Australia: Environment and Climate Regulation Comparative Guide

1 Legal framework

1.1 Which legislative and regulatory provisions govern environment and climate regulation in your jurisdiction?

Australia has a federal system of government established by the Australian Constitution in 1901. The Commonwealth does not have direct constitutional power to make laws for the environment. Instead, its limited environmental jurisdiction derives from indirect constitutional powers, including the external affairs power (eg, implementing Australia's obligations under international agreements) and the corporations power.

State/territory legislation is the principal form of environmental regulation in Australia. The states/territories have the power to legislate on environmental matters generally.

Table 1. Key environmental protection legislation in each jurisdiction

Jurisdiction	Environment legislation	Scope
Commonwealth	Environment Protection and Biodiversity Conservation Act 1999 (CTH) (EPBC Act)	The Commonwealth's legal framework to protect and manage nationally and internationally important matters including flora, fauna, ecological communities and heritage places, and to regulate actions by the Commonwealth and its agencies.
Australian Capital Territory	Environment Protection Act 1997 (ACT) Planning and Development Act 2007 (ACT)	Includes environment protection, waste, environmental authorisations, enforcement and offences. Includes environmental impact assessment.
New South Wales	Protection of the Environment Operations Act 1997 (NSW) Environmental Planning and Assessment Act 1979 (NSW)	Includes environment protection, waste, licences, notices, enforcement and offences. Includes environmental impact assessment.
Northern Territory	Environment Protection Act 2019 (NT)	Includes environmental impact assessment, environmental approvals, environmental offsets, enforcement and offences.
Queensland	Environmental Protection Act 1994 (QLD)	Includes environmental protection policies, environmental impact assessment, environmental duties, contaminated land, enforcement and offences.
South Australia	Environment Protection Act 1993 (SA) Planning, Development and Infrastructure Act 2016 (SA)	Includes environmental protection policies, environmental and development authorisations, contamination, enforcement and offences. Includes environmental impact assessment.
Tasmania	Environmental Management and Pollution Control Act 1994 (TAS)	Includes environmental duties, environmental impact assessment, environmental licences, contamination, enforcement and offences.
Victoria	Environment Protection Act 2017 (as amended by the Environment Protection Amendment Act 2018, which also repeals the Environmental Protection Act 1970 (VIC) from 1 July 2021)	Includes a general environmental duty, environmental permissions, environmental plans and environmental assessment, enforcement and offences.
Western Australia	Environmental Protection Act 1986 (WA)	Includes environmental protection policies, environmental impact assessment, enforcement and offences.

Table 2. Key climate legislation in each jurisdiction

Jurisdiction	Environment legislation	Scope
Commonwealth	There is no overarching climate change legislation at the Commonwealth level. Carbon Credits (Carbon Farming Initiative) Act 2011 (CTH) National Greenhouse and Energy Reporting Act 2007 (CTH) Climate Change Authority Act 2011 (CTH)	This act was amended in 2015 to establish the Emissions Reduction Fund – a scheme enabling the generation of credits for certain emission reduction initiatives such as landfill gas capture. Established a national framework for reporting and disseminating company information about greenhouse gas emissions, energy production and energy consumption. Established the Climate Change Authority to provide independent, expert advice on climate change policy.
Australian Capital Territory	Climate Change and Greenhouse Gas Reduction Act 2010 (ACT)	Sets greenhouse gas (GHG) emission targets and establishes the Climate Change Council.
New South Wales	No general climate change and emission framework in legislation	New South Wales has developed the Climate Change Policy Framework.
Northern Territory	No general climate change and emission framework in legislation	Northern Territory is developing the Climate Response Strategy.
Queensland	No general climate change and emission framework in legislation	Queensland has a Climate Adaptation Strategy and Climate Transition Strategy
South Australia	Climate Change and Greenhouse Emissions Reduction Act 2007 (SA)	Legislates targets to reduce GHG emissions. The act also promotes the use of renewable energy and facilitates the early development of policies and programmes to address climate change.
Tasmania	Climate Change (State Action) Act 2008 (TAS)	Sets GHG target and establishes regulation-making powers.
Victoria	Climate Change Act 2017 (VIC)	Sets GHG targets, policy objectives and guiding principles, climate change strategy, adaptation action plan, emissions reductions pledges, forestry rights and carbon sequestration rights, and soil carbon rights.
Western Australia	No general climate change and emission framework in legislation	Western Australia has developed the Western Australian Climate Policy.

1.2 Which bilateral and multilateral instruments on environment and climate regulation have effect in your jurisdiction?

Australia has signed or ratified approximately 100 environmental treaties. Key environmental bilateral and multilateral instruments on environment which have effect in Australia include the following:

• the Convention on Biological Diversity, done at Rio de Janeiro on 5 June 1992;
• the Convention for the Protection of the World Cultural and Natural Heritage, done at Paris on 23 November 1972;
• the Convention on International Trade in Endangered Species of Wild Fauna and Flora, done at Washington on 2 March 1973;
• the Convention on Wetlands of International Importance especially as Waterfowl Habitat, done at Ramsar, Iran, on 2 February 1971;
• the Convention on the Conservation of Migratory Species of Wild Animals, done at Bonn on 23 June 1979;
• the Agreement between the Government of Australia and the Government of the People's Republic of China for the Protection of Migratory Birds and their Environment, done at Canberra on 20 October 1986;
• the Agreement between the Government of Japan and the Government of Australia for the Protection of Migratory Birds and Birds in Danger of Extinction and Their Environment, done at Tokyo on 6 February 1974;
• the Agreement with the Government of the Republic of Korea on the Protection of Migratory Birds, and Exchange of Notes, done at Canberra on 6 December 2006;
• the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal, done at Basel on 22 March 1989;
• the Rotterdam Convention on the Prior Informed Consent Procedure for Certain Hazardous Chemicals and Pesticides in International Trade, done at Rotterdam on 10 September 1998;
• the Stockholm Convention On Persistent Organic Pollutants, done at Stockholm, 22 May 2001;
• the Vienna Convention for the Protection of the Ozone Layer, done at Vienna on 22 March 1985; and
• the Montreal Protocol on Substances that Deplete the Ozone Layer, done at Montreal on 16 September 1987.

Key environmental multilateral instruments on climate which have effect in Australia include:

• the United Nations Framework Convention on Climate Change (UNFCCC), done at New York on 9 May 1992;
• the Kyoto Protocol to the UNFCCC, done at Kyoto on 11 December 1997; and
• the Paris Agreement, done at Paris on 12 December 2015.

1.3 Which bodies are responsible for enforcing the applicable laws and regulations? What powers do they have? To what extent do they cooperate? What are the mechanisms for cooperation?

Australia's federal system has three tiers of government: Commonwealth, state/territory and local. All tiers of government are responsible for enforcing environmental laws, with various enforcement bodies at each level. However, the key environment protection and enforcement bodies are as follows:

• the Commonwealth Department of Agriculture, Water and the Environment;
• the Australian Capital Territory Environment Protection Authority;
• the New South Wales Environment Protection Authority;
• the Northern Territory Environment Protection Authority;
• the Queensland Department of Environment and Science;
• the South Australia Environment Protection Authority;
• the Tasmanian Environment Protection Authority;
• the Environment Protection Authority Victoria; and
• the Western Australian Environmental Protection Authority.

The powers of authorised officers vary in each jurisdiction. However, enforcement bodies typically have a wide range of powers, including the power to:

• search and enter premises;
• conduct investigations;
• undertake environmental audits;
• take samples;
• ask questions; and
• require records and information.

Local government powers generally relate to:

• local land use planning;
• community waste management;
• civil enforcement;
• minor pollution incidents;
• nuisances; and
• public health.

In 1992, the Commonwealth, states, territories and the Australian Local Government Association entered into the Intergovernmental Agreement on the Environment. The agreement provides a mechanism to facilitate a cooperative national approach to the environment.

There are bilateral agreements between the Commonwealth and states in respect of, for example, the assessment and approval of actions under the EPBC Act. However, these generally relate to streamlining procedural matters.

There is a framework for the development of national environment protection measures (NEPM) under the National Environment Protection Council Act 1994 (Cth). This provides for a cooperative scheme to develop standards and procedures called NEPMs that can be applied in a consistent manner in each jurisdiction. Examples include:

• the National Environment Protection (Assessment of Site Contamination) Measure 1999; and
• the National Environment Protection (Air Toxics) Measure.

