“Never waste a (COVID-19) crisis”: new proposals to streamline the Australian government's environmental approvals regime

On 27 August 2020, the Federal Government tabled the Environment Protection and Biodiversity Conservation Amendment (Streamlining Environmental Approvals) Bill 2020 (Bill) in the House of Representatives.

Why is it important?

If enacted, the Bill will remove potential obstacles to the Commonwealth devolving some of its environmental impact assessment and approval powers to the States and self-governing Territories under the Environment Protection and Biodiversity Conservation Act 1999 (Cth) (EPBC Act). 

Importantly, many of the changes will apply to projects that are referred to the Commonwealth before the Bill is passed and comes into effect. This means that if your project is already being assessed in accordance with the EPBC Act or if you are proposing to refer your project in the foreseeable future, these amendments and the development of new bilateral agreements are relevant to you.

The Bill aims to deliver on a Federal Government commitment to streamline the assessment and approval of projects under the EPBC Act. It is also broadly consistent with some of the key interim findings of Professor Samuels in his Interim Report that was published in July 2020. The Federal Opposition has indicated that it will oppose the Bill in the Parliament, so its prospects will depend on crossbench support in the Senate.

Key takeouts

1. States and Territories to be the sole-decision maker: The Bill proposes that if a project is covered by an approval bilateral agreement, it cannot be referred to the Commonwealth. This will mean that the State and Territory decision-maker will be the sole decision-maker in respect of a project that is covered by an approval bilateral agreement.
2. Greater flexibility around bilateral arrangements: This is principally done by enabling the Commonwealth to accept a State or Territory impact assessment even if the bilateral agreement has been suspended or revoked, and to ensure the operation of a bilateral agreement is not compromised by minor changes to the accredited State and Territory laws and procedures.
3. Commonwealth call-in: The Bill proposes a mechanism that would enable the Commonwealth Minister for Environment to "call-in" a project that is covered under a bilateral agreement.
4. Water trigger: Presently, controlled actions under the water trigger cannot be assessed or approved under a bilateral agreement. The Bill proposes to remove this obstacle and treat these controlled actions in the same manner as other controlled actions.

Context

Presently, the EPBC Act requires a project to be referred to the Commonwealth Minister for Environment if the proponent believes the project will or is likely to have a significant impact on the "matters of national environmental significance." The "matters of national environmental significance" include Ramsar wetlands and world heritage areas, listed nationally threatened species and communities, the Commonwealth marine area, and places on the National Heritage List. The environmental impact assessment and approval requirements also apply to significant environmental impacts of "nuclear actions" (such as a uranium or mineral sands mine), coal mining and coal seam gas production under the so-called "water trigger," and actions on Commonwealth land.

After receiving and giving notice of the referral, the Commonwealth may determine that the referred project is a "controlled action" that needs to be assessed and approved by the Minister under the EPBC Act. The EPBC Act sets out methods and procedures for the assessment of controlled actions, including by way of public environmental report, environmental impact statement, or inquiry.

Recognising the potential for the EPBC Act to duplicate State and Territory environmental impact assessment and approval laws and procedures, the Act also empowers the Commonwealth to enter into bilateral agreements to accredit – and rely on the outcomes of – the State and Territory laws and procedures. There are two types of bilateral agreements possible under the EPBC Act:

1. Assessment bilateral agreements: the Commonwealth accredits the State and Territory impact assessment procedures set out in the agreement, but the Commonwealth Minister must still approve the project if it is to go ahead. There are a number of assessment bilateral agreements presently in force throughout Australia, and they have been a feature of the legal landscape in Australia for more than a decade; and
2. Approval bilateral agreements: the Commonwealth accredits and accepts the State or Territory decision on whether to approve the project. There has never been an approval bilateral agreement in Australia.

More flexible bilateral arrangements

The statutory provisions that govern bilateral agreements have been criticised for being too inflexible in a number of respects, particularly if minor amendments are made to accredited State or Territory laws. Professor Samuels in his Interim Report acknowledged these criticisms and recommend that they be addressed.

The Explanatory Memoranda accompanying the Bill explains that it is envisaged that approval bilateral agreements will set out a class or classes of developments that can be approved by the States and Territories. The Bill also contemplates new Regulations that will set out the criteria that an accredited State or Territory procedure must meet – it remains to be seen whether these Regulations will provide the statutory basis for the National Environmental Standards recommended by Professor Samuels in his Interim Report.

