmental Duty (GED)

The General Environmental Duty (GED) is at the centre of the new laws. It imposes a positive obligation upon businesses (and individuals) engaging in activities that may give rise to risks of harm to human health or the environment from pollution or waste to understand those risks and take reasonably practicable steps to minimise them.[1] The overarching purpose being that Victorians will be less likely to be impacted by environmental disasters, pollution and waste.

How do you prepare your business for the GED? 

The GED is modelled on Victoria’s Occupational Health and Safety laws in that it requires the identification, assessment and control of risks before any harm occurs. It requires a proactive approach. This is the most significant change for businesses (and individuals) as it will now be an offence to breach the GED regardless of whether any harm to human health or the environment actually occurs. For example, a failure to train an employee to correctly dispose of chemical waste will in itself be a breach of the GED, regardless of whether the chemical waste was actually disposed of incorrectly.

The Act specifies that a failure to implement the following proactive actions will be a contravention of the GED:

  • use and maintain plant, equipment, processes and systems in a manner that minimises risks of harm to human health or the environment from pollution and waste;
  • use and maintain systems for identification, assessment and control of risks of harm to human health or the environment from pollution and waste that may arise in connection with the activity, and for the evaluation of the effectiveness of controls;
  • use and maintain adequate systems to ensure that if a risk of harm to human health or the environment from pollution or waste were to ever eventuate, its harmful effects would be minimised;
  • ensure that all substances are handled, stored, used or transported in a manner that minimises risks of harm to human health or the environment from pollution and waste; and
  • provide information, instruction, supervision and training to any person engaging in the activity to enable those persons to meet the GED.[2]

In light of these new obligations, it is crucial to undertake a review of your business’ current environmental protection policies to ensure they meet these new requirements. Generic environmental policies may no longer suffice.

What Constitutes ‘Reasonably Practicable’ under the GED?

You will notice that under the GED, businesses are required to take reasonably practicable steps to minimise harm. But what is ‘reasonably practicable’? Assessing what is ‘reasonably practicable’ is essentially a balancing act and whilst it will vary from business to business, the Act specifies that you must have regard to the following factors:

  • the likelihood of those risks eventuating;
  • the degree of harm that would result if those risks eventuated;
  • what the person concerned knows, or ought reasonably to know, about the harm or risks of harm and any ways of eliminating or reducing those risks;
  • the availability and suitability of ways to eliminate or reduce those risks; and
  • the cost of eliminating those risks.[3]

It is important for businesses to independently assess these factors when preparing or amending their policies to comply with their GED. For example, businesses with higher risk of environmental harm may have a completely different basis of what constitutes ‘reasonably practicable’ than that of a business with a lower risk of environmental harm.

Is there any other duties under the new laws?

Yes. Both individuals and businesses will also have a duty to notify the EPA of ‘notifiable incidents’ regardless of whether the incident is contained to:

  • a single place or premises; or
  •  a place or premises is occupied or under the management or control of the notifier.[4]

A ‘notifiable incident’ means:

  • a pollution incident that causes or threatens to cause material harm to human health or the environment; or
  • a prescribed notifiable incident.[5]

Furthermore, a person in management or control of land must notify the EPA if the land has been contaminated by ‘notifiable contamination’ as soon as practicable after the person becomes aware of, or reasonably should have become aware of, the notifiable contamination.[6]

A ‘notifiable contamination’ means contamination that is:

  • a prescribed notifiable contamination; or
  • contamination for which the reasonable cost of action to remediate the land is likely to exceed $50,000 or any other prescribed amount.

The Environment Protection Regulations 2021 (Regulations) outlines what will be considered a prescribed notifiable contamination, setting out levels which are considered notifiable for soil contamination, asbestos, groundwater and surface water contamination and vapour inhalation pathway.  As the Regulations, in part, assess levels of contamination in reference to various guidelines which are current at the time of the Regulations, what constitutes a ‘prescribed notifiable incident’ and ‘prescribed notifiable contamination’ may evolve over time. So, whether you’re an individual, employee or business owner, this is something to be mindful of to ensure you are aware of your notification obligations.

Stronger Sanctions

A breach of the GED will attract both civil and criminal penalties of up to $1.6 million for corporations. Intentional breaches of the GED attract up to 5 years imprisonment and $3.2 million in fines.

Penalties for illegal dumping of industrial waste will also be increased in line with the penalties for a breach of the GED.

The civil penalty scheme is unique to Victoria and allows the EPA to take more timely and proportionate enforcement action for moderate breaches of the Act.

To support the transition to a risk-based scheme, a transitional material harm offence will apply to a person that causes material harm from pollution or waste, attracting the same penalty as a breach of the GED. A person who can prove compliance with the GED will not be liable for this offence. However, this transitional period will only last for 4 years.

Finally, the Victorian community members directly affected by alleged breaches of the Act can now seek action through the Courts to remedy or restrain the breach.

Key Takeaways

  • It is crucial to have adequate systems and processes in place to ensure your business is compliant with the GED. It will not suffice to establish systems and processes after harm to human health or the environment has already occurred.
  •  If you do have pre-existing processes and systems in place relating to environmental protection, you should begin reviewing them in order to implement any necessary amendments ahead of the Act commencing in July 2021.

Understanding your obligations under the new environmental laws is important. If you have any questions about the changes to the Act or how to prepare your business for its GED, our corporate and commercial team at Coulter Roache can assist you.

[1] Environment Protection Amendment Act 2018 (Vic), section 25.
[2] Ibid, section 25(4).
[3] Ibid, section 6(2).
[4] Ibid, section 32.
[5] Ibid, section 30.
[6] Ibid, section 40.

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