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Scottish government seeks views on design of new environmental enforcement powers for SEPA

Out-Law News | 03 Jul 2014 | 5:31 pm | 3 min. read

Businesses and other stakeholders have been asked to shape the design and potential uses of new powers available to the Scottish Environmental Protection Agency (SEPA) to tackle environmental crime.

The Scottish government's consultation builds on outline proposals published in May 2012, and is open for comment until 3 October 2014. It sets out the proposed design of the new fixed monetary penalties (FMPs), variable monetary penalties (VMPs), enforcement undertakings and non-compliance penalties available to SEPA; as well as the 'relevant offences' for each. The new arrangements are expected to be in place by spring 2015.

Provisions in the Regulatory Reform Act, which was passed in January, gave SEPA the power to issue fines of up to £40,000 in relation to environmental crimes without having to take offenders to court. SEPA was also given more powers to accept 'enforcement undertakings' in a wider range of circumstances, giving environmental offenders the opportunity to make an offer to correct their behaviour and make amends.

The new powers come ahead of the introduction of substantial structural reforms to the Scottish environmental regulatory regime. The 29 separate regimes currently operated by SEPA either on its own or together with other bodies will be replaced with a single structure involving a common set of procedures, notices and other regulatory tools. This new framework, currently planned to come into force in spring 2016, will be based on a hierarchy system with different levels of permission depending on the risk a particular activity poses to the environment.

"This is the first of the consultations putting the meat on the bones of the Regulatory Reform Act, which provides for complete overhaul of environmental enforcement and environment law in Scotland," said environmental law expert Gordon McCreath of Pinsent Masons, the law firm behind Out-Law.com.

"The new tools available to SEPA have the potential to transform their role and their relationship with environmentally regulated businesses, with significant fining powers now available to them. Crucially, those fines can be levied by SEPA when they are satisfied on the balance of probabilities – not beyond reasonable doubt as currently applied – that an offence has been committed. Those fining powers also have the potential to indirectly influence fine levels in the criminal courts, At the same time, the tools present opportunities for regulated persons to propose that, for instance, they grant an enforcement undertaking rather than face prosecution," he said.

Under the framework set out in the consultation, SEPA would be able to issue FMPs in relation to "particularly low level" offences such as administrative offences such as a failure to submit important information to SEPA on time, or where an operator has failed to take on board advice from SEPA. The consultation proposes 'banded' monetary penalties of £300, £600 and £1,000, depending on the nature of the offence. The consultation does not propose distinguishing between individual and corporate offenders in relation to these fines.

VMPs would be available to SEPA for offences at the upper end of the scale, but beneath the level of offending appropriate for prosecution, according to the consultation. Penalties in these cases would be calculated based on a methodology taking account of the financial benefit gained, the severity of the offence and any aggravating or mitigating circumstances. SEPA would be able to issue further penalties for non-compliance, with a 40% uplift proposed by the consultation. Offences for which a VMP may be appropriate include less significant illegal disposal of waste or breaches of a licence.

SEPA will also be able to consider voluntary offers to pro-actively make amends for non-compliance from operators, known as enforcement undertakings. According to the consultation, SEPA should only accept offers to take action to return to, and remain in, compliance; and which propose to restore the position to what it would have been if the offence had not been committed, if this is possible. Operators must also offer an appropriate "beneficial action" over and above these minimum legal requirements, according to the consultation. The action must also remove any financial benefits that were a result of the non-compliance, whether through avoided costs or money made from the offending.

Enforcement undertakings will not usually be an appropriate regulatory option in circumstances where significant environmental harm has been caused, or where SEPA has already decided to impose an FMP or VMP in respect of the offence or to report the offence to the procurator fiscal for potential prosecution, according to the consultation. The government is seeking views on whether the offender should also demonstrate to SEPA that it has consulted interested parties, particularly local communities, about the terms of its offer and taken account of their views.

The consultation document also includes draft Orders for the new enforcement measures, sentencing options and 'relevant offences' to which the various measures would apply. It also deals with provisions in the Regulatory Reform Act which introduce vicarious liability for certain offences by employees and agents; new powers for the criminal courts; and rights to appeal decisions and enforcement action taken by SEPA.

"The impacts of these reforms will be far-reaching, so regulated businesses should be doing all they can to influence their final shape by carefully reviewing and responding to the consultation," said environmental law expert Gordon McCreath.