The ELD came into force in April 2007. The ELD aims to create a framework of uniform environmental liabilities across the EU and to enable the prevention and remediation of environmental damage based on the “polluter pays” principle.
Prior to the implementation of the ELD, EU Member States relied on domestic civil laws to impose liability in respect of damage to persons and their property. Such laws varied considerably and it was difficult to impose liability for damage to the general environment (eg, natural habitats or protected species).
Commonly asked questions
Who might be affected by the Regulations?
Any person operating or controlling an economic activity, whether public or private and whether or not carried out for profit (an Operator).
When might an Operator be liable to comply with the Regulations?
A strict liability regime applies to an Operator where:
- its occupational activities cause (or have the potential to cause) “environmental damage” including damage to: (a) protected species or habitats or a site of special scientific interest; (b) surface water or groundwater; or (c) land; and
- the activities causing the damage are listed in Schedule 2 to the Regulations (this list includes, amongst others, industrial, waste management and chemical processes).
A fault-based liability regime applies to an Operator where:
- its occupational activities cause, or have the potential to cause, environmental damage to protected species or habitats or a site of special scientific interest; and
- it can be proved that the Operator intended to cause the damage or was negligent as to whether the damage would be caused.
What duties apply to an Operator under the two liability regimes?
Where an activity causes an imminent threat of environmental damage, the Operator should: (a) immediately take all practicable steps to prevent damage; (b) notify the appropriate enforcing authority; and (c) comply with an enforcing authority notice requiring specified measures to be taken within set time limits.
Where an activity has already caused environmental damage, in addition to complying with the duties set out above, the Operator should comply with an enforcing authority notice which may require: (a) additional information to be provided on the damage; and/or (b) specified measures to be taken within set time limits to prevent further damage; and/or (c) submission of proposals for measures that will remediate the environmental damage caused; and/or (d) additional monitoring or investigative measures to be carried out during remediation.
Are there any exemptions to these duties?
The duties (and any potential liability) will not apply to environmental damage (or a threat of environmental damage) caused in the following circumstances:
- where the damage occurred prior to 1 March 2009;
- where damage is caused by, for example, an act of terrorism; exceptional natural phenomenon; liability under an international convention; or matters of international security or national defence; and/or
- where the damage is caused by pollution of a diffuse nature and it is not possible to establish a causal link between the damage and specified activities.
What is the extent of remediation required?
Remediation of damage to natural resources (excluding land)
The objective is to achieve the same level of natural resource or services as would have existed if the damage had not occurred. Remediation may include:
- Primary remediation – any remedial measure which returns the damaged natural resources or impaired services to, or towards, the state that would have existed if the damage had not occurred;
- Complementary remediation – any remedial measure taken in relation to natural resources or services to compensate for the fact that primary remediation does not result in fully restoring the damaged natural resources or impaired services to the state that would have existed if the damage had not occurred; and/or
- Compensatory remediation – non-financial measures to compensate for interim losses of the ecological function of natural resources or services.
Remediation of damage to land
The remediation must ensure, as a minimum, that the relevant contaminants are removed, controlled, contained or diminished so that the land, taking into account its lawful current use or any planning permission in existence at the time of the damage, no longer poses any significant risk of adverse effects on human health.
Can the operator appeal against a remediation notice?
An appeal may be made within 28 days of service of the notification. The Regulations provide a list of grounds for appeal including that the Operator’s activity was not a cause of the environmental damage or that the damage resulted from compliance with an instruction from a public authority.
What are the consequences for an Operator failing to comply with the duties?
- It may be liable to reimburse the enforcing authority for its reasonable costs where the authority carries out preventative/remedial works on its behalf.
- It may be subject to criminal prosecution in the Magistrates or Crown Court.
What are the penalties for committing an offence under the Regulations?
- Magistrates Court: A fine not exceeding £5000 and/or imprisonment for a term not exceeding three months.
- Crown Court: An unlimited fine and/or imprisonment for a term not exceeding 2 years.
- Directors and Officers may be subject to personal liability where the offence is proven to have been committed with their consent or connivance.
Who are the enforcing authorities?
The enforcing authorities include (amongst others) the Environment Agency, the relevant Local Authority, Natural England and the Secretary of State. The appropriate authority will depend on factors such as whether the activity causing the environmental damage (or imminent threat of damage) was subject to an Environmental Permit under the Environmental Permitting (England and Wales) Regulations 2007 and the type of natural resources affected by the damage/threat of damage.
Other important factors
Where environmental damage is caused by more than one Operator, then the enforcing authority can choose which Operator is responsible. The Operator held responsible may try to seek contributions from others in separate proceedings.
Third parties may notify an enforcing authority of environmental damage where they are affected (or likely to be affected) by the damage, or if they otherwise have a “sufficient interest”. The term “sufficient interest” is left to each Member State to define. Whilst the Regulations do not provide a relevant definition, guidance to the Regulations suggests categories of persons whom may be deemed to hold such an interest (eg, birdwatchers and ramblers).
- Know your responsibilities under the ELD/Regulations.
- Consider and assess the potential impacts of the legislation on
- your business.
- Check your insurance policies to see whether liability under the Regulations is covered and talk to your brokers.
- Review contingency plans to ensure they are compliant with the duties under the Regulations.
- Consider whether environmental assessments should be carried out on sites to establish the current baseline condition as any restoration under the Regulations would be to the site condition as at 1 March 2009.
- Review the scope and content of compliance audits.
- When purchasing land, assess risk and the potential for remediation costs.
- In transactions, undertake thorough due diligence and maximise contractual protections for liability.