Regulatory Outlook | Environment | July 2017

Current issues

UK Air Quality Plan

On 5 May 2017, the UK Government published its Draft Air Quality Plan, after the High Court rejected its application to extend the deadline for publication of the draft Plan until after the general election. The final Plan must be published by the end of July. The publication of the Plan follows ClientEarth’s successful judicial review challenge in November 2016 against the Government’s failure to tackle illegal air pollution. The High Court subsequently ordered the Government to publish a new UK Air Quality Plan for consultation by 24 April 2017 (to be submitted to the European Commission by 31 July 2017).

The draft Plan proposes the implementation of Clean Air Zones by local authorities as the most effective way of reducing nitrogen dioxide emissions. Although the proposal does not state that charges will be payable to enter or move within a zone, the proposal states that ‘where a charging Clean Air Zone would bring forward achievement of statutory NO2 limit values… local authorities should have the opportunity to identify and implement equally effective non-charging alternatives’. The proposal has been criticised by parties concerned that non-charging zones will not deter the most polluting vehicles compared to charging zones. While the Plan makes clear that air pollution has social costs and threatens economic growth – with estimates that in 2012 poor air quality resulted in costs of up to £2.7 billion through its impact on productivity in the UK – the introduction of the Zones could have a significant impact on businesses that rely on frequent movement into and within the Clean Air Zones.

Brexit – uncertainty over post-Brexit environmental laws

The Government’s Great Repeal Bill White Paper states that it will ensure that ‘the whole body of existing EU environmental law continues to have effect in UK law’ following Brexit. While this undertaking has helped clarify the Government’s initial intentions on environmental policy post-Brexit, there will be areas of uncertainty, and some concerns have been raised about the use of secondary legislation to address these areas. Secondary legislation is subject to less Parliamentary scrutiny and there is nothing to rule out the possibility of amending, repealing or reversing existing environmental provisions. Green groups have further criticised the Great Repeal Bill for failing to address the status of European Commission guidance in post-Brexit Britain and especially what mechanism/enforcement agency will replace the Court of Justice of the European Union and the European Commission. Businesses will be waiting for further guidance from the Government on some of these more challenging issues, and where relevant should be looking to engage with the Government to highlight the areas where potential regulatory changes could have a positive
economic impact.

The Government has also received criticism from businesses and NGOs over the delay caused by Brexit to the publication of DEFRA’s 25 Year Environment Plan, a long-term management strategy for the UK’s environment. DEFRA’s publication of the Plan’s framework last summer was put on hold due to the fact that the original timings of the framework ‘did not take into account [Britain’s] decision to leave the EU’. No new timescale for a post-Brexit Plan has been released.

Contamination land – register of brownfield land to be published

On 16 April 2017, the Town and Country Planning (Brownfield Land Register) Regulations 2017 came into force. The Regulations impose a duty on local planning authorities (LPAs) in England to prepare, maintain and publish a register of brownfield land that is suitable for development in its area. Each register will refer to: (1) brownfield land suitable for residential development; and (2) brownfield land that the LPA has allocated for residential development. It is the Government’s intention that these new measures unlock brownfield sites for thousands of new homes, as developers will be able to identify suitable brownfield sites quickly. It is anticipated that communities will also be able to highlight local derelict and underused buildings sites that are primed for re-development, with the hope of attracting investment.

Guidance on Minimum Energy Efficiency Standards (MEES) for non-domestic rented buildings

In March 2017, the Government published guidance to clarify some aspects of the Energy Efficiency (Private Rented Property) (England and Wales) Regulations 2015 in relation to non-domestic rented properties. The Regulations introduce minimum energy efficiency standards, which from 1 April 2018 will prohibit the letting of a non-domestic property with an EPC rating below Band E and from 2023 will extend the prohibition to properties already let. The guidance is not legally binding but explains how the Government intends the Regulations to be applied. The guidance also sets out how the Government will deal with relevant exemptions to the prohibition, such as listed buildings, those with no EPC in place, and leases under six months or over 99 years.