1.4 What is the regulators' general approach to environment and climate regulation/action?

The approach taken varies between jurisdictions. To maximise the use of limited resources, regulators typically take a risk-based approach to environment regulation. This involves escalating the regulatory response according to:

• the risk to the environment and human health;
• the seriousness of the offence;
• culpability; and
• compliance history.

Prosecution is generally not the first thought. Regulators seek to work with industry/regulated entities to achieve environmental outcomes.

Environmental regulators also seek to give effect to the principles of ecologically sustainable development (ESD). These principles are set out in environmental legislation and in the National Strategy on ESD. The National Strategy requires decision-making processes to effectively integrate both long and short-term economic, environmental, social and equity considerations.

See question 3 regarding climate action.

2 Environmental protection

2.1 What are the key features of the regulatory regimes that protect the following environmental assets in your jurisdiction? (a) Air; (b) Soil; (c) Fresh water; (d) Sea water; (e) Flora and fauna; and (f) Natural habitats and scenic landscapes.

(a) Air

All levels of government play a role in managing air quality. The National Clean Air Agreement sets out the framework for identifying and prioritising actions to address air quality issues. The governments cooperatively set national objectives and develop national environment protection measures via the National Environment Protection Council.

States/territories have primary responsibility for monitoring and managing air quality in their jurisdictions. This generally includes:

• implementing state/territory legislation that prohibits certain activities either absolutely or without a licence;
• reporting against national ambient air quality standards;
• administering licences;
• providing incentives for reducing emissions;
• maintaining pollution prevention equipment; and
• enforcing air pollution offences.

Local governments have responsibility for local air pollution issues such as backyard burning, chimney smoke and dust.

(b) Soil

The Commonwealth does not directly regulate soil or contaminated or degraded land. However, it has developed programmes and strategies aimed at managing and protecting soil, such as the National Soil Strategy and the National Landcare Program.

Each state/territory has its own regime for managing contamination. Some states/territories have specific contaminated land legislation, such as the Contaminated Land Management Act 1997 (NSW) and the Contaminated Sites Act 2003 (WA); while others regulate contamination under general environmental protection legislation, such as Part 8 of the Environmental Protection Act 1994 (Qld).

Local governments typically implement policies in respect of the prevention of land contamination and the remediation of land through land use planning decisions.

In each jurisdiction, there are also state and local erosion and sediment controls.

(c) Fresh water

Water use and efficiency: Water markets have become an essential tool for managing water scarcity in Australia. State/territory governments are responsible for water licensing. In New South Wales, for example, there is a system of regulation through the Water Management Act 2000 that regulates water taking, use and supply through water allocations and licences.

The water in Australia's rivers and dams is shared by many different users. The largest catchment is the Murray-Darling Basin, which covers much of the eastern half of Australia. The Commonwealth has an oversight role through the Water Act 2007 (Cth), which provides the framework for managing the Murray-Darling Basin, water charges and water market rules. Owning entitlements to water for the environment is the role of the Commonwealth Environmental Water Holder (CEWH).

In 2004, the Commonwealth and some states and territories entered into the Intergovernmental Agreement on a National Water Initiative to improve water use and efficiency. Parties to the agreement commit to:

• preparing comprehensive water plans;
• introducing registers of water rights and standards for water accounting;
• expanding trade in water rights; and
• improving pricing.

Water pollution: Responsibility for preventing and enforcing water pollution legislation is generally shared between state/territory environmental protection authorities and local authorities. Typically, there is a prohibition against water pollution without a licence and offences for failure to comply.

(d) Sea water

The International Convention for the Prevention of Pollution from Ships (MARPOL) seeks to prevent the pollution of sea water from ships. The Commonwealth has implemented MARPOL through:

• the Protection of the Sea (Prevention of Pollution From Ships) Act 1983 (Cth);
• Protection of the Sea (Prevention of Pollution from Ships) (Orders) Regulations 1994 (Cth);
• a series of marine orders; and
• Chapter 4 of the Navigation Act 2012, which deals with prevention of pollution.

Each state/territory has also implemented MARPOL through legislation which prohibits different types of marine pollution (eg, pollution from oil) and provides for reporting procedures and pollution offences, for example:

• the Marine Pollution Act 2012 (NSW);
• the Marine Pollution Act 1999 (NT);
• the Transport Operations (Marine Pollution) Act 1995 (Qld);
• the Protection of Marine Waters (Prevention of Pollution From Ships) Act 1987 (SA);
• the Marine-related Incidents (MARPOL Implementation) Act 2020 (Tas);
• the Pollution of Waters by Oil and Noxious Substances Act 1986 (Vic); and
• the Pollution of Waters by Oil and Noxious Substances Act 1987 (WA).

(e) Flora and fauna

There are Commonwealth, state and local protections of flora and fauna.

The Commonwealth Environment Protection and Biodiversity Conservation Act (EPBC Act) aims to protect nationally significant flora, fauna, habitats and places through the identification and listing of:

• threatened species;
• threatened ecological communities;
• migratory species;
• Ramsar wetlands; and
• other matters of national environmental significance (MNES).

It provides for the development of:

• conservation advice and recovery plans;
• a register of critical habitat; and
• threat abatement plans to reduce impacts from key threatening processes.

It also provides for an environmental assessment and approval process for any actions that have or are likely to have a significant impact on MNES. In addition, the EPBC Act controls the international movement of wildlife specimens under the Convention on International Trade in Endangered Species of Wild Fauna and Flora.

Different biodiversity legislation applies in each state/territory. Typically, an authorisation is required to take or disturb threatened flora and fauna. In addition, each jurisdiction has its own land-clearing controls and biodiversity or environmental assessment and offsetting schemes for development that is likely to have relevant impacts on biodiversity.

Land use planning and control of development (other than for major infrastructure and mining, and in some instances major developments considered to be of significance to the state) are largely the responsibility of local authorities. Local government authorities can develop and implement their own policies in relation to the protection of vegetation. It is necessary to consider the interaction between these and state legislation and policies in each case.

(f) Natural habitats and scenic landscapes

At the Commonwealth level, natural habitats and scenic landscapes of national environmental significance are protected by the EPBC Act. These include World Heritage properties, National Heritage properties and Ramsar wetlands.

At the state/territory level, natural habitats and scenic landscapes are generally protected through legislation regulating biodiversity, national parks, reserves and other protected areas.

Local government authorities also have an important role to play in the protection of natural habitats and scenic landscapes, often as land owner or in a trustee role. They have procedures and policies that apply to land use planning and development. It is necessary to consider the interaction between these and state legislation and policies in each case.

2.2 What are the key features of the regulatory regime that protects against environmental nuisances (eg, noise, odour and light pollution) in your jurisdiction?

Environmental nuisances are regulated differently in each state/territory. However, typically these can be regulated as either offences under state legislation or subject to control or prevention orders under state legislation – in each case administered by either a state agency or a local council, or both.

Some states have a comprehensive environmental nuisance regime enshrined in legislation – for example, the Local Nuisance and Litter Control Act 2016 (SA) contains an offence and abatement notice scheme for local nuisances. Local nuisance includes (relevantly) the adverse effects on the amenity value of an area that are caused by noise, odour, smoke, fumes, aerosols or dust.

In contrast, in some states, such as New South Wales, the law of nuisance is primarily based on the common law, with ad hoc provisions in legislation. For example, noise abatement orders can be issued by the local court on the application of an occupier, and noise abatement directions can be issued by authorised officers and police officers under the Protection of the Environment Operations Act (POEO Act). In addition, local councils and New South Wales police can regulate neighbourhood noise under the POEO (Noise Control) Regulation 2017; while odour is regulated where premises have a licence for scheduled activities under the POEO Act. In such cases, the occupier of any premises must not cause or permit the emission of any offensive odour from the premises to which the licence applies.

2.3 What are the consequences of breach of these regulatory regimes?

The consequences of breach vary between the different regimes and depend on the nature of the breach and the environmental history of the offender. Minor breaches may result in verbal advice or a warning letter; while more significant breaches may result in more formal enforcement measures, including prosecution.

Regulators generally have a range of enforcement powers, including the power to:

• issue abatement notices;
• issue infringement or penalty notices;
• issue prevention notices;
• issue clean-up or environmental action notices (or conduct the clean-up itself and recover the cost from the polluter as a debt due);
• issue prohibition notices or stop work orders;
• cancel or suspend licences/approvals;
• issue compensation orders;
• require contribution to environmental funds;
• issue notices requiring publication of the details of the offence;
• issue civil penalties;
• negotiate enforceable undertakings; and
• prosecute.

