Shake up to Queensland’s environmental laws: what’s changed and what happens next?

After an unconventional legislative consultation process, the Environmental Protection and Other Legislation Amendment Bill 2022 (Qld) (EPOLA Bill) passed on 29 March 2023, cementing a raft of changes to Queensland’s environmental laws which will have widespread implications across a number of industries. While some changes are likely to be viewed positively, others present significant challenges and concerns, particularly for executive officers and resource companies.

Background

On 12 October 2022, the EPOLA Bill was introduced into Queensland Parliament, proposing amendments to the Environmental Protection Act 1994 (Qld) (EP Act) and other legislation. Prior to the EPOLA Bill’s introduction, select stakeholders were consulted on a confidential basis, and following its introduction, public consultation was open for just 9 business days. Many of the concerns raised by stakeholders and the public throughout the limited consultation phases have not been addressed in the final version passed.

What’s changed?

The most significant amendments to the EP Act include:

1. expanding executive officer liability, such that executive officers (which can capture employees as well as directors) now face indefinite liability;
2. making public notification mandatory for all major amendment applications to environmental authorities (EAs) for resource activities; and
3. changes to the environmental impact statement (EIS) process for projects to be assessed under the EP Act, including subjective project refusal triggers.

Executive officer liability

Under the EP Act, executive officers are deemed liable for offences committed by the corporation, unless they can prove one of 2 defences: they were not in a position to influence the corporation’s conduct, or if they were, they took all reasonable steps to ensure the corporation’s compliance.

‘Executive officer’ includes anyone who is concerned with, or takes part in, the management of the corporation, regardless of their title or whether they are a director – theoretically, this definition captures employees who do not make, but help implement, corporate decisions.

The EPOLA Bill amendments extend the current liability (and its limited 2 defences) to executive officers who are no longer in office at the time the offence is committed, but were in office at the time the acts or omissions which caused the offence occurred. While this closes a loophole which would allow executive officers to resign prior to their conduct resulting in the commission of an offence, it exposes executive officers to indefinite liability without consideration of matters such as:

1. whether the officer knew, or should have reasonably known, their conduct at the time would give rise to an offence in the future; and
2. the time that has passed since the executive officer was in office and what intervening events may have occurred during that time before the offence transpired.

This expansion of liability will not apply retrospectively (i.e. to executive officers and conduct before this change commences), however it presents a significant new risk to all executive officers moving forward. It may also present potential issues with respect to obtaining director and officer liability insurance.

Public notification for resource EA major amendments

Under the EP Act, applications to amend EAs are categorised as ‘minor’ or ‘major’. For resource EAs, major amendments include adding new production leases, increasing the surface area for the activity by more than 10%, or otherwise significantly increasing the scale or intensity of, or the level of environmental harm caused by, the activity.

Previously, the Department of Environment and Science (DES) had the discretion to require public notification for major amendments to resource EAs, however this discretion has been replaced with a mandatory public notification requirement.

Going forward, all resource EA amendment applications which DES decides are ‘major’ will be subject to the public notification process under the EP Act (and the delays and potential objections that come with it) – this includes amendment applications which have been submitted but not yet received an assessment level decision if DES now decides the application is ‘major’.

EIS changes

The amendments require the chief executive of DES to refuse to allow an EIS to proceed at 3 different stages in the EIS process, including as early as the draft terms of reference stage, if satisfied the project could not proceed under the EP Act or another law. The criteria for refusal include where regulatory requirements oblige the chief executive to refuse the EIS, or where the project would, in the chief executive’s opinion:

1. contravene a law of the Commonwealth or the State;
2. give rise to an unacceptable risk of serious or material environmental harm;
3. have an unacceptable adverse impact on a matter of State or national environmental significance; or
4. have an unacceptable adverse impact on an area of cultural heritage significance (which is defined very broadly).

For proponents undertaking EIS processes under the EP Act going forward, the ambiguity and subjectiveness of the refusal criteria are concerning, particularly as these criteria can ‘veto’ a project in the very early stages of the EIS process before the merits of the project are properly assessed.

Additional changes with respect to the EIS framework include:

1. requiring proponents to submit, with draft terms of reference, a summary of the potential adverse environmental impacts of the project and the measures proposed to avoid or minimise these impacts; and
2. introducing lapsing dates for EIS assessment reports (with the default period to be 3 years), to ensure EA assessments are based on contemporary EIS material.

The EIS changes will not affect coordinated projects undertaking an EIS in accordance with the State Development and Public Works Organisation Act 1971 (Qld).

Other amendments

Other key amendments to the EP Act include:

1. raising the monetary thresholds for material and serious environmental harm from $5,000 to $10,000 and $50,000 to $100,000 respectively for this financial year, with the thresholds to increase with CPI in future financial years – this change is intended to reflect contemporary costs, given the thresholds had not previously changed since the EP Act’s commencement;  
2. clarifying various aspects of the contaminated land framework (including statutory notification obligations for contaminated land and content requirements for contaminated land investigation documents), and introducing a process for land to be voluntarily included in the environmental management register or contaminated land register; and
3. creating new ‘temporary authorities’ to authorise the carrying out of environmentally relevant activities in emergency situations, and requiring DES (not applicants) to draft transitional environmental programs.

The amendments have also closed a legislative gap with respect to the resource sector’s transition to progressive rehabilitation and closure plans (PRCPs). Resource EA holders who were not issued PRCP transition notices by 31 October 2022, or who had not complied with a transition notice or had a proposed PRCP refused, can now submit PRCP applications (and applications made within 5 years will attract a range of transitional protections under the EP Act).

Where to from here?

Operators and individuals should familiarise themselves with the suite of amendments that have been made to the EP Act, noting the majority of amendments (including those referred to above) will commence upon assent.

Proponents undertaking EIS processes under the EP Act going forward should undertake additional work early in the process to demonstrate the project does not fall within any of the broad refusal grounds.

Corporations and individuals concerned in the management of corporations should:

1. ensure effective risk management and compliance systems are in place;
2. keep accurate records with respect to acts, omissions and decisions, and roles played in relation to these matters, particularly in the context of environmental compliance; and
3. monitor whether any amendments are made to DES’ Enforcement Guideline – this helps clarify when DES will take action against a person, including executive officers, and it may be amended in due course to help clarify this new expansion of liability.

Resource companies considering changes to activities which require EA amendments should:

1. assess and obtain advice about whether the proposed amendments are likely to be minor or major prior to making an application (including pre-application engagement with DES if appropriate);
2. where there is an argument to be made that the proposed amendments are minor, provide fulsome application material to justify this categorisation;
3. in any event, factor public notification and potential objections (including the timing and cost implications) into project planning; and
4. monitor DES’ upcoming amendments to the Major and Minor Amendment Guideline, as well as the Queensland Law Reform Commission’s anticipated review into public notification and objection processes for EAs and resource authorities in case relevant changes arise.