All questions

Environmental protection

i Air quality

Air quality is regulated in Australia at both the federal and state level.

The National Environment Protection (Ambient Air Quality) Measure was established in 1998. It aims to provide a common national goal to best protect human health and well-being from the adverse impacts of air pollution. It provides a consistent framework to assess Australia's outdoor air quality by setting national ambient air quality standards for six common air pollutants as well as mandatory monitoring and reporting requirements against these standards for participating jurisdictions. Obligations under this Measure are generally assumed by governments rather than emitters.

On 15 December 2015, Australia's federal and state environment ministers entered into the National Clean Air Agreement. The Agreement, implemented through the National Environment Protection Council, focuses on actions to reduce air pollution and improve air quality through cooperative action between industry and government at the national, state and local levels. Obligations under this Agreement are also generally assumed by governments rather than emitters.

The initial focus of the Agreement will be to:

  1. introduce emission standards for new non-road spark ignition engines and equipment (such as garden equipment and marine outboard motors);
  2. adopt measures to reduce air pollution from wood heaters, including the adoption of new emission and efficiency standards for new wood heaters and sharing best management practices across jurisdictions; and
  3. strengthen ambient air quality reporting standards for particle pollution based on the latest scientific understanding of the health risks arising from airborne particle pollution.

At the federal level, the National Environment Protection (National Pollutant Inventory) Measure (NPI NEPM) sets out national objectives for protecting particular aspects of the environment, which may also affect air quality. More than 4,000 facilities from a wide range of industry sectors that exceed NPI reporting thresholds for the emission of NPI substances to air, land and water are required to report annually to relevant state or territory environment agencies under the NPI NEPM. This reporting enables the NPI to collate and disseminate data about emissions on a geographic, sectoral and facility level.

The federal government also regulates the manufacture, import and export of ozone depleting substances and synthetic GHG through the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989 (Cth) and related acts and regulations. This framework is intended to assist Australia to meet its obligations under the Montreal Protocol.

State and territory governments implement legislation, statutory instruments, policies and programmes in their own jurisdictions in order to meet the Ambient Air Quality NEPM standards and manage the collection of data under the NPI NEPM. For example, Victoria has adopted the State Environment Protection Policy (Air Quality Management) and the State Environment Protection Policy (Ambient Air Quality), which set standards for the discharge of major pollutants from sources, including industrial premises, with a view to controlling air pollution. The EPA monitors achievement of the ambient standards and encourages a range of measures to improve air quality such as promoting clean technology, discouraging open-air burning, using tall stacks to promote dispersion and reducing exhaust pollutants from vehicles.

State and territory governments also implement legislation, policies and programmes to meet their own individual goals in relation to air emissions, such as via specific legislative provisions and licence conditions.

ii Water management and water quality

Responsibility for water resources is primarily vested in the state and territory governments; however, the federal government does exercise certain powers under the Water Act 2007 (Cth) in relation to the management of the Murray Darling Basin, which stretches across the eastern states of Australia, and in respect of water information and data collection. In most cases, there are separate regimes related to water management and water quality.

Water management legislation usually provides for:

  1. the preparation of water management plans for water resource areas to support the sustainable use of available water and protect environmental values of those ecosystems;
  2. the grant of licences or other entitlements to take and use water for various purposes, having regard to the availability of water at different times;
  3. approvals for the construction of works to take and use water;
  4. rules to facilitate trading of water entitlements; and
  5. powers of regulators to investigate and enforce the legislation.

Water quality issues are then separately regulated through pollution control legislation that creates offences for the pollution of water and sets water discharge limits and monitoring requirements through environment protection licences.

At the federal level, the National Water Quality Management Strategy (NWQMS) is a joint national approach to improving water quality in Australian and New Zealand waterways. It was developed in cooperation with state and territory governments. The NWQMS aims to protect the nation's water resources by improving water quality while supporting the businesses, industry, environment and communities that are dependent on water for their continued development.

At the state level, Victoria has adopted environmental quality objectives through its State Environment Protection Policy (Waters of Victoria) (SEPP). The SEPP sets the level of environmental quality required to protect aquatic ecosystems. If the objectives are not met, it signals a potential risk to the ecosystem, which is then investigated by the EPA using the risk-based approach. Similarly, in NSW, the government released the Water Reform Action Plan in response to the independent investigation into NSW water management and compliance. The Water Management Act 2000 (NSW) was amended to deliver the legislative amendments required to implement the Water Reform Action Plan, and a new independent Natural Resource Access Regulator has been established to oversee water-related compliance.

