315R07001
7th International Conference
on Environmental
Compliance and Enforcement
9-15 April 2005
Marrakech, Morocco
Proceedings Volume 1
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7th International Conference on
Environmental
Compliance and Enforcement
Marrakech, Morocco
9-15 April 2005
3J
\
OEGD
ro
z
OGDE
European Commission
THE WORLD BANK
ROM
Moroccan Ministry of Territory Planning,
Water and the Environment
ENVIRONMENT
AGENCY
UNEP
United Nations Environment F
Environment Environnement
Canada Canada
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SEVENTH INTERNATIONAL CONFERENCE ON
ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
CONFERENCE PROCEEDINGS
VOLUME 1
9-15 April 2005
Marrakech, Morocco
Editors:
Mr. Jo Gerardu, VROM, The Netherlands
Mr. Davis Jones, US EPA
Mr. Kenneth Markowitz, INECE Secretariat
Mr. Durwood Zaelke, INECE Secretariat
Executive Planning Committee:
Mr. Peter Acquah, AMCEN
Mr. Bie Tao, People's Republic of China
Ms. Angela Bularga, REPIN
Dr. William Clark, Israel
Mr. Jim Gray, England and Wales
Dr. Marco Antonio Gonzalez Pastora,
CCAD/SICA
Mr. Donald Kaniaru, Kenya
Mr. Lai Kurukulasuriya, UNEP
Dr. Ladislav Miko, Czech Republic
Mr. Antonio Oposa, Jr., Philippines
Mr. Manuel Rodriguez Becerra, Columbia
Mr. Charles Sebukeera (Co-chair), UNEP
Ms. Sabine Sommer, IMPEL
Mr. Durwood Zaelke, (Director), INECE
Secretariat
Mr. Antonio Herman Benjamin, Brazil
Dr. Adriana Bianchi, World Bank Institute
Ms. Paula Caldwell St-Onge, Canada
Mr. Mihail Dimovski, ECENA/BERCEN
Mr. William Futrell, United States
Mr. Markuu Hietamaki, Finland
Mr. Georges Kremlis, European Commission
Mr. Jose Luege, Mexico
Mr. Aiko Morishima, Japan
Mr. Carlos Manuel Rodriguez, Costa Rica
Mr. Kenneth Ruffing, OECD
Mr. Thomas V. Skinner (Co-chair),
United States
Mr. Gerard Wolters (Co-chair), The
Netherlands
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These Proceedings, Volume 1, include papers prepared
by speakers, topic experts, conference participants and
other interested parties for the Seventh International
Conference on Environmental Compliance and
Enforcement, April 9-15, 2005 in Marrakech, Morocco.
Copyright ©2005 by the INECE Secretariat. No part of
this book may be reproduced in any form or by any
means without the prior permission of the INECE Secre-
tariat and the author(s) and attribution to the Seventh
International Conference on Environmental Compliance
and Enforcement, 9-15 April, 2005, in Marrakech, Moroc-
co. Use of these materials is strongly encouraged for
training and further dissemination.
Opinions expressed are those of the authors and do not
necessarily represent the views of their governments or
organizations, or the INECE Secretariat.
Conference Sponsors:
Centre de Developpement des Energies Renouvelables (CDER)
Ceske Svycarsko (National Park Bohemian Switzerland of the Czech Republic) and Appian Group
Ciments du Maroc (CIMAR)
Deutsche Gesellschaft fur Technische Zusammenarbeit (GTZ)
Environment Agency, England and Wales
Environment Canada
European Commission
International Fund for Animal Welfare
Institute for Governance and Sustainable Development
Ministry of Justice, Morocco
Ministry of the Territory Planning, Water, and Environment, Morocco
Ministry of VROM, Department of International Environmental Affairs, The Netherlands
Ministry of VROM, Inspectorate of Housing, Spatial Planning and the Environment, The Netherlands
Organisation for Economic Co-operation and Development
Royal Air Maroc
United Nations Environment Programme
United States Department of State
United States Environmental Protection Agency
World Bank Institute
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PREFACE
PREFACE
These Proceedings contain papers
submitted by Conference participants and
other enforcement professionals in prepa-
ration for the Seventh International Confer-
ence on Environmental Compliance and
Enforcement in Marrakech, Morocco, 9-15
April 2005.
These papers present empowering
concepts, insights, and experiences and
are made available to enforcement practi-
tioners throughout the entire world, from
both developed and developing countries,
to further our common endeavor. These
materials, and a second volume that will be
prepared after the conference, are also
available through the INECE web site
(www.inece.org) along with the proceed-
ings of the previous six INECE Confer-
ences.
The theme of the INECE Seventh
Conference is MAKING LAW WORK: ENVI-
RONMENTAL COMPLIANCE AND SUSTAINABLE
DEVELOPMENT, which builds upon the prem-
ise that the integrity of our ecosystems, the
conservation and wise use of our natural
resources, and our progress toward sus-
tainable development all require a strong
and effective legal system, with strong and
effective compliance efforts, including the
right mix of enforcement and compliance
assistance.
These Proceedings cover a broad
range of subject matter, including the criti-
cal connections between compliance, the
rule of law, good governance, and sustain-
able development; the various theories
developed to explain why States, firms,
and individuals do or do not comply with
law; the strategies used to secure compli-
ance; and the incorporation of empirical
studies and indicators to help determine
which environmental compliance and
enforcement strategies work and which do
not, and then to adjust programs accord-
ingly.
These Proceedings also contain
articles that look at specific strategies and
influences in environmental compliance
and enforcement, such as the role of eco-
nomics, compliance assistance, certifica-
tion systems, and citizen participation in
environmental compliance. Many articles
present case studies of specific networks,
such as Interpol's Ecomessage network on
environmental crime, as well as opportuni-
ties for future networking, such as with haz-
ardous waste at ports and illegal logging.
The articles describe important
new challenges that require a strong
response from compliance and enforce-
ment practitioners, such as the enforce-
ment of emissions trading schemes, and
they provide experiences with and strate-
gies to better measure and manage com-
pliance and enforcement activities through
the use of the indicators that INECE is
helping develop through pilot efforts in sev-
eral countries.
These Proceedings also share sto-
ries of individual, local, and regional victo-
ries in achieving compliance with domestic
laws and multilateral agreements that have
been put in place to guide human behavior
on an all too fragile planet. These stories of
success inspire us to continue to push for
environmental awareness, fairness, and
accountability.
INECE's Seventh International
Conference will bring together enforcement
officials from approximately 80 countries -
developed and developing - to share expe-
riences and make plans to take environ-
mental compliance and enforcement
efforts to the next level. Ultimately, the suc-
cess of INECE's Seventh International
Conference is the strength of the individual
commitments pledged in Marrakech; the
durability of the bonds forged among local,
regional, and international networks and
practitioners; and the powerful and innova-
tive ideas and projects spurred at the Con-
ference and beyond. It is our hope that
these and other results emerge and
become forces for change and a call for
action by governments and nongovern-
mental organizations alike to strengthen
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IV SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
the rule of law for sustainable development, and suggestions should be sent to the
to enforce compliance with environmental INECE Secretariat by email at
law, and to make law work. inece@inece.org, by fax to 1-202-338-
On behalf of the Executive Plan- 1810, or by mail to 2141 Wisconsin Avenue
ning Committee and the Secretariat staff, NW, Suite D2, Washington, DC, 20007.
we look forward to your continued and pro-
ductive use of INECE's Seventh Interna- THE EDITORS
tional Conference materials. Comments
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TABLE OF CONTENTS
CONTENTS
INECE EXECUTIVE PLANNING COMMITTEE AND SPONSORS i
PREFACE iii
PANEL 1: Relationship between Good Governance and
Environmental Compliance and Enforcement
The Relationship Between Good Governance and Environmental
Compliance and Enforcement, Harman, Sir John 5
PANEL 2: The Compliance and Enforcement Message
Rule of Law, Good Governance, and Sustainable Development,
Morita, Sachiko and Zaelke, Durwood 15
WORKSHOP SESSION 1: Exploring Current Environmental Compliance
and Enforcement Topics
Workshop 1A: Economic Aspects of Environmental Compliance Assurance
Economic Aspects of Environmental Compliance Assurance,
Michalak, Krzysztof 23
Combining Legal Mandates With Economics in the Application Of
Environmental Law, Harris, Phyllis 31
Environment Cooperation Between the Province of Overijssel
and the Environmental Committee of the Chambers of Commerce,
Rietkerk, Theo and Rolleman, Geert 39
Workshop 1B: Compliance Incentives and Other Assistance
Compliance Incentives and Other Assistance,
Maslany, Thomas and Drolet, Rene 47
Enforcement Assistance Programme for Firework Storage Sites,
Van Slijpe, Rob 57
Workshop 1C: Eco-message/lnterpol and the Police
Interpol's Ecomessage, Lauterback, Andrew and Clark, William 63
Workshop 1D: Compliance and Enforcement Theories and Design Principles
Strategies and Design Principles for Compliance and Enforcement,
Paddock, Leroy 67
An Introduction to Theories of Why States and Firms Do (and Do Not)
Comply with Law, Grossman, David and Zaelke, Durwood 73
National Strategy for Environmental Legislation Enforcement, Kok, Fred 81
The Compliance Strategy in The Netherlands, Van Der Schraaf, Angelique A.A 89
Minimum Criteria for a Professional Environmental Enforcement Process,
Klein, Wout 95
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2 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
Workshop IE: Certification Systems, Including ISO 14000 and Other
Environmental Management Systems
Environmental Management Systems and Regulatory Compliance,
Howes, Chris, Rowden, Sandy, Cheesbrough, Martin 103
Instruments for the Sustainable Development of Companies:
Environmental Agreements, Beltran, Ma De Los Angeles Barrecheguren 109
Workshop IF: Information Management, Reporting Requirements,
and Self- Monitoring
A Review of Empirical Studies on Environmental Compliance,
Morita, Sachiko and Zaelke, Durwood 113
Workshop 1G: Good Governance and Rule of Law
Measuring Performance Through Independent Enforcement Review:
Challenges and Opportunities for Independent Reviewers, the Public
and the Governments and other Institutions Subject to Review,
Garver, Geoffrey 121
The Rise of Global Environmental Administrative Law -
Improving Implementation and Compliance with the Means of
Global Governance, Avgerinopoulou, Dionysia-Theodora 131
Workshop 1H: Communications Policy and Practice
Briefing Materials to Be Provided at the Workshop
Workshop 11: Citizen Participation in Environmental Enforcement
The Aarhus Convention and its Implementation in the
European Community, Kremlis, Georges 141
Enforcement Indicators and Citizen Submissions on Enforcement
Matters under the North American Agreement on Environmental
Cooperation, Opalka, Katia 145
PANEL 3: Enforcement Initiatives: Stories of Success
Getting a Grip on the Asbestos Chain, Bareman, Peter 151
Legionellose Prevention in the Netherlands, Groen, Bert 155
Enforcement in Rural Groningen, Hake, Daniel W. and Tholen, Peter E 159
Enforcement at Group Level Applied to Waste Disposal Groups,
Hornung-Couwenberg, D.C 163
Environmental and Health Risks from Abandoned Industrial Sites -
A Structured Approach, Ruessink, Henk and Huizinga, Kees 169
Contamination of the Twente Canal: Enschede's Drinking Water Supply
under Threat, De Koster, Jan 171
Cooperation Pays: Integrated Inspections Reduce Burden on Private Sector,
Kroes, Arend and Ruessink, Henk 175
Road Transport Inspections, Roelofs, Jolanda 179
Environmental Protection in Russia, Sapozhnikova, Dr. Victoria 183
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TABLE OF CONTENTS
PANEL 4: Environmental Compliance and Enforcement Indicators:
Measuring Performance, Managing Resources
Using Indicators to Lead Environmental Compliance and
Enforcement Programs, Stahl, Michael 189
WORKSHOP 2: INECE Compliance and Enforcement Indicators
and Other Current Topics
Workshop 2A: ECE Indicators: Getting Started
Please Refer to Stahl Article Cited Above and the Guidance for
Practitioners included with your materials
Workshop 2B: Comprehensive National Indicators: United States/Brazil
Measuring Compliance Program Progress and Impacts: Lessons from
USEPA's National Petroleum Refinery Compliance Program,
Butler, Kathlene and Fekete, Gabrielle 197
Workshop 2C: Focused Sub-national Indicators: Costa Rica/Argentina
Pilot Project on ECE Indicators in Latin America:
The Case of Argentina, Di Paola, Maria 209
Experiences in Environmental Compliance and Enforcement in
Limpopo Province, South Africa, Rampedi, Moshibudi P. 213
Workshop 2D: Focused National Indicators: Canada
Focused National Indicators, Pascoe, Dave 217
Workshop 2E: Criminal Law and Environment:
Prosecutors, Inspectors, Police and Nongovernmental Organizations
International Environmental Enforcement Initiative: Lessons
Learned from U.S.-Belgian Dialogue Regarding Environmental Criminal
Enforcement, Morgule, James A., Rubin, James W., Geysels, Frans J.E.,
van den Berghe, Judge Jan, and Vandewal, Christian G. F. 221
Workshop 2F: Role of Nongovernmental Organizations and the Press:
Climate Litigation Case Study
Workshop 2G: Guidance and Manual on Compliance with and
Enforcement of Multilateral Environmental Agreements
Workshop 2H: Wildlife Enforcement Network
Workshop 21: Negotiated Compliance Agreements
PANEL 5: Strengthening The Implementation Of
Multilateral Environmental Agreements
Lusaka Agreement as a Mechanism for Enforcement of CITES, Mrema, Elizabeth 227
Implementation of International Environmental Agreements:
The Case of Botswana, Rubidiri, Desire 239
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4 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
PANEL 6: INECE Cooperation Projects and
WORKSHOP 3: Networking to Improve Enforcement Cooperation
Workshop 3A: Fresh Water Pollution: Governance to Eliminate Poverty
Briefing Materials to Be Provided at the Workshop
Workshop 3B: Vessel Pollution
Enforcement of Chlorofluorocarbons Regulations On Maritime Vessels,
Klingenberg, Albert 245
Workshop 3C: Hazardous Waste at Ports
IMPEL-TFS Seaport Project: European Enforcement Initiative to Detect
Illegal Waste Shipments, Isarin, Nancy 249
Workshop 3D: Analyzing the Compliance and Enforcement
Mechanisms of the Montreal Protocol
Strengthening the Implementation of Multilateral Environmental
Agreements, Bankobeza, Gilbert 253
Workshop 3E: Enforcement of Emissions Trading Programs
The Role of Compliance and Enforcement of
Emissions Trading Schemes, Davies, Neil 259
The Essential Role of Compliance in Emissions Trading Schemes,
Stone, Scott and Zaelke, Durwood 265
The Infrastructure for Permitting, Inspection and Enforcement of
NOx and CO2 Emissions Trading in The Netherlands,
Dekkers, Chris P. A. and Allessie, Marc M. J 271
Workshop 3F: Illegal Logging: Regional Strategies for
Enforcement Cooperation
New Brazilian Environmental Crimes Law, Brito, Brenda,
Barreto, Paulo, and Rothman, John 285
Workshop 3G: Penalties and Other Remedies
Environmental Damage in Italy in Relation to Directive 2004/35/EC,
Postiglione, Justice Amadeo 291
Penalties and Other Remedies For Environmental Violations:
An Overview, INECE Secretariat Staff 299
Workshop 3H: Multilateral Environmental Agreements:
Synergies for Compliance
Briefing Materials to Be Provided at the Workshop
PANEL 7: Compliance and Enforcement in the Context of
Multilateral Development Banks
The New Accountability and Advisory Mechanism of the Overseas
Private Investment Corporation: The Application of International Best
Practices of International Financial Institutions, Himberg, Harvey A 307
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HARMAN
THE RELATIONSHIP BETWEEN GOOD GOVERNANCE AND
ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
HARMAN, SIR JOHN
Chairman, Environment Agency, Rio House, Waterside Drive, Aztec West,
Almondsbury, Bristol BS32 4UD, UK, john.harman@environment-agency.gov.uk
SUMMARY
Society demands high environmental standards. The need to address a legacy of
harm to the environment on a global scale is more pressing than ever but protection, con-
servation and improvement of the environment can only take place within a framework of
good governance and respect for the rule of law. A framework encompassing the principles
of good governance is necessary so that policy to protect, conserve and improve the envi-
ronment can be developed, and so that appropriate legislation is respected. Regulations,
enforced fairly, enable business to compete on equal terms.
Assuming a regime where the rule of law applies, within an overarching system
embracing the principles of good governance, then compliance with appropriate regula-
tions is more likely. To sustain the ordered structure of good environmental governance,
and to ensure the necessary compliance, compliance assurance and enforcement are nec-
essary. But good governance cuts both ways. If governments and regulators expect com-
panies to respect the law and accept good regulatory standards they also need to recog-
nise that regulators are accountable to the public and to customers, as well as to ministers,
for aspects of their regulatory practice.
This paper discusses the principles of good governance and briefly describes a few
cases where good governance has been put in place to enable good environmental deci-
sion making and to support the ensuing regulations. The link between good governance,
environmental compliance and enforcement in action is explored.
1 WHAT IS GOOD GOVERNANCE?
The term governance has various
definitions in the economic, social, environ-
mental and political disciplines.1 It usually
refers to the manner in which political
authority is exercised in managing
resources, this idea being taken from the
World Bank definition. In essence, good
governance requires that decisions are
made and implemented using a clear and
legitimate process, to achieve consistent
and effective policies. It can be applied at
international, national, local, and organisa-
tional levels and to manage many types of
resources. When considering environmen-
tal resources, good governance means the
manner in which decisions are made which
promote sustainable development (which
includes environmental protection).
Although terminology may differ,
the principles of good governance as
recognised worldwide are similar. They are
outlined in the white paper by the Commis-
sion of the European Communities2 which
suggests that good political governance
must be:
- coherent (with good communications
between all parties);
- proportional;
- open (with access to information);
- effective;
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
- participatory (engaging communities);
and
- accountable (challenging bias and
corruption).
These broad principles are
explored later in the paper in the context of
compliance, compliance assurance and
enforcement.
At a national level, good gover-
nance encompasses all aspects of the way
a country is governed. Recognition of the
role of governments, affected parties and
the broader communities is key to under-
standing good governance.3 Assuming that
a fair legal system is in place as one of the
cornerstones of good governance, (also
known as the rule of law), then the follow-
ing actors should be involved to ensure
good governance at national and interna-
tional level:
- legislators and governments - providing
appropriate and enforceable legislative
frameworks and laws
- regulators - law enforcement agencies
ensuring compliance and impartial
enforcement
- independent judiciary (objective and
reliable) - imposing proportionate
penalties for non-compliance, based
on intent and impact
- companies - taking responsibility for
and managing impacts
- public - exercising democratic control
over institutions and providing context
for outcomes
- media - demanding accountability and
exposing malpractice or corruption
- non-government organisations -
influencing, lobbying and exerting
pressure for change
- investors - demanding financial returns
that are balanced with company
reputation
- research institutes - providing the
science for policy development and
implementation.
The importance of good gover-
nance is being promoted widely to excel-
lent effect. It has long been identified as
central to sustainable development, both
economic and social.4 The basic principles
behind good environmental decision mak-
ing were endorsed by the 178 nations that
attended the Rio Earth Summit in 1992 and
more recently re-emphasised by the inter-
national community at the World Summit
on Sustainable Development in 20025.
With regard to the environment, there are
initiatives world-wide which rely upon good
governance to ensure a successful out-
come.
The United Nations Development
Programme has set up an Environmental
Governance Initiative6 designed to gener-
ate policy advice, identify good practices
and advocate tools that will improve a
country's capacity to protect the environ-
ment and to promote equitable access of
the poor to energy and natural resources.
Interestingly, this initiative recognises that
environmental decision making has been
the pioneering forum of good governance
in many countries and that much can be
learnt from the work done.
In February 2005, the Arab states
of the Middle East and North Africa (MENA)
inaugurated a programme "Good Gover-
nance for Development in the Arab coun-
tries"7 designed to provide regional support
for an ongoing process of governance
reform and to create the conditions needed
for economic and social development
throughout the region. It focuses on six
governance areas: civil service and integri-
ty; e-government, administrative simplifica-
tion and regulatory reform; governance of
public resources; public service delivery;
the role of the judiciary and enforcement;
and civil society and the media. Although
some of these areas are progressing rapid-
ly in the light of modern technology and
global expectation, it is expected that the
project will draw upon the experience of the
international community and by using all
the modern policy tools available, develop
the framework which underlies sustainable
development.
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HARMAN
2 CREATING GOOD LEGISLATION
For compliance and enforcement
to be useful in supporting good gover-
nance, it is essential that legislation is
made in accordance with the principles out-
lined above and that all these principles are
applied to the whole regulatory cycle which
includes policy development, legislation
writing, permitting, enforcement and prose-
cution. This emphasis is described by
many commentators as "better regulation."
The UK Better Regulation Task
Force8 has stated that better regulation
should be transparent (with access to infor-
mation), accountable (avoiding bias and
challenging corruption wherever it occurs),
consistent (with improved communication
between lawmakers and enforcers), pro-
portionate, risk-based, and targeted on out-
comes (e.g. local/national targets and inter-
national commitments). These principles,
which overlap with the objectives of good
governance, are seen in many different
contexts.
However, there is no simple rule for
creating good legislation and regulation.
For environmental legislation, the policies
required depend on the characteristics of
the environmental issue under considera-
tion.9 In order to address different environ-
mental issues, flexibility to use all of a vari-
ety of available instruments must be written
into the legislation.
Assuming that sustainable devel-
opment is the overall goal, good gover-
nance principles must be integrated in all
legislation applying to the environment, the
economics and the social development of a
country.
The following sections provide a
more detailed assessment of the relation-
ship between good governance, compli-
ance and enforcement, and demonstrate
the importance of the link between them.
3 COMPLIANCE, ENFORCEMENT
AND GOOD GOVERNANCE
Traditional compliance and enforcement
has been based around command and
control methods, where specific require-
ments set in law by government are to be
met by business. Technical prescriptions
make it clear what is required and give reg-
ulations legal certainty. This makes it rela-
tively easy for governments to determine,
via an inspection procedure, whether an
operator is meeting the requirements. This
traditional approach has achieved signifi-
cant improvement in environmental condi-
tions. For example, in the UK, sulphur diox-
ide emissions have fallen by 75% since
1990, nitrogen oxides by 52%; water pollu-
tion fell by 65% in the 5 years to 2001.10
However, the command and control
approach can be inflexible and does not
take advantage of the wider acceptance by
business of its role in governance.
Across the world greater emphasis
is now being placed on encouraging indus-
try to achieve goals through self-regulation,
voluntary environmental performance
agreements and a variety of economic
instruments such as taxation or trading of
allowances. Resources are being set aside
for compliance assistance schemes, which
can take various forms. Examples can be
widely found but often pay special attention
to small and medium sized enterprises, and
may include, for example, provision of free
and easy to obtain information to help busi-
nesses to understand their legal obligations
or the provision of incentives to encourage
compliance. An example of this is the
USEPA policies that eliminate, reduce or
waive penalties under certain conditions for
sites that voluntarily discover, disclose and
correct environmental problems.11 In some
countries, such as Thailand, the govern-
ment provides financial assistance to those
who plan to install on site treatment or
abatement facilities, to enable them to
import relevant equipment and expertise
where it is not locally available.12 Such
complementary policy instruments have
been the subject of considerable attention
over recent years.13 They do not replace
the regulatory framework but supplement it,
and are sometimes described as the appli-
cation of a "lighter touch" to industry.
These different approaches to
compliance and enforcement and their role
in good governance are discussed below in
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
the context of the good governance princi-
ples set out by the European Commission.
3.1
Coherent
If an environmental regulator is to
make a real difference, regulation means
solving problems with others. It means
using incentives and rewards just as much
as the threat of tough action, and it means
ensuring that legislation is appropriate in
the first place. Business also needs to be
proactive and take responsibility for their
own compliance.
Partnership approaches to compli-
ance and enforcement provide many
opportunities to create a climate of good
governance through a coherent approach
with good communications between all par-
ties, so long as they are also proportional,
open, participatory, effective and account-
able.
An example of a project that recog-
nises the importance of coherence of
approach is the Canadian International
Development Agency (CIDA) information
network to manage water and land
resources on both national and local levels
in Bangladesh. It is being developed by a
joint Bangladeshi-Canadian initiative, mak-
ing use of an exchange of technology and
knowledge. It is intended to provide timely
information and statistics on a number of
vital indicators dealing with such issues as
riverbank erosion, flooding levels and agri-
cultural production. It will help the
Bangladeshi government and stakeholders
including farmers, weavers, fishers and
small traders, to implement efficient and
effective tools and management practices
at the national and local levels, to improve
the management of natural resources, to
combat erosion and flooding in rural
areas14.
3.2 Proportional
Across Europe and America,15
there has been considerable progress in
establishing stronger links between envi-
ronmental regulation and externally validat-
ed environmental management systems.
The Environment Agency has implemented
an Operator and Pollution Risk Appraisal
Scheme (OPRA) as a way of assessing
pollution risk posed by an activity to the
environment. It provides consideration of
environmental outcomes, financial incen-
tives for improved operator performance,
allows benchmarking of operator perform-
ance and gives recognition to site gover-
nance (e.g. Environmental Management
Schemes or certification under ISO
1400116 or the EU's Eco-Management and
Audit Scheme, EMAS17) in regulation.
It allows the regulator to plan com-
pliance and enforcement activities to target
sites of greatest risk, and allows the best
use of limited resources. Businesses with
better controls and performance are
charged less than those that require more
oversight.
3.3 Open
Providing information to stakehold-
ers, especially the public (including minori-
ty groups), is also key to good governance
allowing transparency. The Rio Declaration
established that the heart of good environ-
mental governance is accessible decision
making. Access to information about the
environment, about the decisions to be
made and about the decision making
process is required to enable public partic-
ipation. Communities need appropriate
information to ensure that their best inter-
ests are represented when decisions are
under consideration. (In some areas, for
example the highland areas of Vietnam and
Cambodia, it is important that access to
environmental information is available in
more than one language and in non-written
form so that it is accessible.)
Compliance and enforcement
activities can provide good information for
all stakeholders and allow them to engage
in the regulatory process. Publication of
information can help reward good perform-
ers, and shame the poor performers (also
see 3.6).
Similarly, part of good governance
by the state is enabling the regulated com-
munity to comply by providing information
and guidance. Businesses and individuals
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HARMAN
need to be made more aware of how their
actions impact on the environment and
human health, and what they can do to
reduce these impacts. Education and
advice can help raise awareness of these
issues through providing clear information,
demonstrating potential improvements
through case studies, and highlighting
good practice.
Regulating small and medium
enterprises (SMEs) can provide a greater
challenge for compliance and enforcement
than large companies. SMEs usually have
few resources to spend on capital invest-
ment and innovation, generally have poor
environmental and legislative awareness,
and only have public pressure from a
localised area. Therefore, regulators need
to use alternative approaches effectively to
encourage good governance within this
sector. Education, awareness raising and
providing advice can contribute significant-
ly to delivering higher levels of compliance
and to reducing the administrative burden
placed on business.
In the UK, "NetRegs" (a joint ven-
ture between the UK environmental regula-
tors), is a web-based system launched to
provide clear, plain English guidance on
what small businesses need to do to meet
the requirements of environmental legisla-
tion.18 The website is accessible freely
without the need to register. Currently,
NetRegs is used by 28,000 different visitors
a month and receives 190,000 hits a month
in total.
3.4 Participatory
The issue of participation has been
acknowledged globally to be essential to
good environmental governance, whether
for environmental enforcement in the UK7
or America,19 sustainable land develop-
ment in Bangladesh20 or pollution control in
India.21. In this context, participation
includes seeking stakeholder opinion to
ensure that practices match expectations
as far as possible. In Denmark, some
municipalities have extended this to polling
opinion regarding the working of their
inspectors. 22
Stakeholder involvement can take
many forms, and embraces many types of
stakeholders. Consultation at the outset of
introducing new regulatory tools is perhaps
the most obvious form of stakeholder
involvement. There is a need to identify
affected businesses and local communities
and other interested parties (industry or
sector representative groups, non-govern-
mental organisations, local liaison bodies
etc) and approach each of these individual-
ly to ensure full participation in a manner
that is appropriate for the stakeholder.
In a mature relationship with busi-
ness, regulators should consider incentiviz-
ing good performance and not just punish-
ing poor performance. With the recognition
of the need for the more wide-ranging prin-
ciples of good governance and the need to
build on the reductions in environmental
impacts, there is now a need and willing-
ness to explore such new approaches.
