On March 21 2017, Trench Rossi Watanabe hosted an information session regarding the “New Rules for the Management of Contaminated Areas in the State of São Paulo”. At this event, experts discussed the key issues and most controversial aspects of CETESB’s new Board Decision nº. 38/2017/C.

Highlights

1. Validity and Enforcement of the new Decision: Immediate enforcement of the new Decision with regards to technical reports must be submitted to CETESB from the date of publication, unless a company’s activity has been completed by 10 February 2017. CETESB advises that preliminary assessments already in progress before the new Decision’s publication should be reviewed accordingly and that it will be available to renegotiate the deadlines with these companies. In case of activities involving samplings, mobilization of teams, etc., CETESB clarified that it will consider the execution date of such activities for the purpose of enforcing the new Decision. That is, if such activities have been performed by February 10, 2017, CETESB will, in principle, accept the correspondent report in the format of the former Decision;

2. Management Aspects: If CETESB understands that a technical report is not in accordance with the new Decision, the report will be rejected and the company may be sanctioned (warning, fine) together with a summary comprising the adjustments required to comply with the new Decision. CETESB will not issue technical opinions without prior receipt of payment by companies. Responses to technical reports will therefore be faster (CETESB estimates a deadline of 60 days). Communication between companies and CETESB will primarily occur by e-mail;

3. Predictability: The idea if that the new Decision may provide greater predictability to companies when hiring works and evaluating the results presented by technical consultants, since it clearly sets out all the information that must be included in technical reports to be presented to CETESB (“Check list”). Such reports must be delivered to CETESB, in digital format, only when the investigation phase has been fully completed;

4. Technical aspects: Greater focus on the Preliminary Assessment (which should include a detailed investigation of the neighboring area and a Confirmatory Investigation Plan, among others), as well as on the conceptual model (which should be robust in order to support the subsequent phases and updated throughout the investigation). The Detailed Investigation should contemplate three-dimensional delimitation of the plumes of contamination, mathematical modeling and calculation of mass of contaminants, among other information. The Intervention Plan should comprise all the information established by the new Decision (e.g. objectives, measures and techniques to be adopted), together with a bank guarantee or environmental insurance in the amount of 125% of the estimated cost of the Plan, among others. In addition, CETESB expects to receive not only reports concerning monitoring campaigns, but also information on the efficiency of the remediation system adopted in the area;

5. Preventive and final monitoring: Companies will be requested to present their Preventive Monitoring Plan as a condition to the licensing proceeding (which may be a technical requirement of the installation license or requested at the time of renewing the operating license). The of the final monitoring should be defined by the technical consultant in accordance with the specificities of the case;

6. Ecological risk assessment: At this moment, CETESB will not establish a method for developing an ecological risk assessment. Therefore, companies must present their suggested method (international references may be used) for CETESB’s evaluation; and

7. Sanctions: Fines will be applied based on Decree No. 59,263 /2013: ordinary infractions from 04 to 1000 UFESPs; severe from 1001 to 5000 UFESPs and very severe from 5,001 to 4 million UFESPs. * 1 UFESP: R$ 25,07. In order to reduce the chances of sanctions, it is important that deadlines established by CETESB be closely monitored and, if necessary, that such deadlines be renegotiated with CETESB in advance and that the request be duly justified. In addition, compliance with the “check-list” established by the new Decision regarding each technical report is of foremost importance.