In NSW, Section 120 of the POEO Act prohibits water pollution. The only defence is to establish that the pollution arose from a regulated activity and the requirements of that regulation were not contravened. There have been a number of recent cases in the NSW Land and Environment Court where companies have received significant fines for water pollution offences. These include a A$360,000 fine for a chemical company found guilty of discharging a number of hazardous chemicals into a pond that drained into a local waterway causing significant environmental harm; and a fine of A$187,500 to a water utility found guilty of water pollution and breaches of licence conditions resulting from fluoride and chlorine being discharged into a local creek. The EPA has also issued a number of A$15,000 penalty notices to companies for water pollution incidents during 2016, demonstrating a commitment to enforcing pollution prohibitions. Similar water pollution offences apply in other states and territories.

During 2016, the impacts of mining activities on groundwater availability and quality came into the spotlight in Queensland when the government introduced the Environmental Protection (Underground Water Management) and Other Legislation Amendment Act 2016 (Qld). This Act introduces a new requirement for resource sector operators (i.e., in the mining petroleum and gas sectors) to obtain an associated water licence for some projects and to carry out additional environmental impact assessment for site-specific environmental authority applications if they involve taking groundwater. Operators may also have 'make-good' obligations or requirements to enter into agreements with landholders if their activities impact upon groundwater availability.

iii Chemicals

The Federal Department is responsible for undertaking environmental risk assessments of industrial and agricultural chemicals for the National Industrial Chemicals Notification and Assessment Scheme (NICNAS) and the Australian Pesticides and Veterinary Medicines Authority (APVMA). The responsibilities of NICNAS derive from the Industrial Chemicals (Notification and Assessment) Act 1989 and include:

  1. assessing new industrial chemicals for health and environmental risks;
  2. maintaining the Australian Inventory of Chemical Substances;
  3. managing the Register of Industrial Chemical Introducers;
  4. compelling commercial importers and manufacturers to notify industrial chemicals that are new to Australia;
  5. providing information and making recommendations about chemicals to other government agencies responsible for the regulation of industrial chemicals; and
  6. administering the Cosmetic Standard 2007.

APVMA performs similar regulatory functions in relation to chemicals used solely for purposes relating to agriculture, gardening, pesticides, pool sanitisers, veterinary medicine, and pets and livestock.

The Department has recently decided to reform the regulation of industrial chemicals in the country. Six bills were introduced to Parliament on 1 June 2017, the key one being the Industrial Chemicals Bill 2017. This Bill aims to reduce red tape and improve the safety risk framework for industrial chemicals in Australia. It establishes a new scheme, the Australian Industrial Chemicals Introduction Scheme, which will replace the NICNAS. Notably, the bill implements the government's 2016 election commitment on animal testing, banning the use of animal testing data for industrial chemicals, where those chemicals are intended solely for an end use in cosmetics.

The other bills deal with transitional arrangements and the introduction of various fees and charges. The bills were passed unamended through the House of Representatives on 17 October 2017 and are currently before the Senate. It was previously proposed that they would come into effect on 1 July 2018; however, to assist regulated entities to adequately prepare for compliance with the new scheme, the Australian government has deferred commencement of the scheme until 1 July 2019.

The Department is also responsible for managing Australia's engagement with, and obligations under, international treaties relating to hazardous and persistent chemicals, for example, gathering information about persistent organic pollutants and developing strategies to reduce or eliminate their use and environmental exposure in accordance with a National Implementation Plan.

Similar to air quality, the federal government has recently been cooperating with state and territory environment ministers to establish a National Standard for environmental risk management of industrial chemicals. A Draft National Standard was released for public consultation on 24 November 2016 and closed on 3 March 2017. It is currently being considered by the environment ministers. The objects of the Draft National Standard are to:

  1. achieve better protection of the environment through improved management of the environmental risks posed by industrial chemicals; and
  2. provide a nationally consistent, transparent, predictable and streamlined approach to environmental risk management of industrial chemicals for governments, industry and the community.