There is also the ability to go beyond com-
pliance where there are gains to the regu-
lator, the regulated community, the local
community, the environment and other
important stakeholders such as investors.
To ensure the success of such approaches
it is important that all stakeholders are fully
involved from the earliest stages.
Approaches that go beyond com-
pliance are being operated in many large
companies in the industrial sector.23 This
has been driven partly by sensitivity to
adverse publicity of poor environmental
performance. Their strategies for operating
maximise compliance, minimise the costs
of enforcement and encourage innovation.
Going beyond compliance sup-
ports many of the principles of good gover-
nance, and also is a good example of the
regulated community taking full responsibil-
ity for their own compliance. This type of
approach also enables engagement of all
stakeholders from the legislators to civil
society.
An example of this is the Wiscon-
sin 'Green Tier' initiative24 in the US. Green
Tier is a program that gives responsible
companies the flexibility they need to
exceed environmental requirements while
boosting productivity and cutting costs. The
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
program adapts to the needs of the compa-
ny, community and environment by using
collaborative contracts and charters, and
environmental management systems. The
goals of the programme include both envi-
ronmental and economic gain.
Another example where the impor-
tance of participation is demonstrated is the
SDC (the Swiss agency for development
and co-operation), Livelihoods, Empower-
ment and Agroforestry project (L. E. A. F) in
Bangladesh. The purpose of this project is
to reduce the poverty of small and margin-
al farmers in the northwestern part of
Bangladesh through better management of
resources — particularly land. The project
supports and fosters local participatory
governance and works through four main
action lines: 1. improvement of the knowl-
edge and skills 2. strengthening farmers
organisations 3. promotion of the enabling
environment, and 4. promotion of rights
and social issues. There are many partners
involved including government institutions,
local NGOs and the association of com-
mercial nurseries.25
3.5
Effective
If industry can identify the benefits
of regulatory compliance and enforcement,
there is an incentive for adopting good gov-
ernance principles. Effective regulation is
integral to successful markets, an essential
ingredient of a vibrant, modern economy.
Unregulated markets would be chaotic,
unfair and unlikely to deliver what people
want - safe, reliable products and a clean
environment.
Oppressive regulation can be dam-
aging, but a modern approach, including
market-based measures such as emis-
sions trading, can help to deliver the envi-
ronmental improvements people want in a
way that fits with a competitive economy.
Business can benefit directly
because regulation in areas such as ener-
gy efficiency and waste reduction can deliv-
er cost savings and help companies devel-
op more attractive products. Some indus-
tries depend for commercial success on
high environmental standards, most obvi-
ously those providing clean technology and
waste management. Danish leadership in
wind turbine technology is an example of a
country gaining competitive advantage by
pursuing environmental leadership.
High standards are also important
in sectors such as tourism and leisure,
which rely on an attractive physical envi-
ronment to win customers.
Where there are gaps in the legis-
lation and conflicts in existing policies and
legal frameworks, these need to be
addressed. There are ongoing projects
worldwide26 carrying out investigations and
rationalising legislation to ensure the effec-
tiveness of legislation.27
3.6 Accountable
There is still a wide gap at an inter-
national level as regards the accountability
of international bodies, especially where
they fail to deliver on agreed obligations
and duties. It is important that the principles
of good governance are better incorporated
and that all countries are accountable for
ensuring their part in driving towards the
overarching goal of sustainable develop-
ment. Improving institutional accountability
is a key priority in the reform of internation-
al governance systems.28
IMPEL, the European network of
regulators, consider that "inspection has an
obligation to transparency in its actions."
To this end, inspectorates must seek to
explain their range of powers, the way they
conduct business, publish results and indi-
cate where progress by operators is
required. In addition, where illegal activities
are a major concern, transparency of rev-
enue collection and spending promotes
trust and community stewardship.29
The US Environmental Protection
Agency has, for many years, published its
Toxic Release Inventory. The Environment
Agency for England and Wales also regu-
larly publishes environmental performance
information of the businesses that it regu-
lates. This includes communication tools
such as the Pollution Inventory, What's in
Your Backyard (where you can search for
environmental performance information
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HARMAN 11
about regulated industry online) and Spot-
light on business environmental perform-
ance to provide information about environ-
mental performance to a wide audience.30
Spotlight both publicly praises good per-
formers and names and shames poor per-
formers. This we believe helps companies
internalise their environmental perform-
ance.
An example of a project which has
recognised the importance of accountabili-
ty is the Canadian International Develop-
ment Agency (CIDA) project to help protect
and manage water resources in
Bangladesh. This initiative will assist the
Bangladesh Ministry of Water Resources to
develop better planning, budgeting and
operating abilities in water resource man-
agement.31
It is important though that, whether
traditional or partnership approaches, regu-
latory regimes are backed up by the rule of
law - by penalties or disincentives to non-
compliance. Where businesses do not
comply with legislation, regulators must
use their enforcement powers firmly and
fairly to prevent pollution or environmental
damage, or to require remedial action.
Where innovative approaches have been
used for regulation and a relationship of
trust has been built between stakeholders
the penalties for breaking this trust and for
the reduced regulatory oversight must be
greater than in traditional regimes.
Prosecution, fines and penalties
are usually the tools of last resort to
improve compliance performance but this
ability to escalate the enforcement action
may be required to ensure that standards
are met.
4 CONCLUSIONS
Good environmental regulation is
central to good governance. Good gover-
nance from the State should be able to
respond positively to good governance by
business. Compliance and enforcement
are powerful tools that provide support for
good governance. There is a wide range of
tools and approaches that can be taken,
but to be effective and to contribute to sus-
tainable development, they must incorpo-
rate the principles of good governance.
Several economic studies have exposed
the myth that regulation leads to competi-
tive disadvantage. Indeed, regulation and
business performance should go forward
hand in hand. The World Bank has
observed, "Contrary to common percep-
tions, higher environmental standards in
industrial countries have not tended to
lower their international competitiveness."32
5 REFERENCES
1 Governance - what is Governance?
Europa (31 January 05). Available at
http://europa.eu.int/comm/governance/g
overnance/index_en.htm.
2 Commission of the European Communi-
ties. European Governance: A white
paper. COM 428, 2001. Brussels.
3 Statement from the international confer-
ence on "Biodiversity: Science and
Governance", 24-28 January 2005.
Available at http://www.recherche.
gouv.fr/biodiv2005paris/en/index.htm.
4 DAC Orientations on Participatory
Development and Good Governance,
OECD 1993, OCDE/GD(93)191. Avail-
able at http://www.acdi-cida.gc.ca/
INET/IMAGES.NSF/vLUImages/HRDG/
$file/Dac-e.pdf.
5 World Resources Institute Research
Topic paper: Governance and Institu-
tions, principles of environmental gover-
nance. Available at http://governance.
wri.org/pubs_content_text.cfm?Con-
tentlD=1698.
6 UNDP Environmental Governance.
Available at http://www.undp.org/ener-
gyandenvironment/envgov.htm. Capaci-
ty development for Environmental Sus-
tainability UNDP country level initiatives
2004. Available at http://www.undp.
org/energyandenvironment/docs/CD12_
CD_Rom.pdf.
7 OECD to join Arab states in launching
"Good Governance for Development"
programme. Organisation for Economic
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
Co-operation and Development (18
February 2005). Available at http://
www.oecd.org/document/36/0,2340,en_
2649_201185_34368484_1_1_1_1,00.
html.
8 UK Cabinet Office Better Regulation
Task Force principles (18 February
2005). Available at http://www.brtf.
gov.uk/.
9 Cunningham, N. and Grabosky, P.,
Smart Regulation: Designing Environ-
mental Policy. 1998 Oxford University
Press.
10 Environment Agency. Delivering for the
Environment: a 21st century approach to
regulation. 2005.
11 USEPA Compliance Incentives & Audit-
ing 2004. Available at http://www.
epa.gov/compliance/incentives/.
121 Fourth International Conference on
Environmental Compliance and Enforce-
ment 1996. Available at http://
www.inece.org/4thvol1/yingphan.pdf.
13 Harvey, F, Stumbling block that poses
threat to Kyoto protocol, Financial
Times, FT.com, 15 February 2005.
14 Canadian International Development
Agency (CIDA), Available at http://
www.acdi-ida.gc.ca/cida_ind.nsf/
0/5642efc2198fefdt85256ca8005a02eb
?Open Document.
15 Commission for Environmental Co-oper-
ation. Improving environmental perform-
ance and compliance: 10 elements of
effective environmental management
systems. CEC 2000, Montreal, Canada.
*16ISO 14001:1996. Environmental man-
agement systems - Specification with
guidance for use. The international stan-
dard for environmental management
systems.
17 European Union. Eco-Management and
Audit Scheme. A voluntary scheme
specified by Regulation of the European
Parliament and Council (Regulation
3658/2000).
18 Environment Agency, Scottish Environ-
ment Protection Agency, Northern Ire-
land Environment & Heritage Service,
Welsh Assembly, Local business Link
and Envirowise. Plain language Guid-
ance for Businesses on environmental
legislation, and how to comply with it.
(18 February 2005) available at http://
www.environment-agency.gov.
uk/netregs/?lang=_e.
19 Bailey K. Citizen participation in environ-
mental enforcement in Mexico and the
United States: a comparative study.
Georgetown Internet Law Rev 16, 2004,
323-358.
20 Khan NA and Khisa SK. Sustainable
land management with rubber based
agro-forestry: a Bangladeshi example of
uplands community development. Sust
Develops, 2000, 1-10
21 US-EPA. India Workplan, project 7:
Environmental Governance and Capaci-
ty Building, 2003, US Agency for Interna-
tional Development.
22 Department of the Environment, Hoje
Taastrup Municipality, Denmark, cited
from reference 4.
23 Cunningham, M., Compliance, Enforce-
ment and Innovation. 2004.
24 Green Tier. Wisconsin Department of
Natural resources (18 February 2005)
available at http://dnr.wi.gov/org/caer/
cea/environmental/faqs.htm.
25 SDC Livelihoods, Empowerment and
Agroforestry project (L. E. A. F. ) Avail-
able at http://www.sdc.org.bd/index.
php?navlD = 3744&IID = 1&user-
hash=22757091 &officelD=63.
2e Land and Agriculture: From UNCED, Rio
de Janeiro 1992 to WSSD, Johannes-
burg 2002 available at http://www.
fao.org/documents/show_cdr.asp?url_fil
e=/DOCREP/006/Y3951 E/Y3951 EOO.H
TM.
27 IUCN Bangladesh Environmental Law,
planning and assessment Programme
available at http://www.iucn.org/places/
asia/oldl 70603/bangladesh.htm.
28 Governance for Sustainable Develop-
ment available at http ://www. earth
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HARMAN 13
summit2002.org/es/issues/Governance/
Montreal-IEG.pdf.
29 EcoGovernance. The Philippine Envi-
ronmental Government Project, 2004.
Information available through the United
Nations Environment Programme at
http://www.unep.org/.
3° Environment Agency. (18 February
2005) available at http://www.environ-
ment-agency.gov.uk
31 Canadian International Development
Agency (CIDA) Available at http://www.
acdiida.gc.ca/cida_ind.nsf/0/5642efc219
8fefdt85256ca8005a02eb?OpenDocu-
ment
32 World Bank, Competitiveness and Envi-
ronmental Standards, 1994.
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14 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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MORITA, ZAELKE 15
RULE OF LAW, GOOD GOVERNANCE,
AND SUSTAINABLE DEVELOPMENT
MORITA, SACHIKO1 and ZAELKE, DURWOOD2
1 Law Fellow, Institute for Governance & Sustainable Development
2 Director, INECE Secretariat; President, Institute for Governance & Sustainable
Development; and Co-Director, Program on Governance for Sustainable Development,
University of California, Santa Barbara's Bren School of Environmental Science &
Management, dzaelke@inece.org
2141 Wisconsin Ave. NW, Suite D2, Washington, DC 20007, United States
SUMMARY
This paper reviews the relationship between the rule of law, good governance, and
sustainable development, as those terms are used by the relevant development organiza-
tions; describes the efforts made by various organizations to promote the rule of law and
good governance; and addresses the need to strengthen compliance and enforcement for
sustainable development.
1 INTRODUCTION
It is widely recognized that good
governance is essential to sustainable
development. Well-functioning legal institu-
tions and governments bound by the rule of
law are, in turn, vital to good governance.
Weak legal and judicial systems - where
laws are not enforced and non-compliance
and corruption are the norm - undermine
respect for the rule of law, engender envi-
ronmental degradation, and undermine
progress towards sustainable develop-
ment.
Practitioners in the development
field have increasingly turned their atten-
tion to reforms to improve legal and judicial
institutions and promote the rule of law and
good governance. For example, various
United Nations agencies such as the Unit-
ed Nations Environment Programme
(UNEP) and the United Nations Develop-
ment Programme (UNDP), as well as the
World Bank and other regional develop-
ment banks, are directing increasing
resources to reform legal and judicial insti-
tutions.
To date, however, most of these
efforts have concentrated on developing
new laws and creating new institutions,
rather than building capacity for ensuring
compliance with existing rules. Yet without
compliance, laws and regulations are
meaningless - or worse, they undermine
respect for the rule of law - and cannot pro-
mote sustainable development. As a result,
many developing countries and countries
with economies in transition still suffer from
weak legal and judicial systems, lack
investment, and have poor development
prospects, sustainable or otherwise. Thus,
donor-driven reform efforts need to ensure
that their rule of law efforts include suffi-
cient training and capacity building to
establish the institutional foundation for
compliance and enforcement, through both
instrumental and normative efforts.
The first section of this paper
reviews the relationship between the rule of
law, good governance, and sustainable
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
development, as those terms are used by
the relevant development organizations. It
then briefly describes the efforts made by
various organizations to promote the rule of
law and good governance. Finally, the
paper addresses the need to strengthen
compliance and enforcement for sustain-
able development.
2 RULE OF LAW, GOOD GOVERNANCE,
AND SUSTAINABLE DEVELOPMENT
There is a political consensus that
the rule of law and good governance are a
necessary foundation for efforts to achieve
sustainable development. But these broad
concepts carry many meanings and there
are many strategies for promoting them.
This section provides some brief definitions
to illustrate how the concepts are used in
the international financial institutions and
other donor and capacity-building agen-
cies. It then explores the relationship
among the rule of law, good governance,
and sustainable development.
2.1 Definitions of "Rule of Law"
and "Good Governance"
Rule of law: Many institutions iden-
tify a fair, impartial, and accessible justice
system and a representative government
as key elements of the rule of law.^ In this
paper, the term "rule of law" is used to
mean independent, efficient, and accessi-
ble judicial and legal systems, with a gov-
ernment that applies fair and equitable laws
equally, consistently, coherently, and
prospectively to all of its people.
Good governance: Good gover-
nance is generally characterized by acces-
sibility, accountability, predictability and
transparency.2 This paper treats "good gov-
ernance" as having openness, participa-
tion, accountability, and transparency as
key elements.
2.2 Relationship Among the Rule
of Law, Good Governance,
and Sustainable Development
While many factors play an impor-
tant role in development, good governance
is now recognized as playing an essential
role in the advancement of sustainable
development. Good governance promotes
accountability, transparency, efficiency, and
rule of law in public institutions at all levels.
In addition, it allows for sound and efficient
management of human, natural, economic,
and financial resources for equitable and
sustainable development. Moreover, under
good governance, there are clear decision-
making procedures at the level of public
authorities, civil society participation in
decision-making processes, and the ability
to enforce rights and obligations through
legal mechanisms.
These aspects of good gover-
nance do not in themselves ensure that
society is run well nor do they guarantee
sustainable development. However, their
absence severely limits that possibility and
can, at worst, impede it. Without proper-
functioning institutions of governance
based on the rule of law that promote social
stability and legal certainty, there cannot be
investment and assumption of risk that
form the basis of market economy develop-
ment, let alone sustainable development.
Indeed, the strength of the rule of law is the
best predictor of a country's economic suc-
cess. Furthermore, deficiency in the rule of
law encourages high rates of corruption,
with further devastating consequences on
the confidence of economic actors. This
lack of investment, in turn, slows economic
growth and consequently deprives the gov-
ernments of resources to invest in educa-
tion, social safety nets, and sound environ-
mental management, all of which are criti-
cal for sustainable development.
Introduction of good governance
and rule of law, however, cannot be done
overnight. The process is often a gradual
one, involving changes to long-standing
practices, entrenched interests, cultural
habits, and social and even religious
norms. A significant step was taken in this
endeavor in 1998 when countries adopted
the Convention on Access to Information,
Public Participation in Decision-making and
Access to Justice in Environmental Matters
("The Aarhus Convention").3 The Conven-
tion recognizes that sustainable develop-
-------
MORITA, ZAELKE 17
ment can only be achieved through the
involvement of all stakeholders and seeks
to promote greater transparency and
accountability among government bodies
by guarantying three pillars for the public:
1) the rights of citizen access to informa-
tion; 2) citizen participation in decision-
making, and 3) citizen access to justice in
environmental matters. In other words, the
Convention guarantees freedom of access
to information on the environment, gives
citizens a right to participate in environmen-
tal decision-making, and provides for
recourse to judicial and administrative
remedies when these rights are denied by
state authorities.
Moreover, in 2000, 191 Untied
Nations member States pledged to fulfill a
set of key goals (the Millennium Develop-
ment Goals) for poverty reduction and sus-
tainable development by the year 2015. In
the Millennium Declaration, the member
States agreed to "spare no effort to pro-
mote democracy and strengthen the rule of
law, as well as respect for all international-
ly recognized human rights and fundamen-
tal freedoms, including the right to develop-
ment."4
In addition to these international
agreements by heads of the States, donor
agencies are making significant efforts to
promote the rule of law and good gover-
nance throughout the world. The following
section briefly describes these efforts.
3 EFFORTS TO PROMOTE THE RULE
OF LAW AND GOOD GOVERNANCE
Recognizing the importance of rule
of law and good governance, many donor
agencies are actively supporting legal and
judicial reforms, including judicial training,
development of new laws and legal institu-
tions, and capacity-building. For example,
UNEP has convened several symposia for
judges to facilitate judiciary communica-
tion, sharing of legal information, and har-
monization of different approaches to the
implementation of global and regional
instruments.5 One such symposium was
the Global Judges Symposium on Sustain-
able Development and the Role of Law that
UNEP organized with the International Net-
work for Environmental Compliance and
Enforcement (INECE) as a key partner in
2002. At the Symposium, the participants
adopted the Johannesburg Principles on
the Role of Law and Sustainable Develop-
ment, in which they affirmed, among other
things, "that an independent Judiciary and
judicial process is vital for the implementa-
tion, development and enforcement of envi-
ronmental law" and that "there is an urgent
need to strengthen the capacity of judges,
prosecutors, legislators and persons who
play a critical role at national level in the
process of implementation, development
and enforcement of environmental law."6
UNDP also has helped promote
good governance by focusing on the follow-
ing six areas:7
1) parliamentary development;
2) assistance with electoral systems and
processes;
3) improvement of access to justice and
human rights;
4) promotion of access to information;
5) support for decentralization and local
governance; and
6) reform of public administration and
civil service.
Financial institutions and other
organizations have also made significant
efforts to advance good governance and
the rule of law. The World Bank, for exam-
ple, has several legal and judicial develop-
ment projects supporting law reform, court
modernization, training of judges and court
personnel, and legal education.8 In addi-
tion, institutions such as the Organisation
for Economic Co-operation and Develop-
ment (OECD) have worked to improve and
reinforce the legal, judicial, and law
enforcement systems.9 For instance, on
February 6-7, 2005, OECD and UNDP,
along with the Arab League, the World
Bank, the European Union, and a number
of organizations working in the region,
including those from the private sector and
civil society, launched a major program to
promote good governance for development
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
in the Arab region.10 Called the "Good
Governance for Development in the Arab
Countries", the program is designed to
address the following six themes:
1) civil service and integrity;
2) the role of the judiciary and
enforcement of judgments;
3) e-government, administrative
simplification, and regulatory reform;
4) the role of civil society and media in
reform of the public sector;
5) the governance of public finance; and
6) the public services delivery and
private-public partnership.11
4 IMPORTANCE OF COMPLIANCE AND
ENFORCEMENT FOR SUSTAINABLE
DEVELOPMENT
Despite a growing body of environ-
mental law both at the national and interna-
tional levels, environmental quality has
been declining in many countries. Further-
more, even after more than ten years and
hundreds of millions of dollars in aid, many
judicial and legal systems in the world are
still functioning poorly. One reason for
these trends is the inadequate investment
in enforcement and compliance efforts.
The need to strengthen enforce-
ment and compliance has been widely rec-
ognized. For example, the participants of
the Rio Earth Summit in 1992 recognized
this necessity in Chapter 8.21 of AGENDA
21, which established an international man-
date to build compliance and enforcement
capacity as an essential element of envi-
ronmental management.12 Agenda 21 also
empowered UNEP and other organizations
to more actively support compliance and
enforcement activities, including capacity
building.
Moreover, UNEP Executive Direc-
tor Toepfer has recently highlighted the
importance of enforcement and compli-
ance:
We all have a duty to do whatever we
can to restore respect for the rule of
law, which is the foundation for a fair
and sustainable society...Sustainable
development cannot be achieved
unless laws governing society, the
economy, and our relationship with the
Earth - both international and domestic
- are put into practice and connect with
our deepest values. Law must be
enforced and complied with by all of
society, and all of society must share
this obligation.13
Various institutions' efforts, includ-
ing those mentioned above, are helping
advance rule of law and good governance.
However, it is insufficient to point out a legal
obligation and to invest in institutional
reforms if the culture of law abidingness
has not replaced the culture of corruption.
In other words, if the countries receiving the
aid do not work to make the internal
changes and do not actually implement the
legal and judicial reforms, their legal and
judicial systems will continue to struggle to
improve, their economic development will
continue to falter, and there will be no
progress towards sustainable develop-
ment.
Therefore, the donor agencies
need to focus more on those reforms aimed
at the deeper goal of increasing govern-
ments' compliance with the laws. This
requires tools that empower citizens to par-
ticipate in governance, including access to
justice, with opportunities to pressure the
judicial and legal systems. It is increasingly
recognized that the fundamental changes
that are needed for rule of law and sustain-
able development require the support and
commitment of the key people within the
system, and this core group needs to be
given enabling assistance to help build the
essential internal political will these reforms
require. Donor assistance is critical, but so
is the will to reform, which must be fostered
from within.
The international community is
already beginning to move in this direction.
For example, as noted, the Aarhus Con-
vention guarantees the rights of access to
information, public participation in decision-
making, and access to justice in environ-
mental matters. These rights empower citi-
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MORITA, ZAELKE 19
zens to ensure that environmental laws are
properly enforced and complied with. On
the capacity building front, institutions such
as UNEP, the Global Environmental Facili-
ty, and the United Nations Economic Coun-
cil for Europe (UNECE) have produced
guidelines to facilitate implementation and
compliance with certain multilateral envi-
ronmental agreements (MEAs).14 The
UNEP Guidelines, for instance, highlight
several compliance assistance strategies,
including sharing experiences, evaluating
the effectiveness of technology transfer,
and drafting model legislation.
In addition, public agencies and
researchers have begun collecting empiri-
cal data to analyze the effectiveness of dif-
ferent policies and strategies in inducing
compliance with various environmental
regulations. For instance Oran Young, Hel-
mut Breitmeier, Michael Zurn, and others
have created the International Regimes
Database to empirically analyze 23
MEAs.15 However, the empirical literature
on environmental enforcement is still fairly
sparse, due to the difficulty of obtaining reli-
able empirical information about the com-
pliance of particular regulated entities.
There is a great need for more well-func-
tioning, reliable, and comprehensive data
gathering systems. NGOs and various
international networks, including INECE,
can play an important role in gathering and
validating information for such systems.
With better coordination and
increased support, all of these efforts -
those addressing the rule of law and good
governance issues, environmental compli-
ance assistance, and empirical data collec-
tion and analysis - will help expedite
progress towards sustainable develop-
ment.
5 CONCLUSION
There is a consensus that the rule
of law and good governance are the foun-
dation for achieving sustainable develop-
ment goals. Various institutions have taken
initiatives in promoting the rule of law and
good governance throughout the world and
have made considerable progress over the
years. However, despite these efforts and
the growing number of environmental laws
and regulations, environmental quality and
public health continue to deteriorate due in
significant part to lack of implementation,
enforcement, and compliance with existing
laws. A strengthened focus on compliance
and enforcement efforts could overcome
these problems and would be a critical
investment for advancing sustainable
development.
6 REFERENCES
1 The World Bank, Initiatives in Legal and
Judicial Reform 3, available at http://
www4.worldbank.org/legal/leglr/ (2004);
Christina Biebesheimer & J. Mark Payne,
IDB Experience in Justice Reform: Les-
sons Learned and Elements for Policy
Formulation 4, available at http://www.
iadb.org/sds/doc/sgc-IDBExperiences-
E.pdf (2001) (Inter-American Develop-
ment Bank); Organisation for Economic
Co-operation and Development (OECD),
Final Report of the Ad Hoc Working
Group on Participatory Development and
Good Governance, Part 1, 10, available
at http:// www.oecd.org/dataoecd/44/
12/1894642.pdf (1997) (hereinafter Final
Report of the Ad Hoc Working Group).
2 Asian Development Bank, Elements of
Governance, available at http://www.
adb.org/Governance/gov_elements.asp;
Commission of the European Communi-
ties, European Governance: A White
Paper, COM(2001) 428 final, available at
http://europa.eu.int/eur-lex/en/com/cnc/
2001/com2001_0428en01 .pdf.
3 Convention on Access to Information,
Public Participation in Decision-making
and Access to Justice in Environmental
Matters, June 25, 1998, available at
http://www.unece.org/env/pp/treaty-
text.htm. The Convention came into
force on October 31, 2001 and has been
ratified thus far by 33 countries.
4 United Nations Millennium Declaration,
Res. 55/2, Sept. 8, 2000, available at
http://www.un.org/millennium/declara-
tion/ares552e.pdf.
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
5 See UNEP, Judges Programme, avail-
able at http://www.unep.org/DPDL7Law/
Programme_work/Judges_programme/i
ndex.asp.
6 The Johannesburg Principles on the
Role of Law and Sustainable Develop-
ment, adopted at the Global Judges
Symposium held in Johannesburg,
South Africa, on 18-20 August 2002,
available at http://www.rolac.unep.mx/
deramb/publicaciones/GlobalJu.pdf.
7 UNDP, Promoting Democracy through
Reform, available at http://www.undp.
org/governance/index.htm. For other
examples of UNDP's efforts, see
Ramaswamy Sudarshan, Rule of Law
and Access to Justice: Perspectives
from UNDP Experience, 7-9, available
at http://www.undp.org/oslocentre/
access.htm.
8 The World Bank Group, Annual Report
2002, Themes: Promoting the Rule of
Law, available at http://www.worldbank.
org/annualreport/2002/chap0406.htm.
9 Final Report of the Ad Hoc Working
Group, supra note 1, at 6.
10 Organisation for Economic Co-opera-
tion and Development, OECD to Join
Arab States in Launching "Good Gover-
nance for Development" Programme,
Feb. 2, 2005, available at http://
www.oecd.org/document/36/0,2340,en_
2649_201185_34368484_1_1_1_1,00.
html.
11 Declaration of the Initiative on Good
Governance for Development in the
Arab Countries, Feb. 6-7, 2005, avail-
able at http://www.oecd.org/dataoecd/
51/12/34425871 .pdf.
12 Adenda 21, 8.21, available at http://
www.un.org/esa/sustdev/documents/ag
enda21/english/agenda21 chapters.htm.
13 MAKING LAW WORK: ENVIRONMENTAL COM-
PLIANCE AND SUSTAINABLE DEVELOPMENT,
Preface (Zaelke, Durwood, Kaniaru,
Donald & Kruzi'kova, Eva eds., 2005).
14 See Mrema, Elizabeth and Bruch, Carl,
UNEP Guidelines and Manual on Com-
pliance with and Enforcement of Multi-
lateral Environmental Agreements
(MEAs), 7th INECE Conference Pro-
ceedings (2005).
15 BREITMEIER, HELMUT, R. YOUNG, ORAN &
ZURN, MICHAEL, ANALYZING INTERNATIONAL
ENVIRONMENTAL REGIMES: FROM CASE
STUDY TO DATABASE, Chapter 6 (forth-
coming 2005). The IRD contains infor-
mation for more than 50 states and the
European Union. Id. at Chapter 2, 33.
