As the COVID-19 crisis advances, compliance with environmental regulatory requirements will present challenges for businesses. Although environmental management systems that are designed to maintain regulatory compliance may be in place at industrial or resource-based operations, full adherence with all legal requirements may, at some point, become difficult to achieve because of the legal and practical impediments created by the COVID-19 response.
Companies are already facing decisions which may compromise their ability to fully comply with these conditions, and the difficulties are likely to become more acute as the crisis deepens.
COVID-19 IMPACTS ON COMPLIANCE
The ability to meet requirements—such as operating conditions, emissions limits and monitoring, record keeping and reporting obligations—that are imposed by environmental protection statutes, regulations, approvals and other regulatory instruments will be impacted because of the restrictions imposed and impediments created by the COVID-19 crisis.
Federal, provincial and local governments and employers have imposed or are considering orders to shelter-at-home or self-isolate, requirements for social distancing and hygiene, travel restrictions, as well mandatory closure of all non-essential workplaces. These restrictions will result in a reduction in personnel to carry out tasks needed to ensure continued compliance with the legal requirements. Other impacts that are occurring and are anticipated include:
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Reduced staffing levels will make it more difficult to keep systems functioning and pollution control systems working efficiently, especially when specific in-house expertise is missing.
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Reduced availability of third-party contractors who perform specialised sampling and perform vital operational, maintenance and monitoring functions and impacts on the supply puts additional strain on company operators to maintain operations.
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Limitations on delivery services which transport samples for analysis and the reduction in commercial flights from remote locations is limiting the ability to get samples to laboratories located in urban areas within the statutory timelines for testing.
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Curtailing activities (including shifting operations to care and maintenance) in response to prohibitions on non-essential work and the loss of market demand for products can exacerbate a problem where compliance is assured by maintaining a certain balance in process systems, which can impact on the ability of the system to function as designed.
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Stockpiling of raw and waste materials can create additional environmental strain on an industrial site, especially when there are limitations on the ability to hire contractors to manage them.
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Personnel reductions in commercial laboratories are also limiting their ability to prioritize testing for industrial operations.
CONSIDERATIONS FOR BUSINESSES
For those companies which find themselves unable to comply with specific requirements, there are a number of steps that can be taken to reduce future regulatory risk. Businesses should consider the following:
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Enforcement Discretion: Given the unique circumstances, businesses can hope that regulators will adopt a flexible approach to compliance and use their discretion when deciding whether to enforce requirements. Several business and industry associations have reached out to federal and provincial governments requesting a relaxing of monitoring and reporting conditions, especially in circumstances where such monitoring is redundant or not immediately essential, to ensure ongoing protection of the environment.
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Suppliers and Contractors: Companies should document the inability of third-party contractors or suppliers to perform their obligations under any agreements, particularly where the non-performance may result in non-compliance.
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Government Communications: Federal and provincial regulators are facing strains on their systems, which is impacting their ability to respond to requests for assistance from industry, even just to provide advice in response to questions. Documenting actual and attempted communications with regulators is advisable.
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Record-keeping: If enforcement discretion is not exercised, records of efforts made to maintain and achieve compliance should be made and kept, including the impacts of the impediments created by the response to the COVID-19 emergency.
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Potential Legal Defences: Companies should consider possible legal defenses that are available in the event of prosecution, penalty or administrative action.
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Due Diligence: The due diligence defence allows a person to escape liability if they demonstrate that they took all reasonable steps to prevent the commission of the offence. This defence does not require superhuman efforts, but rather that all reasonable steps were taken. During a pandemic, such steps could include implementing health and safety measures for employees and having appropriate emergency response procedures in place.
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Necessity: The common law defence of necessity applies in circumstances of imminent risk. Three conditions must be met for a successful defense: (1) an urgent situation of imminent peril or danger, (2) the absence of a reasonable legal alternative; and (3) proportionality between the harm done and the harm avoided. In the context of COVID-19, such a defence could potentially be argued when workers’ lives and public health issues are at stake
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Impossibility: While necessity deals with the imperative to break the law, impossibility deals with the inability to comply with the law. Therefore, impossibility may be an available defense where it is not physically or morally possible to comply with the law. The threshold for a successful impossibility defence is high. However, the government-imposed restrictions preventing travel or trade due to COVID-19 could potentially render certain environmental compliance obligations impossible to comply with.
Exercising diligence in decision making, prioritising environmental protection over bureaucratic requirements, obtaining input of experts and regulators where possible, and keeping clear records of the reasons why actions are being taken, will all contribute to the company’s ability to answer questions in the future and should assist in protecting companies against enforcement activities and provide for viable defences against future accusations of non-compliance.
The impact of COVID-19 is rapidly evolving and there are no clear answers or timeframe for the crisis to end. To help navigate the challenges posed by the COVID-19 outbreak, Blakes has consolidated resources on a range of topics relating to the coronavirus and its business and legal implications.
In particular the Blakes Environmental group is here to assist you with any contractual, regulatory, enforcement queries or concerns that you may have relating to COVID-19 and its impact on business.
