Under new proposals being drawn up by the Government, waste companies that commit waste offences could risk being fined up to 10 per cent of their turnover, warn lawyers.
The Department for Environment, Food and Rural Affairs has been consulting on proposals to introduce new civil penalties to aid in the enforcement of environmental offences in the form of the Environmental Sanctions Order 2010. These powers will be in addition to existing criminal penalties.
The consultation ended on 14 October and the new regulation is intended to be laid before Parliament in January 2010, with a likely implementation date of April 2010.
Law firm Pinsent Masons LLP warn that companies need to fully understand the new proposals or could face fines.
Defra states that the proposed civil sanctions scheme is designed to be transparent and proportionate.
Proposals include variable monetary penalties that enable regulators, such as the Environment Agency, to impose a financial penalty for non-compliance when it decides that prosecution is not in the public interest. Pinsent Masons state that it is suggested that VMPs could be up to 10 per cent of an operators turnover, akin to penalties for breaches of competition law.
Other proposals include:
- A range of enforcement notices including compliance notices, restoration notices (a written note by regulator which requires a person to take steps to restore harm caused by non-compliance) and stop notices (A written notice which requires a person to cease an activity which is causing serious harm or presents a significant risk or causing serious harm);
- Fixed monetary penalties; and
- Enforcement undertakings, by which an operator could offer to voluntarily undertake works to rectify any harm caused to the environment or to compensate those affected.
Pinsent Masons planning and environmental team senior associate Simon Colvin said: On the one hand, the current proposals will be welcomed by operators as regulators will have a wider range of more proportionate penalties available to them. That should hopefully mean operators do not face criminal prosecution for minor unintentional offences as is sometimes the case.
However, the fact that the penalties are regulator imposed no doubt means we will see a greater level of enforcement action than is currently the case under the existing criminal scheme. This is important when you consider that one of the proposals is to enable the imposition of VMPs up to 10 per cent of an operators turnover.
The EA recently fined soft drinks firm Red Bull £261,279 for packaging waste offences, if it had subjected the firm to the new civil penalties it could have fined Red Bull 10 per cent of its turnover.
Colvin said that companies which could be subject to the new civil penalties need to understand the right to object or appeal. He added that while the new proposals offer important benefits for both business and regulators they come with a health warning.