The IRD includes 23 regimes: Antarctic,
Baltic Sea, Barents Sea Fisheries, Bio-
diversity, CITES, Climate Change,
Danube River Protection, Desertifica-
tion, Great Lakes Management,
Hazardous Waste, Inter-American Trop-
ical Tuna Convention, Conservation of
Atlantic Tunas, International Regulation
of Whaling, London Convention, ECE
Long-Range Transboundary Air Pollu-
tion, North Sea, Oil Pollution, Protection
of the Rhine Against Pollution, Ramsar
(Wetlands), Protection of the Black Sea,
South Pacific Fisheries Forum Agency,
Stratospheric Ozone, and Tropical Tim-
ber Trade. Id. at 19-21.
7 BIBLIOGRAPHY
The Access Initiative, Assessing Access to
Information, Participation, and Justice for
the Environment: A Guide, available at
http://www.accessinitiative.org/how_to_gui
de.html.
African Development Bank, Good Gover-
nance Policy 23, available at http://www.
afdb.org/en/content/download/964/6439/fil
e/governance.pdf.
Asian Development Bank, Good Gover-
nance Practices, available at http://www.
adb.org/Governance/gov_practices.asp.
Asian Development Bank, Law and Policy
Reform, available at http://www.adb.org/
Law/default.asp.
Carothers.Thomas, The Rule of Law
Revival, 77 (2) FOREIGN AFFAIRS 95 (1998).
Draft Handbook on Promoting Good
Governance in EC Development and Co-
operation, 6, available at http://europa.eu.
int/comm/europeaid/projects/eidhr/pdf/the
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MORITA, ZAELKE 21
mes-gg-handbook_en.pdf.
Heyes, A.G., Implementing environmental
regulation: Enforcement and compliance,
17(2) J. REG. ECON., 107-129 (2000).
HUNTER, DAVID, SALZMAN, JAMES & ZAELKE,
DURWOOD, INTERNATIONAL ENVIRONMENTAL
LAW AND POLICY, Chapter 16: Human Rights
and Environment (2002).
Inter-American Development Bank, Sus-
tainable Development Department, Rule of
Law, available at http://www.iadb.org/sds/
SCS/site_2776_e.htm.
Kremlis, Georges & Dusik, Jan, The chal-
lenge of the implementation of the environ-
mental acquis communautaire in the new
Member States, 7th INECE Conference
Proceedings (2005).
OECD, Policy Brief, Working Together
Towards Sustainable Development: The
OECD Experience, 5-6 (2002).
Oljaca, N., Keeler, A.G., & Dorfman, J.,
Penalty functions for environmental viola-
tions: Evidence from water quality enforce-
ment, 14 J. REG. ECON., 255, 256 (1998)
The Rule of Law and Enforcement,
Address by the Hon. James Spigelman AC,
Chief Justice of New South Wales, ICAC-
Interpol Conference, Hong Kong (Jan. 22,
2003), available at http://www.lawlink.
nsw.gov.au/sc%5Csc.nsf/pages/spigel-
man_300103.
Sarma, K. Madhava, Compliance with the
Montreal Protocol, Sarma, K. Madhava,
Compliance with the Montreal Protocol, 7th
INECE Conference Proceedings (2005).
SLAUGHTER, ANNE-MARIE, A NEW WORLD
ORDER, 66 (2004).
Spence, David, The Shadow of the Ration-
al Polluter: Rethinking the Role of Rational
Actor Models in Environmental Law, 89
CALIF. L REV. 917, 966 (2001)
UNDP, Access to Justice, Promoting
Democracy through Justice Sector Reform,
available at http://www.undp.org/gover-
nance/justice.htm.
UNDP, Electoral Systems & Processes,
available at http://www.undp.org/gover-
nance/e lecto ral. htm.
UNDP, Parliamentary Development, avail-
able at http://www.undp.org/governance/
parldev.htm.
UNDP, Public Administration and Civil Ser-
vice Management Reform, available at
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UNEP, Draft Manual on Compliance with
and Enforcement of Multilateral Environ-
mental Agreements, A Companion to the
2002 UNEP Guidelines on Compliance with
and Enforcement of Multilateral Environ-
mental Agreements
Zaelke, Durwood et al., Strengthening
Environmental Enforcement and Compli-
ance through Networks, available at
http://www.farn.org.ar/docs/p32/en17_Zael
ke.pdf (2002).
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22 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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MICHALAK, SCHUCHT 23
ECONOMIC ASPECTS OF ENVIRONMENTAL
COMPLIANCE ASSURANCE
MICHALAK, KRZYSZTOF1 and SCHUCHT, SIMONE2
1 Administrator, Non-Member Countries Division, Environment Directorate,
krzysztof.michalak@oecd.org
2 Consultant, Non-Member Countries Division, Environment Directorate
OECD, 2 Rue Andre-Pascal, 75775 Paris Cedex 16, France
SUMMARY
Discussions about strengthening enforcement systems in the context of designing
policies that stimulate economic growth have become a subject of particular interest in the
national and international context. These discussions have shown the need to develop and
promote a more systematic assessment of the incentive structures facing firms and the
need to provide governments with approaches that can generate, and optimize the use of,
public and private expenditure on compliance and its assurance. A Conference on Eco-
nomic Aspects of Environmental Compliance Assurance, organized on 2-3 December 2004
in Paris within the framework of the Organisation for Economic Co-operation and Develop-
ment (OECD) Global Forum on Sustainable Development, took these discussions further
by facilitating a dialogue and exchange of experience and good practices between OECD
countries and non-members from transition and developing economies. This paper pres-
ents the summary of the discussion held during the Conference.1
1 INTRODUCTION
Environmental enforcement, or
compliance assurance, programs involve a
broad array of actions that governmental
agencies, alone or in co-operation with
other stakeholders to correct or halt behav-
ior of the regulated community that fails to
comply with environmental requirements.
But even though these programs are com-
prehensive the compliance rates are still
unsatisfactory as detecting and prosecut-
ing non-compliance is complex, time and
resource consuming.
Low compliance rates often stem
from inadequate incentives provided by
governmental regulations. On the other
hand, underlying theoretical assumption is
also that perfect (i.e. 100 %) enforcement is
not always efficient. The underlying reason
for the flawed enforcement programs is
often a lack of in-depth analysis of the
entire spectrum of economic reasons that
influences the decision of the firm to com-
ply, or not, with environmental require-
ments. This includes, for example, the rela-
tions between levels of penalties and com-
pliance monitoring activities (inspections),
the selection of an appropriate penalty for
non-compliance, the need for a differentiat-
ed approach depending on the type of the
regulated community, relations between
compliance rates and tax breaks and spe-
cial financing, the size and structure of
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
firms, the structure and influences of its
ownership, etc.
In the recent years there has
been a rapid growth in theoretical discus-
sions of the economic framework for envi-
ronmental compliance and enforcement.
However, in-depth analysis of government
enforcement policies from the economic
angle has been carried out mostly in the
OECD countries. In transition and develop-
ing countries such analyses are sporadic or
often non-existent. Very rarely government
agencies consider the economic aspects of
enforcement and non-compliance and
inadequate attention is paid to answering
the following fundamental questions:
—Why do firms comply (or not) with
environmental laws?
—What are optimal enforcement
strategies and tools that can maximize
environmental benefits and minimize
costs to the regulators and regulated
community? and finally.
—What are the opportunities and limits in
the choice, and calibration, of regulatory
instruments to deter non-compliance,
and the ways to supplement them with
information-based and other instruments
to induce compliance?
2 OECD GLOBAL FORUM ON
SUSTAINABLE DEVELOPMENT:
CONFERENCE ON ECONOMIC
ASPECTS OF ENVIRONMENTAL
COMPLIANCE ASSURANCE
On 2-3 December 2004 in Paris,
OECD hosted an international conference
to advance policy dialogue between senior
government officials, researchers, non-
governmental organizations and business
people from OECD Member and non-mem-
ber countries on economic aspects of envi-
ronmental compliance assurance. The
meeting convened around 100 enforce-
ment practitioners, economists, lawyers,
scientists and representatives of business
and non-governmental community from 37
developed, developing and transition coun-
tries. The Conference was financially sup-
ported by the OECD, the World Bank, and
the government of Denmark. It was organ-
ized in cooperation with the INECE and its
partners.
The Conference did not aim to
address all the aspects of enforcement and
compliance in a comprehensive way; rather
the agenda has been structured around
four main issues:
— Determining the factors that drive
environmental performance and non-
compliance behavior of firms vis-q-vis
environmental regulation to identify key
elements in the incentive framework
for firms to comply with regulations
(Session 1).
—Classifying government approaches to
ensuring environmental compliance
according to behavioral patterns of
enforcers suggested by economic and
political economy-based literature. The
relevance of practice will be asserted
in order to make suggestions with
respect to types of regulations that
induce compliance and can encourage
innovation (Session 2).
—Assessing empirical evidence on how
inspectors allocate their limited
enforcement budgets. The aim is to
make suggestions to optimize current
instruments in compliance assurance
programs, focusing primarily on
compliance monitoring and enforcement
(or non-compliance responses),
and their impacts on administrative
implementation and firms' compliance
costs (Session 3).
—Identifying approaches susceptible of
reducing the administrative costs of
monitoring and enforcement with a view
to promoting innovative approaches
which save administrative and
compliance costs (Session 4).
3 ENVIRONMENTAL COMPLIANCE
ASSURANCE - THE "CINDERELLA"
OF ENVIRONMENT POLICIES
Although the implementation of
environmental policies has played an
increasingly important role in many coun-
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MICHALAK, SCHUCHT 25
tries, the enforcement of these policies,
and more specifically economic aspects of
compliance assurance programs, has
attracted less attention. Workshop partici-
pants consequently characterized enforce-
ment as the "Cinderella" of the environment
policies. Empirical findings reflecting this
neglect include:
i) inadequate consideration of
enforcement problems in designing
environmental policies;
ii) lack of empirical analysis of, and
hence limited knowledge about, actual
compliance rates;
iii) absence of consideration of economic
impacts of enforcement programs by
enforcers; and
iv) lack of ex ante/ ex post cost-benefit
analysis of compliance assurance
policies and enforcement actions.
To address these problems and
to pursue environmental improvements in
an economically efficient way, the costs
and benefits of compliance and enforce-
ment need to be taken into account
throughout the whole cycle of a policy
design and implementation. During the
concluding session, participants agree on:
—The need for designing policy mixes
that are adapted to the specific context,
combined with a greater use of
economic instruments, when possible,
to reduce the costs to the regulated
community and also to approach
the problems of small polluters.
They stressed the need to consider
enforcement in the design phase of
a policy and hence to increase
cooperation between enforcers and
policy makers.
—The necessity of more empirical
analysis on compliance rates, and
especially benefits of compliance
assurance, and with this also a need for
enforcement and compliance indicators
as well as more empirical analysis on
types of enforcement policy approaches
that lead to more transparency and
better performance. The analyses of
funding and efficiency of inspectors
work was also raised in this context.
—The importance of creating a
proper environment for the involvement
of the public ("whistle blowers"
protection; transparency; freedom of
information; "blame and shame"
approaches using public disclosure of
information and performance rating
that is understandable to third parties;
education).
—More dialogue between economists
and practitioners as well as between
practitioners of different areas (e.g.
"brown" and "green" sectors) and
countries to learn from experience while
being careful in copying other countries'
approaches as the context is crucial for
the effects obtained.
The implementation of these rec-
ommendations would help countries to
obtain greater environmental effects at
lower costs overall, to focus scarce
resources where they are most needed and
where they have the greatest effects, as
well as to limit corruption.
The participants considered that
the Global Forum on Sustainable Develop-
ment conference was very timely as very
few discussions between enforcement
practitioners and economists at the nation-
al and international level have been carried
out so far on designing enforceable poli-
cies. They called for continuation of this
dialogue, for more empirical analysis and
reviews of empirical evidence and assess-
ments of their policy relevance as well as
best practices that can serve as recom-
mendations for countries. The OECD
expressed its readiness to provide a plat-
form for further dialogue and analysis, in
the framework of OECD work on Eastern
Europe, Caucasus and Central Asia and
other regions and in co-operation with the
INECE and its Partners.
4 FACTORS DRIVING COMPLIANCE
WITH ENVIRONMENTAL
REGULATIONS AS KEY ELEMENTS
OF AN INCENTIVE FRAMEWORK
FOR FIRMS
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
In considering factors that can
drive or impede compliance a set of eleven
factors was presented by the Dutch Inspec-
torate which relate to i) spontaneous com-
pliance (knowledge of the regulation, cost-
benefit ration, degree of acceptance of the
regulation, loyalty and obedience of the
regulatee, informal monitoring); ii) monitor-
ing aspects (informal reporting probability,
monitoring probability, detection probability,
selectivity of inspectors); or iii) aspects of
sanctions (chance of sanctions, severity of
sanctions). An ongoing OECD project on
impacts of government environmental poli-
cies on firm's management revealed a
number of factors that can influence com-
pliance, including consideration of the strin-
gency of regulations, place of environmen-
tal officers in firm's management hierarchy
and the perception of penalties.
An intense discussion during
Session I centered on the adequacy of the
economist's basic enforcement model that
describes firm behavior. Do firms weigh up
compliance and non-compliance costs and
choose the least cost alternative or do they
rather have an intrinsic motivation or self-
interest in compliance with environmental
regulation? Testimonies from various par-
ticipants suggest that large, multinational
firms work towards high environmental per-
formance standards independent of the
location of their sites. Such firms seem to
comply not only following the policy of the
parent company but also to build their glob-
al reputation and image even in countries
where environmental regulation is low or
absent. Based on this, an OECD Business
and Industry Advisory Committee repre-
sentative suggested that regulators should
apply different approaches towards firms
aiming at achieving compliance, on the one
hand, and towards companies which may
be involved in "criminal" activities on the
other.
Other participants stressed that
the economist's compliance model is not in
contradiction to sociological and political
explanations of firm behavior (reputation,
social norms, etc.). Rather, these explana-
tions are considered as complementary as
firms have multiple objectives and react to
multiple signs and incentives. Firms may
well aim to improve their environmental
behavior even without a punishment. Nev-
ertheless, the model assumes that penal-
ties need to be applied in some circum-
stance as even law-abiding firms that do
not want to violate the law may be subject
to random (management) errors that might
lead to non-compliance. In that cases
enforcement may increase the care they
apply. Most participants agreed on this
view and suggested that, next to penalties,
the monitoring frequency - and non-pre-
dictability of inspections and the fact that
firms know they are randomly inspected - is
an important factor in inducing compliance.
A further discussion addressed
the issue of workers' and labor/trade
unions' influence on compliance. Can work-
ers be expected to care for environmental
needs and compliance, and to influence, or
report on, the non-compliance behavior of
their employer firms? And what is the role
of trade/labor unions? Participants sug-
gested that the influence of workers might
depend on the existence of "whistle blow-
ers" (individuals or groups prepared to alert
the public and other stakeholders on non-
compliance) as well as on the risks coming
from the implications of such actions, e.g. a
firm closing down owing to environmental
problems they uncover. It was also sug-
gested that workers might be less involved
when unions are stronger but more
involved when there are links between
environmental and health effects. The latter
aspect points to the usefulness of creating
a link between health and safety and envi-
ronmental inspections. Indeed, the US
Environmental Protection Agency (US
EPA) plans to share information between
the two responsible agencies (US Occupa-
tional Safety and Health Administration and
US EPA) in the future and to set up joint
inspections.
5 CHARACTERISTICS OF
ENVIRONMENTALLY EFFECTIVE
AND ECONOMICALLY EFFICIENT
REGULATION
The discussions in Session II
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MICHALAK, SCHUCHT 27
mainly focused on four broad issues:
i) the enforceability of environmental
policies,
ii) types of policy instruments and
enforcement approaches that
encourage firms to comply,
iii) frequently insufficient interagency
cooperation and coordination, and iv)
the role and impacts of local discretion
of enforcers.
Several speakers stressed the
importance focusing not only on the actual
enforcement of policies but rather on con-
sidering the enforceability of policies. This
issue points to a need to assess what part
of non-compliance can be attributed to "bad
policy" and what part to "bad implementa-
tion" and aims to avoid dealing with symp-
toms without knowing the causes. It is the
reasoning, for example, behind the Euro-
pean Union's "Better Regulation" initiative
developed by the Environment Agency of
England and Wales. The Agency identifies
six principles which demand regulation to
be:
i) transparent (clearly communicated),
ii) accountable,
iii) consistent (within and between
sectors and over time),
v) proportionate (risk-based),
v) targeted (outcome-focused), and
vi) practicable (proper funding for
enforcers and clearness to business
about what they have to do).
Interaction between policy mak-
ers and enforcers is well developed in the
Netherlands where the enforcement
agency checks all policies with respect to
their enforceability and seeks dialogue with
the policy makers where problems are
identified, informing them about both prob-
lematic and well-working regulatory
aspects. Also the US EPA is reported to be
usually involved when laws are written. All
in all, early interaction between policy mak-
ers and enforcers is considered as neces-
sary for enforcement issues to be taken
into account when policies are designed
and for creating understandable and
enforceable regulation.
With respect to regulatory
approaches and policy instruments that fur-
ther compliance and innovation, partici-
pants agreed on the need to apply a policy
mix which is adapted to the specific con-
text. In particular, economic instruments,
when adequately designed, can reach
environmental objectives at lower costs
than "command-and-control" type regula-
tion (and additionally drive technology
development with which the firms can earn
money). Nevertheless, workshop partici-
pants pointed at the possibility of "win-win"
situations for firms developing environmen-
tal technologies also as a result of stringent
regulations. While more empirical analysis
is necessary with respect to the choice
between applying "command-and-control"
or economic instruments (such as trading
schemes) and voluntary agreements, it
was suggested that the involvement of third
parties, for example of non-governmental
organizations taking on a "watchdog" role,
might improve their credible functioning.
As Small and Medium Size Enter-
prises (SMEs) can significantly impact the
environment", the choice of adequate
instruments for their regulation is important.
Shareholder pressure is generally not an
important factor for this firm group. Since
SMEs have also limited knowledge on bet-
ter management practices, information pro-
vision and compliance promotion is an
important starting point and can be sup-
ported by translation of legislation into
management procedures, advising on how
to comply, and making clear what exactly is
compliance. But also incentives for compli-
ance should be provided, which can be
captured in the formula "help and threaten".
Some participants suggested the applica-
tion of a "gradual" approach, which starts
by soft and voluntary instruments but even-
tually includes penalties (cf. the "Enforce-
ment Instrument Pyramid" presented at the
conference).
Next to the issue of "getting the
regulation right", effective and efficient pol-
icy making also requires that different
actors coordinate their work. A lack of inter-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
agency cooperation was not only reported
with respect to policy makers and
enforcers, but also between inspectors and
prosecutors or the Ministry of Justice and
the Ministry of the Environment. It is fre-
quently because the agencies lack a com-
prehensive view of enforcement and their
responsibilities.
The issue of discretion for local
regulators was discussed at length with the
following conclusions:
— Discretion increases a risk to local
regulators as they need to prove
that their actions are in line with the
regulation. This implies, firstly, that
inspectors tend to prefer "command-
and-control" regulation and, more
generally, that they frequently focus
more on "activities" than on "outcomes,"
while the opposite would be preferable
from an economic point of view.
—On the other hand, enforcement
agencies at the local level may have
better knowledge of the local situation.
Some advantages of local discretion
exist as it allows enforcement effort to
be better targeted and carried in a more
efficient way. In practice, however,
these agencies cannot be expected to
perform cost-benefit analyses with
respect to each action taken. This
results in agencies to focus on ensuring
that the costs of their operations are
(re-)covered.
—On a more negative side, discretion
may open the ways to corruption. It
was argued that incentives must be set
correctly to prevent corrupt behavior
of inspectors. This should involve
local enforcers to be properly paid and
corruption cases punished (including
imprisonment). But where a lack in
capacity is at the origin of corruption
training and capacity building (including
negotiation and making settlements
skills just as lawyers are trained for
correctly setting up contracts) may be
more important.
A related issue addresses a
question of how to best finance enforce-
ment agencies. However, as state budgets
face serious constraints enforcement agen-
cies are frequently under-funded. To
address this issue, agencies should work
towards covering their costs where possi-
ble (although an ultimate goal is to receive
adequate resources from the state budget)
but not have their budget linked to income
from enforcement actions (penalties). As a
positive example, the UK Environment
Agency partly recovers the cost of its Occu-
pational Pensions Regulatory Authority
scheme through permit charges which
reflect the risk and therefore the regulatory
effort involved.
6 THE OPTIMIZATION OF COMPLIANCE
MONITORING AND ENFORCEMENT
The discussions during Session
III showed that there remains a difference
between the economist's and the practi-
tioner's view with respect to the meaning of
the "optimization" of enforcement activity.
Whereas practitioners seem to favor a view
according to which enforcement should
focus on where the pollution problems are
the biggest (i.e. highest non-compliance
risk), economists would advocate to target
problems to achieve the biggest return on
resources invested ("the biggest bang for
the buck"). As an example the Dutch
Inspectorate's compliance strategy was
discussed which distinguishes two dimen-
sions when determining priority tasks: the
present state of risk and of non-compli-
ance. From an economist's point of view
economic aspects (the environmental ben-
efits attainable through compliance assur-
ance compared to the costs necessary to
reach compliance) should be included as a
third dimension. And even though the mar-
ginal impact of a unit of enforcement
resources spent is difficult to measure,
enforcement agencies should reflect this
issue and adjust their activity accordingly.
Most participants agreed, howev-
er, that in order to optimize enforcement the
available resources need to be focused on
situations that achieve considerable
improvement. This also requires some
level of local discretion. In this context, the
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MICHALAK, SCHUCHT 29
UK reported that enforcers tend to receive
direct enforcement assignments from the
Environmental Agency and therefore can-
not use the resources with flexibility which
can take account of their perception of pri-
orities.
The participants stressed the
need to recognize "decent" operators (firms
that are willing but maybe unable to com-
ply) and distinguish enforcement approach-
es from those which do not want to comply
and can be characterized as "environmen-
tal criminals". With this aim in mind, the UK
Environment Agency is currently building
the mindset of inspectors that they can also
promote compliance and help firms to
address their environmental problems, and
to refocus enforcement and non-compli-
ance response towards hose who avoid
compliance.
An important point highlighted
with respect to limited enforcement
resources is the asymmetry in information
that can work in favor of the regulator.
Using this information asymmetry, (partly
by "bluffing" on the side of enforcement
agency - "blitz and bluff") deterrence can be
created. Helpful in this respect may also be
publishing information on enforcement and
non-compliance measures taken.
Participants acknowledged a
need for better data to assess
whether/where enforcement results justify
enforcement (cost-benefit analysis). Addi-
tionally, more empirical research is neces-
sary on the impacts of different enforce-
ment approaches. It was suggested that
both extremes, an "aggressive" style and a
"cooperative" approach, might be counter
productive. To the extent that this is true,
there is a point for the earlier mentioned
approach that works in a gradual way, start-
ing with information provision and persua-
sion, but applying severe penalties where
this is not sufficient ("compliance promo-
tion/ non-compliance response pyramid".
This approach can also be compatible with
the claim that the enforcement style should
be aligned with the respective corporate
attitudes.
7 INNOVATIVE APPROACHES THAT
HELP SAVE ADMINISTRATIVE
IMPLEMENTATION AND FIRMS'
COMPLIANCE COSTS
Session IV focused on empirical
examples of information disclosure pro-
grams ("shame and blame" approach and
subsequent community pressure) and their
relative importance with respect to "classi-
cal" government-led enforcement taking
account firms' concern about their reputa-
tion and potential sanctions from con-
sumers and clients.
Several participants reported
positive experience from their countries. In
the US, the ECHO (Enforcement Compli-
ance History Online) Internet site, together
with the "freedom of information act" and
the possibility for citizens to sue companies
after informing the US EPA has been effec-
tive in improving the enforcement system.
In Japan citizens and the mass media have
a "watchdog" role (demonstrations against
polluting industries played an important
role in the 1960s and 1970s). Also the
European Union aims at a stronger involve-
ment of non-governmental organizations
and the general public, which is reflected in
its engagement in the UN/ECE Convention
on Access to Information, Public Participa-
tion in Decision Making and Access to Jus-
tice in Environmental Matters (the Arhus
Convention). By granting the public access
to justice and thus promoting private litiga-
tion, the European Union aims at strength-
ening the role of national courts in enforce-
ment.
Indonesia's PROPER program.s
and similar approaches applied in India and
China, is another well-known examples of
effects of wide disclosure of information
about the pollution, and enterprises envi-
ronmental performance rating, to the pub-
lic. Such approaches were by workshop
participants as an easy to develop and
powerful ways of co-operating with various
stakeholders. The PROPER program,
under which firms are rated based on com-
pliance checks with the regulation, can be
considered as a complement to the
enforcement agencies' work. Where
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
PROPER shows that no improvements take
place, environmental inspectors check and
eventually take enforcement actions. Par-
ticipants also suggested that the involve-
ment and use of multiple sources of infor-
mation within the PROPER program might
provide a way also of handling corruption.
Discussing the relative impor-
tance of traditional enforcement versus
public pressure, participants warned that
community pressure should not be seen by
the government as a sign that they can do
less. It was suggested that "green" con-
sumers and public pressure can help but
will never be sufficient to solve entirely
existing environmental problem. Therefore,
traditional enforcement and public pressure
will need to be considered as comple-
ments. Furthermore, it was suggested that
involving the public might be more difficult
in some areas (where no-self interest
exists) than in others. And finally, the role of
non-governmental organizations was con-
sidered as particularly important in inform-
ing enforcement agencies about problems
and possible solutions in the OECD coun-
tries. Therefore, this co-operation should
be pursued in developing countries where
regulation and enforcement are less
robust. Empowering non-governmental
organizations and providing the public with
information can be considered as crucial
tasks.
8 REFERENCES
1A Background Paper on Economic
Aspects of Environmental Compliance
Assurance which provides an extensive
analysis of the theories and practical
examples of consideration of economic
aspects of environmental compliance
assurance is available on the OECD con-
ference web site: http://www.oecd.org/
ccnm/sustdev. In addition to the back-
ground paper all the presentations made
at the conference and other background
materials are available on the above-
mentioned web site.
2 For example, 20 million of SMEs account
for 60% of pollution in the EU.
3 Program for Pollution Control Evaluation
and Rating (PROPER)
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HARRIS 31
COMBINING LEGAL MANDATES WITH ECONOMICS
IN THE APPLICATION OF ENVIRONMENTAL LAW
HARRIS, PHYLLIS P.
Principal Deputy Assistant Administrator, Office of Enforcement and Compliance
Assurance United States Environmental Protection Agency, harris.phyllis@epa.gov
SUMMARY
It has been the experience of United States Environmental Protection Agency
(EPA) that strong environmental protection has helped, not hurt, the U.S. economy. EPA
does not see the economy and the environment as being in conflict; instead they are mutu-
ally supporting. This paper discusses the role of monetary penalties in improving compli-
ance with environmental requirements, analyzes how the 'polluter pays' principle has been
implemented in the United States, and presents case studies on both civil and criminal
penalties.
1 INTRODUCTION
This paper briefly describes the
environmental enforcement challenges
faced in the United States. We use sound
economic approaches to apply the "polluter
pays principle." Today EPA achieves very
high compliance rates without being undu-
ly punitive and usually without closing
enterprises or causing unemployment. We
see this linkage of law and economics as a
key ingredient for our success in the U.S.
In the United States, this economic
competition and resulting environmental
degradation resulted in the creation of Unit-
ed States Environmental Protection
Agency (EPA) in 1970. Since then, in the
world's biggest economy, the EPA has
been able to control pollution while at the
same time allow our industries to be eco-
nomically competitive in a global economy.
Likewise, nations across the globe are pri-
vatizing, democratizing, transitioning, and
rapidly developing. In many respects, the
United States is a microcosm of all of these
characteristics. Science and technology
are key to solving or improving most envi-
ronmental problems. Knowledge is also
widely shared as to what makes good envi-
ronmental law. Many nations, however,
lack the political will to enforce environmen-
tal laws. This lack of will arises from the
perceived conflict between economic goals
and the desire to protect the environment.
Responsibility for successful
enforcement of environmental standards is
in my office within the EPA, the Office of
Enforcement and Compliance Assurance.
In the enforcement of our environmental
laws, we follow a philosophy of "Smart
Enforcement," which is using the most
appropriate tools to address the most sig-
nificant problems to achieve the best out-
comes. We also build in human economic
motivators. As a result, we have made
good progress toward including economic
incentives within the effective enforcement
of the law.