Generally, it should be assumed that polluting contrary to the relevant state legislation will be an offence and there is a risk of prosecution.

3 Climate change/action

3.1 What are the key features of the regulatory regime governing greenhouse gas emissions in your jurisdiction?

Australia has two targets to reduce greenhouse gas (GHG) emissions pursuant to international climate agreements:

• 5% below 2000 emission levels by 2020 (under the Kyoto Protocol); and
• 26–28% below 2005 levels by 2030 (under the Paris Agreement).

The Emissions Reduction Fund (ERF) is the Australian government's key policy to reduce GHGs. It is a voluntary emissions offset scheme established under the Carbon Credits (Carbon Farming Initiative) Act 2011 (Cth) that involves the government purchasing emission reductions. The ERF incentivises businesses and landowners to undertake eligible projects that reduce or avoid GHGs, such as avoiding clearing of native regrowth and improving energy efficiency in buildings. One Australian carbon credit unit (ACCU) is earned for each tonne of carbon dioxide equivalent stored or avoided by a project. ACCUs can be sold to generate income – either to the government through a carbon abatement contract or in the secondary market.

The ERF has three important components: crediting, purchasing and safeguarding emissions reductions. The safeguard mechanism operates under the framework of the National Greenhouse and Energy Reporting (NGER) scheme. It is intended to ensure that emissions reductions achieved through the ERF are not offset by emissions increases above business-as-usual levels by other emitters. Large GHG emitters are required to keep net emissions below their emissions baseline. The government has also proposed a new Safeguard Crediting Mechanism to incentivise industry to further reduce emissions, as part of its response to the Final Report of the Expert Panel examining additional sources of low-cost abatement (known as ‘the King Review').

In October 2021, the Australian Government published a Long-Term Emissions Reduction Plan, which aims to achieve net zero emissions by 2050. The plan focuses on reducing the cost of low emission technologies and deploying them at scale. In addition, each state/territory has set its own zero carbon target and has developed or is developing policies for action to achieve the target.

3.2 What emissions trading regimes are operational in your jurisdiction and what are their key features?

Emissions trading regimes in Australia are voluntary or targeted to specific aspects of activities.

A national ‘cap and trade' emissions trading scheme was in place under the Clean Energy Act 2011 (Cth). However, the scheme was repealed by the subsequent government in 2014.

The Clean Energy Regulator administers the two national schemes:

• the voluntary ERF scheme described in question 3.1; and
• the Renewable Energy Target (RET).

The RET aims to incentivise the generation of electricity from renewable resources so that 20% of Australia's electricity supply comes from renewable sources by 2020. There are two RET schemes:

• large-scale RET, for investment in renewable power stations to achieve 33,000 gigawatt hours of additional renewable electricity generation by 2020; and
• small-scale RET, for small-scale installations, such as household solar panels and solar hot water systems.

The RET operates through the creation of tradable certificates for every megawatt hour generated from renewable sources. Certificates can be sold to wholesale electricity purchasers (or retailers) which are obliged to surrender a certain number of certificates each year to meet their renewable energy obligations. There is also a secondary trading market, which includes financial institutions, traders, agents and installers.

The Commonwealth Clean Energy Regulator administers the ERF. This is a voluntary scheme to provide incentives for the adoption of improved practices and technologies to reduce emissions. The enabling legislation is:

• the Carbon Credits (Carbon Farming Initiative) Act 2011;
• the Carbon Credits (Carbon Farming Initiative) Regulations 2011; and
• the Carbon Credits (Carbon Farming Initiative) Rule 2015.

Participants can earn ACCUs for emissions reductions, which can be sold to generate income, either to the government or in the secondary market.

Most states/territories have renewable energy targets and renewable energy action plans, schemes or policies. For example, the Victorian Renewable Energy Target was increased to 50% by 2030 and is supported by the Victorian Renewable Energy Auction Scheme, which offers long-term contracts to successful renewable energy projects. In New South Wales, there is the Net Zero Plan Stage 1 2020–2030 and the 2016 Climate Change Policy Framework.

3.3 How prominently does renewable energy feature in the energy mix in your jurisdiction? What regulations and other measures have been put in place to promote the use of renewable energy?

The Department of Industry, Science, Energy and Resources reported in September 2021, that fossil fuels accounted for 93 per cent of Australia's primary energy mix (consumption) in 2019–20. Australia's energy consumption by fuel type in 2019-20 comprised:

• coal (28.4%);
• gas (27.4%);
• oil (37.3%);
• renewables (7%).

Australia's energy production in 2019-20 comprised:

• black coal (61.4%);
• brown coal (2.1%);
• natural gas (29.6%);
• oil and NGL (4.0%);
• LPG (0.8%);
• renewables (2.1%).

Australia's electricity generation by fuel type in 2019-20 comprised:

• black coal (42.2%);
• brown coal (12.7%);
• natural gas (20.8%);
• oil (1.7%);
• renewables (22.6%).

As discussed in question 3.2, the RET scheme imposes an obligation on wholesale purchasers (and notional wholesalers) of electricity to contribute towards the generation of renewable energy with a target of 20% of electricity from renewable sources by 2020.

3.4 What regulations and other measures have been put in place to promote greater energy efficiency in your jurisdiction?

Energy efficiency in buildings: There are a number of energy efficiency measures at the Commonwealth level.

The National Construction Code (Section J) includes energy efficiency requirements for all building classifications. It was updated in 2019 to provide more stringent energy efficiency requirements for commercial buildings in particular.

The Commercial Building Disclosure is a national energy efficiency programme which requires sellers and lessors of commercial office spaces over 1,000 square metres to provide energy efficiency information to prospective buyers and tenants.

Commonwealth agencies and certain statutory bodies must comply with the Energy Efficiency Government Operations. These require building owners and government tenants to commit to energy efficiency improvements in government office buildings. These obligations are usually incorporated in green lease schedules which form part of the lease or memorandum of understanding.

The National Australian Built Environment Rating System rates buildings from 0 to 6 stars, with 6 stars representing exceptional greenhouse performance and resource efficiency. It is an independent energy rating scheme that is based on real energy data and is used to identify potential for saving energy, track progress and demonstrate commitment to energy efficiency.

States/territories also have various energy efficiency plans, policies and incentives, many of which are geared towards improving household energy efficiency.

There are also schemes to incentivise building upgrades – for example, in New South Wales the Environmental Upgrade scheme in Chapter 6, Part 2A of the Local Government Act 1993.

Energy efficiency in products: The Greenhouse and Energy Minimum Standards Act 2012 (Cth) established a national framework for product energy efficiency in Australia. Each regulated product has minimum energy performance standards and energy rating labelling requirements.

3.5 What other initiatives have been rolled out in your jurisdiction to combat climate change and its effects? How are those effects typically manifesting in your jurisdiction at the present time?

The NGER scheme, established by the National Greenhouse and Energy Reporting Act 2007 (Cth), is a national framework for reporting and disseminating company information about GHG emissions, energy production and energy consumption. The NGER scheme requires corporations that meet the facility threshold or corporate group threshold to register for the scheme and report on GHG emissions, energy consumption and energy production from facilities for which they have operational control. The Emissions and Energy Reporting System is used for all reporting under the NGER scheme.

Climate Active is a partnership between the Australian Government and Australian businesses to encourage climate action. It is a voluntary initiative which certifies businesses and organisations that have reached a state of achieving net zero emissions in accordance with the Climate Active Carbon Neutral Standard.

In most jurisdictions, land use planning and environmental protection legislation also requires decision makers to have regard to the principles of ecologically sustainable development. Increasingly, this is one mechanism through which decision makers are required to consider the impacts of climate change facilitated by developments or the impacts of climate change on developments. This has recently resulted in decisions to refuse approvals for coal mining projects or challenges in courts to decisions to approve projects.

3.6 What impact is Covid-19 likely to have on climate action in your jurisdiction?

The COVID-19 pandemic offers insights and opportunities for climate action in Australia. Public health orders restricting travel and a decline in economic activity have resulted in reduced emissions from aviation, transport and industry, as well as a new perspective on remote working and online solutions.

