Environmental Law Quarterly Update - Q3 2021

This quarterly environmental law update provides a summary of news stories in the period July 2021 - September 2021.

July

Stowey Quarry saga convictions

Following a three year investigation by the Environment Agency, two companies, UK Environmental Limited and European Metal Recycling Limited, pleaded guilty to two charges each after they took advantage of a quarry that became an illegal tipping site. The companies were required to pay a total of £913,000, which included prosecution costs totalling £433,000. Confiscation orders were made of £7,048 and £32,958 respectively. The case follows the related convictions of Mark Foley, reported in the Q2 update here.

Southern Water fined £90m for illegal sewage discharges

Following guilty pleas to 51 offences, on 9 July 2021 Southern Water was fined £90m for discharging between 16 and 21 billion litres of raw sewage into the rivers and coastal waters in Kent, Hampshire and Sussex. Between January 2010 and December 2015 there were thousands of illegal discharges of raw sewage at 17 different sites across the North Kent coast and the Solent. The sewage was released over a total period of 61,704 hours, equating to just over seven years.

The sentencing Judge said that each of the offences “…seen in isolation, shows a shocking and wholesale disregard for the environment, for the precious and delicate ecosystems….for human health and for the fisheries and other legitimate businesses that depend on the vitality of the coastal waters” with Southern Water’s “…previous persistent pollution of the environment over very many years” aggravating the case further. Concluding the company had been obstructive during the investigation and that all but one of the offences were committed deliberately by Southern Water’s board of directors, the Judge held “…history shows that fines of hundreds of thousands or low millions of pounds have not had any effect on the Defendant’s offending behaviour. It is necessary to set a fine which will bring home to the management of this and other companies the need to comply with laws that are designed to protect the environment. Individual shareholders may, I accept, have no direct responsibility for the offending. Their investments may suffer as a result of a substantial fine and its consequences. But if that results in large institutional investors taking a more active role in ensuring that the companies that they invest in comply with the law, then that is not inconsistent with the purposes of sentencing, which include the reduction of crime”.

A costs order of £2,542,428.51 was ordered but no confiscation order was sought, with the fine encompassing any benefit estimated to have been derived by Southern Water from its offending (£36m). For more information see our previous blog here.

The Environment Agency’s annual report finds water companies are still failing in their duty to protect the environment

Shortly after Southern Water’s £90m fine was imposed, on 13 July 2021 the Environment Agency published its annual report of England’s nine water and sewage companies’ environmental performance. It found that no single company had met the expectations for the period 2015–2020 with four companies rated poor or requiring improvement. See our earlier blog on the 2020 report here.

Biffa caught exporting banned waste again

On 30 July it was reported that Biffa Waste Services Limited, the UK’s leading waste management company, had been fined £1.5m for breaching regulation 23 of the Transfrontier Shipment of Waste Regulations 2007. Following a two week trial, a jury convicted the company for exporting tonnes of waste from private homes, mislabelled as paper, to India and Indonesia in 2018 and 2019. This is Biffa’s second relevant conviction, after being fined £350,000 in 2019 for shipping similar prohibited material to China in 2015 (see our previous blog here).

Defra opens consultation on establishing environmental review by amending the civil Procedure rules

In July 2021 the Department for Environment, Food & Rural Affairs (Defra) opened a consultation on amendments to the Civil Procedure Rules (CPR) which would establish an ‘environmental review’ in the High Court. The ‘environmental review’, created by clause 39 of the Environment Bill, would act as a litigation mechanism for the Office for Environmental Protection, a statutory body also created by the Bill. The deadline for responses was 6 September 2021. A link to the consultation can be found here, with the Law Society’s response here.

August

Lincolnshire recycling company fined

On 6 August 2021 it was reported that Environcom England Limited had pleaded guilty of failing to comply with its environmental permit, contrary to Regulation 38(2) of the Environmental Permitting (England and Wales) Regulations 2010. The company, which operates a waste electrical and electronic equipment (WEEE) recycling plant, was found to have stored plastic on their site which far exceeded the permitted amount. Environcom was ordered to pay £35,000 in costs and, in relation to other related matters, agreed to pay £20,000 to Lincolnshire Rivers Trust.

Environment Bill strengthened

On 27 August amendments to the Environment Bill were tabled in order to strengthen the bill by including a legally-binding commitment to halt species decline by 2030. The new amendments align with the G7’s commitment to stop and reverse the loss of biodiversity by the same year. Other changes also introduced included a requirement on water companies to monitor and publish data on sewage discharges; duties placed on the government and water companies regarding storm overflows; and new powers and duties for the Secretary of State in relation to biodiversity gain sites. For more information on the Environment Bill see the Q1 Update here and the government website here.

September

A focus on greenwashing

September saw a focussing on misleading greenwashing claims by two key regulators: the Advertising Standards Agency (ASA) and the Competition and Markets Authority (CMA). On 20 September the CMA published its ‘Green Claims Code’, the purpose of which is to explain to businesses how they can check their environmental claims are genuine. Only a few days later the ASA announced their own commitment to setting out industry guidance to ensure adverts do not mislead. Whilst this focus on greenwashing is not new, with the ASA already having upheld complains regarding misleading claims by Ryanair in 2020, BMW in 2017 and Shell in 2008, it is clear that there will be greater regulatory spotlight placed on such claims, with enforcement action taken more readily where breaches are identified. It is also not only the ASA and the CMA who are taking a keener focus, with the Department for Business, Energy & Industrial Strategy announcing in August its own review into potential greenwashing within the retail energy sector. For more information on the CMA’s focus see here and here.

Yorkshire Water fined £150,000

On 8 September Yorkshire Water was fined £150,000 and required to pay over £36,000 in costs after the Environment Agency prosecuted the company for causing pollution to enter a tributary at Potter Carr Nature Reserve and breaching their environment permit relating to ammoniacal nitrogen levels. The company, who pleaded to the two offences under the Environmental Permitting (England & Wales) Regulations 2016, apologised and explained it had invested hundreds of thousands of pounds in remedial works.

£9m for local authorities to tackle air pollution

Applications for the government’s ‘Air Quality Grant’ scheme was formally opened on 3 September. The press release, which built on earlier announcements referred to in the Q2 update, confirmed that at least £1 million of the £9 million available will be directed to projects designed to improve public awareness of the risks surrounding air pollution, one of the key recommendations following the death of Ella Kissi-Debrah.  In addition, this year the grant will be focussed on various projects, including those which are aimed at reducing air pollutant exceedances, inform individuals about air quality and the steps they can take to reduce their exposure to pollution. The deadline for applications was 8 October.

Experts discuss the FAFT report on money laundering from environmental crime

On 30 September a range of experts discussed FAFT’s recent report into money laundering arising from environmental crime (see the Q2 update here). The panel discussed the fact that there was no lack of awareness in business as to what environmental issues were, but there was a lack of clarity around what constituted an environmental crime. The need for information sharing across agencies and borders was also discussed to allow businesses and authorities to identify the necessary red flags. The full webinar can be viewed here

Further information

For further information on the issues raised in this blog post, please contact a member of our Health, Safety & Environment team.

About the author

Sophie Wood is a Senior Associate in the Criminal Litigation team with extensive experience in advising corporate and individual clients involved in a wide range of internal, criminal and regulatory investigations. Sophie has acted for individuals and companies involved in investigations brought by the Environment Agency, Health and Safety Executive and local authorities, and is a member of the firm’s cross-practice Health, Safety and Environment Group.