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Higher fines for serious offenders expected , says expert, as first sentencing guidelines for environmental crimes published

Large businesses found guilty of the most serious environmental crimes can expect bigger fines following the publication of the first sentencing guideline for environmental offences, an expert has said.

Eluned Watson of Pinsent Masons, the law firm behind Out-Law.com, said that the final version of the guideline (26-page / 192KB PDF) contained some welcome clarifications to the draft guideline published for consultation last year, as well higher ranges of fines for businesses which would now be categorised by size for that purpose. However, she warned that the courts now had more discretion when categorising a company, making maximum fines less certain for businesses.

"This is the first time that the Sentencing Council has produced guidelines for environmental offences and it encourages the courts to make more use of the highest level of fines for some of the more serious offences," she said. "We welcome the new guidelines that should provide much-needed clarity and help achieve greater consistency and transparency on the levels of fines for environmental offence set by the courts."

"What is clear is that corporate offenders committing serious offences, which are likely to be those causing most damage or risk to health, should expect to receive higher fines going forward. For this reason, companies likely to be affected by the changes, such as those operating in the utilities sector, need to ensure they understand the new framework so they limit the potential impact of any enforcement action on their business," she said.

The guideline will be used by courts when sentencing from 1 July 2014, regardless of when the offence itself took place. As a result of consultation feedback, the Sentencing Council has introduced separate guidance for use when sentencing corporate offenders and individuals.

"This does give companies some lead-in time to get to grips with the new guidelines and how they will be applied," said Watson. "One key point to note is that the guidelines have been extended in scope in some areas, for example, the courts should refer to the sentencing approach set out in the guidelines when sentencing other relevant and analogous environmental offences."

"However, it is disappointing that the final guidelines have not introduced any 'special status' for statutory undertakers and others fulfilling a quasi public function, such as those included in the guidelines for charities and other public bodies," she said.

The new guidance is intended to establish a consistent approach to the sentencing of environmental offences in courts across England and Wales. It covers a wide variety of offences governed by the Environmental Protection Act and the Environmental Permitting Regulations including fly-tipping; breaches of the waste permitting regime; and 'nuisance' offenders who cause noise, odour, dust or health or pollution risks. The scope of the guidance has also been expanded from the draft so that its general principles, if not sentencing levels, can be applied to other environmental offences such as the unlawful treatment or disposal of waste.

Among the refinements made to the draft guideline is the addition of specific steps that a court should consider before deciding the level of a compensation or confiscation order. "While the identification of an intial/starting point fine level for an organisation is still primarily linked to its turnover, once an initial fine level has been identified the guideline allows the sentencer to 'step back' and consider a wide range of relevant factors in deciding the final level of the fine - for example, the offender's wider financial circumstances and avoided costs and operating savings," said environmental and energy law expert Eluned Watson. "This goes some way to addressing concerns that turnover alone is too basic an approach to take to set fines at a proportionate level."

"Further, the Council has adjusted the thresholds of the company size categories so that 'large' organisations are those with a turnover or equivalent of £50 million and over - previously this was a turnover of over £25.9m - and 'small' companies are those with a turnover or equivalent of between £2m and £10m. The guidelines also now explicitly state that where a defendant company's turnover or equivalent greatly exceeds the threshold for large companies, it may be necessary to move outside the suggested range to achieve a proportionate sentence," she said.

The Sentencing Council said that it was unlikely that its new guidance would result in significant changes to the sentencing for lower level offences; or to the overall proportions of offenders receiving the various types of sentence such as fines and, in the case of individuals, community sentences, discharges and prison sentences.

"Illegal disposal of hazardous waste not only causes damage to the environment but puts people's health at risk as well," said magistrate Katharine Rainsford, a member of the Sentencing Council. "This guidance for courts will help ensure consistent and appropriate sentences for offenders."

"These crimes are normally about making or saving money at the expense of the taxpayer. They also undermine law-abiding businesses in the waste management industry who are contributing to economic growth. This guidance aims to ensure that sentences hit offenders in their pocket," she said.

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