The Department of Industry, Science, Energy and Resources reported that GHG emissions in 2020 were 5% (26.1 million tonnes of carbon dioxide equivalent) – less than the previous year, and the lowest emission level ever recorded in the National Greenhouse Gas Inventory. Although these figures are positive, they highlight the immensity of the task to reduce GHG emissions in a business-as-usual scenario. Even in the extraordinary circumstances of the COVID-19 pandemic, Australia reduced its emissions only by a relatively small percentage. This may have a positive effect on climate action. However, the move away from resource-intensive industries is a complex issue for Australia. Government policies and incentives to accelerate economic recovery, such as fast-tracked planning processes, are unlikely to prioritise climate considerations.

4 Environmental permits and approvals

4.1 What environmental permits and approvals are required in your jurisdiction, and when are these typically required?

Environmental approval is required from the Commonwealth under the Environment Protection and Biodiversity Conservation Act (EPBC Act) where an action is likely to have a significant impact on matters of national environmental significance (MNES). The Commonwealth is currently streamlining environmental assessment and approval procedures to avoid duplication and will seek to establish bilateral agreements with the states/territories to enable states/territories to approve actions on behalf of the Commonwealth.

Environmental permits and approvals vary in each state/territory. However, the following approvals are typically required:

• planning/development approval incorporating environmental impact assessment for major projects; and
• environmental protection licences for specified industrial activities (eg, the extractive industry and the chemical industry), or for pollution incidents – in particular, water pollution.

It is common for multiple approvals to be required. Other specific approvals may also be required, depending on the nature of the activity and its impacts. Table 3 demonstrates the range of environmental approvals that could be required.

Table 3. Examples of environmental approvals

Nature or impact of an activity	Approval required
New development	Planning/development approval; works approval
Mining	Exploration licence, mining lease
Pollution or specified polluting activities	Environment protection licence/authorisation; water pollution licence
Waste	Waste transport and disposal licence; hazardous waste permit
Hazardous substances	Licence to store or use hazardous substances above certain quantities or in certain situations
Threatened species	Licence to damage, disturb or take
Water use	Licence for water extraction, access, supply works and use
Ozone	Licence for keeping, using, maintaining and disposing of prescribed ozone-depleting substances
Aboriginal objects or areas	Licence to disturb or enter
MNES	EPBC Act approval

4.2 What is the process for obtaining environmental permits and approvals? If a permit or approval is refused, can the decision be appealed?

Obtaining a permit: The process for obtaining permits and approvals varies between and within jurisdictions, depending on the nature of the permit. However, an applicant is normally required to apply to the relevant approval body for the permit or approval (eg, the Environment Protection Authority (EPA) for an environment protection licence), along with the relevant fee. In the case of planning/development applications, the applicant may also be required to prepare and submit an environmental impact assessment.

Typically, the application process is characterised by:

• submission of an application;
• an impact assessment;
• community involvement or at least the publication or notification of the application; and
• the determination of the application subject to conditions.

Many approval bodies require pre-application meetings and recommend early community engagement. In addition, some approval regimes have a screening/referral phase. For example, under the EPBC Act, a person proposing to take an action must refer a proposed action if it has, will have or is likely to have a significant impact on MNES. The purpose of the referral is to determine whether the action will need formal assessment and approval under the EPBC Act.

Appeal rights: The nature of appeal rights varies for different approvals and jurisdictions. However, an applicant typically has a right of appeal to a court or administrative tribunal for merits-based review or judicial review.

In some circumstances, a person that objected to the grant of the permit will also have a right of appeal to the grant of the permit. In addition, third parties will often have standing to seek judicial review of administrative decisions.

4.3 What is the duration of environmental permits and approvals?

The duration of an environmental permit or approval varies depending on the jurisdiction and type of approval.

Environmental protection licences normally remain in force until they are surrendered by the licence holder or revoked or suspended by the EPA.

Under the EPBC Act, the approval must specify the period for which it has effect. There is no standard approval period; however, it usually covers the anticipated duration of the action and the timeframe for implementing actions under the approval.

Planning/development approvals typically do not lapse (and are often described as ‘running with the land'), provided that the development approved by them has been commenced within a specified period. The period generally ranges between jurisdictions from one to six years.

4.4 What, if any, requirements and restrictions apply to the transfer of environmental permits and approvals?

Environment protection and waste licences and approvals are personal to the licence holder and can usually be transferred by applying to the relevant agency with the prescribed fee. In some jurisdictions, the agency can refuse to transfer the licence because the transferee or its directors are not fit and proper persons to hold the permit. Conditions can be imposed on the transfer of licences and approvals. The decision to seek a transfer of a licence must be carefully considered because the transfer may bring with it liability for pre-transfer acts or omissions.

In contrast, planning and development approvals can be thought of as benefiting the land. They need not be transferred and can be relied on by any person carrying out the approved development on the land to which the approval relates. However, in each case, it is necessary to consider the conditions of the approval and any agreements that support its operation to ensure that a person other than the applicant can have the full benefit of the approval.

4.5 What ongoing rights and obligations apply to the holder of an environmental permit or approval?

The rights and obligations of licence holders vary between jurisdictions. However, they are typically required to:

• comply with the conditions of their approval;
• notify the regulator of pollution incidents;
• cooperate with authorised officers;
• pay the relevant annual administrative fee;
• prepare pollution incident and emergency response plans; and
• submit annual returns.

4.6 What are the consequences of breach of an environmental approval or permit?

Generally, it should be assumed that breach of a condition of an environmental approval or permit is an offence. This does not mean that the relevant authority will prosecute. There are (as discussed earlier) a range of enforcement options available. In some cases, a penalty notice can be issued for breaches of a licence condition.

For example, in New South Wales, the maximum penalty for failing to comply with a licence condition is:

• in the case of a corporation, A$1 million and A$120,000 for each day the offence continues; or
• in the case of an individual, A$250,000 and A$60,000 for each day the offence continues.

However, a penalty notice in the amount of A$3,000 for a corporation and A$1,500 for an individual may be issued for failing to submit an annual return by the time required in a licence condition. In any other case, a penalty notice for breach of a licence condition may be issued in the amount of A$15,000 for corporations and A$7,500 for individuals.

A failure to comply with the conditions of an environment protection or waste authorisation may also enable the relevant authority to suspend amend or terminate the authorisation.

5 Waste management

5.1 How is ‘waste' defined and regulated in your jurisdiction? Does the regime vary depending on the type of waste involved?

Definition of waste: ‘Waste' is defined differently in each jurisdiction. However, in general, ‘waste' is broadly defined to include any discarded, rejected, unwanted, surplus or abandoned substance, whether or not it is intended to be (or can be) reprocessed, reused or recycled. There have been many cases in which the definition of ‘waste' has been contentious. Generally, the approach to understand whether a substance is ‘waste' is not to consider whether there may be some beneficial reuse available, but to look at the purpose of the person consigning the substance from their facility. If the material is surplus or unwanted in the hands of that person at that point, then the substance is likely to be waste. There will be exceptions to this.

Waste regulation: All levels of government have a role to play in waste regulation, but the primary controls are in state legislation and administered by either state or local authorities.

The Australian government is responsible for administering national waste legislation and policies, including measures that implement international obligations. For example, the Commonwealth regulates:

• the export, import and transit of hazardous waste pursuant to the Hazardous Waste (Regulation of Exports and Imports) Act 1989 (Cth); and
• the export of regulated waste material pursuant to the Recycling and Waste Reduction Act 2020 (Cth). Rules may prohibit the export of regulated waste material unless export conditions prescribed by the rules are met. Rules are being phased in – for example:
• • from 1 January 2021, rules have applied to the export of certain waste glass, ie the Recycling and Waste Reduction (Export—Waste Glass) Rules 2020; and
  • from July 2021, rules have applied to certain types of plastic, ie the Recycling and Waste Reduction (Export—Waste Plastic) Rules 2021.

States/territories are primarily responsible for managing waste in accordance with their legislation and policies. It is an offence in all jurisdictions to dispose of waste in a manner that harms or is likely to harm the environment – for example, disposing of waste at an unlicensed landfill site or illegally dumping waste on public or private land. Environmental protection licences and other authorisations are required for waste activities where certain thresholds are met.

In some jurisdictions, waste management or tracking obligations are imposed on those that generate or deal with waste. For example, from 1 July 2021 in Victoria, obligations to manage waste are part of the general environmental duty under the Environment Protection Act 2017 (Vic). This includes ensuring that waste is appropriately classified, sent to a lawful place and tracked during transportation.