Under the Draft National Standard, industrial chemicals are categorised as low, medium or high risk and broken into seven specified categories, or environmental schedules. Each of the environmental schedules has a set of outcomes-based risk management measures. Responsibility for managing the environmental risks of chemicals throughout their life cycle is then targeted at those who have the capacity to best manage them. This is intended to allow industry to manage risk efficiently and clearly separate regulatory responsibilities for government.

State and territory governments also play a role in managing the use and disposal of industrial chemicals. Certain activities involving the manufacture or use of chemicals may be regulated by EPAs and require environment protection licences to be held. Further, the disposal of certain chemicals will in most jurisdictions only be permissible at facilities licensed to receive them.

iv Solid and hazardous waste

The waste industry in Australia is highly regulated, primarily by state and territory governments through their EPAs.

At the federal level, legislation has been introduced to manage certain activities relating to hazardous waste, used packaging waste and promote product stewardship. The Hazardous Waste (Regulation of Exports and Imports) Act 1989 (Cth) regulates the export, import and transit of hazardous waste within and outside Australia. The Act was developed to enable Australia to comply with specific obligations under the Basel Convention on the Control of the Transboundary Movements of Hazardous Wastes and their Disposal.

The main functions performed by the Department in relation to hazardous waste include processing of export, import and transit permit applications under the Act; ensuring compliance and enforcement with the Act; and participating in domestic and international policy development under the Basel Convention.

The National Environment Protection Measure on Used Packaging Materials (the Australian Packaging Covenant) provides a framework where voluntary signatories make commitments to practise product stewardship throughout the life cycle of consumer packaging. This includes through the design of packaging to minimise the use of materials and eliminate excess packaging; adopting and implementing the Environmental Code of Practice for Packaging; supporting materials recovery systems; and reporting and demonstrating continuous improvement. 'Brand owners' of consumer products who do not sign up to the Australian Packaging Covenant and who have a gross annual income of A$5 million or more are required to comply with obligations to recover, reuse and recycle in accordance with targets set by relevant regulatory authorities. They are also required to prepare a waste action plan and to keep certain records. These obligations are imposed under environmental laws in each Australian state and territory, and there are penalties for non-compliance.

Under the Product Stewardship Act 2011 (Cth) the life cycle of products, materials and industries can be regulated through voluntary approaches, co-regulatory approaches and mandatory obligations. To date, regulations have only been passed to support a co-regulatory approach for the recycling of televisions and computers. These regulations require liable parties to notify the Minister each year of how many products (identified by product code) in the class of products they imported in the financial year. Approved co-regulatory arrangements are then responsible for the collection and recycling of computers (usually an administrator). This usually involves providing access to collection services or sites. Voluntary approaches have been adopted for used tyres and mercury containing lamps.

At the state and territory level, most jurisdictions adopt an approach to waste management that looks at management options in the following order:

  1. avoidance;
  2. recovery (e.g., reuse, reprocessing and recycling); and
  3. treatment, contaminant and disposal.

By way of example, the NSW EPA has produced guidelines on waste avoidance and resource recovery under the NSW Waste and Resource Recovery Strategy 2014–2021, which prioritise avoidance as a primary measure, with measures then cascading into recycling, diverting waste from landfill, reducing litter and finally responsible disposal of waste. The target for the diversion of waste from landfill is increasing from 63 per cent in 2014–2015 to 75 per cent by 2021.

Specific waste provisions in each state and territory generally regulate production and storage of some waste, transport, disposal and reuse of waste. In some circumstances, an offence can be committed by a previous owner of waste if that waste is not disposed of properly by a contractor, unless the due diligence defence can be established.

Another increasing trend in Australian jurisdictions relating to product stewardship is the container deposit schemes (CDS). CDS has been introduced in SA, Northern Territory (NT), NSW, Queensland and the Australia Capital Territory (ACT). The Western Australia CDS is due to commence in early 2020.

The SA scheme was established in 1977 and is now administered under the state's Environment Protection Act 1993. In 2011, the NT introduced a CDS under the Environment Protection (Beverage Containers and Plastic Bags) Act 2011. The SA and NT schemes follow the same design. Both schemes place a 10-cent refund on eligible beverage containers returned to collection points. Drink manufacturers are required to have a waste management plan for their containers. In practice, this requirement is met by manufacturers joining a 'supercollector', which runs a collection scheme on behalf of its member companies.