The Bill proposes a number of amendments to achieve greater flexibility and reduce the potential for duplicating Commonwealth and State and Territory impact assessment laws and procedures.

States and Territories are to be the sole decision-maker

If a project is being assessed or has been approved under a bilateral agreement, the proponent cannot refer the project to the Commonwealth under the EPBC Act. This amendment will prevent proponents from "forum shopping" if it is dissatisfied with the State or Territory's assessment or approval decision. The key issue for proponents will be to establish whether their project is covered by a bilateral agreement, as this will decide whether the proponent should refer the project to the Commonwealth under section 68 of the EPBC Act or proceed under the accredited State and Territory bilateral agreements. It would be desirable for the bilateral agreements to require the States and Territories to confirm these matters with proponents.

Greater scope and flexibility in bilateral arrangements

Presently, if a bilateral agreement is suspended or cancelled, any project that is being assessed under the accredited State and Territory laws is left "in limbo" and may require the assessment to be restarted under an EPBC Act procedure. The Bill proposes to address this by giving the Minister the power to make use of a completed, or partially completed, State or Territory assessment to complete the assessment and approval process under the Act.

The Bill also proposes to expand the scope of State and Territory assessment and approval procedures that can be covered by a bilateral agreement. However, the Regulations will need to set out criteria that State and Territory assessment and approval laws and procedures must meet. The Commonwealth must also be satisfied that the assessment is adequate and that the project will not have unacceptable and unsustainable impacts on a matter of national environmental significance.

What happens when accredited State and Territory arrangements change?

Under the Bill, it is proposed that certain minor changes can be made to an accredited State or Territory management or authorisation procedure; provided they meet the criteria in the Regulations. The types of changes proposed by the Bill include minor changes to the public comment period or the assessment documentation requirements, or additional requirements relating to procedural fairness.

Commonwealth "call-in"

The Bill proposes that both the Commonwealth Minister and the relevant State or Territory Minister may effectively "call-in" a project that is covered by an approval bilateral agreement. This will enable the Commonwealth to decide whether or not the project is a controlled action, the assessment method under the EPBC Act, and ultimately whether to approve the project.

To avoid duplication, the Bill proposes deeming provisions that prevent a proponent from having to refer the declared project under the EPBC Act.

Projects in more than one State or Territory

The new bilateral arrangements will not apply to projects in two or more States or Territories unless the project is covered by an assessment or approval bilateral in each jurisdiction.

Projects on Commonwealth areas

Presently, bilateral agreements cannot apply to projects on Commonwealth areas. The Bill does not propose to alter this.

Water trigger

A coal seam gas or large coal mining project will require assessment and approval under the EPBC Act if the Minister for Environment determines the project has, will have, or is likely to have a significant impact on a water resource. This control is typically referred to as the "water trigger." Under the current legislation, an approval bilateral agreement cannot cover projects that are captured by the "water trigger."

The Bill proposes to remove this legislative barrier and enable approval bilateral agreements to cover projects that are captured by the "water trigger," but only if the State or Territory undertakes to obtain and consider the advice of the Independent Expert Scientific Committee on Coal Seam Gas and Large Coal Mining Development (IESC). The IESC will also advise the Commonwealth Minister on the operation of an approval bilateral agreement in respect of the water trigger.

Next steps

The Minister for Environment has already published notices of proposals to enter into approval bilateral agreements with the States and Territories. As the Bill makes its way through the Federal Parliamentary process, proponents should monitor announcements regarding the criteria proposed in new Regulations and the scope and operation of any new assessment and approval bilateral agreements. The key to the Bill's future will be whether the Federal Government can get the support of a sufficient number of crossbenchers to support the Bill in the Senate.

More broadly, Professor Samuels' final report is due in October 2020. The government has been silent on a number of Professor Samuels' interim recommendations, except that the Minister for Environment has indicated that the government will not support his recommendation to establish an independent authority to monitor compliance and enforce compliance with the EPBC Act. Presumably the government envisages that under a completely devolved system, the States and Territories will be responsible for enforcing compliance with the approvals they issue under an approval bilateral agreement.

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