The range of new civil powers – which have been welcomed by the NFU and EEF, the manufacturers’ organisation – given under the Regulatory Enforcement and Sanctions Act 2008, will increase the options available to regulators and include fixed and variable monetary penalties and compliance notices.
The sanctions will provide an alternative to criminal prosecutions for regulators which is more proportionate and reflects the fact that the majority of non-compliance by businesses is unintentional.
 Environment Secretary, Hilary Benn, said:
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“These new powers will help make the system fairer for the law-abiding majority of businesses and will give regulators a practical and effective alternative to prosecution. The Environment Agency and Natural England, the first bodies to be given these powers, will have access to flexible and proportionate sanctions that will strengthen the protection of the environment and human health when tackling businesses who break the law.”
Ian Lucas, Minister for Business and Regulatory Reform, said:
“Creating a more flexible and proportionate regulatory system is at the heart of the Government’s better regulation agenda. The award of these new powers is a significant step forward that will provide an alternative to costly and time consuming criminal proceedings. It will mean businesses will benefit from a more straightforward process with sanctions that better fit their non-compliance and send a clear signal that the worst offenders should receive the toughest criminal penalties.”
The powers, conceived by Professor Richard Macrory, were designed to create a modern and targeted system that will give regulators greater flexibility to impose more appropriate sanctions on non-compliant businesses. The Environment Agency and Natural England will be able for the first time to accept a voluntary commitment from a business to remedy non-compliance.ÂÂ
The existing system was considered to be too reliant on costly and time consuming criminal prosecutions. The new powers will not replace existing informal methods such as advice and guidance. Businesses and individuals will have access to an appeals process through an independent and impartial tribunal.
The criminal courts already have substantial powers to impose proportionate sanctions for environmental offences. The Government also has plans for new sentencing powers to enable the courts to put restoration ahead of monetary penalties. Courts would be able to remove the financial benefit from non-compliance and order environmental restoration and restitution to local communities.
Gareth Stace, Head of Climate & Environment Policy at the EEF, the manufacturers’ organisation, said:
“We support the Government’s aims to create a fairer, more effective and more proportionate enforcement regime. Defra’s Fairer and Better Environmental Enforcement (FBEE) project has actively engaged with manufacturers on the introduction of these new civil powers for environmental non-compliance and has done a successful job in addressing a number of manufacturer concerns. We remain encouraged that the transition of civil sanctions from legislature to regulator can now be fairly and equitably applied.”
Andrew Clark, Head of Policy Services, the National Farmers’ Union said:
“We appreciate the work that Defra and its regulators have put in to develop a more flexible and proportionate approach to environmental enforcement, and for their having involved us in that work. The availability of sanctions other than just criminal prosecution in dealing with businesses which do not comply with the law is long overdue.”
Key FactsÂÂ
1. The Regulatory Enforcement and Sanctions Act 2008, part 3, contains the enabling powers to introduce four new civil sanctions:
- Fixed monetary penalty (FMP) notices – under which a regulator will be able to impose a monetary penalty of a fixed amount;
- Discretionary requirements – which will enable a regulator to impose, by notice, one or more of the following:
- a variable monetary penalty (VMP) determined by the regulator;
- a requirement to take specified steps within a stated period to secure that an offence does not continue or happen again (compliance notice); and
- a requirement to take specified steps within a stated period to secure that the position is restored, so far as possible, to what it would have been if no offence had been committed (restoration notice);
- Stop notices – which will prevent a business from carrying on an activity described in the notice until it has taken steps to come back into compliance;
- Enforcement undertakings – which will enable a business, which a regulator reasonably suspects of having committed an offence, to give an undertaking to a regulator to take one or more corrective actions set out in the undertaking.
A 12 week public consultation by Defra and the Welsh Assembly Government on the proposed use of civil sanctions for environmental offences closed on 14 October 2009. Respondents gave overall support to the proposals. A summary of respondents’ views and the Government’s response and the Government guidance to regulators on use of civil sanctions, can be found at http://www.defra.gov.uk/environment/policy/enforcement/project/index.htm and http://www.defra.gov.uk/environment/policy/enforcement/project/legislation.htm
2. Subject to debate in Parliament, these powers will be made available to the Environment Agency and Natural England for certain offences through secondary legislation, (The Environmental Civil Sanctions (England) Order 2010 and The Environmental Sanctions (Misc. Amendments) (England) Regulations 2010). The legislation will be laid before Parliament shortly. The Welsh Assembly Government is drawing up co-ordinated secondary legislation in Wales to extend civil sanctioning powers to the EA in Wales.
3. Defra has plans to work with the local authority sector, Local Better Regulation Office, businesses and other groups to develop possible proposals for local authority use of civil sanctions. This would be subject to a further public consultation and separate legislation.
4. In using the civil sanctions regulators must apply a criminal standard of proof: i.e. they must be satisfied ‘beyond reasonable doubt’ that an offence has been committed before imposing any restoration notice, compliance notice, fixed monetary penalty or variable monetary penalty. Regulators must impose a Notice of Intent to impose such sanctions so that the recipient can make representations and objections.
5. Both the EA and NE are required to carry out a full public consultation on the details of how they would apply the new powers before the powers can be used.
6. A Variable Monetary Penalty (VMP) for an offence that can be tried in the Crown courts will be no higher than £250,000. VMPs for other offences are capped at the maximum the magistrates’ courts could impose, which may be £5,000, £20,000 or £50,000 depending on the offence.
7. Professor Richard Macrory was commissioned by the Government to examine why businesses did not comply with the law and what could be done to address the situation. His report published in November 2006 made a number of recommendations including a range of civil sanctions that could be made available to regulators. This report can be found at www.berr.gov.uk/files/file44593.pdf .
 8.     Appeals against the new civil sanctions will be made to the General Regulatory Chamber of the First-tier Tribunal. For further information on the General Regulatory Chamber see http://www.tribunals.gov.uk/Tribunals/Firsttier/generalregulatory.htm .
Paul Gray is an entrepreneur and digital publisher who creates online publications focused on solving problems, delivering news, and providing platforms for informed comment and debate. He is associated with HRZone and has built businesses in the HR and professional publishing sector. His work emphasizes creating industry-specific content platforms.
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