Waste carriers are generally required to be licensed, particularly when they transport higher risk or controlled waste. The type of licence required varies between jurisdictions.

Additional controls apply when generating, handling or disposing of certain classes of waste. For example, more than one regulator is usually responsible for managing the different aspects of asbestos waste, from its presence in buildings to its removal, transport and disposal.

Local governments are responsible for waste management within their area, including household waste collection and recycling services, local landfill sites and litter controls.

5.2 What key rights and obligations apply to waste operators in your jurisdiction? What are the consequences of breach?

Key obligations of waste operators: An environmental protection licence or equivalent authorisation is generally required in all jurisdictions to operate a waste facility. Obligations include:

• various waste reporting obligations, such as recording and reporting the quantities and types of waste received at the facility;
• complying with licence conditions; and
• maintaining records.

Waste operators may also be subject to other authorisations (eg, works approvals in Victoria), waste levies and financial assurance requirements.

Consequence of breach: It is an offence to deposit waste on land – for example, at a landfill site – without an approval. Penalties vary between the jurisdictions and depend on the seriousness of the harm. For example, in New South Wales, a person that wilfully or negligently disposes of waste in a manner that harms or is likely to harm the environment is liable on conviction:

• in the case of a corporation, to a penalty of up to A$5 million (wilful) or A$2 million (negligent); or
• in the case of an individual, to a penalty of up to A$1 million, seven years' imprisonment or both (wilful), or A$500,000, four years' imprisonment or both (negligent).

In South Australia, a person that causes material environmental harm by polluting the environment intentionally or recklessly, and with the knowledge that environmental harm will or might result, is guilty of an offence. The maximum penalty is:

• in the case of a body corporate, A$500,000; or
• in the case of a natural person, A$250,000, imprisonment for two years or both.

There are also penalties for failure to hold a licence. For example, in New South Wales, failure to hold an environment protection licence required for premises carrying out scheduled activities (including waste facilities that meet certain thresholds) is an offence punishable by:

• in the case of a corporation, A$1 million and A$120,000 for each day the offence continues; or
• in the case of an individual, A$250,000 and A$60,000 for each day the offence continues.

In New South Wales, there is a defence against a land pollution charge for unlicensed landfills if those facilities maintain certain minimum standards.

As per question 4.6, it is also an offence to breach a condition of an environmental approval or permit. In some cases, a penalty notice can be issued for breach of a licence condition.

5.3 Are any producer responsibility regimes applicable in your jurisdiction?

The National Waste Policy sets out the framework for waste and resources recovery in Australia. Product stewardship – which is a key strategy in the policy – recognises that anyone involved in the manufacture, sale, use or disposal of products and materials has a shared responsibility to ensure the environmentally sound management of those products and materials throughout their lifecycle.

Producer responsibility schemes are a type of product stewardship, and place responsibility for the collection, recycling, treatment and disposal of a product at the end of its life on the producer (manufacturer) or importer. The schemes may be voluntary, mandatory or shared with industry.

There are currently some voluntary product stewardship/recycling schemes in operation, including:

• the National Television and Computer Recycling scheme, where consumers can return items to designated free drop-off points. Liable parties (manufacturers, importers and distributors) must be members of an approved co-regulatory arrangement, and commitments are made to certain collection and recycling targets;
• FluoroCycle, a product stewardship scheme for recycling waste mercury-containing lamps;
• the Australian Packaging Covenant, which is an agreement between the government and companies in the supply chain to reduce the environmental impacts of consumer packaging, including through efficient collection and recycling programmes; and
• the Tyre Product Stewardship Scheme, which promotes the reuse of end-of-life tyres and the development of markets for tyre-derived products.

Most states/territories have also introduced container deposit schemes, which offer a small refund for the return of certain recyclables.

6 Hazardous substances

6.1 What are the key features of the regulatory regime governing hazardous activities and substances in your jurisdiction?

Hazardous substances and activities are subject to a variety of regulatory regimes, including:

• work health and safety (WHS) laws, in respect of labelling, using, storing and handling hazardous substances, and carrying out hazardous activities;
• dangerous goods legislation, when hazardous substances that are classified as dangerous goods are transported;
• environmental protection laws, when hazardous substances cause pollution or become waste; and
• planning laws, in respect of the development and use of hazardous facilities.

These laws are primarily state legislation.

Australia imposes stringent WHS obligations on employers/business owners, particularly where hazardous activities affect the health and safety of workers, visitors and others in close proximity. Primarily, work health and safety is regulated at a state level.

Safe Work Australia is a national statutory body responsible for developing national policy for work health and safety (WHS). This includes:

• policies relating to:
• • the management of hazardous chemicals;
  • WHS duties; and
  • the duties of suppliers, manufacturers and importers; and
• requirements for transporting hazardous chemicals.

However, the adoption and implementation of these remain matters for the states.

The transport of dangerous goods is also regulated through specific legislation such as the Dangerous Goods (Road and Rail Transport) Act 2008 (NSW).

In addition, various specific pieces of legislation regulate particular types of hazardous substances (eg, radioactive substances and waste, asbestos and asbestos waste and chemicals).

6.2 What key rights and obligations apply to operators of hazardous sites in your jurisdiction?

Operators of hazardous sites must comply with the conditions of their licences and approvals, as well as WHS laws, environmental and planning laws, and other hazardous substances laws. Failure to comply with WHS laws could lead to significant fines and/or imprisonment. In addition, breaching the conditions of an environmental permit or causing environmental harm is an offence under relevant environmental protection legislation, and could also lead to significant penalties and/or imprisonment.

6.3 What reporting requirements apply to environmental accidents in your jurisdiction?

Environmental reporting requirements differ in each state/territory. However, they are typically triggered:

• by pollution incidents (including soil or groundwater pollution) that have a prescribed level of materiality or significance;
• in circumstances set out in approval conditions; or
• when contamination exceeds certain levels as set out in guidelines or regulations.

Notification requirements generally apply to:

• the person that caused the pollution;
• the employer of the person responsible; and
• the owner/occupier of the land.

Pollution incidents must usually be reported to the relevant agency (eg, the EPA, the local authority, Safe Work or Fire and Rescue). In New South Wales, there is a duty to report pollution incidents to the EPA under Section 148 of the Protection of the Environment Operations Act; and in Queensland, there is a duty to notify the Department of Environment and Science within 24 hours of pollution incidents and activities that cause or threaten to cause serious environmental harm or material environmental harm. It may also be prudent to notify adjoining landowners or occupiers if there are health risks or a risk of property damage.

Where the accident involves an unsafe work accident or affects the health and safety of a person, notification requirements may apply under the relevant WHS law. Employers must record incidents in a register and investigate why the incident occurred. In New South Wales, for example, SafeWork must be notified when a person dies or experiences a serious injury or illness, or when a potentially dangerous incident occurs.

6.4 What is the process for investigating environmental accidents in your jurisdiction?

The process for investigating pollution incidents generally involves:

• recording the incident;
• gathering evidence;
• assessing the damage; and
• determining whether any enforcement action is warranted.

The purpose of the investigation is to determine:

• whether an offence has occurred;
• the severity of the offence;
• the identity of those who may be responsible; and
• steps that should be taken to remedy the harm.

Environmental regulators have broad investigative powers to:

• enter premises;
• inspect premises, plants and equipment;
• take samples, photographs and videos;
• seize offending articles or other evidence;
• carry out monitoring and assessment;
• require the production of documents;
• interview employees;
• require responses to questions; and
• require notification of incidents.

Where the accident involves an unsafe work accident or affects the health and safety of a person, the relevant SafeWork investigator may:

• conduct interviews (including of witnesses, other employees, the employer and experts);
• collect evidence;
• request documents; and
• review employment, training, maintenance and medical records.

SafeWork will consider prosecution where there is sufficient evidence and it is in the public interest to file charges.

6.5 What are the potential consequences of breach of the regulatory regime governing hazardous activities and substances – both for operators themselves and for directors, managers and employees?

The breach of a regime governing hazardous activities and substances will typically expose the regulated entity to a number of risks, as follows:

• the risk of prosecution – penalties can be significant;
• the risk of clean-up orders and prevention orders;
• the risk of stop work orders;
• the risk of compensation orders or liability to impacted people and to regulatory authorities; and
• the risk of authorisations being revoked or varied.