This paper is about pollution con-
trol, which we handle very effectively in the
United States. EPA applies sound econom-
ic approaches by using the "polluter-pays
principle." We see this linkage of law and
economics as a key ingredient of our suc-
cess in enforcing environmental law, and
we recommend this approach to any
nation.
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
2 ECONOMICS AND MAKING THE
VIOLATOR PAY
In the United States, Congress cre-
ated command-and-control statutory man-
dates that define prohibited acts and pre-
scribe penalties. To execute this statutory
intent, our core enforcement program has
strategically focused on the "outlaws" or
violators of environmental laws. EPA
applies these laws with well-known rigor
that creates the cognizance in the regulat-
ed community that violations are likely to be
detected and followed by an enforcement
response that imposes a heavy penalty or
sanction. By making it unprofitable to fail to
comply immediately, the government is
able to get prompt, voluntary conformity or
compliance from most companies. The rest
we punish, deter or dissuade.
Our U.S. approach of large penal-
ties, and sometimes imprisonment, may
seem excessive today in countries where
there is consideration of using economic
instruments as the best way to encourage
environmental compliance. Some countries
enjoy a culture of greater cooperation,
respect for government, and voluntary
adherence to green values and laws. But in
many parts of the world there is great
poverty, corruption and chaos, for which
only a very strong hand of government can
exert any control. As a result, based on the
experience of the U.S., it may be necessary
to be very strong in command-and-control
applications of economics-based enforce-
ment instruments.
The goal of a pollution control eco-
nomic policy instrument is to minimize
unwanted "externalities" by having enter-
prises internalize all costs, including pollu-
tion control, in product pricing. Because the
EPA is well known to be an effective
enforcer, most regulated enterprises
choose to pay for effective pollution control
and do achieve compliance. As a result,
fear of EPA enforcement is an important
motivator for compliance. Whatever other
motivation may be present, a small govern-
mental expenditure on dissuasion or deter-
rence produces a huge investment in pollu-
tion control. In this way, the permitted and
lawful polluter internalizes the cost of pollu-
tion control.
For violators, we make sure that
the costs to be internalized and paid are
even higher. In a limited way, we have done
this under some of our laws that require the
clean up of sites and natural resources
damaged by the release or improper dis-
posal of hazardous wastes and sub-
stances. In an ideal or theoretical world, we
would always price the natural resources -
including air and water - damaged. But in
most pollution control enforcement cases, it
is neither necessary nor possible for EPA to
price either the value of the natural
resources damaged, or the cost of their
clean up or restoration. Usually, violations
of our laws do not involve catastrophic
spills. Most violations result from routine
operational mismanagement and every-
day illegal pollution from chimneys, stacks
and pipes from factories and other plant
facilities. Indeed, it is very important to our
overall success that EPA laws are applied
early and preventively, usually before there
is measurable natural resource damage or
harm to public health.
For the EPA enforcement program,
it is enough just to prove that the violating
source discharged, emitted or released
more pollutants to the environment than
permitted or to prove that the facility oper-
ated outside of the law. Our source-based
controls typically define the allowed parts
per million or smaller for each chemical,
and it is a violation to allow anything more
to leave the chimney, stack or pipe. It is
precisely because EPA does not either use
ambient controls or try to measure environ-
mental damage, but relies on source-based
controls, that it has become possible for
EPA to prove most routine violations. We
do not have to prove the cost of the envi-
ronmental damage or wrongful externali-
ties. We look elsewhere. A starting point is
the maximum penalty set by law; it provides
the upper limit of the penalty amount.
Under the typical EPA statute, each day of
exceedance for each controlled chemical is
a separate violation, and each day of viola-
tion may be penalized up to as much as
$32,500 per day. Violations continuing for a
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HARRIS 33
period of time or for multiple pollutants can
quickly reach tens or hundreds of millions
of dollars. By referring to that maximum
penalty, EPA quickly gets the attention of a
violator.
The maximum penalty available by
law often has little rational relationship to
the facts and to economics. EPA's goal is
not to use the highest possible penalties to
cause unemployment by closing enterpris-
es, but to keep enterprises open provided
they operate in compliance. Assuming that
a violating enterprise wants to remain
open, EPA first requires the installation of
all required pollution control equipment.
Then, EPA takes the following three steps
to provide economic incentives to violators
to comply with the law.
2.1 Assessing "Compensatory"
Penalty Component to Recover
the Economic Benefit of
Noncompliance
In this penalty calculation, EPA
applies a very effective "economic instru-
ment" by which "the polluting violator pays."
In this regard, EPA's economic goal is to
level the economic playing field in the
enterprise sector of which the violator is a
member. EPA sets the monetary penalty at
a level that recovers from the violator the
full "economic benefit of noncompliance,"
to recapture the violator's wrongful cost
savings from not controlling pollution, and
from undercutting non-polluting competi-
tors. If this was not corrected, polluters
would drive out compliers, and ultimately
only lawbreakers would remain operating.
To eliminate this unfair economic advan-
tage, EPA calculates the wrongful savings
by the violator as this "compensatory" ele-
ment of the penalty. "BEN" is the name of
EPA's model used to (http://www.epa.
gov/oeca/datasys/dsm2.html) calculate the
present value of the violator's failure to buy,
install, and operate pollution-control tech-
nology. Because a violator should not be
permitted to realize any illicit economic gain
from a violation, this amount is almost
always recovered and usually is not
reduced in negotiations. EPA economists
have testified in court in support of the effi-
cacy of BEN calculations, and judges have
regularly upheld EPA's penalty assessment
method as based on sound economics,
principled, and fair. BEN is a huge success
for us.
2.2 Adding the "Punitive"
Component of the Penalty
BEN is only the beginning. We
have found that if all an enterprise has to
do is pay a penalty to restore the level play-
ing field, most will just wait until they are
caught. Instead, to create a reason for busi-
ness to comply voluntarily and to deter oth-
ers from not complying with the law, EPA
increases the monetary penalty by the
punitive - what we call "gravity based" -
element of the penalty. This is adjusted up
by considering factors such as the extent of
departure from required behavior and
whether there was the potential or actuality
of environmental harm. At this point, if we
have any information as to the value of the
natural resources damaged, this may be
considered not as a matter of economic
compensation but as justification for an
additional penalty that is a punishment.
Finally, we may also adjust penalties down-
ward in consideration of the defendant's
cooperation and lack of prior offenses.
2.3 Reducing Penalties by the
Value of Voluntary Work to Go
Beyond Compliance
Beginning in 1991, EPA began
developing ways to reduce payment as
punishment and to do more to encourage
environmentally desirable behavior - while
still using our traditionally tough enforce-
ment processes and large penalty assess-
ments. We now may agree to reduce the
punitive component of the final penalty
assessment by the amount paid by the vio-
lator for certain extraordinary actions that
the violator agrees to take to protect the
environment or to assure future good
behavior. These refinements by EPA policy
have been well received by the public and
by companies found in violation. As a
result, EPA now has "carrots to accompany
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
the stick" These "carrots" encourage the
right behavior, benefit the environment, and
in many instances those communities that
were impacted by violator's actions.
Supplemental Environmental Pro-
jects (SEPs) are actions that qualify for
such a penalty reduction. These must (1)
be in addition to required compliance with
EPA's end-of-pipe or stack pollution control
requirements; (2) "go beyond compliance"
with EPA's pollution control requirements,
and thus be extraordinary projects that are
even more protective of the environment
than is legally required; and (3) cost no less
than the amount of the penalty mitigated.
EPA will not reduce its penalty more than
the amount of the violator's expenditure on
a SEP. Because a violator should not be
permitted to realize any economic gain
from a violation, the economic benefit com-
ponent of the penalty is always recovered
and not mitigated. Penalty reductions for
SEPs may only apply to reduce the punitive
penalty, and usually at least some penalty
must be paid so that no violation is "free."
Some types of SEPs are:
(1) production process (source reduction,
waste minimization) changes to
prevent pollution (not just control it);
(2) environmental restoration or clean-up
activities upstream, where others
caused contamination, or of damage
not caused by the violation; and
(3) community emergency planning and
preparedness assistance, such as
providing hazardous materials
control equipment or training to local
governments that must respond to
pollution emergencies. To calculate
the cost of the SEP on economic
principles, we use a computerized
economic model.
2.4 EPA's Enforcement Policies on
Environmental Auditing
In the United States, permitted pol-
luters must self-monitor pollution control
performance and report certain self-moni-
toring results. Beyond this, there is no legal
requirement for companies to conduct
comprehensive self-audits or to develop
environmental management systems. EPA
welcomes the activities of the industry-
based International Standards Organiza-
tion (ISO) that encourage environmental
audits or environmental management sys-
tems (EMS).
However, because the ISO 14000
program does not address compliance per
se, it does not fulfill EPA legal require-
ments. So, EPA by policy incorporated
environmental auditing firmly within the
enforcement process, an achievement that
we believe to be highly significant and per-
haps unique. Starting in 1986, a violator's
voluntary agreement to do an environmen-
tal audit may be the basis for a substantial
reduction in the punitive portion of its EPA
penalty assessment. Additional penalty
reductions may be given to government
agencies or nonprofit organizations that are
violators, provided they use their money to
come into compliance and remain so. Also,
small enterprises in violation now may
receive total penalty credit and pay no
penalty if they agree to perform continuous
environmental self-audits to report and cor-
rect violations. EPA invites violators to "vol-
untarily" conduct an audit (which EPA can-
not legally require), rather like a voluntary
Supplemental Environmental Project that
the government will reward in the same
way. It is EPA's reputation for tough
enforcement that has greatly increased the
use of auditing. A 1995 survey showed that
in the U.S. more than 90% of the respond-
ing enterprises that conducted environ-
mental audits did so to find and correct
environmental violations before they were
found by government inspectors and pun-
ished! (While the cost of the audit is cred-
ited to reduce the penalty, the cost of cor-
recting or achieving compliance based
upon the audit's findings - which by law
must be done anyway - is not credited.)
Even where EPA has not identified
a violation, EPA's audit policy encourages
companies to discover violations and dis-
close them to EPA. This must be done in a
way that is systematic, prompt and inde-
pendent. The company must agree to cor-
rect and remediate harm, prevent recur-
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HARRIS 35
rence, make information publicly available
and cooperate with regulators. EPA
reserves to the government the right to pro-
tect the public health and the environment
in cases of serious violation. EPA's audit
policy does not excuse and does not apply
where there are repeat violations or there is
a pattern of violations, imminent or sub-
stantial endangerment or serious actual
harm, criminal conduct or substantial eco-
nomic benefit from noncompliance. There
is no total amnesty.
2.5 Environmental Auditing in
Relationship to Criminal Cases
Where a criminal case is filed, for
many years it also has been the policy of
national prosecutors and many national
judges to encourage environmental audit-
ing. A guilty environmental offender may
receive a reduced sentence where there
was already in effect a good faith environ-
mental auditing or compliance program.
Similarly, an offender can expect some
leniency when, reasonably promptly after
becoming aware of the crime, the offender
reports it to government authorities, coop-
erates and accepts responsibility. Also,
when sentencing an environmental offend-
er, leniency may be shown to the offender
who agrees to begin an effective environ-
mental auditing program to prevent and
detect future violations. In this way, criminal
punishment, like civil penalties, is reduced
to encourage and reward environmental
auditing.
EPA by policy will not initiate crimi-
nal cases against companies that voluntar-
ily and promptly disclose and correct viola-
tions and meet the specific conditions of
the audit policy. But where an enterprise or
its employees ignore audit reports of viola-
tions, are willfully blind to violations or con-
ceal or condone continuing non-compli-
ance, any audit report may become what
we call a "smoking gun" or strong evidence
of guilt. Then, the audit report may be evi-
dence of knowledge of violations, intent to
continue to violate, and thus actual criminal
behavior of the most serious kind.
3 CASE STUDIES
These principles can be illustrated
with two examples of U.S. cases. Usually
EPA files a formal complaint with a court or
administrative judge to begin the enforce-
ment action based on violations. Civil court
proceedings and administrative cases seek
monetary penalties paid to the U.S. Trea-
sury, and a court order, if needed, to stop
an illegal or dangerous activity or to require
a clean up. The filed complaint brings
industry lawyers to the table to negotiate
with the government over the resolution of
the problems. Because EPA collects good
evidence of violations, most cases are set-
tled without trial.
3.1 Civil Case Example
The "Petroleum Refinery Initiative,"
is one of the most successful enforcement
initiatives undertaken by the EPA
(http://www.epa.gov/compliance/civil/ pro-
grams/caa/oil/index.html). This initiative
illustrates how "global" agreements
(addressing major sources of pollutants at
all of an enterprise's facilities at once) in a
specific sector are economically feasible
while improving environmental perform-
ance. Since 2000, EPA has entered into
settlements for environmental compliance
with petroleum refining companies that
control approximately 40 percent of the
nation's refining capacity in more than 20 of
our 50 states. Negotiations are continuing
with refiners representing another 40 per-
cent of the nation's refining capacity. Taken
as a whole, these settlements will (based
on the settling companies' estimates) result
in a reduction of atmospheric emissions of
nearly 45,000 tons of nitrogen oxide, more
than 95,000 tons of sulphur dioxide, and
large reductions of benzene, volatile organ-
ic compounds and particulate matter. The
companies agreed to invest nearly $2 bil-
lion in control technologies, pay civil penal-
ties of $36.8 million, and perform Supple-
mental Environmental Projects valued at
approximately $25 million. One SEP was
the donation of an island for a county park,
another to install pollution controls on pub-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
lie school buses.
The Petroleum Refinery Initiative
applied an innovative, enterprise-wide
approach, addressing major sources of pol-
lutants at all of an enterprise's refineries at
once, rather than taking a traditional facili-
ty-by-facility, violation-by-violation enforce-
ment path. This approach enabled EPA and
refining companies to efficiently and quick-
ly address many environmental problems
presented by this large and complex indus-
trial sector.
By agreeing to address pollution
problems in a coordinated, enterprise-wide
basis, settling refiners were able to receive
the first refinery-wide emission caps nego-
tiated in a consent decree. By avoiding a
chimney-by-chimney regulatory approach,
these plant-wide caps enhance a refiner's
flexibility for producing fuels. These caps
are expected to help eliminate production
problems that could limit fuel supplies and
raise prices, to improve plant efficiency,
and to significantly reduce emissions. The
refineries also agreed to use the most mod-
ern control technologies. For example,
detection and repair of leaking equipment
and benzene waste will be controlled by
measures exceeding what is required by
national law. Moreover, in some instances,
as permitted by law, settling refineries are
partnering to develop new and better con-
trol technology.
These cases illustrate that there is
almost always some penalty money paid to
the government, even when an enterprise
eventually cooperates. The U.S. approach
to environmental enforcement which
includes payment of penalties is a strong
deterrent to future violations. Without penal-
ties, even for the first violation, most compa-
nies would not comply until they are caught.
Moreover, the government does not have
the resources to prosecute all of those
companies that are out of compliance.
Therefore, the EPA almost always imposes
a cash penalty. We find that this creates an
atmosphere in which enterprises will chose
to comply because they are "deterred" from
committing violations, and because they
believe that our system is fair. We estimate
that in the U.S. the rate of compliance with
EPA requirements is between 80% and
95% in various programs.
3.2 Criminal Case Example
In criminal cases, the government
seeks prison time for individuals who com-
mit environmental crimes. In the United
States, while we have been developing
economic incentives to encourage compli-
ance, simultaneously we have strength-
ened our means to compel it using forms of
dissuasion exceeding what can be
achieved by economics and monetary
penalties. Today we have a national force
of about 225 EPA pollution control police
officers. They increase the stakes for
industry. Sending to prison those managers
and workers who pollute intentionally is
very popular with the American people,
who regard environmental crime as unac-
ceptable behavior.
For example, treatment as crimi-
nals is both appropriate and necessary for
international businesses that smuggle chlo-
rofluorocarbons (CFCs). Within the U.S.
the market for illegal CFCs is as profitable
to smugglers as illegal narcotic drugs.
EPA's national environmental police,
together with customs and revenue police,
find these criminals and bring them to our
Department of Justice for prosecution.
The case of AGA International Cor-
poration and Barry Himes is one of many in
the U.S. against smugglers who would
undercut the Montreal Protocol on Sub-
stances that Deplete the Ozone Layer. Mr.
Himes imported CFCs from Russia and
China that were shipped through Canada
into the U.S. Between 1996 and 1998,
more than one million pounds of CFCs
were imported illegally, falsely described as
recycled. The criminals used various shell
companies and offshore bank accounts in
the Bahamas and Antigua to conceal their
control of these transactions to defeat
efforts by tax authorities to collect the sub-
stantial excise tax that the U.S. imposed to
promote use of ozone-friendly replacement
products.
Himes was charged as a criminal
and pled guilty in a national court. In 2003,
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HARRIS 37
he was sentenced to six and a half years in
prison and ordered to pay $1.8 million in
restitution and a fine of $12,500. Mr. Himes
had previously forfeited to the government
more than $3 million in property including
an expensive home, car and jewelry. His
principal colleague was sentenced to a
term of four years in prison and ordered to
pay $1.2 million in restitution. Ten other
persons pled guilty and each received an
average of one and half years in prison.
This criminal case illustrates that
sometimes deterrence fails. To an econo-
mist, it may seem crude or incorrect to say
that such command-and-control enforce-
ment illustrates the application of an eco-
nomic instrument. To this I can only answer
that surely criminal polluters "pay" dearly
when they receive such sentences. A major
advantage to society of having the criminal
proceedings and penalties available is that
this tool produces so great a deterrent
effect that usually it seldom has to be used.
As economists observe, good
information is essential to making rational
choices. For this reason, EPA regularly
issues announcements regarding signifi-
cant enforcement case filings and conclu-
sions. We are very transparent, even mak-
ing available on the Internet the compliance
records of violators. From anywhere in the
world, you can visit our Internet site to see
if an enterprise operating in the United
States has performed within the law or is in
violation (http://www.epa.gov/echo). If a
violating enterprise is coming to your
nation, we want you to know so that you
may consider imposing special permit con-
ditions and surveillance.
4 CONCLUSION
This paper has described how in
the U.S. we use sound economic
approaches to apply the "polluter pays prin-
ciple." Today EPA achieves very high com-
pliance rates without being unduly punitive
and usually without closing enterprises or
causing unemployment. We see this link-
age of law and economics as a key ingredi-
ent for our success in the U.S., and we rec-
ommend this approach to any nation that
would effectively enforce its environmental
law.
The United States Environmental
Protection Agency wants to cooperate with
all nations seeking better environmental
enforcement. We readily collaborate with
all like-minded nations that ask our help to
improve their domestic environmental
enforcement capacity, and nations that
want to develop cases against international
environmental criminals. EPA is ready to be
a partner in this effort.
5 REFERENCE
This paper was presented to the Organisa-
tion for Economic Co-operation and Devel-
opment on December 1-2, 2004, at its
Global Forum for Sustainable Development
in Paris. Ms. Harris has served as the Unit-
ed States Environmental Protection
Agency's number-two enforcement official
since 2001. She is also a Co-Chair of the
International Network for Environmental
Compliance and Enforcement (INECE).
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38 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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RlETKERK, ROLLEMAN 39
ENVIRONMENT COOPERATION BETWEEN THE PROVINCE
OF OVERIJSSEL AND THE ENVIRONMENTAL COMMITTEE
OF THE CHAMBERS OF COMMERCE
RlETKERK, THEO1 and ROLLEMAN, GEERT2
1 Member of the Executive Council for Space and Environment, Province of
Overijssel
T.Rietkerk@prv-overijssel.nl
2 Chairman of the Environmental Committee of the Chambers of Commerce
Geert.Rolleman@wavin.nl
SUMMARY
The province of Overijssel and the Environmental Committee of the Chamber of
Commerce (representing the trade industry) joined forces in a cooperation program. The
province and the Environmental Committee consult each other regularly (three to four times
a year). Agreements made in these meetings are agreements between the province, the
Chambers of Commerce, and the Federation of Netherlands Industry and Employers Cen-
tral Region. These parties consider it important that the Overijssel environmental partners
develop their mutual activities in cooperation, which is why they want to stimulate the
coherence by consultation and by developing mutual activities. In 2004, the first collective
program was implemented. This paper discusses the targets achieved, the projects contin-
ued in 2005, and the outcomes of the cooperation project.
1 INTRODUCTION
The province of Overijssel and the
Environmental Committee of the Chamber
of Commerce (representing the trade
industry) joined forces in a cooperation pro-
gram to achieve concrete results. The
province of Overijssel is convinced that the
economy and the environment should be
balanced, with room for both entrepreneur-
ship and limit the burden on the environ-
ment. As it is, we strive for safer and health-
ier living conditions in Overijssel.
This cooperation program con-
tributes to a cleaner environment by remov-
ing a number of impediments. The program
combines knowledge and skills of the trade
and industry and the authorities of Overijs-
sel. The province and trade association
have agreed on projects they will imple-
ment together. Such a far-reaching cooper-
ation is unique in the Netherlands, and only
possible due to two crucial aspects.
First, both the authorities and the
industry group feel responsible for
approaching a number of collective spear-
heads of the environmental policy. We also
want to start and implement them together.
No fat documents, but actually off to work
and using knowledge, skills and financial
means as effectively as possible!
Second, acknowledging the own responsi-
bility has been of major influence in forming
the cooperation. Respect and room for the
typical roles of the authorities and the trade
and industry give both parties the neces-
sary room to implement projects collective-
ly. "Trust" is a key word!
Environmental policy is one of the
main subjects of the Chambers of Com-
merce in Overijssel. Environmental policy
remains an important surrounding factor.
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
Companies are stimulated more and more
to comply with the environmental regula-
tions and to work on environment manage-
ment. On behalf of the trade and industry
the Environmental Committee speaks with
the Executive Council of Overijssel about
the environment. The Environmental Com-
mittee is a committee of experts of the
trade and industry who give advice to the
managements of the Chambers of Com-
merce in Overijssel. Both the employers
(the Federation of Netherlands Industry
and Employers (VNO/NCW) and the small
and medium-sized enterprises sector) and
the employees (Trade Union Confederation
(FNV/CNV)) are represented in the Envi-
ronmental Committee.
The Chambers have entered into a
covenant with the regional departments of
VNO/NCW in order to cooperate closely in
analysing problems and preparing views on
affairs that affect them mutually. For this
reason also the VNO/NCW Central Region
is represented in the Environmental Com-
mittee.
2 COOPERATION TARGETS
The Environmental Committee
(and thus the environmental network) has
the following external targets in the envi-
ronmental area:
—influencing the integral national policy
with regard to the environment in the
interest of the trade and industry in
Overijssel;
—collecting information from the trade
and industry and transferring it to the
authorities, in the interest of the trade
and industry, including the initiating and
supporting of projects in Overijssel;
—communicating relevant policies
and regulations with regard to the
environment to companies in Overijssel.
The province of Overijssel strives
for a sustainable development of the Over-
ijssel economy. This involves an optimal
balance between the environment, the
economy and the social quality. A central
theme within that strive is the deregulation
and simplification of regulations. The
province contributes as follows by:
—stimulating the sustaining development
of sectors and companies with special
attention for an economic use of
space and sources, and applying and
developing sustainable sources of
energy;
—stimulating the situation that the right
companies will be in the right places,
with special attention for fitting them into
the physical surroundings and the social
and economic structure;
—aiming at the active cooperation with the
trade and industry, other authorities and
interested parties.
The province and the Environmen-
tal Committee consult each other regularly
(three to four times a year) on the basis of
these targets. Agreements made in these
meetings are agreements between the
province, the Chambers of Commerce and
the VNO/NCW Central Region. These par-
ties consider it important that the Overijssel
environmental partners develop their mutu-
al activities in coherence, which is why they
want to stimulate the coherence by consul-
tation and by developing mutual activities.
The province can also invite the ISP
Twente (Information Service Department of
Twente), the Twente Region and the Ussel-
Vecht Region to these meetings.
The environmental cooperation
takes place through the ISP Twente. It
attempts to realise a flexible and continu-
ous form of environmental cooperation
between the municipalities themselves in
Twente. The tasks, working methods, tar-
gets and the financial foundations were laid
down in a collective regulation which was
signed by all participating municipalities.
The Environmental Program, which is draft-
ed annually, is based on this regulation. .
The Twente Region is a coopera-
tion of fifteen municipalities (fourteen from
Twente and one from Gelderland). It plays
an important role on the field of industrial
sites. The Ussel-Vecht Region is a form of
cooperation between twelve municipalities
in the North-West and North-East of Overi-
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RlETKERK, ROLLEMAN 41
jsel and Gelderland. It also plays an impor-
tant role on the field of industrial sites.
Apart from that, it has a role on the field of
environmental cooperation.
3 COOPERATION SPEARHEADS
In 2002 it was concluded that the
quality of the cooperation between the
province and the Environmental Committee
could be improved further. Both the
province and the Environmental Committee
have their own working programs which
were not tuned. As a result of that, the pos-
sible synergy between the programs
remained unused.
After comparing the working pro-
grams of the province and the Environmen-
tal Committee, five spearheads were
named which the province and the Environ-
mental Committee want to give shape to,
namely:
—Projects of sustainable industrial sites;
— Environmental permitting and
compliance control;
— Noise limits for companies;
— Environmental management in small
and medium-sized enterprises;
—Tuning environmental policy and
spatial planning.
4 STARTING POINTS ENVIRONMENT
COOPERATION PROGRAM
As of 2003 the collective activities
on the field of the spearheads named were
laid down in a mutual cooperation program.
The province and the Environmental Com-
mittee have agreed that the latter will sub-
mit a proposition for collective activities to
the province, including the financial
aspects. In preparing this, both parties will
cooperate closely.
The cooperation program is based
on activities, which the Chambers of Com-
merce, the VNO/NCW Central Region and
the province could develop in order to con-
tribute to the development of sustainable
industrial activities in Overijssel. Below you
will find an outline of these activities.
The activities of the Chambers in
cooperation with the VNO/NCW Central
Region are meant to indicate possible bot-
tlenecks as soon as possible, such as lack
of: space, acting room or adequate acces-
sibility. This concerns groups of enterpris-
es, which have the same or similar bottle-
necks. Together with representatives of
such groups, they reflect on the character
of the problems, indicate the possible direc-
tions of solutions and organise the begin-
ning of the solutions to those problems.
The Chambers of Commerce, in
close consultation with the VNO/NCW Cen-
tral Region, dedicate themselves to starting
cooperation projects in their regions for the
trade and industry on the fields of the
spearheads named. In order to do this, they
accumulate the necessary support (finan-
cial as well), and dedicate themselves to
convincing entrepreneurs and municipali-
ties to participate in this collectively.
In Overijssel the Chambers of
Commerce have started an "environmental
network". This is a closely operating net-
work of organisations and companies, in
which the companies are informed in an
optimal way about environmental affairs
which are relevant to them, and in which
the promotion of interests is tuned well on
local, regional and provincial levels. The
members of the Environmental Committee
act in this network. Concrete activities of
the environmental network are the periodi-
cal newsletter, theme meetings (e.g. on the
new Noise Abatement Act and the liberali-
sation of the energy market) and cost sav-
ing projects for companies (on the fields of
energy, water, and waste streams).
Through its network, the province
stimulates the Ussel-Vecht Region, the
Twente Region, the ISP Twente and the
municipalities towards participation in
those initiatives of the trade and industry it
thinks useful, on the fields of noise limits for
companies, environmental permitting and
compliance control and environmental
management in the middle and medium-
sized enterprises sector.
The province assesses the cooper-
ation program which the Environmental
Committee submits. After a positive
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42
SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
assessment it may put financial means
available for projects which have been
approved. The province shares its skills
and experience in these projects. With
regard to content, it contributes from its
skills in giving information to the trade and
industry.
5 COOPERATION PROJECTS 2005
In 2004 the first collective program
was implemented. Of the projects named
almost all targets were achieved in 2004.
5.1 Projects of Sustainable
Industrial Sites
In general, the province faces a
huge task with regard to revitalising exist-
ing sites, which is why this task is one of
the policy priorities of the province and the
municipalities involved. Apart from the
municipalities and the province, many par-
ties are active on the field of sustainable
industrial sites. In order to revitalise the
existing sites it is imperative that the munic-
ipalities and the trade and industry want to
cooperate on this subject. Both the
province and the Environmental Committee
want to contribute to that cooperation. Aim
of the contribution is to stimulate that revi-
talising existing sites will be sustainable.
The three starting points are:
—a decrease in environmental burdens
by companies;
—a more efficient use of space and a
better site planning and management;
—cost saving and better functioning of
companies.
