Australia: Doing Business in Australia - Environment and Climate Change

Last Updated: 1 May 2012
Article by Tony Holland

Australian government policies, business priorities and consumer choices are all being influenced by environmental concerns, such as management of pollution, contaminated land and the impacts of climate change. Organisations with the right approach and advice can view these issues as opportunities, whereas those who don't could face added costs and business disruption.

ENVIRONMENTAL LAWS

Protection of the environment is a major priority in Australia, and environmental issues receive a great deal of media and public attention. Australia has had a strict system of federal and state environmental regulations prohibiting the discharge of pollution and waste to air, water or land. Recently, an improved range of regulatory mechanisms involving more flexibility has allowed for a spirit of cooperation between business and government to promote corporate sustainability. There are increased opportunities for industry to interact directly with government authorities to plan targets for energy and resources use, waste control and disposal. The Federal Government has also recently introduced product stewardship legislation, which provides the framework to effectively manage the environmental, health and safety impacts of products, and in particular those impacts associated with the disposal of products. The framework includes a new industry-led national scheme for recycling televisions and computers.

Each state and territory has its own environmental legislation and administration, and its own regime for town planning, control of pollution, clearing vegetation and the use and extraction of resources including water. The principles in each jurisdiction's legislation are similar, but there are important differences that need to be carefully considered in the particular state and territory. In most states, the body with responsibility for environmental administration (including compliance and enforcement) is known as the Environment Protection Authority. There are some environmental issues, for example water, where a coordinated national approach to ecologically sustainable development has been undertaken by all tiers of government.

Approval requirements vary between the different state, territory and local governments responsible. Commonly, approvals are required before particular land uses are commenced, buildings constructed, or before certain types of plants may be installed and environmental impact assessments may be required as part of the approval process. Approvals often need to go through a public notification and comment stage. The Environment Protection and Biodiversity Conservation Act 1999 (Cth) may also apply if there are impacts on matters of national environmental significance, for example world heritage, protected wetlands, or threatened species of flora or fauna.

Licences will generally be required for activities such as waste discharge, and the disposal, treatment, storage and use of certain quantities of chemicals. Any process that involves the production of pollution will be subject to stringent works approvals and licensing requirements administered by the environment protection authorities in each state. Each state and territory also has different approaches to statutory requirements to report pollution incidents and contaminated land and who is responsible for reporting.

Failure to comply with environmental and planning legislation may lead to civil and/or criminal liability. Penalties may include both fines and jail, along with loss of licences and liability for clean-up costs. A company convicted of environmental offences may find itself the subject of adverse publicity. There has been a growing trend to impose substantial financial penalties and, in certain circumstances, directors and managers may be held personally liable for offences committed by a company.

CLIMATE CHANGE POLICY AND BUSINESS

Australia is a party to the United Nations Framework Convention on Climate Change and ratified the Kyoto Protocol in 2007. Since signing the Kyoto Protocol, Australia's climate change policy has seen great change, buffeted by the sudden economic decline and heated political debate.

In 2011, the Federal Government announced its Clean Energy Future Plan, which will introduce a price on carbon in Australia from 1 July 2012 through the Clean Energy Act 2011 (Cth) and associated legislative package. The Clean Energy package will put an initial fixed price on carbon of AU$23 per tonne in 2012-2013. This will rise by 2.5% per year for a fixed period of three years (to AU$24.15 in 2013-2014 and AU$25.40 in 2014-2015). The carbon price will then transition to a full trading scheme on 1 July 2015 and will regulate greenhouse gases by setting a cap on Australia's carbon emissions. Businesses will then have to meet this cap by acquiring and trading in carbon units, which will be issued by the Federal Government.

The introduction of a price on carbon will have an impact on around 500 companies that will directly bear its cost. The impact will filter throughout the economy as the costs borne by businesses are passed on and flow through, such as increases in electricity prices and other inputs. Each year, liable entities are required to purchase Eligible Emissions Units (EEUs) for each tonne of CO2-e they emit. Liable entities are entities that have operational control of a facility that emits more than 25,000 tonnes of carbon dioxide equivalent (CO2-e) greenhouse gas emissions or more than 10,000 tonnes of CO2-e for some landfill sites. A separate threshold applies to natural gas, as natural gas retailers will be liable for greenhouse gas emissions embodied in the natural gas that they supply, regardless of the amount supplied, unless liability is transferred. Other key features of the legislative package include:

  • The creation of the framework underpinning the introduction of a carbon price, including registries, audit and compliance requirements and changes to the taxation system
  • The creation of a number of new authorities and other statutory bodies to administer the measures under the legislative package
  • Transitional measures to assist businesses and industry sectors adjust to a carbon price.

The sectors covered by the carbon price mechanism include stationary energy, industrial processes, fugitive emissions (generally from coal mining and natural gas extraction) and emissions from landfills. The forestry and agricultural sectors will not be subject to a carbon price. Instead, these sectors will be incentivised to achieve emissions reductions through the Carbon Farming Initiative (CFI). The CFI mechanism will allow certain accredited carbon abatement and sequestration projects tradeable credits known as Australian Carbon Credit Units from land sector abatement initiatives.

EEUs under Australia's carbon price mechanism are regarded as financial products, which means that trading in carbon credits and providing advice in relation to credits may require an Australian Financial Services Licence. This is an area that is evolving and specific legal advice should be sought.

Legislation already impacting business in this area includes the National Greenhouse and Energy Reporting Act 2007 (Cth), which demands businesses report on environmental matters. This Act creates a National Greenhouse and Energy Register, placing mandatory reporting requirements on businesses producing or consuming energy or greenhouse gases above specified thresholds. Such businesses have to register and report as well as comply with prescribed monitoring and auditing processes. Reporting began in October 2009. Heavy penalties are imposed for compliance failure, while increased directors' liability places responsibility on them to oversee compliance. Importantly, while only high-level users were initially caught by this Act, the relevant thresholds have decreased rapidly, capturing a much wider range of businesses.

There are also a number of state and Commonwealth schemes setting renewable energy targets and energy efficiency standards.

© DLA Piper

This publication is intended as a general overview and discussion of the subjects dealt with. It is not intended to be, and should not used as, a substitute for taking legal advice in any specific situation. DLA Piper Australia will accept no responsibility for any actions taken or not taken on the basis of this publication.


DLA Piper Australia is part of DLA Piper, a global law firm, operating through various separate and distinct legal entities. For further information, please refer to www.dlapiper.com

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Tony Holland
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert
Email Address
Company Name
Password
Confirm Password
Mondaq Topics -- Select your Interests
Accounting and Audit
Anti-trust/Competition Law
Consumer Protection
Corporate/Commercial Law
Criminal Law
Employment and HR
Energy and Natural Resources
Environment
Family and Matrimonial
Finance and Banking
Food, Drugs, Healthcare, Life Sciences
Government, Public Sector
Immigration
Insolvency/Bankruptcy, Re-structuring
Insurance
Intellectual Property
International Law
Law Practice Management
Litigation, Mediation & Arbitration
Media, Telecoms, IT, Entertainment
Privacy
Real Estate and Construction
Strategy
Tax
Transport
Wealth Management
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.