These risks may derive from numerous overlapping regulatory regimes, including:

• the environment protection and waste laws;
• dangerous goods and hazardous substances laws;
• WHS laws;
• planning and land use laws; and
• water management and natural resource laws.

The result is that enforcement action can be pursued by multiple agencies and potentially by impacted people and communities.

Where a company commits an offence, there are commonly provisions which state that directors and people concerned in management also commit an offence. These offence provisions normally provide a defence if the director or person concerned in management exercised due diligence (or similar terms) or had no control over the activity.

Prosecution of individual directors or individual people concerned in management is unusual, but should not be dismissed as a remote or unlikely risk.

7 Contaminated land

7.1 What are the key features of the regulatory regime governing contaminated land in your jurisdiction?

The regulation of contaminated land is typically the responsibility of state or local authorities.

There is a national environment protection measure that aims to establish a nationally consistent approach for the assessment of contaminated land. However, the identification and remediation of contaminated land is generally regulated at the state/territory level.

The contaminated land regime varies in each jurisdiction. Most regimes are embodied in the general environmental legislation. However, New South Wales and Western Australia have enacted specific contaminated land legislation. Typically, the regulatory regime includes:

• a reporting or notification requirement (this varies from jurisdiction to jurisdiction);
• the ability of the relevant authority to serve investigation and management (or remediation) orders – for example, on:
• • the polluter;
  • the owner of the land;
  • in some cases, other entities with an interest in the land; and
  • public authorities. Typically, the polluter pays principle is applied when determining liability for the clean-up or remediation of contaminated land; and as a general rule, government liability is a last resort;
• the ability of impacted neighbours to recover compensation; and
• the ability for public authorities to recover compensation.

Contaminated land may also be regulated through the relevant state/territory planning regime where it is being rezoned or redeveloped. Planning authorities may require a site assessment to be carried out before granting development approval, and for remediation to be carried out before the approval is granted or as a condition of the approval.

The requirements for notifying regulators of contamination vary between the states and territories. For example, in New South Wales and Victoria, there are specific duties to notify contamination:

• In New South Wales, there is a duty on the landowner and anyone that contaminates land to report the contamination to the EPA as soon as practical after becoming aware of it.
• In Victoria, from 1 July 2021, there is a duty to manage and report contamination above certain thresholds when a person in management or control becomes aware, or reasonably should have become aware, of ‘notifiable contamination'.

Contaminated land that has been identified is sometimes classified and recorded in a contaminated land register, which also includes details of any relevant notices, investigation orders or audit statements. The scope, completeness and adequacy of these registers are variable.

7.2 Who bears the liability for the clean-up of contaminated land? Can such liability be excluded or subcontracted/delegated?

Determining liability: Each state/territory has a different approach for determining liability for remediation. In accordance with the polluter pays principle, the person responsible for contaminating the land will generally be liable for remediation. However, a range of other people may also be liable, especially where the polluter is no longer in existence or cannot be found – for example:

• the owner of the land (particularly where it knew or ought to have known of the contamination);
• the occupier of the land (this may include a mortgagee in possession, liquidator or receiver in control of a site);
• a person that exacerbates the risk from contamination;
• a person that redevelops the land or changes the use of the land to a more sensitive use; or
• a public authority (although as mentioned above, this is usually a last resort).

Transferring liability: The ability to transfer liability for contaminated land varies considerably in each jurisdiction.

For example, in Western Australia, the Contaminated Sites Act allows a person responsible for the remediation of a site to transfer all or part of that responsibility to another person, with that person's written agreement and the agreement of the chief executive officer of the Department of Water and Environmental and Regulation. It is also possible to transfer liability by agreement to the state in prescribed circumstances and with the written approval of the minister.

In contrast, in New South Wales, it is not possible to transfer the risk of regulatory orders. The person responsible for the contamination remains liable to be served with orders under the Contaminated Land Management Act. However, it is possible to:

• obtain an indemnity and release from a contractual counterparty; and
• enter into a contract under which the counterparty must carry out remediation.

In addition, as a general rule, a person cannot contract out of criminal liabilities. Therefore, where a person has caused or contributed to contamination and the circumstances in which the contamination was caused or the fact of the contamination itself amounts to an offence, it cannot contract out of this liability.

7.3 How is liability determined in cases where multiple parties have contributed to the contamination?

The approach for determining liability varies in each jurisdiction. The relevant legislation may set out a hierarchy of who is the most appropriate person to be served with a remediation order. This is generally based on who is most responsible for the contamination.

Where a remediation order is served on a party, it will generally have a right to recover costs against a person that may have contributed to the need to remediate. In addition, parties may agree to allocate liability contractually; although in most jurisdictions this will not prevent a person from being issued with a remediation order.

7.4 Can individuals bring proceedings against polluters, landowners and/or occupiers where they have been affected by contamination? If so, which court/tribunal is competent to deal with such proceedings?

An individual or third party may bring a common law claim for negligence or public nuisance in the relevant court (eg, in New South Wales, the Supreme Court) where, for example, contamination has migrated off site and caused damage to property, human health or the environment. However, these kinds of actions are generally rare due to the difficulty of establishing the claim and the costs involved.

It is important to check that the right to bring civil proceedings in respect of contamination is not limited. For example, in Western Australia, the Contaminated Sites Act provides that nothing in the act affects any right a person has at law to prevent, control or abate contamination, or to obtain damages.

An individual may also bring proceedings in the relevant court to enforce contractual obligations – for example, an indemnity in respect of remediation.

Although the regulator is generally responsible for enforcing a remediation or clean-up order, a third party may be able to enforce the order or decision where there is a failure to comply. For example, in New South Wales, the Contaminated Land Management Act allows any person to bring proceedings in the Land and Environment Court for an order to remedy or restrain a breach of the act, whether or not any right of that person has been or may be infringed by the breach.

In some jurisdictions, the relevant legislation gives third parties rights to bring actions for civil enforcement and criminal enforcement. For example, Section 9.45 of the Environmental Planning and Assessment Act 1975 (NSW) empowers any person to bring proceedings to restrain breaches of that act.

8 Reporting, auditing and disclosure

8.1 Are any public registers of environmental information maintained in your jurisdiction? If so, what are they, who can access them and how? What possibilities exist for third parties to access environmental information and what is the process for doing so?

Each jurisdiction maintains public registers with a variety of environmental information. They can generally be accessed by anyone. Most are available for free online, but some are available only upon request for a prescribed fee.

The Commonwealth government publishes a number of decisions, notices, agreements and plans under the EPBC Act, as well as in respect of greenhouse gas emissions.

The states/territories publish a range of information on public registers, including:

• environmental protection licences and other environmental authorisations;
• planning and development approvals;
• contaminated land and priority sites;
• water licences and entitlements;
• threatened species and communities;
• protected areas and heritage places;
• environmental impact statements;
• environmental offsets; and
• enforcement action, including penalties, notices and convictions as well as civil penalties and enforcement undertakings.

8.2 What environmental reporting requirements apply to companies in your jurisdiction?

Most environmental reporting by companies on environmental and sustainability matters is voluntary. However, there are some mandatory reporting requirements, including those set out below.

Corporations Act: The Corporations Act requires certain entities to prepare an annual financial report and an annual directors' report.

In preparing the financial report, Australian accounting standards require companies to prepare financial statements of:

• profit and loss and comprehensive income;
• financial position;
• cash flows; and
• changes in equity.

Actual or contingent environmental liabilities must be considered in accordance with those standards.

Sections 299 and 300 of the Corporations Act specify what the directors' report must contain. This includes, under Section 299(1)(f), details of the entity's performance in relation to environmental regulation if the entity's operations are subject to any "particular and significant environmental regulation" under a law of the Commonwealth or any state/territory.

When preparing annual reports, entities make materiality judgements about what information to disclose. Information is considered material if omitting, misstating or obscuring it could reasonably be expected to influence decisions that the users of financial statements make on the basis of those financial statements. Climate-related risks and other emerging risks are increasingly considered material to financial statements. A key consideration is whether investors could reasonably expect that such risks have a significant impact on the entity.

Australian Securities Exchange (ASX) Listing Rules: Public listed companies may be required to disclose environmental information to the ASX under the continuous disclosure rules if any reasonable person would expect that information to have a material effect on the price or value of its securities.

In addition, the ASX Corporate Governance Principles and Recommendations recommend that a listed entity disclose whether it has any material exposure to environmental or social risks (including climate change risks) and, if it does, how it manages or intends to manage those risks.