Projects
— Drafting the framework for the provincial
policy on sustainable reinforcement of
existing sites: It is the target to involve
the Environmental Committee in drafting
the framework for a policy aimed at the
reinforcement of existing sites. Tuning is
necessary between the regional plat-
forms of industrial sites and the Environ-
mental Committee.
—Stimulating sustainable reinforcement
existing sites in the regions of the
Chambers of Commerce of the Zwolle
region and Veluwe region, by both
Chambers and the VNO/NCW Central
Region: The Chamber of Commerce of
the Zwolle region is the initiator and the
chairman of project groups on the field
of sustainable reinforcement of existing
sites and as such stimulates the
municipalities and companies to
develop existing sites in a sustaining
way. In Twente all involved parties will
implement the action program for sites
(8KB Plus) in cooperation with the
Chambers of Commerce for Veluwe
and Twente.
—Development manual/checklist for
market-oriented restructuring of
existing sites: It is the intention to
assess in a simple way, by means
of a checklist/manual, whether
redevelopment of (a part of) an existing
site can be achieved in both a
market-technical and financial way,
and which conditions market parties
and/or developers make in order to
invest herein.
— Development of an ICT-tool for park
management: A research into the
possibilities of considerably reducing
the cost of park management by using
the internet. By using a practical
internet-tool the practical and
administrative work can be done in
a simpler, and thus cheaper way. In
this way the amount of time a park
manager spends on all kinds of work
can be limited. The research project
may contribute considerably to a further
innovation of the trade and industry.
5.2 Environmental Permitting And
Compliance Control
In the past few years the interest in
the environmental permitting and compli-
ance control has increased considerably.
Among other things, this led to setting
national quality standards, which the con-
trolling institutions have to comply with. The
aim behind it is a uniform control. The trade
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RlETKERK, ROLLEMAN 43
and industry have interest in this too.
Target of the cooperation between
the province and the Environmental Com-
mittee is to cooperate on a simple, safe and
practicable environmental policy for com-
panies, including a well-tuned compliance
control. This concretely expresses the
provincial strive for deregulation and sim-
pler regulations. Due to the large extent of
the autonomy of the municipalities in this
area, the cooperation is limited to the
provincial tasks in this field. Within its pos-
sibilities the province will stimulate that
there is sufficient consultation between the
municipalities and companies.
Projects
—Checklists for companies that are sub-
ject to general administrative orders: A
checklist is drafted for all the companies
in Overijssel that are subject to general
administrative orders. The aim is to
improve the cooperation between the
trade and industry and the province
within the framework of controlling
through information and assistance for
companies and controllers. Stimulating
the uniformity of control.
— Permit information leaflet: Development
of a leaflet with regard to the regulations
on the fields of spatial planning and
the environment by means of a survey:
procedures, necessities and deadlines
will be placed next to each other in one
survey on zoning plans and permits for
building, environment, use, advertising
and demolition.
— Information on permits for use, and fire
safety: Giving specific information to
companies on the legal requirements
for companies with regard to fire
safety, permits for use, the room these
requirements leave and which points of
interest. This can be done by a sheet
developed for this purpose.
— Improving the quality of permits
(procedures): At the end of 2005 the
quality of permits procedures will be
improved due to the fact that: it is clear
what companies may expect from
the Overijssel provincial unit EMT
(Economy, Environment and Tourism)
and vice versa; the dilemmas and
problems of both parties have been
mapped, along with the (possible)
solutions; parties have made
suggestions for improving the quality
of the environment permit with regard
to the application, the period of time
from the application until the permit
is granted, and the contents of the
permit itself.
5.3 Noise Limits for Companies
In many municipalities there are
companies for which the noise limits are
insufficient in order to function optimally. It
seems there is more and more a 'clash of
functions' in which companies and houses
have been located too closely to each
other. In the interest of both the inhabitants
and the companies it is advisable to look
for creative solutions together. For their fur-
ther development, it is important for compa-
nies that their noise limits are sufficient.
The aim of the cooperation between the
province and the Environmental Committee
in this field is to set a course for the
approach of the noise limit problem for the
trade and industry.
Projects
—Anticipating to the new noise
regulations by the province and the
municipalities: Making an inventory
of the amendments in the Noise
Abatement Act and discussing
collectively their consequences for
the municipalities, the province and
the trade and industry.
—Setting up and implementing
four research projects in Almelo,
Hardenberg, Zwolle and Deventer:
The target of this project is to research
the reason for the noise limits being
insufficient and to research whether the
noise limits for the trade and industry
on the zoned industrial sites can be
extended, by a different method of
calculating noise, adaptation of the
noise limit zone, or a more efficient
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
allocation of the existing noise limits
(e.g. by buying or exchanging each
others noise limits). The province
is preparing one integral project
proposition, in consultation with the
Chamber of Commerce (Zwolle region)
and the VNO/NCW. An external bureau
researches four fields of interest.
5.4 Environmental Management
In Small And Medium-Sized
Enterprises
The Environmental Committee and
the province of Overijssel aim at increasing
the awareness of companies on environ-
mental management. As it is, many compa-
nies still lack sufficient information about
their chances in this field. Apart from that,
due to the extended implementations of the
Environment Management Act companies
have more obligations to put in efforts on
the field of environmental management for
which they will have to answer to the
province. Environmental management may
contribute to the target of the cooperation
between the province and the Environmen-
tal Committee on the field of sustainable
industrial sites.
Projects
— Prevention projects for the small and
medium-sized enterprises in Zwolle
(Voorst): In these prevention projects
the chances for cost saving are being
researched. Also, agreements are made
with the participating companies on how
recommendations to save on costs can
be implemented (implementation plan).
It will also be considered whether the
recommendations can be tuned to the
most important requirements of the
general administrative orders companies
have to comply with. The assistance
to be developed (see environmental
permitting and compliance control) will
be an important tool. In these projects
there is stress on researching whether
sustainable energy and innovation can
started and implemented as chances.
—Sustainable energy project in Twente:
Making an inventory of chances, and an
implementation of sustainable energy
on an industrial site in Twente. This is
meant as a pilot project to achieve
knowledge and to explore the support.
—Exploring bottlenecks and chances
for large-scale use of wind energy on
industrial sites: It is permitted to place
large wind turbines (axis height 80
meters and more) on the larger
industrial sites (50 hectares and more).
In fact, this has not really been started
yet. Target of this project is to explore
bottlenecks and chances for large-scale
use of wind energy on industrial sites in
cooperation with the Environmental
Committee.
— Distributing the results and upgrading
the pilot project on sustainable energy:
Distributing the results of the pilot
project in Twente and the project on
exploring the chances of wind energy
on industrial sites, and possibly the
upgrading to other industrial sites in
Overijssel.
5.5 Tuning Environmental Policy
And Spatial Planning
The environmental policy usually
has a spatial component. Therefore, par-
ties may cooperate on the common
grounds of the policies on the environment
and the spatial planning in future.
One possibility through which this
can be done is the permit from the Ministry
of Spatial Planning, Housing and the Envi-
ronment (VROM). It strives for one deci-
sion, regardless the number of Acts and
rules that have to be met, for inhabitants
and companies that want the permission of
the authorities for a certain activity which
influences the living conditions. One should
only have to go through one procedure with
regard to the application (or report), partic-
ipation, objections and appeal. Also, inhab-
itants and companies should have to refer
to one department only.
As introducing the VROM permit
means much and brings changes for both
the one who applies and the one who
grants the permit, two projects are started
besides the legislation procedure which will
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RlETKERK, ROLLEMAN 45
prepare the introduction of the VROM per-
mit: the pilots "permit management" and
"VROM permit". The pilot "permit manage-
ment" is aimed at having a fast insight in all
procedures, so that it is possible to acceler-
ate the building of houses. The pilot
"VROM permit" means that other decisions
will be made apart from the decision to
amend the zoning plan, in order to realise
the various parts of the zoning plan. This
means that the preparation of the neces-
sary decisions (such as the permits for
environment, demolition, building, cutting,
construction and use) will take place as
simultaneous and coordinated as possible.
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46 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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MASLANY, DROLET 47
COMPLIANCE INCENTIVES AND OTHER ASSISTANCE
MASLANY, THOMAS1 and DROLET, RENE2
11405 Perkiomenville Road, Perkiomenville, PA, 18074, tmaslany@nni.com
2 Director, Compliance Assurance, National Programs Directorate, Environment Canada,
351 St-Joseph Blvd., 17th Floor, Gatineau, Quebec, K1AOH3, Canada,
rene.drolet@ec.gc.ca
SUMMARY
The primary goals of a compliance assurance program are to change human
behavior so that people choose to comply with the environmental requirements and to force
compliance on those that choose not to comply voluntarily. Both goals are important. To
achieve these goals, a good understanding of the different sectors of the regulated com-
munity is required, as well as what makes them change their compliance behavior towards
environmental requirements.
1 UNDERSTANDING COMPLIANCE
BEHAVIOR
Few people will obey a law simply
because it is a law. There may be multiple
reasons why people obey laws and rules.
For example, complying can be linked with
professional ethics or moral duty. It can
ensure good reputation with others. But
there is also a different and competing set
of reasons why people do not comply with
laws and rules. Costs of complying can
seem high compared to the sanctions,
especially if the risk of being detected is
low. People may also be motivated to dis-
obey a rule simply because they disagree
with it for personal or professional reasons.
Knowledge of the factors that drive
environmental performance and non-com-
pliance behavior of firms and individuals is
critical to designing and applying regula-
tions or other control instruments to stimu-
late the desired behavior. A deeper under-
standing of human and organizational
behavior is required in order to better
match rules and requirements to the
desired behaviors.
A frequent mistake from regulatory
agencies is to assume that a target group
will be aware of, and understand how to
comply with, a rule when it is published.
However, increases in the complexity and
volume of new rules can make this basic
assumption unrealistic. New rules need to
be accompanied by information and appro-
priate development programs to ensure
they are made comprehensible to the tar-
get group. A focus on the feasibility of com-
pliance is also needed.
To secure compliance, the target
group must be:
—aware of the rule, and understand
it and why it is necessary (clarity and
transparency);
—willing to comply;
—able to comply.
The regulated community can be
divided into three general groups. The first
group is those that will comply regardless
of what the government does. They comply
because they believe in the rule of law
and/or the benefits of environmental goals.
This group just needs to know that a
requirement exists and what the expecta-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
tions are. On the opposite side of the spec-
trum, another group consists of those in the
regulated community that may not believe
in rule of law, do not support the need for
environmental goals, and/or have financial
business concerns that they believe will not
allow them to consider the expenditures for
environmental compliance. For this group,
direct enforcement by the government to
compel them to comply is the only path for
government to change their behavior.
In general the largest group in the
regulated community is the group that will
choose to comply based on actions of the
government and their awareness of these
actions. Some will only comply out of fear
of the consequences of violating the law.
They are deterred from violating the law by
the actions of the government against other
violators. This undecided group will also
comply more readily if they see positive
incentives to comply or if they can get the
necessary technical assistance.
2 COMPLIANCE INCENTIVES AND
OTHER ASSISTANCE
Compliance incentives and compli-
ance assistance relate to all activities and
programs, excluding enforcement actions,
which promote compliance and/or con-
tribute to securing compliance with legal
environmental requirements (laws and reg-
ulations) and other risk management tools
such as pollution prevention planning, vol-
untary measures, economic instruments,
environmental management systems, envi-
ronmental taxes, etc. In some countries,
compliance promotion (i.e. building recog-
nition that a requirement exists, and that
there are benefits to complying with the
requirement and potential consequences
for not complying) is considered a separate
function or topic from compliance assis-
tance and incentive programs. This paper
will include compliance promotion as part
of the continuum of tools that can be used
to promote voluntary compliance.
2.1 Why is it Important for
Governments to Provide
Compliance Incentive/
Assistance Programs?
As was previously mentioned the
behavior of the regulated community can
be changed by both "carrots" and "sticks."
The awareness of enforcement, with real
consequences (the stick), will create a
stronger desire in the regulated community
to comply. However, since governments do
not have resources to continually monitor
all of the regulated communities or develop
large numbers of enforcement actions that
will strain the administrative and judicial
processes of the government, it is impor-
tant to create other tools that will take
advantage of this increased desire to com-
ply. Once government has their attention,
they are more likely to respond to positive
incentives and support (the carrot).
Lack of awareness and under-
standing of the requirements is the first
obstacle that needs to be addressed. The
regulated community needs to understand
the relevance of the requirements to their
operation, the specific interpretation relat-
ing to their unique operation, and the
expectation on new interactions with gov-
ernment resulting from these requirements.
Many in the regulated community may not
have the necessary devoted resources to
understand and interpret new government
requirements. Also company management
may not appreciate why these require-
ments are important to their long-term busi-
ness interests (liabilities), their impacts on
the communities in which they operate, and
the importance of healthy environments to
the well-being of society. For many, their
first impressions are driven by this lack of
understanding, failure to recognize the
importance of the requirement, and the fear
of change (which is heightened by this lack
of understanding). Compliance promotion
by the government can address many of
these concerns.
Many in the regulated community
are unaware of the types and amounts of
discharges and emissions they are gener-
ating and the nature of the environmental
damage they are creating. This lack of
awareness, while varying greatly from busi-
ness sector to sector, can be seen in even
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MASLANY, DROLET 49
large sophisticated corporations that have
not yet made environmental management
part of their business plan. Creating this
pollution awareness (especially with the
added awareness of enforcement conse-
quences for lack of action) can in itself
stimulate environmentally sound behavior
change. During the late 1980s, the United
States Environmental Protection Agency
(US EPA) conducted intensive audits of the
major chemical industries and presented
their results to the corporate leadership of
the companies. Many of these officials
expressed disbelief and shock about the
information that was being presented to
them. They were alarmed by the potential
impacts on the communities in which they
operated, unaware of potential loss of prod-
uct and inefficient operations, and con-
cerned about their corporate image. Once
many of these corporate officials under-
stood the environmental damage that they
were creating, environmental management
became an important part of their corporate
management planning. When the United
States adopted the Emergency Prepared-
ness and Community Right-to-know Act
(EPCRA) which required annual reporting
and disclosure to the public of releases to
the environment, the corporate attention to
environmental management was greatly
improved.
Even if the regulated community is
aware of the environmental damage that
they are creating, lack of knowledge in
environmental management and technical
solutions can still be a problem. This is
especially true for many of the medium to
small industries. They are unlikely to have
in-house staff that is devoted to environ-
mental management. If they do, it may only
be a very limited commitment which must
address not only environmental but all non-
production regulatory affairs. In these situ-
ations the government cannot only make
them aware of the requirement but can help
provide technical services to the regulated
community. The government is assisting by
imparting technical knowledge about meth-
ods or equipment that will ensure compli-
ance with the requirement - compliance
assistance.
By providing technical information
in a matter that they can quickly and easily
understand, the government can build on
their willingness to make the necessary
changes. Therefore, both the format and
forum that is use to transmit this informa-
tion is important if the transfer is to be suc-
cessful. Each regulated sector has a cer-
tain common knowledge base and jargon,
and receives information in ways that are
unique to them. The presentation of infor-
mation must be tailored to conform to
these. Their human resource constraints
must also be considered in the design of
the delivery system. The government can
not afford to build a larger or more complex
program then the audience can use.
Incentive programs provide addi-
tional "carrots" to help promote the behav-
ior change and achieve compliance. If
there is an awareness of the requirements
but there is still reluctance due to financial
constraints, the regulated community may
respond to incentives that the government
creates. Even minor incentives to their
business or operations may be enough to
persuade them to comply, especially when
this is balanced against the cost of defend-
ing against an enforcement action by the
government and any penalties that may be
imposed. There are both positive and neg-
ative incentives that the government can
create to help motivate compliance.
Providing compliance incentives,
technical assistance, and promoting com-
pliance will not only relieve pressure on the
enforcement program, reduce non-compli-
ance, and achieve pollution reductions
quicker, but also provide credibility to the
environmental agency and government.
The agency and government will be viewed
as a more full-service authority that focus-
es on its mission and not just on performing
legal functions. The regulated community
will become more receptive to working with
the government and less to challenging
their authority and public reputation. This
will be especially true if the government's
compliance assurance program is viewed
as willing to first work with the regulated
community to achieve compliance and then
force compliance where cooperative sup-
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port has not resulted in a compliant behav-
ior change.
A final benefit relating to govern-
ment compliance incentives and assis-
tance programs is seen when part of the
regulated community is not responding to
these supportive government actions and
enforcement becomes the necessary
behavior change tool. Once enforcement is
undertaken there are many political and
emotional pressures that may be initiated
by the violating companies. Internal agency
decision-makers, political officials, and
even judicial officials will be faced with hard
decisions relating to social-economic con-
cerns and potentially relationships with the
business community. The argument for
enforcing the law, with the consequences
that will result to the individual company or
regulated sector, will become more under-
standable and accepted when it is under-
stood that other supportive efforts have
failed to motivate compliance. The agency
will not only be prepared to present its fac-
tual case that a violation exists but also its
political case that enforcement is now the
necessary tool. This is especially true when
the agency can lay out a supportive compli-
ance assurance timeline and show that
other competing companies in the regulat-
ed community have responded
2.2 What is the Role of Government
versus Other Stakeholders?
The prime function of the environ-
mental agency is not usually associated
with support of the regulated community.
The environmental agency interacts with
the industry in a more formal manner such
as developing standards, issuing permits,
monitoring for compliance, and ensuring
compliance through formal legal mecha-
nisms. The nature of these functions leads
to a more adversarial relationship then a
cooperative relationship.
Government resources are limited,
and most environmental agencies have
trouble with the workload required to meet
their statutory obligations. In many coun-
tries, time periods for completing these
statutory obligations are facing tight restric-
tions by the courts and/or politically driven
schedules. Hiring additional staff is usually
not an option. Committing to additional
functions relating to management of incen-
tive programs and providing compliance
assistance is a difficult choice.
The role of the government in this
area is also questioned by some. No other
body can develop standards, issue permits,
and carry the bulk of the enforcement
responsibilities, but other bodies can pro-
vide compliance assistance. Private con-
sulting services, trade organizations, gen-
eral commerce organizations, national,
regional and local non-governmental
organizations, and to some extent acade-
mia can and do provide compliance assis-
tance. These services can do a good job in
this area because their existence and prof-
it depends on them providing this service.
Free market systems have also shown that
good production practices go hand-in-hand
with good environmental management
which creates a built-in incentive. The ISO
14001 system reflects this relationship.
While governments can create
incentive programs that only they can cre-
ate, such as reduced compliance monitor-
ing for well-operating operations, reduced
permit processing time, or tax reductions
for environmentally beneficial process
changes or installation of control equip-
ment, governments do not have significant
technical advantage when it come to pro-
viding compliance assistance. While the
government may have an understanding of
control equipment and methodologies, it is
not their business to design and build envi-
ronmental control systems. The private
sector can also respond to the timing needs
of the regulated community since the pri-
vate sector has the ability to pay for highly
specialized individuals and can change
their workforce as the needs arise. They
also have established communication net-
works and, many times, a better under-
standing of the regulated communities'
needs. With the private sector, the regulat-
ed community also perceives the advan-
tage of being more in control and that the
information they share will not be used
against them. The advantage the govern-
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MASLANY, DROLET 51
ment has is in the understanding of the
requirement, any unique interpretation, and
implementation policies. The government
may also have a better understanding of
the compliance picture across the regulat-
ed community. The best compliance assis-
tance system should try to combine the
best attributes of both the private sector
and the government.
Why would the government want to
work with the private sector in the delivery
of compliance assistance? The prime rea-
sons are that the private sector services
have the established delivery systems, the
additional resources, and an understanding
of the unique characteristics of the different
regulated communities. For example, when
the US EPA adopted regulations for
drycleaners, they realized that approxi-
mately half of the drycleaners were owned
by Korean speaking families. These dry-
cleaning operators did not understand the
government requirements or environmental
management, and did not get information in
the same manner as other sectors previ-
ously regulated. The agency found that it
was advantageous to work with trade
organizations that were specifically estab-
lished for Korean drycleaners. Information
about the requirements were translated
into Korean and sent via their newsletters.
The trade organizations and the agency
were also able to hold workshops. The
agency, on its own, would not have been
able to reach this portion of the regulated
community.
Why would the private sector want
to cooperate with the government? Since
the private sector must deliver the best
product in order to profit and survive, being
able to deliver government information that
may not be as readily available can help
improve their services, and therefore, their
success. They also know that the regulated
community is more willing to discuss their
problems and issues with them because
they know that this information will not be
communicated to the government. This
communication shield enhances the worth
of their service.
Non-government organizations
can also be a mechanism for delivery of
compliance assistance information. They
differ from trade organizations or general
commerce organizations in that they gener-
ally provide information and services to
communities, not industrial sectors.
Another difference is that non-government
organizations are usually funded by contri-
butions and therefore do not bring signifi-
cant resources to the partnership. Their
strength is in the connection they have in
the community. It is usually necessary to
provide them with already published mate-
rial and more support than with business
organizations. In Canada, community
groups (including aboriginal communities)
are trained by the government to provide
compliance promotion and assistance on
behalf of the government. In some cases
these individuals are certified.
In general, the function of providing
compliance promotion and assistance can
be divided between the government and
other groups in the following manner:
—Government - Production of
authoritative documents relating to the
requirements, implementing policies,
and interpretation.
— Government or in partnership with
other groups- Delivery of information
and general technical support to the
regulated communities.
— Private Sector - Design and operations
of pollution control equipment or
methodology necessary to meet the
requirements.
2.3 What are the Different
Types of Programs that
Governments can Provide?
2.3.1 Compliance Assistance
—Virtual Compliance Assistance Centers -
With the growing use of the Internet, this
mechanism is becoming the most effi-
cient way to disseminate information
when the user wants it. One of the
advantages of this mechanism is that it
can provide practically endless amounts
of information in a matter that allows the
user to quickly get to the desired informa-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
tion. It also provides some degree of
anonymity to the user.
-Workshops or Formal Training - The
main advantage of workshops is that
they are interactive and the whole
audience can learn from the questions
of others. Sector specific workshops
allow the government to bring experts
to the discussions.
-Hotlines - Dedicated telephone
numbers that the regulated community
can call to get verbal assistance. If
operated by the government, the
service can usually only provide
general information or be used as a
referral service.
-Printed Material - Pamphlets and
other printed material can be developed
by the government or in partnership
with other groups. If material is
produced jointly with another group, the
government must ensure the accuracy
of information that others produce.
-Audit inspections or audit/compliance
inspections - Since inspectors visit a
significant number of facilities they
can gain an important knowledge of
how other facilities have solved their
compliance problems. While inspectors
can impart useful information to the
facilities operators, it is important that
they do not release any confidential
information. Inspectors can also provide
approved printed material.
-Skill Transfer Programs - Sometimes
compliance problems relate to operator
skill. The government can sponsor the
internship of new operators with more
experienced operators or experienced
operators can go to a problem facility to
train the operators. This type of program
works best with municipal services such
as sewage treatment or drinking water
systems where there is no financial
competitiveness.
-Training of Compliance Assistance
Providers - Formal training programs
offered to non-profit groups on
compliance assistance. The objective
of this type of program is to increase
the number of compliance assistance
providers to groups that can not afford
paid professional services.
2.3.2 Compliance Incentives (positive)
—Awards - Government awards with the
corresponding recognition can be used
to stimulate improved compliance in the
regulated community. Criteria for the
award should be established and made
available. If the award is for a specific
process within a facility, then general
compliance of the whole facility or
company is usually a factor in the
award also.
—Green Labels - Recognition given by
the Government for compliant (or
beyond compliance) operation of a
facility or the collection of facilities
owned by a company
—Tax Incentives - Formally adopted tax
laws that allow tax deductions for the
installation of pollution equipment or
process changes that reduce pollution
and lead to compliance.
— Low Cost Loans or Grants -
Government sponsored programs that
provide for low cost loans for the
installation of pollution control equipment
or grants for pollution control equipment.
Funding for these programs are either
out of the general revenue, or a special
tax relating to use of the environment or
penalties collected from non-compliant
facilities. Grants programs are usually
established for special needs sectors or
municipally owned operations.
—Legal Time Extensions for Compliance -
Programs established by either law
or policy that provide for formal time
extensions if the applicant meets
certain conditions.
2.3.3 Compliance Incentives (Negative)
—Public Disclosure of Non-compliance
Information - Public announcements
of non-compliant facilities though the
news media or printed material. This
program can be conducted either by
the government or non-government
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MASLANY, DROLET 53
organizations. Public disclosure of this
information can damage their reputation
in the community in which they operate,
or with customers they serve, and with
investors. In some business sectors
or communities this can be a strong
incentive to comply.
—Financial Disclosure of Environmental
Liabilities - In many countries,
publlicly owned companies must
provide financial information to their
stockholders. If potential environmental
liabilities (both cost of control equipment
and potential penalties) for non-
compliance are required to be presented
in these reports then greater market-
based forces will be brought to the
problem.
—Pollution Fees - In some countries
where environmental user fees are
established, the fees increase for
the pollution generated beyond the
compliance level.
2.4 What Issues are Associated with
Compliance Incentive and
Assistance Programs?
2.4.1 Fear of Communicating
Non-compliance to
Government Agents
The regulated community has an
understandable fear of discussing their
non-compliance situation when the govern-
ment did not have prior knowledge of their
violations. If they are considering investing
in pollution control technology but have not
yet made the corporate decision to do so,
they do not want to be placed in a situation
where their inquiries invite government
enforcement actions. If governments wish
to offer compliance assistance programs
then steps should be taken to isolate these
activities from other environmental agency
responsibilities. This can be accomplished
by separating compliance assistance pro-
grams from compliance monitoring/
enforcement programs within the organiza-
tion or in a different agency.
Another mechanism is to have the
compliance assistance programs operated
by a contracted service or in partnership
with trade organizations.
In most countries, environmental
laws prevent the government from provid-
ing assurances of no enforcement when
the government learns of a violation. For
that reason, it is desirable to ensure that
specific information relating to the identity
of the non-compliant facility or the exact
nature of a violation is not required to
receive compliance assistance. It is impor-
tant that the regulated community under-
stands that a compliance assistance pro-
gram is a program to help them comply vol-
untarily and a not a mechanism for the gov-
ernment to gain information for prosecution
of the law.
2.4.2 Reducing Costs to Government
for Implementation of
these Programs
In many situations, if the govern-
ment partners with another group, their
costs can be greatly reduced. This is espe-
cially true when the partner's mission is
also achieved by the partnership. For
example, trade organizations (either sector
based or pollution control based) were cre-
ated to provide a service to their clients. If
they can make it easier for their clients to
receive information pertaining to govern-
ment requirements that affect their busi-
ness and operation, then their value as an
organization is enhanced. Sometimes busi-
nesses that are selling a product to a cer-
tain community are willing to help distribute
government compliance assistance infor-
mation because they are providing a serv-
ice to their customers in hopes that they will
be viewed as a more valued company.
However, the government should ensure
that they do not create an unfair advantage
for one company over another.
Costs can be further reduced by
ensuring that only necessary services and
material are created. It is therefore impor-
tant that the government develops an
understanding of what the regulated com-
munity needs and minimizes the duplica-
tion of material or services that may already
exist. This can be accomplished by con-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
ducting periodic dialogues with representa-
tives of the regulated community and other
compliance assistance providers.
2.4.3 Reliance on Government
Advice and Determining
the Degree of Advice Provided
Environmental laws require that
the owners and operators of facilities in the
regulated communities comply with the
requirements. It is their responsibility to
ensure that the control equipment installed
or methodology used will produce compli-
ance. It is the government's role to ensure
that they meet this obligation. If the govern-
ment provides assistance that goes into the
detailed design of control equipment and
the regulated entity does exactly what was
suggested but does not achieve compli-
ance, then it will be used as a defense
against any action by the government to
ensure full compliance with the require-
ments. This defense will be seen either in
the courts or the political system of govern-
ment operations.
Achieving compliance at an indus-
trial facility requires an evaluation of the
range of operating parameters, establish-
ing maintenance and operating conditions,
training of personnel, and other factors that
are unique to the specific facility. This usu-
ally requires the assistance of an engineer-
ing firm with extensive experience in this
discipline. The private sector can best pro-
vide this time-consuming service. The gov-
ernment's assistance should be geared
towards providing a full understanding of
the requirements, explaining the types of
control options that have been successful,
and pointing them to other services provid-
ed by the non-government sector.