In NSW, the scheme commenced on 1 December 2017 and provides that anyone who returns an empty eligible beverage container to an approved NSW collection depot or reverse vending machine will be eligible for a 10-cent refund. A network of depots and reverse vending machines will open across NSW to receive the empty containers. Beverage suppliers (manufacturer, importer, wholesaler or retailer) that bring eligible containers into NSW will be responsible for funding the refund as well as associated costs. Queensland has adopted a similar scheme to NSW.

v Contaminated land

There is no federal law that deals directly with contaminated sites, although there are a number of policy documents and guidelines that have influenced state laws. For example, the National Environment Protection (Assessment of Site Contamination) Measure (Site Contamination NEPM) aims to establish a nationally consistent approach to the assessment of site contamination. It provides guidance on determining whether contamination poses an actual or potential risk to human health and the environment, either on or off-site, sufficient to warrant remediation, having regard to current and future land uses.

While the Site Contamination NEPM is used by environmental consultants as a national standard, each state and territory in Australia regulates contaminated land independently. Western Australia and NSW are the only states that have legislation specifically relating to contaminated land, while the remainder of Australia's states and territories regulate the issue in more general environmental protection and management acts and in subordinate legislation. In addition, the NSW Environment Protection Authority released the Contaminated Land Management Compliance Statement in July 2018. It sets out how the EPA can ensure those responsible for managing and remediating significantly contaminated land can comply with their legal obligations to achieve improved environmental and human health outcomes.

Although different definitions are adopted, contamination is broadly described as 'a condition of land or water where any chemical substance or waste has been added at above background level and represents, or potentially represents, an adverse health or environmental impact'. Several states in Australia, including NSW, Western Australia, Victoria, Queensland and Tasmania, have a contamination register that the public can search for sites with known contamination. In general, these registers are not exhaustive. If a site is not listed in a register, this cannot be relied upon as conclusive evidence that the site is not contaminated, and conversely, nor will listing a site in the register automatically satisfy disclosure obligations.

Responsibility of persons for the clean-up and remediation of contaminated land is expressed differently in each jurisdiction but will ordinarily start with the person causing the contamination and then cascade down to owners or occupiers of contaminated sites. In NSW, in determining the appropriate person to serve with a management order, the EPA is, 'as far as practicable', to specify a person who is responsible for the contamination over the owner of the land or the notional owner of the land (such as a mortgagee in possession).

A similar principle applies in Western Australia, where the legislation establishes a hierarchy for determining responsibility of remediation, and allows for the transfer of that responsibility. In addition, in Western Australia, if an owner or occupier has changed or proposes to change the use of all or part of the land, the owner or occupier will be liable for remediation of that land to the extent that the remediation is required because of the change. To the extent that remediation is required because of the change of use, the person who caused or contributed to the contamination, as well as the state, is released from any liability he or she may otherwise have had.

In Victoria, there is a greater risk to owners and occupiers of land. The Victorian Environment Protection Authority may serve a notice directing the recipient to clean up the contaminated area and the person so directed need not necessarily be the person who caused the contamination. There is no hierarchy of responsibility and the notice may be served on the occupier. The definition of occupier includes a controller of premises, which may be an owner or a lessee and in certain circumstances can include a financial institution that is a mortgagee in possession.

Where contaminated land is being transacted, it is prudent to conduct investigations for potential contamination. In Western Australia, any transaction that will involve the sale, lease or mortgage of a site that has been classified as contaminated or possibly contaminated under the relevant legislation must include formal disclosure of the contamination at least 14 days before completion.

It is possible to provide contractually that the buyer accepts and undertakes clean-up requirements in some states. In Western Australia, responsibility for clean-up can be transferred with a written agreement and with the approval of the Department of Environment and Conservation. Similarly, in SA and Tasmania, responsibility can be transferred to a purchaser if appropriate notices have been provided to the respective environment protection authorities. Conversely, in NSW for example, a contract cannot operate to transfer statutory liability for contamination under the Contaminated Land Management Act 1997, although indemnities can still provide contractual protection where appropriately drafted.

In our experience, a purchaser will only take on contractual responsibility for contamination for which it is not responsible if it has confirmed the level of contamination (if any) and has been compensated appropriately for taking on that liability (whether by direct payment or by adjustment of the purchase price).