Greenhouse gas (GHG) and energy reporting: All controlling corporations that meet a certain threshold under the National Greenhouse and Energy Reporting (NGER) scheme must apply to be registered under the NGER Act. Registered corporations must report company information about GHG emissions, energy production and energy consumption.

National Pollution Inventory (NPI): Industry facilities that exceed an NPI reporting threshold must report emissions of those substances to the NPI each year. For each substance triggered in certain categories, facilities must also report any transfer of that substance.

8.3 Are companies in your jurisdiction subject to environmental audit requirements?

There is no power under the Corporations Act for the regulator to undertake environmental audits of companies.

However, some state/territory environmental protection authorities have the power to undertake environmental audits as part of their investigations. In addition, companies can be required to undertake mandatory environmental audits in the conditions of an environment protection licence.

8.4 When and how must environmental issues be disclosed (eg, in the event of the potential sale of land or a merger or acquisition)?

Each state/territory has different environmental disclosure requirements. For example, in New South Wales, the Conveyancing (Sale of Land) Regulation 2007 requires certain prescribed documents to be disclosed and certain implied warranties and prescribed warranties to be given – for example, that the land is not subject to any adverse affectation (eg, a remediation order under Part 11 of the Biodiversity Conservation Act 2016).

In some states/territories, the seller must disclose site conditions and contaminated land to the purchaser. For example, in Western Australia, the seller must disclose sites that are classified as:

• contaminated – remediation required;
• contaminated – restricted use; or
• remediated for restricted use.

Breach of vendor disclosure requirements can entitle the purchaser to rescind the contract and may result in penalties for breach of any relevant legislative provisions. Care should be taken to ensure that any statements made are not misleading or deceptive, as this could amount to an offence and lead to claims for damages. In addition, silence or a failure to disclose a significant state of affairs could amount to misrepresentation.

9 Tax

9.1 What environmental and climate taxes are applicable in your jurisdiction?

Under the Australian Constitution, both the Commonwealth and states have power to levy taxes. There is no national environmental tax. However, there are some taxable deductions for environmental activities. These are discussed in question 9.2.

Currently, there is no national carbon tax (beyond the limited trading under the Emissions Reduction Fund (ERF)). In 2012, the Australian Labor government introduced a carbon pricing mechanism with a fixed price of A$23 per tonne. This was part of the plan to move to a flexible carbon price pursuant to a cap-and-trade emissions trading scheme by 2015. However, in 2014 the ‘carbon tax' was repealed by the Liberal government and replaced with the ERF.

Some jurisdictions have a waste levy to incentivise diversion of waste from landfill.

9.2 Are any exemptions or incentives available?

Miscellaneous tax incentives are available for environmental protection, conservation and remediation. For example:

• tax incentives are available to gift property (eg, land, buildings, shares, vehicles and machinery) to an eligible environment body:
• • an income tax deduction is available for gifts to an eligible environmental body of property valued at more than A$5,000; and
  • a capital gains tax exemption is available for gifts of property bequeathed in a will to an eligible environmental body;
• tax incentives are available to enter into a conservation covenant:
• • an income tax deduction is available for any decrease in land value as a result of entering into a conservation covenant (as long as the landowner does not receive a payment for entering into it); and
  • capital gains tax provisions apply where a conservation covenant is entered into, as if it were a sale or gift of the land;
• a tax deduction is available for certain environmental protection activities, including:
• • preventing, fighting or remedying certain pollution; and
  • treating, cleaning up, removing or storing certain waste;
• a tax deduction is available for capital expenditure on a Landcare operation in Australia; and
• a tax deduction is available for carbon sequestration (carbon sink) establishment expenditure, such as:
• • acquiring trees or seeds;
  • preparing the area for planting; and
  • planting the trees or seeds.

9.3 What strategies might parties consider to mitigate their environmental and climate tax liabilities?

There are no national environmental or climate taxes to mitigate.

Concerns regarding state/territory waste levy loopholes have largely been closed – for example:

• the introduction of a waste levy in Queensland so that waste is not sent to landfill sites there to avoid levies in other jurisdictions; and
• the use of waste transfer stations in non-levy zones to avoid payment of the levy.

10 Insurance

10.1 What types of environmental insurance arrangements are put in place in your jurisdiction? Is there any mandatory environmental insurance in your jurisdiction? How sophisticated is the environmental insurance market? What, if anything, is excluded from insurance cover?

The environmental insurance market in Australia is still developing.

A range of environmental insurance products are available – for example:

• site pollution policies;
• transaction/environmental liability policies; and
• contractor's pollution liability policies.

However, environmental insurance is not compulsory.

Inclusions/exclusions vary between policies, but commonly exclude specific contaminants (eg, asbestos and lead paint) and/or gradual pollution. Some policies may include cover for emerging contaminants (eg, per- and polyfluoroalkyl substances).

10.2 What are the ‘green finance' arrangements in your jurisdiction? To whom do they apply? What, if any, obligations do they impose? Who is responsible for monitoring, enforcing and reviewing such arrangements in your jurisdiction?

Australia does not have a government-led regulatory framework for green or sustainable finance. However, a number of voluntary and sector-driven initiatives have been developed.

The 2018 UN Environment Programme Finance Initiative Conference in Sydney on financing a resilient and sustainable economy led to a joint statement by the Australian and New Zealand finance sectors and global finance initiatives to develop a sustainable finance roadmap for Australia.

In November 2020, the Australian Sustainable Finance Initiative launched the Australian Sustainable Finance Roadmap, which sets out 37 recommendations and an action plan. These include:

• establishing a permanent sustainable finance body in 2021; and
• establishing targets and trajectories to support net-zero aligned decisions and build sustainable finance markets.

The voluntary green finance market is growing and new products are emerging. Key green finance products available include:

• green bonds – debt security issued to fund projects that have positive environmental and/or climate benefits;
• green loans – a type of credit offered by a financial institution to fund a product or project with environmental credentials; and
• sustainability-linked loans – a type of credit offered by a financial institution for any purpose (not limited to environmental projects) where the loan aligns the cost of borrowing with a borrower's performance measured against prescribed sustainability performance targets.

11 Disputes

11.1 In which forums are environmental and climate change disputes heard in your jurisdiction?

The forum for resolving environmental disputes varies in each jurisdiction. In most states/territories, a specialist environmental court or tribunal has been established to hear appeals under planning and environmental legislation. The main court or tribunals for each jurisdiction are:

• the Land and Environment Court of New South Wales;
• the Planning and Environment Court, Queensland;
• the Environment, Resources and Development Court, South Australia;
• the Resource Management and Planning Appeal Tribunal, Tasmania;
• the Northern Territory Civil and Administrative Tribunal;
• the Victorian Civil and Administrative Tribunal;
• the Australian Capital Territory Civil and Administrative Tribunal; and
• the State Administrative Tribunal and Office of the Appeals Convenor, Western Australia.

Common law claims (eg, negligence and nuisance) are usually brought in the relevant state/territory Supreme Court. Appeals against decisions of the Supreme Courts and specialist courts/tribunals are typically heard in the relevant state/territory Court of Appeal.

Claims made under federal legislation or judicial review of decisions made by Commonwealth decision makers are brought in the Federal Court of Australia.

The relevant forum for climate change disputes depends on the nature of the claim. An administrative law challenge to a decision made by a state/territory decision maker (eg, the decision maker did not consider the greenhouse gas emissions from a development/project) will generally be brought in the relevant state/territory court or tribunal. However, climate change challenges brought under federal legislation (eg, the Corporations Act) or in respect Commonwealth government decisions will be brought in the Federal Court of Australia.

11.2 What issues do such disputes involve?

Environmental disputes and proceedings in state/territory courts and tribunals generally fall into the following categories:

• merits-based reviews – for example, planning and development appeals;
• judicial review – for example, administrative law appeals against decisions of public bodies;
• criminal enforcement proceedings – for example, prosecution for breach of environmental offences;
• civil enforcement proceedings – for example, civil penalties for breach of environmental offences; and
• common law claims – for example, environmental negligence and nuisance claims.

Environmental disputes and proceedings in the Federal Court and High Court of Australia generally involve:

• biodiversity matters under the Commonwealth Environment Protection and Biodiversity Conservation Act;
• climate change;
• native title claims under the Native Title Act 1993; and
• cases involving the interpretation of the Constitution.