For smaller simpler operations,
especially where the regulated community
does not have sufficient financial resources
and their operations are more marginal, the
decision on how much technical assistance
is given is more difficult. However, these
decisions should be decided up front in the
design of the compliance assistance pro-
gram. The debate on these issues should
include such factors as complexity of the
polluting process and control options, the
sophistication of the facility operators, gen-
eral financial resources of the sector, if
there are trade organizations for this sector,
other technical resources available to them,
and of course the level of confidence that
advice provided will ensure compliance.
Regardless of the extent of the
advice provided, it is useful for the govern-
ment to provide a caveat that it is the
responsibility of the owner/operator to
ensure compliance.
2.4.4 Tailoring Programs to the
Uniqueness of each
Regulated Sector
Each regulated sector has its own
characteristics that govern how they oper-
ate, communicate with each other, receive
information, and relate to the government.
The support needs and delivery system for
each regulated sector will vary. Some sec-
tors may have active trade organizations or
professional societies and a well estab-
lished sophisticated communication system
of Internet, professional seminar, and col-
lective research efforts. These sectors may
have already established communication
networks with the government. Other sec-
tors may not interact formally with each
other or have the resources to fund support
organizations. They may be less trusting of
interacting with the government. It is neces-
sary for the government to develop an
understanding of the sector as they design
a compliance incentive or assistance pro-
gram.
3 CONCLUSION
A major role of the government in
implementing environmental laws is to
ensure compliance with established
requirements that are designed to protect
the environment and human health. This
requires changing the behavior of the regu-
lated communities. Changing behavior is a
complex process that requires understand-
ing the reasons why a non-compliant
behavior exists and addressing those barri-
ers. While some in the regulated communi-
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MASLANY, DROLET 55
ty will always need to be forced to change ers contributing to their reason for not com-
their behavior, many will respond voluntari- plying. Compliance promotion, assistance,
ly to the potential threat of enforcement if and incentive programs can be an effective
the government can also reduce the barri- way to reduce the numbers of barriers.
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56 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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VAN SLIJPE 57
ENFORCEMENT ASSISTANCE PROGRAM FOR
FIREWORK STORAGE SITES
VAN SLIJPE, ROB
Inspectorate of Housing, Spatial Planning and the Environment, North-Western Region
P.O. Box 1006, 2001 BA Haarlem, The Netherlands, rob.vanslijpe@minvrom.nl
SUMMARY
The Inspectorate of the Netherlands Ministry of Housing, Spatial Planning and the
Environment (VROM) has given high priority to the supervision of firework storage sites
because of the great safety risks associated with storing fireworks. In 2004, the Inspec-
torate launched a major nationwide project focused on the safe storage of fireworks, begin-
ning with companies that revealed poor compliance with the Fireworks Decree. The Inspec-
torate subsequently started a joint enforcement assistance program with the other law
enforcement agencies (provincial authorities, municipal authorities and the Public Prosecu-
tion Service) to ensure the safe storage of fireworks. The inspections data is still being
processed, but there is already an expectation that the outcome will not be positive either
in terms of compliance with the law by firework companies or in terms of enforcement of
the law by provincial and municipal authorities.
1 INTRODUCTION
A major firework explosion
occurred in the Dutch city of Enschede in
2000 caused by the unsafe storage of fire-
works. There were numerous casualties
and considerable damage to property. This
disaster led to more stringent regulations
for fireworks and greater attention to the
enforcement of regulations.
The tighter regulations for fireworks
were incorporated into the new Fireworks
Decree of March 2002. The Minister of
Housing, Spatial Planning and the Environ-
ment holds political responsibility for imple-
menting the Fireworks Decree. The Inspec-
torate is part of the Ministry and has two
types of duties:
1. Enforcement of numerous regulations
embodied in the legislation for which
the Ministry is responsible, notably
in respect of waste and hazardous
substances. The Inspectorate acts
as the enforcement agency when
companies breach the law.
2. Supervision of the implementation and
enforcement of those laws by provincial
and municipal authorities. The 12
provincial authorities and approximately
450 municipal authorities in the
Netherlands are responsible for
enforcing the conditions attached to the
environmental licences issued to almost
all companies. They also enforce the
regulations contained in the Fireworks
Decree for firework storage sites. The
provincial and municipal authorities
are required to ensure rectification
of breaches of the regulations. The
Inspectorate examines whether
provincial and municipal authorities
perform their enforcement duties
properly. This is called "second-line
supervision."
The Inspectorate has given high
priority to the supervision of firework stor-
age sites because of the great safety risks
associated with storing fireworks. In 2004,
the Inspectorate launched a major nation-
wide project focused on the safe storage of
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
fireworks. The project focuses on the sec-
ond task mentioned above, namely super-
vision of provincial and municipal authori-
ties. This paper deals with the following
subjects:
—structure of the project: objectives and
activities;
—poor compliance with regulations:
absence of automatic fire extinguishing
systems in many cases;
—enforcement assistance program;
— results of enforcement assistance
program.
2 STRUCTURE OF THE PROJECT:
OBJECTIVES AND ACTIVITIES
The objectives of the Inspec-
torate's project are to:
1. Check the enforcement of legislation
covering firework storage sites by
provincial and municipal authorities. Are
the provincial and municipal authorities
taking proper action against companies
that breach the law?
2. Assist enforcement by provincial and
municipal authorities. The ultimate goal
is for firework companies to comply
with the regulations and store fireworks
safely.
3. Provide a national picture of compliance
with laws for firework storage sites.
The most important activities being
undertaken as part of the project to achieve
these objectives are:
1. conducting inspections at firework
storage sites;
2. examining enforcement dossiers at
provincial and municipal authorities;
3. informing provincial and municipal
authorities of the results of these
inspections and examinations.
When the Inspectorate observes
breaches of the law at firework storage
sites, it requests the provincial and munici-
pal authorities to take enforcement action.
The project is linked to the expira-
tion of the transitional periods defined in the
Fireworks Decree. The Fireworks Decree
came into effect on 1 March 2002. Large
firework storage sites (i.e. sites where
more than 10,000 kg is stored) were given
two years from that date to meet the more
stringent requirements embodied in the
Fireworks Decree, i.e. by 1 March 2004.
Smaller storage sites (i.e. those with not
more than 10,000 kg) were given six
months longer (until 1 November 2004).
The project was launched mid-
2004 and will be completed mid-2005. All
the major storage sites - about 50 com-
panies in all - are being inspected first.
The provincial authorities are responsible
for enforcing the law at these companies.
Subsequently, approximately 50 randomly
selected small storage sites will be inspect-
ed. In total there are almost 2000 small
storage sites. The random sample thus
represents 2.5% of small storage sites. The
municipal authorities are responsible for
enforcing the law at these companies.
The inspections focus on the most
important safety regulations, namely:
— Fire safety regulations: the most
important requirement is that firework
storage sites must possess an
automatic fire extinguishing system
("sprinkler system").
— Electrical safety regulations: the
electrical system must have safety
features that prevent sparking.
—Safe distances: there must be a
sufficient distance between the firework
storage site and vulnerable properties
like residential dwellings.
3 POOR COMPLIANCE WITH
REGULATIONS: ABSENCE OF
AUTOMATIC FIRE EXTINGUISHING
SYSTEMS IN MANY CASES
At the start of the project, the
Inspectorate had reasonably positive
expectations about enforcement and com-
pliance with the Fireworks Decree. The
reasons for these positive expectations
were:
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VAN SLIJPE 59
—the Fireworks Decree generally contains
clear regulations;
—the fireworks industry appeared to be
well aware of the regulations;
—the Fireworks Decree allows fairly
ample transitional periods for meeting
the more stringent requirements;
—companies unable to meet the more
stringent requirements were able to end
their business with compensation from
the Ministry;
—attention to enforcement had increased
sharply following the Enschede firework
disaster;
—the Ministry, provincial authorities,
municipal authorities and the Public
Prosecution Service had agreed
clearly-defined arrangements for
enforcing the Fireworks Decree.
Despite these expectations, the
first round of inspections at large firework
storage sites revealed poor compliance
with the Fireworks Decree. A majority of
companies did not possess an automatic
fire extinguishing system.
The fireworks industry association
asked the State Secretary for Housing,
Spatial Planning and the Environment to
allow fireworks companies more time to
install an automatic fire extinguishing sys-
tem. The State Secretary rejected the
request for postponement. He pointed out
that force majeure could exist only in indi-
vidual cases, i.e. where companies had
done everything reasonably possible to
have an automatic fire extinguishing sys-
tem in place on time, but had been unable
to do so due to circumstances beyond their
control.
The Inspectorate wanted to avoid a
situation where firework storage sites keep
fireworks on premises not equipped with an
automatic sprinkler system. Given the safe-
ty risks involved, this would be an irrespon-
sible situation. A salient point is that most of
the small storage sites sell fireworks to
members of the public at the end of the
year. People in the Netherlands let off a lot
of fireworks at midnight on New Year's Eve.
Without an automatic fire extinguishing
system, members of the public would be
insufficiently protected during the sales
period against potential fires on premises.
Another consideration was obviously the
risk posed to the surroundings. Many small
firework storage sites are located in ordi-
nary shopping streets, in some cases in
between residential dwellings.
The Inspectorate's project was
designed to inspect only 2% of small stor-
age sites. It was uncertain what municipal
and provincial authorities would do in the
way of enforcement with regard to the other
98%. Would all of those companies be
inspected? Would proper enforcement
action be taken against breaches of the
law? Given this situation, the Inspectorate
launched an enforcement assistance cam-
paign additional to its own project.
4 ENFORCEMENT ASSISTANCE
PROGRAM
To set up an enforcement assis-
tance program, the Inspectorate convened
a meeting of all law enforcement agencies
involved: provincial authorities, municipal
authorities and the Public Prosecution Ser-
vice. Provincial and municipal authorities
are responsible for enforcing regulations
under administrative law at firework stor-
age sites. The Public Prosecution Service
(through the police) is responsible for
enforcement under criminal law. Through
this joint action, the Inspectorate wanted to:
—work out a joint enforcement approach
with the aim of enforcing laws and
regulations uniformly and effectively at
all firework storage sites;
— maximise the number of inspections
by provincial authorities, municipal
authorities and the police;
—facilitate enforcement by adopting
standard enforcement methods;
—maximise the deterrent effect towards
the fireworks industry by giving a lot of
publicity to the enforcement assistance
program.
The ultimate goal was naturally to
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
ensure the safe storage of fireworks. The
State Secretary for Housing, Spatial Plan-
ning and the Environment mounted a pub-
licity offensive at the start of the enforce-
ment assistance program. He sent out the
following message in powerful terms on tel-
evision and in newspapers: "Without an
automatic fire extinguishing system there
will be no storage of fireworks; this require-
ment will be strictly enforced."
This gave the fireworks companies
the choice of as yet installing an automatic
sprinkler system or ceasing to store or sell
fireworks. The Inspector General of the
Inspectorate subsequently sent a letter to
municipal and provincial authorities con-
veying the same message and urging them
to enforce regulations properly. The organ-
isations that represent the provincial and
municipal authorities supported these calls
in letters sent to their members. The Public
Prosecution Service instructed public pros-
ecutors about the action required under
criminal law.
All information about the enforce-
ment assistance program was published on
a special website. This enabled rapid com-
munication on new developments. A
helpdesk was set up to answer practical
questions from law enforcers. One of the
standard enforcement methods was a
framework for examining recourse to force
majeure. The Inspectorate designed this
instrument in close consultation with the
enforcement partners. The framework
made it possible for law enforcement agen-
cies to easily determine whether force
majeure existed. It also enabled a uniform
examination of this question.
The aforementioned instruments,
intended mainly to facilitate enforcement,
are best described as enforcement assis-
tance. "Compliance assistance" is about
making it easier for companies to comply
with the law. "Enforcement assistance" is
about making it easier for law enforcement
agencies to enforce the law.
The enforcement program devoted
special attention to the fireworks industry
using several influencing techniques:
—Deterrence: The industry received a
letter making it clear that fireworks
traders who supplied fireworks to
fireworks companies without an
automatic fire extinguishing system
would be committing a criminal offence.
—Consultation: Regular consultations
were held to provide information and
respond to developments in the
industry.
— Publicity: The fireworks industry tried to
emphasise through the media that the
industry was not to blame for insufficient
compliance with the law. The industry
pointed to circumstances that included
an alleged shortage of companies to
install automatic fire extinguishing
systems. The Inspectorate always
responded alertly by seeking publicity
itself and properly informing the law
enforcement partners.
5 INITIAL IMPRESSION OF THE
RESULTS OF THE ENFORCEMENT
ASSISTANCE PROGRAM
The Inspectorate's project for fire-
works storage sites has not yet been com-
pleted. At present (February 2005), the
data from the inspections is still being
processed. However, the expectation is
that neither compliance nor enforcement
will produce a positive picture.
The enforcement assistance pro-
gram will be evaluated separately. The first
impression looks positive, however. The
deterrent effect appears to have been con-
siderable. The publicity given to the pro-
gram left the fireworks companies in no
doubt about the great likelihood of being
caught and of the possible penalties. A
large proportion of the companies quickly
had an automatic sprinkler system
installed. This is evident from an increase
in the number of orders received by the
installation companies. There was such an
increase in demand for the systems that a
shortage of parts occurred, but this prob-
lem confronted only those companies that
were already far too late in ordering the
installation of a system.
There would appear to be few
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VAN SLIJPE 61
cases where enforcement resulted in fire-
works being removed from storage sites
that did not have automatic fire extinguish-
ing systems. To a large extent this seems to
be due to the circumstance that the
enforcement program had greatly reduced
the group of companies without such a sys-
tem. However, it is also possible that
provincial and municipal authorities did not
consider it necessary to order the removal
of the fireworks in the short term after
weighing up safety risks and business
interests in individual cases. The analysis
of the inspection results from the project
and the evaluation of the enforcement
assistance program will help clarify
whether this is the case.
The cooperation between the law
enforcement partners can be considered
another positive outcome of the program.
This collaboration yielded considerable
knowledge and experience of effective and
efficient enforcement of the law at firework
storage sites. Provincial and municipal
authorities can take advantage of this
knowledge and experience when conduct-
ing their regular inspections at firework
storage sites in 2005.
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62 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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LAUTERBACK, CLARK 63
INTERPOL'S ECOMESSAGE
LAUTERBACK, ANDREW E1 AND CLARK, WILLIAM2
1 Chief, International Criminal Enforcement Policy Section, Office of Criminal
Enforcement, Forensics and Training, US EPA and Chairman, Interpol Environmental
Crimes Committee; US Environmental Protection Agency, One Congress Street,
Boston MA02114.USA, lauterback.andrew@epa.gov
2 CITES Coordinator, Nature and National Parks Protection Authority, Department of Law
Enforcement, Israel (and Senior Advisor, International Fund for Animal Welfare); 3
Rehov Am Veolamo.Givat Shaul,Jerusalem 95463, Israel, clarkb@netvision.net.il.
SUMMARY
Interpol developed a database called the Ecomessage in order to coordinate inter-
national efforts to combat environmental crime. In addition to improving communication
among environmental law enforcement personnel in different countries, the Ecomessage
database allows for criminal analyses to determine trends and commonalities of criminal
activity. It can also assist in environmental enforcement targeting. This paper discusses the
objectives and mechanism of the Ecomessage.
1 INTRODUCTION
1.1 The Objectives of the Ecomessage
There is general agreement that
environmental crime is one of the most
profitable and fastest growing areas of
international criminal activity. According to
the International Crime Threat Assessment,
a report prepared by an interagency US
government task force, environmental
crime syndicates worldwide garner
between $22-31 billion US. These crimes
range from hazardous waste dumping,
smuggling proscribed hazardous materials,
to exploiting and trafficking protected natu-
ral resources. Criminal networks and syndi-
cates, motivated by high profits and low
risks, have established an international
industry that:
—Endangers the health and welfare of our
communities and future generations.
—Compromises the natural heritage and
ecological integrity of the planet.
— Unfairly disadvantages those
businesses complying with
environmental laws, and
— Flouts environmental law as well as
many other laws.
It is important to keep in mind that
environmental crime can be both localized,
but also transnational. For example, an
incident of illegal dumping of hazardous
waste or illegal trafficking of protected
wildlife, obviously concerns the location
where the event occurred. Nevertheless,
generators, transporters, agents, princi-
pals, and witnesses can be far from the
scene, and frequently reside beyond
national borders. In those cases, environ-
mental crime is effectively countered only
by good international cooperation.
Interpol, the International Criminal
Police Organization (ICPO) has been mak-
ing efforts to suppress environmental crime
since 1976. As part of this effort, Interpol in
1994 set up an Environmental Crimes
Committee, which is comprised of a Work-
ing Group on Wildlife Crime, and a Working
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
Group on Pollution Crime.
More than a quarter-century of
experience has persuaded Interpol that the
timely exchange of pertinent information is
crucial to any campaigns that target inter-
national environmental crime. Interpol has
also learned, however, that information
exchange between various countries can
suffer disruptive complications because:
— Required information often must be
collected from widely scattered sources.
—Countries do not have uniform reporting
methods.
—There had been no international
repository for the collection, storage,
analysis and circulation of information
useful in efforts against environmental
crime.
— Investigators in one country often did
not know which law enforcement
agency or agencies were their
appropriate contacts in other countries.
Interpol acted to resolve these
shortcomings by creating the Ecomessage.
With the Ecomessage, Interpol created a
reporting system and database that covers
all major environmental crime, including:
— Illegal transboundary movements and
illegal dumping of wastes and other
hazardous materials.
— Illegal transboundary activities involving
radioactive substances.
— Illegal trafficing of wild flora and fauna
species.
2 ECOMESSAGE: WHAT IT IS
AND HOW IT FUNCTIONS
Interpol's General Secretariat in
Lyon, France, serves as a central collection
point for information on international envi-
ronmental crime. Interpol has developed
the Ecomessage as a reporting system that
systematically accepts environmental
crime data and enters it into a computer-
ized data collection facility at the General
Secretariat.
The Ecomessage system uses a
simple form to transmit details of a particu-
lar crime to the Interpol. The Ecomessage
form is carefully designed. When Interpol
receives environmental crime reports via
the Ecomessage, the standardized design
of the communication permits:
—Speedy and methodical entry of the
report's details in a format that is
compatible with the Interpol database.
— Efficient cross-referencing of the
data against other entries in the
computerized database.
—Organized and meaningful extraction
of that data in a way that facilitates
applications such as criminal
intelligence analysis.
—An Ecomessage report must be
transmitted to Interpol via a
standardized procedure and routing.
This systematic approach helps
to assure the validity of the data
transmitted, and in turn, provides for
more dependable results when that
information is used.
Many governmental law enforce-
ment agencies may be involved in enforce-
ment of environmental laws. The environ-
ment ministry or agency may have various
enforcement authorities. Customs is often
the agency that intercepts and seizes con-
traband consignments of waste shipments,
endangered fauna or flora, or banned sub-
stances. Water police and coast guard
authorities can be involved if the case con-
cerns pollution on surface waters. National
and local police departments are often
involved in environmental law enforcement,
as are Attorneys General, and other gov-
ernmental agencies.
Any of these agencies may gather
the information required for an Ecomes-
sage report. When the information is gath-
ered, however, it should be brought to the
Interpol National Central Bureau (NCB) of
the reporting country. This is usually found
in the international relations department of
the national police. It is their responsibility
to transmit the details of an Ecomessage to
the Interpol General Secretariat. This
responsibility is outlined in Interpol circular
letter reference 38/DII/SD2/E/INT/WG/2/
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LAUTERBACK, CLARK 65
ENV/94 of 9th June 1994, which should be
on file in every Interpol National Central
Bureau worldwide.
When the Interpol General Secre-
tariat receives an Ecomessage, the infor-
mation contained is entered into Interpol's
computerized database. There are several
important benefits that are generated by
this process:
—The information is immediately
screened against all other information in
the Interpol computer. This can produce
important feedback. For example, if
Country X reports the arrest of Mr. A on
charges of illegally transporting waste,
the processing of the Ecomessage may
produce information that Mr. A is also
wanted by Country Y for a similar
offense, or that he has already been
convicted in Country Z for a related
offense. Information on concurrent
warrants for arrest, or prior convictions,
is of great interest and importance to
prosecuting attorneys.
—The Ecomessage form also has
provision for the reporting country to ask
questions, and provides a mechanism
for international cooperation. For
example, imagine a wildlife dealer
has shipped an illegal consignment of
protected parrots into Country X from
country Y. Using the questioning
possibilities of Ecomessage,
investigators in Country X can ask
for information about the wildlife dealer
in Country Y, or the carrier involved.
It can also ask anything else where
international information exchange will
help the case along.
—Data collected in Interpol's computers
can be accessed by professional
analysts of the Interpol Analytical
Criminal Intelligence Unit. When there
is adequate reliable data available, very
useful analyses can be conducted to
reveal the criminals involved, as well as
the size, structure and dynamics of
criminal enterprise or network involved.
Although Interpol has been using
the Ecomessage for a number of years, the
database is still too small to produce a truly
global analysis of the criminality associated
with international environmental crime.
More data must be put into the system - via
Ecomessage reports. Once statistically sig-
nificant masses of data are acquired, they
can be analyzed and used to construct a
world-wide picture of the illegal internation-
al environmental crime.
3 APPLICATIONS OF THE
ECOMESSAGE
Interpol's Wildlife Crimes Group
has used the Ecomessage data in two ana-
lytical projects in recent years. One project
focused on illegal trafficking in reptiles, and
the other on trade in live primates. Both
were conducted in cooperation with Inter-
pol's highly professional Analytical Criminal
Intelligence Unit, and produced important
overviews of criminal syndicates engaged
in illegal wildlife trade. Link analyses identi-
fied individuals, and their relationships to
each other within a loose federation of a
crime network. Hypotheses were tested,
conclusions were reached and recommen-
dations were made. Acting on these recom-
mendations, law enforcement authorities
targeted individuals and syndicates identi-
fied in the study. This resulted in several
syndicates being terminated and several
individuals arrested and prosecuted. The
most noteworthy prosecution was that of
illegal reptile dealer Anson Wong, who was
apprehended on an Interpol Red Notice in
Mexico City, and subsequently extradited
to the United States, where he pleaded
guilty to 40 felony counts of violations of
wildlife laws. He was sentenced to serve 71
months in a U.S. prison.
4 CURRENT EFFORTS INVOLVING
THE ECOMESSAGE
Interpol's Pollution Crimes Working
Group in conjunction with INECE sent out
an electronic mailing to environmental
enforcement managers throughout the
world recently informing them of the
Ecomessage. Similarly, Interpol's Wildlife
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66 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
Crimes Working Group in partnership with Bureaus. Only through cooperative efforts
the International Fund for Animal Welfare, of law enforcement, ministry environmental
sent out a mailing to wildlife enforcement enforcement officers, prosecutors and
officers around the world also encouraging NGOs do we have a chance to succeed in
them to prepare Ecomessages and forward our fight against environmental crime.
them to Interpol's National Central
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PADDOCK 67
STRATEGIES AND DESIGN PRINCIPLES
FOR COMPLIANCE AND ENFORCEMENT
PADDOCK, LEROY
Director of Environmental Law Programs, Pace University School of Law, 78 North
Broadway, Preston 214, White Plains, New York 10603, United States,
paddock@law.pace.edu
SUMMARY
Compliance and enforcement practices should not remain static. Rather they must
evolve to account for the changing nature of environmental problems, the number of organ-
izations and individuals subject to regulations, the complexity of the regulations, the avail-
ability of human and financial resources, the level of public concern about environmental
issues and of support for enforcement, and changes in other societal and economic factors
affecting enforcement. This article explores the evolution of compliance and enforcement
strategies and design principles, primarily in the United States context, in light of these fac-
tors. It points out the increasing use of strategic planning to ensure that limited enforcement
and compliance resources are deployed to address priority problems. This article also
notes the importance of looking beyond the traditional enforcement and compliance tools
to build an effective compliance program. It suggests that strategies for compliance should
incorporate the important roles that economics and values can play in holding regulated
entities accountable for their environmental behavior.
1 INTRODUCTION
Compliance and enforcement
activities are essential to effective imple-
mentation of environmental legislation.
Despite, or perhaps because of, the
decades of experience government agen-
cies have had in designing and deploying a
wide range of compliance and enforcement
techniques, there exists no unified theory of
environmental compliance and enforce-
ment. Instead, a variety of theories and pro-
gram design principles have emerged, per-
haps because compliance and enforce-
ment approaches must reflect unique cir-
cumstances in each particular program and
in each cultural setting. Several of these
strategies and design principles are dis-
cussed in this article. It is important to note
that these approaches are not mutually
exclusive. Government officials may rely on
a combination of several of these theories
in managing compliance and enforcement
programs.
2 THE COMPLETE COVERAGE MODEL
Early enforcement efforts in the
United States followed what might be
called a "complete coverage model."
Michael Stahl, a senior EPA official, notes:
The traditional strategy of regulated
compliance programs has been to
create and maintain a presence in the
regulated universe, which could identify
and correct violations and deter others
from violating the laws and regulations.
This strategy viewed complete
coverage of the regulated universe
and uniform enforcement of the law as
overarching goals.
This model places emphasis on
identifying all of the facilities subject to a
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
particular regulation, regularly inspecting
those facilities, and initiating enforcement
actions for all of the identified violations.
The complete coverage model
deters poor environmental conduct - both
specifically for the particular violator and
generally in the wider regulated community
- by increasing the likelihood that violations
will be detected and punished. The model
works best in situations where the number
of regulated entities is relatively small and
where government inspection and enforce-
ment resources are relatively high.
3 A FOCUS ON COMPLIANCE
ASSISTANCE
As the number and type of regulat-
ed entities expand, particularly when small-
er facilities make up a significant percent-
age of the regulated universe, the complete
coverage enforcement model breaks down
because of the enforcement resources
needed to inspect facilities and to initiate
enforcement actions. Further, enforcement
against small facilities, especially soon
after a new regulation is adopted, can be
quite controversial, with many arguing that
operators of small facilities do not have the
time or staff resources to understand what
needs to be done to comply with the law.
And because compliance is the principal
goal for government officials, if that goal
can be achieved more efficiently or more
effectively through assistance, then compli-
ance assistance becomes a preferable
strategy.
Compliance assistance programs
in the environmental field have both practi-
cal and philosophical facets. From a practi-
cal perspective, small facilities do not have
employees who can spend significant time
understanding environmental laws and
adjusting business practices to comply with
the laws. As a result, government agencies
may assist facility operators by providing
training or engineering expertise to help the
operators meet environmental require-
ments.
From a philosophical perspective,
some environmental agencies have adopt-
ed a "customer service" orientation under
which the agency sees its first obligation as
assisting its "customers" - the regulated
entities - comply with the law. Agencies
with a customer service orientation may
reserve "hard" enforcement - penalty
assessment - for circumstances where the
regulated entity has had access to compli-
ance assistance but persists in violating the
law. This orientation essentially adds a fault
element to environmental violations since
violators will have had knowledge of the
requirements and the opportunity to comply
but nevertheless failed to comply. Measur-
ing the effectiveness of enforcement and
compliance programs is a critical factor in
understanding whether the programs are
effective. Historically, compliance assis-
tance programs have not been rigorously
evaluated for effectiveness. Instead, the
measure often relied upon by government
agencies is the number of "compliance
contacts" with the regulated community.
This measure does not provide much infor-
mation about how effective the programs
are in changing behavior.
4 TARGETING ENFORCEMENT
RESOURCES
One consequence of the rapid
expansion of the number of regulated facil-
ities and limited enforcement resources is
the need to "target" at least "hard" enforce-
ment to the highest priority situations. Facil-
ities may be targeted for enforcement
based on a variety of factors but three of
the most common targeting factors are:
(1) the amount and kind of emissions from
a particular industry or industry sector;
(2) the level of risk presented by those
emissions;
(3) the history of compliance by
the industry or the sector. Effective
targeting relies on the ability of
government officials to obtain a wide
range of sound data on the polluting
activities of regulated facilities and the
ability to analyze the data in a way that
identifies high priority violators.
Targeting allows limited enforce-
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PADDOCK 69
ment resources to be focused on the high-
est risk, highest return problems. If an
industry sector is targeted, the targeting
effort is likely to increase deterrence in that
sector. However, targeting means that
fewer resources will be directed to enforce-
ment in other areas. This fact requires a
thoughtful analysis about what non-
enforcement strategies may be available to
maintain or improve compliance in the non-
targeted sectors.
