This update provides further detail on key issues for industry following the announced proposed amendments to the Environment Protection and Biodiversity Conservation Act 1999 (Cth) (EPBC Act) by the Department of Sustainability, Environment, Water, Population and Communities (DSEWPaC).

These proposals will have significant implications for the developers and operators of projects, as they will impact upon the reach of the Commonwealth’s interest in environmental matters and affect the time and cost involved in undertaking an environmental assessment of the project and seeking the Government’s approval. They will also increase Commonwealth involvement in environmental enforcement action.

The good … and the questionable

The following aspects of the proposed amendments will, or may, be positives for industry, with our caveats provided:

  • the continuation of triple bottom line decision making, but noting that the minister may only endorse a strategically assessed policy, plan or program where he or she is satisfied that actions taken in accordance with it will be ecologically sustainable.
  • strategic assessments, if they deliver certainty, less red tape, fewer project assessments, a collaborative cross-jurisdictional approach and equitable outcomes for proponents. Recent experience on some strategic assessments would suggest that the assessment is only as good as the State or Territory agency that leads it. And we would hope to see some improvements on this front.
  • increased emphasis on biodiversity banking schemes, though clear and practical guidance on the institutional and regulatory arrangements for these schemes will be important.
  • consultants will not be subject to additional requirements in the manner recommended in the independent review (through a Code of Conduct), but targeted auditing will be implemented (and published) to evaluate the quality of information provided by proponents and environmental outcomes. This may lead to increased risk of misleading information prosecutions.
  • clarification regarding who is taking an action but only if this does not make proponents inappropriately responsible for the actions of others.
  • the increased use of useable, clear and scientifically robust ‘significance’ guidelines, provided that these do not provide prescriptive ‘tests for significance’ unsupported or inadequately supported by scientific evidence or relied upon by the Government without regard to individual project circumstances.
  • inclusion of provisions that allow for binding determinations to be made as to classes of actions that will not have a significant impact on matters of national environmental significance, but the minister also having the power to determine classes of actions that will be considered to have such an impact leading to risk of significant reputational taint for particular industries.
  • clarification that offsets will not be able to be considered in the making of particular manner decisions, but noting that this may lead to more controlled action decisions.
  • providing greater clarity regarding changing project scopes after approval.
  • no amendment to the current standing and injunction provisions in relation to undertakings as to damages and security for costs.

Watch out for these …

The proposed amendments contain the following potentially negative developments for industry:

  • It potentially sets up a confrontational political environment for managing strategic and regional assessments. Whilst strategic assessments can conceptually deliver improved outcomes through early environmental planning and certainty, the proposed amendments assert Commonwealth environmental dominance. This may to lead to disputes with the States, or to the States developing and leading the assessment of poorly thought-out or defective strategies. 
  • The National Heritage Listing of the Kimberley is an indication of what is to come with respect to a strategic, regional or landscape approach and raises concerns regarding a lack of scientific rigour.
  • There is a mixed message on offsets. The minister’s press statement included the comment:

One of the things that has annoyed business the most is to believe that they were through all the environmental approvals and to believe that they’d established an agreement on what offsets they’d have to be engaged with and then to find that Commonwealth rules are a different standard ...

However, the draft EPBC Act Environmental Offsets Policy states that ‘It is important to note that while there are many similarities between the environmental laws of the states and territories and the EPBC Act, they also differ in a fundamental way. Therefore, a state or territory offset will count toward an offset under the EPBC Act to the extent that it compensates for the residual impact to the protected matter identified under the EPBC Act.’ It is also stated that already negotiated State offsets will not be taken into account by the Commonwealth at the stage of deciding whether to assess a project.

  • A potential broadening of enforcement powers is proposed and the ability to issue warning notices and environment protection orders. Flexibility may provide advantages, but the devil will be in the detail. 
  • Legislative and performance audit powers will be expanded.
  • Proponents will be required to publish all comments made to them as part of the statutory assessment process, except for campaign letters. This appears to include comments received at any stage of the assessment process.
  • The Commonwealth indicated that there is no need to enshrine administrative law principles in the EPBC Act (for example, the requirement to give a proponent information adverse to the project). However, to minimise the risk of administrative law challenge, enshrining principles would assist in ensuring that appropriate processes are adopted. Too often we are met with the response by Government officials, ‘if it’s not in the Act, we don’t have to do it’.
  • Key threatening processes such as land clearing and dieback are being used in guidelines as risk thresholds for ‘significant impacts’. The use of guidelines is proposed to be expanded under the EPBC Act. The minister takes such key threatening processes into account in decisions. However, it is not entirely clear how these threatening processes will be incorporated into the proposed landscape approach.

What you can do

These reforms will have significant long term implications for industry. Companies should ensure that they are fully engaged with their industry organisation as the reform debate continues. We will be assisting the relevant industry organisations at each step so please call us if you are concerned about particular aspects for your operations.