11.3 What defences and indemnities are available, both for corporates and for individuals?

Individuals and corporations can be prosecuted for environmental offences in Australia. Environmental legislation typically includes director liability provisions holding directors and other officers concerned in the management of a corporation liable for offences committed by the corporation. Organisations may also be held vicariously liable under the common law for the acts and omissions of their employees and contractors.

Each state/territory has different environmental offences and defences. Offences generally fall into the following categories:

• absolute liability – no defence is available where the defendant is found to have breached the requirement;
• strict liability – the elements of the offence do not include proof of fault or intent, and there may be defences available, either prescribed in the legislation or implied by the common law; and
• fault-based liability – requires proof of intent, negligence, recklessness or other deliberation.

Defences: Examples of defences that may be available include:

• due diligence defences – for example, the respondent exercised due diligence and took all reasonable steps to prevent the contravention;
• honest and reasonable mistake of fact;
• necessity defence – for example, there was a sudden or extraordinary emergency and committing the offence was the only reasonable way of dealing with the emergency; or
• defence of authority – for example, the contravention was regulated by a permit or approval and the conditions of that permit or approval were not breached.

However, the fact that an environment protection licence is held, is not necessarily a defence to a common law claim for damages for nuisance.

Indemnity: A company may indemnify its directors and officers in respect of legal proceedings and claims made against them. However, Section 199A of the Corporations Act 2001 (Cth) prohibits a company from indemnifying its directors and officers against certain liabilities, including those which did not arise out of conduct in good faith, and in respect of legal costs incurred in defending or resisting criminal proceedings in which the person is found guilty.

Indemnities against fines for fault-based offences in particular might not be enforceable at the suit of the indemnified party.

11.4 How are environmental disputes resolved?

There is no standard procedure. Disputes are resolved through:

• negotiation; or
• if negotiation fails, either litigation or alternative dispute resolution (ADR).

Regulators are not typically tasked with the resolution of disputes.

Where ADR processes are used, these will normally be agreed between the parties and might include:

• mediation;
• conciliation;
• arbitration;
• compulsory conference;
• neutral evaluation; or
• reference to a referee.

ADR may be mandated by the court or tribunal – usually in the form of conciliation or mediation.

Where a matter is to be adjudicated in a court or tribunal by a judge, commissioner or other judicial officer, the matter will usually be managed by the court through a series of directions hearings or case conferences.

11.5 Have there been any recent cases of note?

The recent decision of Justice Preston, chief judge of the Land and Environment Court of New South Wales, in JK Williams Staff Pty Limited v Sydney Water Corporation [2021] NSWLEC 23 highlights the importance of environmental principles in jurisprudence.

The case concerned whether Sydney Water was responsible for significant erosion of a creek bank on the applicant's land. The applicant claimed that Sydney Water was legally responsible for the erosion on a number of grounds, but of particular interest was the claim in negligence.

A statutory duty of care exists in relation to the right of support of land under Section 177 of the Conveyancing Act 1919 (NSW). The applicant claimed that Sydney Water owed a duty of care not to do anything that removed the right of support on its land, and had breached this duty by discharging treated effluent into the creek which flowed downstream and eroded the bank on the applicant's land.

The court found that Sydney Water was negligent, and that a reasonable person in the position of Sydney Water would have taken precautions against this foreseeable risk of harm to the bank. In making this decision, the court considered Sydney Water's statutory functions and the conditions governing the exercise of those functions. One of Sydney Water's principal objectives is to protect the environment by conducting its operations in compliance with the principles of ecologically sustainable development. This includes the precautionary principle and the polluter pays principle. The court held that:

12 Trends and predictions

12.1 How would you describe the current environment and climate change landscape and prevailing trends in your jurisdiction? Are any new developments anticipated in the next 12 months, including any proposed legislative reforms?

The making and enforcement of environmental laws in most jurisdictions is in a state of flux, reflecting a tension between:

• constituents who prioritise environmental protection and conservation;
• constituents who see a need to balance those priorities with community, social and economic priorities; and
• constituents who are less interested in environmental outcomes as such.

In that context, it is difficult to be clear on how priorities will play out over the near term. However, it is likely that this tension and flux will continue to dominate over the medium term. Some developments that are relatively clear are set out in this section.

Assessment and approvals: Planning reforms in many states/territories are now aiming to fast-track planning approvals, boost the construction sector and stimulate the economy during the pandemic. ‘Streamlining' environmental and planning approvals is high on some government agendas to assist economic recovery in light of the COVID-19 pandemic.

At the Commonwealth level, the Environment Protection and Biodiversity Conservation (EPBC) Act is currently undergoing reform following the 10-yearly independent review of the act which concluded last year. Reform priorities include:

• single-touch approvals, which will allow states/territories to approve projects on behalf of the Commonwealth with national environmental significance. The aim is to avoid duplication between Commonwealth and state/territory environmental assessment and approval processes, and result in faster approvals;
• the development of National Environmental Standards to underpin single touch approvals; and
• the establishment of an environment assurance commissioner tasked with independently monitoring and auditing the systems that support approval decision making.

Environment protection: Environment protection laws will remain in place and will gradually be developed. However, resourcing of regulators will remain an issue.

Developments at the state/territory level include:

• delayed commencement of the Environment Protection Amendment Act 2018 (Vic), which overhauls environmental law in Victoria (from 1 July 2020 to 1 July 2021);
• the commencement in June 2020 of the Environment Protection Act 2019 (NT) and Environment Protection Regulations 2020 (NT), which modernise environmental regulation in the Northern Territory; and
• the commencement in February 2021 of the first tranche of amendments to the Environment Protection Act 1986 (WA) made by the Environmental Protection Amendment Act 2020, which deal with investigations, enforcement and other administrative changes.

Waste: Waste and resource recovery systems in Australia are stressed, and it is likely that there will be continued evolution of the waste laws in each jurisdiction aimed at encouraging resource recovery and reuse.

Finance: Environmental social governance and sustainable finance markets are likely to continue to develop in Australia over the next 12 months. See question 10.2 for a discussion on sustainable finance products and voluntary initiatives.

Ecologically sustainable development principles enforced through litigation: Climate change litigation is increasing, with applicants testing novel cases in the state/territory and Federal Courts. Three recent cases are worthy of comment. The first is McVeigh v REST, in which Mr McVeigh – a member of the REST superannuation fund – brought a challenge alleging that REST had failed to adequately manage and disclose to its members climate change risk in its investments. The proceedings settled out of court; however, REST made a public statement agreeing to continue to develop its management processes for dealing with the financial risks of climate change on behalf of its members.

The second is Sharma v Minister for the Environment [2021] FCA 5602020, in which the Federal Court held that the Commonwealth minister for the environment had a duty to take reasonable care to avoid causing personal injury to Australian children when deciding whether to approve an extension to a coal mine project under the EPBC Act. The court denied to grant an injunction. The case has important ramifications for government decision making and the potential for further climate change actions in negligence.

The third is Bushfire Survivors for Climate Action Incorporated v Environment Protection Authority [2021] NSWLEC 92 – the Bushfire Survivors for Climate Action (BSCA) sought an order compelling the EPA to perform a statutory duty to develop environmental quality objectives, guidelines and policies to ensure the protection of the environment from climate change. The Land and Environment Court found that the EPA has such a duty, has failed to perform this duty, and ordered it to do so.

13 Tips and traps

13.1 What are your top tips for smooth environmental and climate change compliance in your jurisdiction and what potential sticking points would you highlight?

In Australia, compliance should be taken seriously. Compliance systems should demonstrate a focus on operational risks and action should be taken to manage or prevent those risks being realised. This requires a thorough understanding of the environmental aspects of the business.

The flux in policy discussed in this Q&A has meant that often the community and the business community are (or appear to be) moving ahead of government policy and regulation. That is, expectations are developing that there will be outcomes such as emissions reductions, even though these are not required by law. This in turn demands that businesses move away from rhetorical flourishes and actually focus in a meaningful way on how to improve environmental outcomes. Lacking guidance from legislation or clear policy, businesses need to determine what they see as improved environmental outcomes and how much they value those outcomes.

Finally, businesses should expect to be held to account. Recent cases in which ecologically sustainable development principles have been enforced demonstrate that a significant portion of the community wants to see these high principles given effect and not merely be empty statements. Consequently, an organisation's policies, mission statement and values statement may become yardsticks against which they will be judged.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.