5 COMPLIANCE MANAGEMENT
SYSTEMS
The expanded use of compliance
assistance and targeting introduces signifi-
cant complexities into the enforcement
planning process. In response, some gov-
ernmental agencies have developed "Com-
pliance Management Systems" or "CMS"
that take into account a wide variety of
information and factors in order to more
strategically deploy government compli-
ance and enforcement resources. These
systems may, for example, employ compli-
ance assistance techniques for a discrete
period of time after a regulation is adopted
to educate regulated entities about the
requirements of new regulations, to provide
information on compliance technologies, or
to deploy direct engineering assistance to
help small businesses change their produc-
tion technology. The CMS may then target
enforcement to the same sector after an ini-
tial compliance assistance focus to rein-
force the idea that companies that do not
change their conduct as a result of the
assistance programs will be subject to
enforcement. These combined assis-
tance/enforcement strategies may have the
secondary benefit of increasing support for
enforcement by showing that the govern-
ment has given the regulated entities a fair
chance to comply before enforcement
occurs.
A CMS may also be used to map
out a larger set of compliance and enforce-
ment measures beyond a single sector.
The CMS might lay out the overall
approach the agency will take towards
compliance assistance, when it will resort
to hard enforcement, how it will target that
enforcement, what mechanisms it will use
to promote compliance in non-targeted
sectors, and how it will evaluate success of
its compliance programs and adjust the
programs based on this evaluation.
The CMS concept is reflected in
EPA's concept of "smart enforcement." The
smart enforcement approach is comprised
of five components that, in combination,
are designed to produce a "strategic and
focused" enforcement program. The com-
ponents are:
1. Addressing significant environmental
problems.
2. Using data to help make strategic
decisions for better resource utilization.
3. Using the most appropriate tool to
achieve the best possible outcome.
4. Assessing the effectiveness of program
activities to ensure continuous
improvement and desired program
performance.
5. Effectively communicating to the
public and other regulated entities
the environmental, public health and
compliance outcomes of activities to
enhance program effectiveness.
6 PENALTY POLICIES
Approaches to penalty assessment
also vary significantly. In some systems,
penalties may only be assessed after
repeated notices of violations and efforts to
achieve compliance by "jawboning," that is,
urging the facility to comply through such
means as issuing warning letters. In other
systems, laws may require that an operator
be notified of a violation and given an
opportunity to correct the violation before a
penalty can be imposed. And in yet other
systems, penalties are imposed without
any advance notice.
Several factors typically are used
in calculating penalties including:
—history of non-compliance.
—the nature of the emissions.
—the level of cooperation.
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
—actual harm to public health or the
environment;
—the type of violation involved.
In some systems, government
agencies attempt to separately calculate
the economic savings to the regulated enti-
ty that occurred as a result of not comply-
ing with the law and then recapture that
"economic benefit" as part of the penalty. In
these systems, there are typically two
penalty elements: the economic benefit
element designed to recapture any of the
economic benefit gained as a result of non-
compliance and the "gravity" element
designed to punish the illegal behavior and
deter future violations by the facility or by
other similarly situated facilities.
Some government agencies will
reduce penalties in recognition of conduct
seen as environmentally beneficial. For
example, penalty policies may encourage
facilities to adopt environmental manage-
ment systems (such as ISO 14001) or con-
duct environmental audits by reducing or
even eliminating penalties if a facility peri-
odically audits its compliance, promptly
reports any identified violations, and cor-
rects any violations found through the
audit. Penalties may also be reduced if a
facility agrees to undertake projects that
benefit the environment as part of an
enforcement settlement. In the United
States, these environmentally beneficial
activities are known as "Supplementary
Environmental Projects". Typically, these
projects must not include work required by
law to remedy the violation. They often
involve projects that provide amenities to
communities like restored wetlands, new
parks, or health screening programs.
7 EMPHASIS ON
BEHAVIORAL DRIVERS
Most of the discussion above has
focused on how the regulatory system,
through enforcement and compliance
assistance programs, can change undesir-
able behavior. There are, however, two
other key drivers of environmental behavior
- economics and values. Government offi-
cials tend to be less comfortable relying on
these drivers since the government has
less control of the environmental outcome
produced by economic factors or by individ-
ual or organizational values. Still, econom-
ics and values appear to have an increas-
ing influence on the environmental behav-
ior of individuals and organizations. As a
result, if government officials are to get the
most out of the limited resources they can
direct towards compliance, they must
understand and take advantage, in a
strategic way, of these non-regulatory
behavioral drivers. For example, informa-
tion about the impacts of noncompliance
may encourage facility operators who care
about the environment to comply with the
law. Similarly, consistent efforts to inform
the public about the importance of a sound
environment may create a societal compli-
ance ethic and condition the citizenry to
demand better compliance. The informa-
tion may alter the values of those who may
control or influence the polluting activity.
Economics can also drive compli-
ance in a wide variety of ways. Data about
cost savings associated with pollution pre-
vention, waste minimization or emissions
reductions can stimulate better compliance
or even result in actions that go beyond
compliance. Well-designed trading sys-
tems can encourage compliance by allow-
ing companies to make or save money by
improving their environmental perform-
ance. The acid rain training program in the
United States has functioned for several
years with almost no enforcement actions
through a combination of a well-designed
trading system that includes information
from continuous emissions monitors, and
mandatory penalties that far exceed the
cost of acquiring emissions credits on the
open market. Liability standards can sub-
stantially increase the cost of poor environ-
mental management, creating a strong
economic incentive to comply. Companies
with a high public profile may find it impor-
tant as a matter of reputation to maintain a
very good record of compliance. Compa-
nies may also find that environmental com-
pliance, or even activities that go beyond
compliance, are important to assure that
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PADDOCK 71
they will have access to markets in coun-
tries where customers or regulators place a
high value on a company's environmental
record. The environmental conduct of com-
panies is increasingly affected by concerns
from their insurers about environmental lia-
bility, by scrutiny from investors including
socially directed investment funds and by
"green" procurement standards.
8 COMPLIANCE INCENTIVES
Government can provide incen-
tives including penalty reduction, public
recognition and regulatory relief to encour-
age compliance or beyond compliance
behavior. Governments have used a wide
variety of recognition programs to encour-
age emissions reduction and compliance.
An early example in the United States was
a program known as "33/50" that chal-
lenged companies to reduce emissions of
33 high priority chemicals by 50 percent
over a period of a few years. More recent-
ly, the EPA's "Performance Track" program
provides both recognition and some regula-
tory relief if a facility adopts an environmen-
tal management system consistent with
ISO 14001, increases the information it
makes available to the public and estab-
lishes clear emissions reduction goals that
go beyond mere compliance.
9 CITIZEN ENFORCEMENT
In some legal systems, citizens are
authorized to initiate enforcement actions.
Under most of the major environmental
laws in the United States, for instance, citi-
zens are authorized to initiate enforcement
actions against regulated entities who have
violated the law, after providing the regulat-
ed entity and the government with advance
notice of their intent to sue - a so-called
"60-day notice." The 60-day notice allows
the regulated entity time to come into com-
pliance if it agrees that there is a violation.
It also allows the government agencies the
opportunity to initiate an enforcement
action if the agency believes enforcement
is appropriate. If the violation is not correct-
ed and the government does not com-
mence "diligent enforcement," the citizens
may proceed with the lawsuit, ask the court
to order that the violations be corrected and
that penalties be imposed, and be awarded
their reasonable attorneys fees incurred in
the litigation.
In addition to federal citizen suit
authority, several states in the United
States have enacted legislation that allows
citizens to sue any person to prevent "pol-
lution, impairment or destruction of the
environment." Citizen enforcement plays
an important part in the enforcement
regime in the United States because it sup-
plements the limited government enforce-
ment resources and ensures that govern-
ment inaction does not mean that there will
be no enforcement.
10 ENVIRONMENTAL
ACCOUNTABILITY
As the preceding discussion indi-
cates, compliance can be shaped by a wide
variety of tools. Enforcement, better infor-
mation about how to comply with environ-
mental requirements, public values that
result in consumer pressure on companies
to comply with the law, and economic fac-
tors such as access to environmentally
restricted markets or the ability to make or
save money through pollution trading pro-
grams, all play roles in driving environmen-
tal behavior. The term "environmental
accountability" is designed to encompass
this wide range of tools that can be strate-
gically deployed to produce better environ-
mental outcomes. It includes mechanisms
that expose the environmental behavior of
individuals or organizations to public scruti-
ny creating a legal obligation to improve
behavior, an economic incentive to improve
behavior, or a sense of responsibility to
improve behavior.
These environmental accountabili-
ty mechanisms are, however, just a means
to an end. In his book, The Regulatory
Craft, Malcolm Sparrow cautioned that a
problem-solving approach to protecting the
environment first picks the most important
tasks and then selects appropriate tools in
each case "rather than deciding on the
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
most important tools and picking the tasks
to fit." Once priority problems have been
identified, though, it is important to system-
atically identify the tools that can best hold
individuals and organizations accountable
for behavior that creates or contributes to
the problem.
The concept of environmental
accountability suggests that government
agencies should go well beyond the rela-
tively limited strategic planning processes
inherent in compliance management sys-
tems to build a much more comprehensive
strategic compliance approach that maxi-
mizes environmental outcomes. A system
more broadly focused on the concept of
environmental accountability would incor-
porate enforcement options, assistance
mechanisms, targeting, and other tradition-
al compliance tools. But the system would
also consider how government can take
advantage of, or influence economic pres-
sures for, compliance, build societal values
to support compliance, and use mecha-
nisms such as public access to data and
innovative public involvement approaches
in designing a strategic approach to envi-
ronmental compliance that leverages gov-
ernments' limited compliance resources to
maximize environmental outcomes.
11 CONCLUSION
Strategic compliance allows gov-
ernment to direct environmental conduct
through tools such as traditional enforce-
ment, but also to influence compliance, and
even conduct that exceeds compliance, by
understanding and using a broad range of
regulatory, economic, and value-based
tools. This integrated approach to compli-
ance requires a strong planning process
that sets and implements priorities, has
access to adequate data and monitoring
capabilities to support resource allocation
planning and adaptive management, uti-
lizes a full range of "accountability" tools,
includes a strong commitment to informing
and interacting with the public, and has suf-
ficient financial and human resources to
carry out the essential tasks.
12 REFERENCES
1. Sparrow, Malcolm K., The Regulatory
Craft: Controlling Risks, Solving Prob-
lems, and Managing Compliance (2000).
2. U.S. Environmental Protection Agency,
Principles of Environmental Compliance
and Enforcement.
3. Environmental Law Institute, Beyond
Enforcement: Enforcement, Compliance
Assistance, and Corporate leadership
Programs in Five Midwestern States
(2003).
4. Rechtschaffen, Clifford, & Markell, David
L, Reinventing Environmental Enforce-
ment & the State/Federal Relationship
(2003).
5. Stahl, Michael, Beyond the Bean Count:
Measuring Performance of Regulatory
Compliance Programs, 28 The Public
Manager (1999).
6. Paddock, Leroy, Environmental Account-
ability and Public Involvement, 21 Pace
Environmental Law Review 243 (2004).
7. Beierle, Thomas C. & Crawford, Jerry,
Democracy in Practice: Public participa-
tion in Environmental Decisionmaking
(2002).
8. Food And Agriculture Organization of the
United Nations, International Code of
Conduct on the Distribution and Use of
Pesticides (Revised Version): Guidelines
on Compliance and Enforcement of a
Pesticide Regulatory Program (October
2004).
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GROSSMAN, ZAELKE 73
AN INTRODUCTION TO THEORIES OF WHY STATES AND
FIRMS DO (AND DO NOT) COMPLY WITH LAW
GROSSMAN, DAVE1 and ZAELKE, DURWOOD2
1 Staff Attorney, INECE Secretariat and Institute for Governance & Sustainable
Development
2 Director, INECE Secretariat; President, Institute for Governance & Sustainable
Development; and Co-Director, Program on Governance for Sustainable Development,
University of California, Santa Barbara's Bren School of Environmental Science
& Management
2141 Wisconsin Ave. NW, Suite D2, Washington, DC 20007, United States,
dgrossman@inece.org, dzaelke@inece.org
SUMMARY
Theories about compliance provide different accounts of why States, firms, and
individuals comply with or do not comply with international and domestic laws. The discus-
sion in this paper focuses on theories of compliance behavior at two principal levels of gov-
ernance - international and domestic - and the interplay between them.
1 INTRODUCTION
Theories about compliance provide
different accounts of why international and
domestic actors - States, firms, and indi-
viduals - comply with or do not comply with
international and domestic laws. These
theories are useful lenses for viewing and
understanding compliance-related behav-
ior and the reasons behind that behavior.
Because they provide distinct perspectives
on what motivates compliance and non-
compliance, these theories suggest differ-
ent approaches that state and non-state
actors can use to influence States and
firms to comply with laws designed to fur-
ther environmental protection and sustain-
able development.
Theories about international com-
pliance are largely about the behavior of
States - about how and why they comply
with international law. Theories about
domestic compliance, on the other hand,
focus more on the behavior of firms and
individuals. In two important ways, howev-
er, theories about international and domes-
tic compliance are remarkably similar.
First, international law, especially
in the environmental realm, generally is
given effect through implementation of
domestic laws and regulations. So on the
practical level, theories of domestic compli-
ance are in many instances also theories
about international compliance. According
to one prominent author, "no significant dis-
tinction exists between international
regimes and the rules of purely domestic
regimes once the international rules have
been domesticated through the passage of
implementing legislation."1 Of course,
important distinctions remain between the
domestic and international spheres. Inter-
national agreements must be agreed to by
States, and States must pass implementing
legislation and provide the resources for
enforcement and compliance, at least for
environmental agreements. In addition to
providing frameworks for domestic regula-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
tion, treaties also can regulate the conduct
of States, as with nuclear test ban treaties.
The international and domestic realms also
differ in the tools, resources, and strategies
available to encourage compliance.
Second, both domestic and inter-
national theories of compliance can be
grouped into similar categories. Broadly
speaking, they tend to fall into either:
(1) "rationalist" models that focus on deter-
rence and enforcement as a means to
prevent and punish non-compliance by
changing the actor's calculation of ben-
efits and costs, or
(2) "normative" models that focus on coop-
eration and compliance assistance as a
means to prevent non-compliance. Both
domestic and international compliance
theories also vary according to the
degree they disaggregate the targets of
regulation, either treating States and
firms as unitary entities or recognizing
that both are made up of multiple
actors.
2 THE LOGIC OF BEHAVIOR:
CONSEQUENCES VS.
APPROPRIATENESS
At the broadest level, questions of
compliance are questions about behavioral
motivations. What leads a State, firm, or
individual to act in compliance with laws?
In The Institutional Dynamics of Interna-
tional Political Orders, James March and
Johan Olsen divided the basic logic of
human action into the "logic of conse-
quences" and the "logic of appropriate-
ness."2 The "logic of consequences" views
actors as choosing rationally among alter-
natives based on their calculations of
expected consequences, whereas the
"logic of appropriateness" sees actions as
based on identities, obligations, and con-
ceptions of appropriate action. While not
mutually exclusive, these broad categories
provide a useful starting point for dis-
cussing the particular international and
domestic theories of compliance, and the
specific approaches that flow from these
different logics of action.
3 THEORIES OF INTERNATIONAL
COMPLIANCE
Scholars in international law and
international relations have developed a
variety of theories about why States do (or
do not) comply with international law; each
theory provides useful and often comple-
mentary insights into the puzzle of compli-
ance.
3.1 Logic of Consequences:
Rationalist Theories
Rationalist theories, following the
logic of consequences, are utilitarian at
their core. They posit States as unitary,
rational, self-interested actors that calcu-
late the costs and benefits of alternative
actions in an anarchic international world
order. Given this view of States as rational-
choice actors, rationalist theories - at least
those that see international law as having
any effect - suggest that enforcement and
deterrence are the main ways to prevent
non-compliance.
The principal rationalist theories
that view international law as having little or
no effect are realism and neorealism, in
which "considerations of power rather than
of law determine compliance."3 Combined,
the two realist theories explain compliance
with international rules as being a result of
one of three situations:
1) a hegemonic State or group of powerful
States forces other States to comply;
2) the international rules merely reflect
current practice or expected future
practice; or
3) the international treaty resolves a
situation in which no party has an
incentive to violate the treaty.
In the modern international arena,
States are no longer the only actors that
can exert sufficient power by themselves to
influence the behavior of other States;
major sources of finance such as multina-
tional corporations and multilateral devel-
opment banks are increasingly important
players in international power dynamics, as
are NGOs. Regardless of the source of
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GROSSMAN, ZAELKE 75
influence, realist theories view "compli-
ance" with international law as largely
either a coincidence or a result of interna-
tional power dynamics.
Unlike realist theories, institutional-
ism sees a role for international institutions,
namely to facilitate cooperation that is in
the States' long-term interests and to pre-
vent short-term defections that might jeop-
ardize those long-term interests. Institution-
alism, unlike realism, sees compliance with
international law as strategic. One strain of
institutionalism known as enforcement the-
ory or political economy theory focuses
more on the costs end of the cost-benefit
compliance calculation. As international
agreements get "deeper" - demanding
greater changes in the actors' behavior
from the status quo - enforcement theory
argues that the incentives for States to vio-
late the agreement also grow, thereby
requiring greater punishments to deter non-
compliance and sustain cooperation.
These punishments can be retaliatory,
monetary, political, or reputational.
Liberalism or liberal international
relations theory is largely a rationalist
model, but it discards the assumption that
States are properly viewed as unitary
rational agents. Liberalism disaggregates
the State and places the focus on domestic
political processes. Compliance comes
from the favorable effect of international
law and legal institutions on domestic inter-
ests, who mobilize to pressure the govern-
ment to comply - a phenomenon more like-
ly to be found in liberal States. While losing
the simplicity and clarity of the theories just
discussed, liberalism seems to more fully
capture the complexity of state decision-
making, and highlights the role that NGOs,
businesses, the media, and international
organizations, including financial institu-
tions, can play in generating compliance.
3.2 Logic of Appropriateness:
Normative Theories
Normative theories, following the
logic of appropriateness, focus more on the
normative power of rules, the persuasive
power of ideas and legal obligations, and
the influence of shared discourse and
knowledge on States' interests. According-
ly, normative theories suggest a more
cooperative approach to obtaining compli-
ance. Even though they provide a different
lens on compliance behavior than "rational-
ist" models, normative models do not
assume States are acting irrationally;
rather, they broaden the focus to include
influences that are not as readily reducible
to costs and benefits. Compliance, under
this view, is less about rational calculation
or imposed sanctions and more about
norms of behavior and norms of obligation
flowing from law's special role as an order-
ing principle of societies.
The banner of normative theory
encompasses a range of perspectives.
One theory in this vein, articulated most
prominently by Thomas Franck, is legitima-
cy theory, which maintains that "in a com-
munity organized around rules, compliance
is secured - to whatever degree it is - at
least in part by the perception of a rule as
legitimate by those to whom it is
addressed."4 Legitimacy - which is largely
based on process, clarity, and fairness -
determines the rules' "compliance-pull" on
governments.
Managerialism, developed by
Abram and Antonia Chayes, starts with the
premise that States have a propensity to
comply with their international commit-
ments because:
(1) treaties generate legal norms, which
carry a widely accepted obligation of
obedience;
(2) States rationally have an interest in
complying with rules they helped to
create;
(3) compliance is efficient from a
bureaucratic inertia or internal
decisional perspective.5
Given this propensity, managerial-
ism argues that instances of non-compli-
ance are often inadvertent, stemming from
lack of capacity or resources, ambiguous
commitments and provisions, and time lags
between commitment and performance. As
such, these sources of noncompliance can
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
be managed by routine, non-confrontation-
al international political processes - such
as dispute resolution procedures, technical
and financial assistance, and transparency
- aimed at the collective improvement of
performance.
Transnational legal process, a the-
ory put forth by Harold Koh, posits that
States obey international rules when they
internalize the norms and incorporate them
into their own value system.6 This process
begins when one or more transnational
actors (diplomats, NGOs, issue networks,
etc.) work with other such actors on a legal
issue, over time requiring interpretation and
enunciation of the norms applicable to the
interaction. These norms are then internal-
ized into domestic structures through exec-
utive, judicial, and legislative action.
Repeated international participation leads
to a continued process of creating and
internalizing legal norms, which leads
nations to reconstitute their own interests
and identities, and to obey international
law. Like liberalism, this theory disaggre-
gates the State, highlighting the role that
non-state parties such as NGOs, business-
es, scientists, and networks can play in
enunciating norms in the international
arena and internalizing them domestically.
4 THEORIES OF DOMESTIC
COMPLIANCE
Theories of compliance at the
domestic level study responses not of
States, but of citizens and firms, to laws
and legal commands. At the domestic level,
coercive enforcement measures are usual-
ly more readily available than at the inter-
national level; indeed, many theorists mark
the absence of formal sanctioning authority
at the international level as a critical distinc-
tion between domestic and international
law. (Although in States that lack capacity
to impose meaningful sanctions, this dis-
tinction may be irrelevant in practice.)
While there are significant similarities
between international and domestic theo-
ries - including the distinction between
rationalist and normative approaches -
they also differ as they address, and are
shaped within, a different context.
4.1 Logic of Consequences:
Rationalist Theories
Like its international counterpart,
the rationalist model of domestic compli-
ance follows the logic of consequences,
positing regulated firms as rational actors
that act to maximize their economic self-
interest. Accordingly, these theories
emphasize enforcement and deterrence to
change the firm's calculation of benefits
and costs.
Seminal early work on domestic
theory of compliance and enforcement was
done by Gary Becker, addressing the
enforcement of criminal law.7 His basic
insight is that potential offenders respond
to both the probability of detection and the
severity of punishment if detected and con-
victed. Thus, deterrence may be enhanced
either by raising the penalty, by increasing
monitoring activities to raise the likelihood
that the offender will be caught, or by
changing legal rules to increase the proba-
bility of conviction.
Deterrence theory extends the
Becker model to corporate non-compliance
and maintains that there must be a credible
likelihood of detecting violations; swift, cer-
tain, and appropriate sanctions upon detec-
tion; and a perception among the regulated
firms that these detection and sanction ele-
ments are present. The job of an enforce-
ment agency under this view is to make
penalties and the probability of detection
high enough that it becomes irrational for
firms to violate the law. As with the more
nuanced international rationalist models
such as institutionalism, a view of "costs"
broader than merely monetary costs opens
up a range of enforcement options, includ-
ing extra-legal "punishments" such as
moral stigma and loss in reputation.
Behavioral decision theory adds a
deeper dimension to rationalist theories by
acknowledging the role that people's cogni-
tive biases can play in their "rational" calcu-
lations and highlighting the importance of
factors such as how a particular choice is
framed (e.g., people choose differently
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GROSSMAN, ZAELKE 77
when a choice is framed as the number of
lives that will be saved instead of the num-
ber of lives that will be lost) or how proba-
bilities of detection, prosecution, and pun-
ishment are presented (e.g., people
choose differently when probabilities for
each stage in a chain of events are pre-
sented instead of when the overall proba-
bility is presented).
4.2 Logic of Appropriateness:
Normative Theories
As in the international arena, nor-
mative theories of domestic compliance fol-
low the logic of appropriateness, viewing
regulated entities as good-faith actors that
want to obey the law but cannot. The heart
of normative theories is that firms are insti-
tutions that are generally inclined towards
compliance with environmental laws,
whether because of civic motives, social
motives, or internalization of societal norms
favoring environmental protection. But gen-
erally, the theory holds that firms comply
because of a "compliance norm", fueled by
the belief that laws that are developed and
implemented fairly should be followed. As
in some of the international normative the-
ories, compliance is expected to be higher
when individuals and firms believe the rules
are legitimate and fairly applied. Under the
normative model, this compliance norm
affects behavior even absent legal sanc-
tions.
Like their international counter-
parts, normative domestic theories posit
that noncompliance occurs largely because
of the regulated entities' lack of "capacity"
(knowledge of the rules, and financial and
technological ability to comply) and "com-
mitment" (determined by norms, percep-
tions of the regulators, and incentives for
compliance). Accordingly, these theories
call for a more cooperative approach to
ensuring compliance, with the full range of
compliance assistance strategies such as
dissemination of information, technological
assistance, and inspections designed to
enable inspectors to provide compliance
advice.
The complexity critique, although
more about bureaucratic and administra-
tive limitations than about norms, focuses
on the "capacity" of the regulated firm,
charging that environmental regulations
are:
(1) too numerous,
(2) too difficult to understand,
(3) too fluid, or ever-changing, and
(4) too hard to find.8
According to proponents of this cri-
tique, most firms do not know what consti-
tutes perfect compliance and so cannot
achieve it. This would particularly be the
case for small businesses, which generally
lack the resources to stay apprised of com-
plicated, changing regulatory requirements.
The role of regulated firms' "com-
mitment" is most evident when considering
firms' perceptions of the legitimacy of the
regulatory authorities, which is influenced
by the firms' views of how fairly the regula-
tions are created, implemented, and
enforced.
4.3 Disaggregating the Firm and
Broadening the Field of Players
Like some international theories,
the usual forms of both the rationalist
(deterrence-based) and normative (cooper-
ative) domestic models treat the regulated
entity as a unitary actor — the "firm" calcu-
lates penalties or the "firm" has a compli-
ance norm. However, firms are composed
of multiple actors. The focus on the unitary
actor can mask strategies that incorporate
a broader range of players, both within and
outside the regulated entity.
By disaggregating the firm, for
example, additional considerations enter
into play as forces influencing compliance
behavior. For instance, because firms are
made up of human beings, the inner work-
ings of firms are heavily influenced by the
effect of norms on the behavior of firm
employees. In a fascinating article, Michael
Vandenbergh explored the influence of
eight norms (law compliance, human
health protection, environmental protection,
autonomy, fair process, good faith, reel-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
procity, and conformity) on the environmen-
tal compliance decision-making of corpo-
rate managers.9 But norms, including the
compliance norm, only become salient
when the actor gets cues that indicate that
the norm is relevant. This means that the
compliance norm will only get triggered
when the actor:
(1) knows of the legal standard,
(2) is aware of business activities that are
potentially governed by the standard,
and
(3) believes that he or she has the
authority and/or responsibility within
the firm to initiate actions leading to
compliance.10
This reality implicates the impor-
tance of intra-firm informational flows, orga-
nizational theory, and the interactions and
potentially conflicting goals of sharehold-
ers, owners, senior managers, subordinate
managers, and employees.
The focus of domestic compliance
efforts can also be expanded further, taking
a systems approach to describe a multi-
player game. For instance, States can
empower NGOs, investors, consumers,
lawyers, competitors, and others through
mandatory information disclosure laws,
through citizen suit provisions, or simply by
disclosing information about violators to the
public and the media. Regulators also can
facilitate the $500 billion per year environ-
mental goods and services sector to act as
additional "enforcers", giving incentives to
press their clients (and potential clients) to
improve compliance. Designing effective
compliance systems requires a detailed
understanding of a range of entities, their
relationships, and the motivations of their
behavior.
4.4 Blending Rationalist and
Normative Models
Both rationalist and normative
models provide useful insights into behav-
ior that leads to compliance. As in the inter-
national realm, these models are not mutu-
ally exclusive, but rather are different lens-
es for viewing and understanding influ-
ences on compliance behavior. Both are at
play in compliance decisions.
A synthesis of the two theories
presents a more realistic picture of enforce-
ment and compliance as it actually occurs.
The proper balance of the two models thus
seems to be a compliance enforcement
system that also encourages the norms
and incentives that lead to voluntary com-
pliance, while maintaining the bedrock
foundation of enforcement and deterrence
to alter the calculations of those less
inclined to voluntarily comply. As noted by
the eminent jurist H.LA. Hart, "what reason
demands is voluntary co-operation in a
coercive system."11
5 CONCLUSION
These theories provide important
lenses for viewing compliance behavior.
While they focus on different drivers of
behavior, and thus implicate different com-
pliance strategies, these theories should
not be thought of as mutually exclusive. "It
is perfectly possible to argue that soft com-
pliance paths have great potential with re-
gard to regulatory regimes without denying
that there is a hard core of noncompliance
that will not yield to such treatment."12
Compliance theories need to con-
tinue to help us understand the reality we
face. The more they disaggregate the State
and the firm and focus on the institutions
and individuals within them, the more they
reflect the reality of decision-making and
empower actors of all types in governments
and civil society.
Theories and hypotheses also
need to be tested. Policies and strategies
need to be informed by analyses of what
works and what does not, so that these
approaches can be modified. In other
words, it is important to combine theory and
empirical analysis, so that we can keep
moving towards a system in which we
implement programs, go out and determine
if they are really working, and then adjust
accordingly, "in a continuous information
feedback loop that enables dynamic read-
justment of policy and practice."13
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GROSSMAN, ZAELKE 79
6 REFERENCES
1 Young, Oran R., Is Enforcement the
Achilles' Heel of International Regimes?
in Governance in World Affairs 93 (1999).