Water pollution: record fine for Thames Water Utilities Ltd

On 22 March 2017, Thames Water was fined an unprecedented £20,361,140 for a series of significant pollution incidents on the river Thames between 2012 and 2014. Major environmental damage was caused along 14km of river, resulting in the deaths of birds, fish and invertebrates and which also contributed to widespread disruption to local businesses, waterside residents and farmers. Investigations showed the illegal discharge by Thames Water of untreated or poorly treated raw sewerage into the Thames River and it’s tributaries.

In focus: Personal liability

Despite the Environment Agency being encouraged to use more civil/administrative sanctions (e.g. administrative fines, notices and undertakings), the majority of environmental statutes contain offences that are dealt with under criminal law. As part of that criminal liability these offences commonly contain a potential sanction for individuals; not only as the primary offender as a legal person, but also where it can be demonstrated that an offence of a company was carried out with the consent, connivance or neglect of company officers. These ‘parasitic offences’ (as they are commonly termed) are mostly used in waste offences (Environmental Protection Act 1990) or breaches of environmental permits (Environmental Permitting Regulations 2016). Few statutes contain a statutory defence and rather it is normally the operational conduct of the defendant company officer that is crucial.

Have there been any notable fines or custodial sentences for individuals?

The majority of large personal liability fines under environmental law have been in relation to waste offences where individuals have intentionally sought to circumvent the law (and avoid landfill tax) through storing or disposing of waste illegally. The largest personal fine in 2016 was £120,000 with five prison sentences.

Is this a current area of focus for regulators or prosecuting authorities?

Certainly in the waste sector where there is a big focus owing to the enormous economic cost of waste crime: a recent report by Eunomia estimated that waste
crime costs the UK economy over £600m per year. However, with the new environmental sentencing guideline having a real impact (as seen by the £20m fine for Thames Water this March) in other sectors, notably water, the focus on personal liability is likely to follow other sectors such as construction and other large utilities. Indeed, many commentators were surprised that a personal prosecution did not take place in the Thames Water case.

What can individuals do to protect themselves?

A common-sense approach can help to manage personal liability: if a person becomes aware of something that is or could be a breach of environmental law with serious ramifications, don’t ignore or sit on that knowledge. Make sure any incidents are appropriately reported at board level, where decisions can be taken on early engagement with the relevant regulator (usually the Environment Agency).

Dates for the diary

15 June 2017 – Government consultation on Draft Air Quality Plan closed.

18 June 2017 – Government consultation on penalties for litter offences closed.

25 June 2017 – Government consultation on changing the Ultra Low Emission Zone for Central London closed.

9 July 2017 – The Conflict Minerals Regulation comes into force, with due diligence obligations to apply later, from January 2021. Companies within the EU will be under an obligation to ensure that imports of conflict metals and minerals are obtained from responsible sources only.

31 July 2017 – Deadline for publication of the Government’s Air Quality Plan.

Summer 2017 – A comprehensive update to the European Chemical Agency’s guidance on REACH substances is expected to be published.

Autumn 2017 – White Paper on “25 Year Plan for the Environment” expected.

19 December 2017 – Deadline for the implementation of the Medium Combustion Plant Directive 2015.

31 December 2017 – Deadline for local planning authorities to publish brownfield land registers.

End of 2017/beginning of 2018 – DEFRA’s “25 Year Plan for the Environment” expected.

1 April 2018 – Introduction of prohibition on the letting of non-domestic properties with an EPC rating below Band E under MEES Regulations.

January 2019 – Legislation is expected to come into force that will set binding emission limit values on relevant air pollutants from diesel engines. The proposed legislation follows the Department of Environment and Climate Change’s consultation on further reforms to the Capacity Market in March 2016.

September 2020 – Ultra Low Emission Zone to be introduced for central London.