2 March, James G. & Olsen, Johan P., The
Institutional Dynamics of International
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(1998).
3 Morgenthau, Hans Joachim, Politics
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4 Franck, Thomas M., Legitimacy in the
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5 Chayes, Abram & Chayes, Antonia
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tive Action in World Politics, 54(1) Int'l Org.,
3-7 (2000) (discussing March & Olsen).
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Ethics: The Case for Moral Pluralism
(1987).
Stone, Christopher D., Where the Law
Ends: The Social Control of Corporate
Behavior (1975).
Sunstein, Cass R., Moral Heuristics,
Behavioral and Brain Sciences, 9-11 (forth-
coming 2005).
Segerson, Kathleen & Tietenberg, Tom,
The Structure of Penalties in Environmen-
tal Enforcement: An Economic Analysis, 23
J. Envtl Econ. & Mgmt, 179-200 (1992).
Silberman, Jon D., Does Environmental
Deterrence Work? Evidence and Experi-
ence Say Yes, But We Need to Understand
How and Why, 30 ELR 10523 (2000).
Tyler, Tom R. & Blader, Steven L., Cooper-
ation in Groups: Procedural Justice, Social
Identity, and Behavioral Engagement
(2000).
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Werksman Jacob, ed., Greening Interna-
tional Institutions (1996)
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KOK 81
NATIONAL STRATEGY FOR ENVIRONMENTAL
LEGISLATION ENFORCEMENT
KOK, FRED
Secretary of the Board for the National Administrative Platform for Environmental
Legislation Enforcement, Koningskade 50, 2596 AA The Hague, The Netherlands,
fkok@lomsecretariaat.nl
SUMMARY
The Dutch national strategy for environmental enforcement is a framework that
national and decentralized authorities can adopt as their policy. The basis principles are
settled by an agreement between the competent authorities. These principles give two
responses to offences of the environmental laws: (1) warning with period allowed for rever-
sal of situation and (2) sanction and/or indictment. This paper describes the key tenants of
the Dutch national strategy and details how the strategy is implemented.
1 INTRODUCTION
In the Netherlands, governmental
responsibility for environmental manage-
ment is decentralized. Moreover, a distinc-
tion is drawn between criminal law and
administrative law. There are separate
competent authorities for each area. As a
result of this organizational structure and
the division of responsibilities, there are
some six hundred public sector organiza-
tions which enforce environmental legisla-
tion.
Businesses and the general public
will come into contact with various authori-
ties, possibly further to permit require-
ments. Many activities which are prohibited
because they are harmful to the environ-
ment fall under the jurisdiction of more than
one authority. Moreover, many infractions
are the result of a chain of activities, with a
different authority responsible for each link
in that chain.
In this type of 'chain problem' (as
well as in others) coordinated government
action is required. Businesses and the pub-
lic also regard coordination as desirable in
the interests of justice and equal treatment
under the law. At the same time, it is recog-
nized that the action taken should depend
on the individual situation. Accordingly, the
decentralized authorities have been
assigned certain tasks, since they are clos-
est to the problem and are in the best posi-
tion to consider the interests at stake in a
balanced manner.
The strategy described in this
paper has been agreed by all authorities
having enforcement responsibility. A nation-
al consultative body - the Bestuurlijk Lan-
delijk Overleg Milieuhandhaving (National
Administrative Platform for Environmental
Legislation Enforcement; BLOM) has been
instituted for the purposes of coordination.
It includes representatives of the ministers
of Justice, the Environment, Water, and
Nature and Landscape, and representa-
tives of the decentralized authorities
(provinces, municipalities and water man-
agement authorities). This ensures unifor-
mity of action wherever this is desirable.
Certain infractions will always attract the
same penalties no matter where they
occur, and regardless of the situation.
The decentralized Dutch system
entails that certain basic principles cannot
be established by means of central (nation-
al) legislation. The competent authorities
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
have therefore decided to make certain
agreements regarding their enforcement
action based on consensus. This decision
is based on the fact that the nature of envi-
ronmental problems is usually such that no
single authority can provide a solution
which applies to the entire chain. If their
enforcement action is to be effective, the
Dutch authorities must cooperate with each
other.
2 THE DUTCH NATIONAL STRATEGY
The Dutch national strategy is a
framework which national and decentral-
ized authorities can adopt as their policy
line, or within which they can formulate
their own policy.
The principles applied are:
a) a recognizable and transparent
enforcement line;
b) decisive action against every infraction;
c) appropriate combination of
administrative law and criminal law;
d) transparency regarding any
deviations from policy.
The BLOM has established this
strategy for all areas of enforcement in
which its members are involved.
The strategy applies to all current
forms of response or intervention further to
a breach of environmental legislation. That
response may vary from a warning to tak-
ing action, from an indictment under crimi-
nal law to administrative measures.
2.1
Terms and Definitions
In 1999, the Dutch Public Prosecu-
tions Department published its 'Environ-
mental Strategy'. This was primarily intend-
ed as a framework ensuring uniformity of
action on the part of the regional public
prosecutors' offices and the investigating
officials of the regionally organized police
force. By means of enforcement platforms,
the criminal law strategy was given an
important place at the provincial level, serv-
ing to coordinate enforcement action on the
part of the relevant officials.
The strategy of imposing sanctions
is regarded as an appropriate response,
depending in particular on the nature and
the consequences of the offence. In most
cases, however, neither the nature nor the
consequences of an infraction can be stat-
ed prior to the event. Nevertheless, it is
necessary that the relevant authority
should attempt to do so, and should do so
in line with the strategy stated by the Public
Prosecutions Department. The BLOM has
classified certain offences as 'fundamental
breaches of the law.' These are the
offences covered by the "key regulations,"
a list of the main national ordinances and
directives. The standard response to any
infraction of these key regulations has been
agreed between the Public Prosecutions
Department and the BLOM, and is binding
on each party.
However, the existence of the list of
key regulations must not prevent each case
being considered individually to determine
whether the basic criteria for a 'warning'
response or an 'action' response have
been met.
2.2 The Importance of Compliance
The enforcement of regulations,
permit conditions or general rules is the
enforcement of an established norm.
Before that norm came into existence,
there will have been countless forms of
commentary, consultation and democratic
control. After all interests were duly consid-
ered, the norm was formalized by means of
an Act of Parliament, directive or permit
requirement, and it applies equally to
everyone whom the norm addresses. Com-
pliance with a norm that has been estab-
lished by democratic means is the duty and
obligation of every citizen and every legal
entity, such as a corporation or company.
In drawing up its work plans, each
regulatory authority will of course set cer-
tain priorities and will devote greater atten-
tion to more serious potential environmen-
tal effects and to 'suspect' companies.
However, once an infraction has been iden-
tified - even a minor infraction on the part
of well-intentioned company - an appropri-
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KOK 83
ate response must follow.
2.3 The Importance of Enforcement
Enforcement of the regulations is
important for the following reasons:
a) To limit environmental damage and to
ensure restoration to the original state.
b) To prevent recurrence, whether by the
same party or others.
c) To cancel out any unfair advantage that
the offender may have enjoyed.
d) To reaffirm:
• norms established in the interests of
the environment or public health;
• the possibility of government control
(by means of quantified standards,
etc.)
This being in the interests of:
—the credibility of the legislative
apparatus;
—justice;
—fair competition.
Enforcement action is primarily
concerned with repair, deterrence and
sanction. In other words, it aims to restore
the environmental situation to its prior
state, to discourage the offender and oth-
ers from committing offences in future, and
to penalize the offender (thus cancelling
out any unfair advantage gained). In addi-
tion, consistent enforcement action is nec-
essary in the interests of legal certainty,
justice, equality of treatment and credibility.
2.4 The Importance Of There Being
Both Criminal Law Action And
Administrative Law Measures
Both the criminal law system and
that of administrative law are concerned
with encouraging compliance with the
established norms. The instruments of
administrative law are primarily geared to
terminating and reversing (insofar as possi-
ble) the current illegal situation, i.e. resolv-
ing the nuisance or damage caused and
implementing appropriate provisions for the
future. The instruments of criminal law are
primarily geared to penalizing the offender
and removing any unfair (competitive)
advantage that he may have enjoyed.
Both types of instrument also have
a deterrent effect and are therefore preven-
tative measures at both the individual and
general levels. Because all these aspects
come into play in almost every infraction of
environmental legislation, a well-consid-
ered combination of the two forms of action
is generally desirable. Each enforcement
action will then be instigated by the civil
authority and the Public Prosecutions
Department working in tandem. Wherever
possible, they will make general agree-
ments regarding the nature of their cooper-
ation, and will consult each other regarding
each specific incident.
2.5 The Possibility of Legalization
In the light of the stated compli-
ance objectives, it is also important to con-
sider the possibility of legalizing ('decrimi-
nalizing') an offence, whereby the authori-
ties must decide whether it is nevertheless
possible to issue a permit after the event.
The factors which must be considered are
whether any unfair competitive advantage
has been gained, whether the general
sense of standards has been violated, and
so forth. Where the results of the offence
are clearly in violation of the objectives of
the legislation, there is good cause for
enforcement action despite any possibili-
ties for legalization. A penalty under crimi-
nal law (further to due process instigated by
the administrative authority) would then
seem most appropriate, although it is pos-
sible that the authority will choose to
impose some penalty under administrative
law, either instead of or in addition to the
criminal law sanction. The reasons for this
must then, of course, be stated in the
enforcement decision.
3 IMPLEMENTATION OF THE
NATIONAL STRATEGY
There are generally two forms of
response to an identified infraction: (1) a
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
written warning which states a date by
which the illegal activity must be discontin-
ued and (2) administrative and/or criminal
law action, involving the preparation
and imposition of an administrative sanc-
tion and/or the issuing of an indictment
under criminal law. A warning is applied in
cases involving a first offence relating to
activities not covered by the key regula-
tions. An administrative and/or criminal law
action is taken for any breach of key regu-
lations; in the event of persistent or repeat-
ed offences; or for an offence for which
subsequent re-inspection is not possible.
3.1 Warnings
A warning with a deadline for
restoration can be issued during or after an
inspection, by means of an official report or
an official letter. The warning is always in
writing. Where subsequent re-inspection
reveals that the illegal activities for which a
warning was previously issued are continu-
ing, or have been resumed, this is classed
as a 'repeated' or 'persistent' offence,
whereupon the second type of response -
criminal or administrative action - will fol-
low.
3.2 Administrative or Criminal Actions
An administrative or criminal action
(e.g., coercive penalty payment, adminis-
trative coercion, (future) administrative set-
tlement, possible closure or revocation of
permit) is appropriate if it seems likely that
a warning will have no effect, perhaps
because subsequent effective re-inspec-
tion is not possible. This will be the case for
incidental transport inspections, the trade
in materials and waste materials, and the
so-called 'free field' offences. The main
group of offences to which the second type
of response will be applied comprises
those which breach the key regulations.
Based on agreements between the
regulatory authorities and the Public Prose-
cutions Department, it will be determined
whether an enforcement decision is to be
taken or an indictment under criminal law is
to be issued. In some cases, both courses
of action may be taken. The process of tak-
ing action does not detract from the regula-
tory authority's responsibility to investigate
all relevant facts and to determine the inter-
ests which will be influenced by the imposi-
tion of a sanction. All stakeholders will be
invited to express their standpoints, giving
the offender the opportunity to state
whether he believes an infraction has
indeed taken place, and whether there is
any good reason to waive (or postpone)
further enforcement action. It is also impor-
tant to state exactly which regulations have
been contravened, since this will determine
whether the authority to take enforcement
action exists. Furthermore, a decision must
be taken with regard to the measures to be
taken further to any administrative coer-
cion, or the nature of the coercive penalty
payment. Needless to say, the regulatory
authority has to be able to prove that the
alleged offence actually took place.
Even an indictment does not mean
that prosecution will definitely follow. The
Public Prosecutions Department must con-
sider the likelihood of success, questions of
evidence, and even opportunity.
3.3 Special Situations
In cases in which immediate action
is required, the preliminary process may be
omitted. Some situations are so urgent that
administrative constraint is inappropriate
(i.e. there is no 'grace period' in which to
resolve the situation) while in some cases,
the sanction is imposed at a later date.
If the illegal activities continue
beyond the grace period, it is important that
enforcement action is pursued in a consis-
tent manner. This is in the interests of the
credibility of the enforcement process as a
whole, and in terms of the preventative and
punitive effect of the instruments.
4 PREDICTABILITY
It is important that the response to
a (potential) infraction should be pre-
dictable. Accordingly, not only the key reg-
ulations but the usual grace periods for
reversal and restoration are laid down by
means of internal enforcement guidelines.
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KOK 85
The existence of the key regulations list
does not absolve the regulatory authority
from its duty of considering each case indi-
vidually. This is particularly so when key
regulations do not apply. Each case must
be carefully assessed to determine
whether there is a significant infraction for
which action under administrative and/or
criminal law is appropriate.
This would certainly be so if:
—there is direct impairment, or a
significant and palpable risk of
impairment, to the environment, public
health, the credibility of the government,
fair competition or government control, or
—the actions of the offender indicate a
calculating or mala fide attitude, or
—there is a reasonable likelihood that
a failure to take action will result in
escalation of the illegal activities, or
—the illegal activities are being
undertaken on a scale which is likely
to lead to undesirable effects through
accumulation, or
—enforcement action is mandatory under
international law.
The enforcement decision includes
a grace period within which the illegal activ-
ities must be discontinued in order to avoid
the stated sanction being imposed. In for-
mulating the national key regulations,
efforts are made to establish the grace peri-
od and the level of any coercive penalties.
In some cases, the payment of a financial
penalty will avoid further criminal action
(settlement), while in others a court hearing
is always required. This too is established
as part of the key regulations list.
4.1 Transparent Individual Evaluation,
In Consultation Between The
Administrative Authority And The
Public Prosecutions Department
No matter how carefully matters
are assessed in advance, there will always
be situations in which discretion is required
and in which some deviation from the stan-
dard guidelines is required.
There are two reasons why a pre-
determined policy line can never be com-
plete. Firstly, it is impossible - and fruitless
- to attempt to list all possible offences, not
least due to the complexity of some com-
mercial operations. Secondly, even 'fore-
seeable' offences can take place in unfore-
seen circumstances. A degree of discretion
is then required in the interests of justice
and equality. Accordingly, the administra-
tive authority and Public Prosecutions
Department may decide to take a more
lenient course, or indeed more stringent
action than would normally be the case.
However, the deviation from standard prac-
tice must be transparent and controllable.
In the case of violation of the key
regulations, it will be possible to waive for-
mal action in favour of a warning, if the
offence:
—has not been committed deliberately;
—is clearly an isolated incident;
— is of limited extent and impact;
—has been committed by a party of
otherwise good record who has
been willing to take remedial action
immediately.
4.2 Offences Committed By
Governmental Authorities
The enforcement of compliance on
the part of another governmental authority
(or a department of one's own authority) is
no different to that applying to other parties.
Indeed, here it is even more important to
ensure that the objectives of maintaining
the general sense of standards and the
credibility of the legislative apparatus are
upheld.
Of course, certain judicial or practi-
cal complications can arise, particularly in
the case of criminal prosecution of the cen-
tral government or administrative action
against one's own authority. In such cases,
democratic control remains the most effec-
tive instrument to ensure that the legislation
is observed. Internal guidelines for the
identification of an offence on the part of a
governmental authority and for the action to
be taken must therefore be geared to
ensuring the best possible opportunities for
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
effective democratic control.
Other governmental bodies or pub-
lic sector organizations which are found to
have committed an offence will be treated
in exactly the same way as companies and
the general public in terms of administrative
action.
Offences committed by one's own
organization (other departments or allied
organizations) will also be dealt with in line
with the framework described above. The
required level of transparency will be
achieved by the following means:
—the inspector (or the director of the
department) is authorized and required
to report any breach of the key regula-
tions committed by his own organization
to the Public Prosecutions Department
and to institute the usual administrative
enforcement measures in full
—a copy of the report must be submitted
not only to the director of the
department or organization concerned,
but also to the minister or other public
administrator responsible for that
organization, and to the minister
responsible for environmental legislation
enforcement.
All parties will respond to the report
in such a way as to ensure that the results
are open to democratic control.
Where the inspector identifies a
key regulation offence committed by his
own department but for which his own
department is not the competent authority,
he is to report this to the Public Prosecu-
tions Department, to the minister or other
public administrator responsible for the
department, and to the competent authori-
ty.
5 SUMMARY
Response 1. Warning with period allowed
for reversal of situation
— First offence, not relating to key
regulations or Offence against a key
regulation, but:
— Not deliberate and
—An isolated incident and
—Of limited extent and
—Offender of otherwise good record and
—Measures taken
Response 2. Sanction and/or indictment
—Offence against key regulation or
— Persistent/repeated or
— Incapable of re-inspection, or
— Direct impairment of:
environment
public health
government credibility
fair competition
government control, or
—Calculating or mala fide, or
—Likelihood of re-offending or
—Accumulation, or
—International obligation
Individual deviations from the
Response framework:
—Key regulations.
— Reversal or grace period.
—Level of coercive penalty or settlement
(to be documented with full reasons for
decision).
Where a key regulation offence
has been committed by one's own depart-
ment, the notification of action is submitted
to the director of the governmental depart-
ment concerned (with the competent
authority informed as appropriate) with
copies sent to:
—the minister responsible for the
enforcement of environmental
legislation;
—the minister responsible for the
organization in question.
—the Public Prosecutions Department.
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KOK 87
Warning
Impairment or
Calculating or
Repeat or
Accumulation or
International
Action
Offence
Re-inspection possible?
Ongoing?
Key regulation?
Non-deliberate and
Isolated incident and
Limited extent
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88 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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VAN DER SCHRAAF 89
THE COMPLIANCE STRATEGY IN THE NETHERLANDS
VAN DER SCHRAAF, ANGELIQUE A.A.
Inspectorate of Housing, Spatial Planning and the Environment, P.O. 16191, 2500 BD
the Hague, The Netherlands, angelique.vanderschraaf@minvrom.nl
SUMMARY
This paper illustrates the Dutch Compliance Strategy developed by the Ministry of
Housing, Spatial Planning and the Environment. The compliance behaviour of the regula-
tees is the central point in all the action the department takes to reach the policy goals: con-
tribution to a safe, healthy and sustainable environment. A regulatee has certain reasons
to respond positive or negative on regulation. The responses are summarised in the so-
called Table of Eleven, a broadly accepted and used list of reasons for non-compliance In
the Netherlands. Therefore, knowledge of compliance behaviour is essential for the min-
istry to do the right things, to do the things right and be accountable. Experience with the
implementation of the Compliance Strategy is shared. Some examples are given of expe-
riences with the compliance strategy.
1 INTRODUCTION
The final purpose of an environ-
mental policy is the reduction of the load of
the environment and eliminating harmful
effects on humans, animals and vegeta-
tion. Legislation is one of the tools tot
reduce the effects. This legislation aims to
alter the behaviour of the regulatee in order
to obtain the set environmental objectives.
But rules have to be complied. The ministry
of Housing, Spatial Planning and the Envi-
ronment has developed a Compliance
Strategy in 2002. This strategy contains a
clear compliance and enforcement mes-
sage. It is a framework for both policymak-
ers and Inspectorate how to stimulate com-
pliance and how to enforce it.
In 2003 this strategy was approved
by the whole department (policy makers
and Inspectorate) and since this moment
the strategy was fully implemented. So we
have now some two years of experience
with the implementation of the Compliance
Strategy!
2 COMPLIANCE AS A CENTRAL
FACTOR IN THE DUTCH
COMPLIANCE STRATEGY
Compliance in the Dutch Compli-
ance Strategy is seen as the behavior a
regulatee shows to respond to regulatory
requirements. So the key word is behavior.
By approving the Compliance Strategy, the
ministry pinpoints the behaviour (and the
manipulation of the behaviour) of the regu-
latee as the focus point in her compliance
strategy. Knowledge of compliance behav-
iour is essential for the ministry to do the
right things, to do the things right and there-
by to reach the objective of the ministry:
contribution to a safe, healthy and sustain-
able environment.
3 THE COMPLIANCE STRATEGY
IN SHORT
The strategy can be seen as a way
to make compliance transparent and to use
newly developed indicators for several pur-
poses: priority setting (doing the right
things), effective enforcement (doing the
things right) and accountability.
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
One of the first activities employed
within the Compliance Strategy was the
identification of all the sets of environmen-
tal legislation confined to firms, citizens and
other governmental actors (provinces,
municipalities). In the Netherlands there
are about 450 sets of legislation the Inspec-
torate has to observe. Some 70% of these
regulations concern environmental regula-
tions. The next step: per set of environmen-
tal legislation all the regulatees were identi-
fied. On this regulatee-level the present
state of risks and compliance behaviour
were identified and classified in risk- and
compliance indicators. The heights of the
risk and compliance indicators were all esti-
mated and are based on expert knowledge
(Inspectorate and policy makers).
The compliance indicator is a
measure for non-compliance. The compli-
ance indicators will be used to calculate the
compliance efforts the ministry (policymak-
ers and the Inspectorate) has to make on a
yearly base.
Risk indicators are developed on
the same way: in several expert workshops
risks were estimated per piece of environ-
mental legislation per regulatee on the
effects on: public health, safety, sustainabil-
ity and social factors in case the Inspec-
torate should not enforce compliance.
When risks and the non-compli-
ance rates are known, the ministry can pri-
oritise the tasks with the help of a 2 x 2
matrix (see figure 1). So this will help the
department to pick the right things and be
accountable for the choices she makes.
Finally the reasons for non-compliance
were identified per set of regulation and per
regulatee.
Figure 1: Priority setting with the Dutch
Compliance Strategy
RISK
RATE
t
Regular tasks
; , Rdofjfcftffin
Not this year
Regular tasks
4 DO THE THINGS RIGHT:
COMPLIANCE BEHAVIOR
A regulatee has certain reasons to
respond positive or negative on regulation.
The responses to regulation are sum-
marised in the so-called Table of Eleven®,
a broadly accepted and used list of reasons
for non-compliance In the Netherlands.
The base of this table is formed by
a combination of social, psychological en
criminal theories found in literature on com-
pliance behaviour and on practical experi-
ence within the field of the maintenance of
law and order. The dimensions of the table
of eleven can be seen as behavioural sci-
entific parameters, which can influence the
compliance behaviour.
Box 1: Table of Eleven
Aspects of spontaneous compliance:
1. knowledge of the regulation
2. cost / benefit ratio
3. degree of acceptance of the
regulation
4. loyalty and obedience of the
regulatee
5. informal monitoring
Aspects of monitoring:
6. informal report probability
7. monitoring probability
8. detection probability
9. selectivity of the inspector
Aspects of sanctions:
10. chance of sanctions
11. severity of sanctions
NON-COMPLIANCE RATE
5 INTERVENTIONS
In order to do the things right, the
reasons for non-compliance have to be
taken into account. Within the ministry it is
decided that the policy makers will tackle
interventions on the dimension of sponta-
neous compliance; the Inspectorate will
tackle the monitoring- and sanction dimen-
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VAN DER SCHRAAF 91
sions. Per reason for non-compliance an
intervention mix can be generated to make
the regulatee comply as meant by the reg-
ulations. This leads to a general Interven-
tion Strategy.
Of course before actual intervening
the context factors have to be taken into
account: what type of firm is it? What is the
financial status of the firm? What invest-
ments are already made in order to com-
ply? What is the history of the firm: does he
have a large history of regular non-compli-
ance or is this the first time of non-compli-
ance? Is there a compliance pattern
detectable within the whole branch? See
also the questions following each non-com-
pliance dimension in appendix A.
This will lead to a tailor made smart
intervention strategy, with a mix of quite a
number of (possible) intervention tools:
— Policy interventions.
— Policy development (new regulation,
cost reduction programmes etc.).
—Communication.
— Prevention.
—Compliance assistance
— Deterrence.
—Enforcement; administrative,
criminal and civil.
— Feedback to the minister and
parliament (annual report of the
Inspectorate).
At this moment we are busy to
define per reason of non-compliance the
possible sets of interventions on experi-
ence based investigations. This is a way of
working - by translating the focus of the
regulatee to the work of policymakers and
inspectors - which is quite new and attrac-
tive!
6 WHERE ARE WE NOW?
Within three years work, the min-
istry has developed a robust model form
compliance management based on indica-
tors of the present state of compliance and
risks at stake. But note: most indicators are
estimated!
The use of estimation as a method
was a deliberate choice: quickly and at low
costs results were obtained. Three years of
priority setting with the Compliance Strate-
gy have proved the use: we have a good
tool to make risk- and compliance-rate
based priority choices. In the departmental
Agenda for 2005 we have set ambitious
goals for the priority tasks in a more year
perspective. This makes us more account-
able. The challenge will be to find effective
ways to reach the set objectives. We now
run a programme on 'smart enforcement' in
order to develop sophisticated intervention
toolboxes to support this challenge.
In 2004 a supporting evaluation
programme is launched to test if the policy
objectives are within reach (compliance
evaluation, ex-ante and ex-post).
In 2003 we have started to validate the risk-
based indicators with scientific data. This
project will be finished in 2005. The first
results are promising.
Also we are developing a compli-
ance indicator monitoring system. This sys-
tem is based on the OECD input-output-
outcome model to classify compliance and
enforcement indicators in order to manage
compliance. The following indicators are
already monitored and used to manage
compliance:
Inputs:
—Compliance promotion officers
(policymakers)
—Compliance enforcement officers
— Investments in Training IT, sampling
etc (in €)
— Days planned for compliance:
promotion and enforcement
Outputs:
—Compliance promotion campaigns
—Of inspections
—Of prosecutions
—Of penalties
—Days realised for compliance:
promotion and enforcement
Intermediate outcomes:
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
—Compliance rates
— Risk rates
Final Outcomes:
—Ambient load of pollutants in air and
water by a Pollutant Release and
Transfer Registry system.
—Environmental effects monitoring in
the yearly State of the Environment
and State of Nature reports of the
State Institute for Public Health and
the Environment.
7 TWO EXAMPLES TO ILLUSTRATE
THE IMPLEMENTATION OF THE
COMPLIANCE STRATEGY
7.1 High Priority: Asbestos
Removal Decree
Asbestos is found in half of all demolished
buildings. If the asbestos is not removed
selectively, it will remain in the rubble.
Asbestos can be released during demoli-
tion work, during transport and in usage in
other products like roads. As such it is a
risk for the public health and for the proces-
sors of the asbestos rubble.
Regulatee:
—Citizens who deliver asbestos
containing rubble.
—Asbestos containing rubble
processors.
—Owners of asbestos containing
products.
Reasons for non-compliance:
— Knowledge of the rules ( T 1)
-Cost / benefit ratio (T 2)
—Degree of acceptance of the
regulation (T 3)
— Loyalty and obedience of the
regulatee (T 4)
— Monitoring probability (T 7)
—Severity of sanctions (T 11)
Intervention mix:
— Communication (T 1).
—Frequent (T 7) and severe
enforcement actions: administrative,
criminal, civil
-(T 2, 3, 4,). Often the costs of
separating asbestos from other
material at the beginning of the
rubble chain are not very high (it only
takes time and knowledge of what is
asbestos or not - the particles are
large enough tot detect); further on
in the chain when the asbestos
containing rubble processors are
the regulatee, the costs of
separating asbestos from the rest
rise enormously and the regulatee
takes the chance of being detected.
— Higher sanction rates (T 11).
7.2 High Risk, Low Non-Compliance
Rate: Fireworks Decree
(Fireworks For Consumers)
Most of the important regulatees (the
wholesalers) comply. But, if there were to
be an explosion it would create a great risk
(safety and health). Buildings could be
damaged and, far more serious, there
could be fatalities.
Regulatee:
—Wholesalers usually store fireworks
safely. They adhere to requirements
concerning quantities, packaging and
distance to surrounding buildings.
—Citizens: a diffuse group with
unknown storage of fireworks
(quantities and quality).
Reasons for non-compliance:
Wholesalers:
—Cost / benefit ratio (T 2): large
investments have to be made in
order tot comply to the rules. At this
moment we see many wholesalers
stop their business because of the
costs. Reducing the standards is
non-negotiable.
—Chance of detection (T 7)
—Severity of sanctions (T 11): sanction
rates are so low, that some whole-
salers take the risk
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VAN DER SCHRAAF 93
Citizens:
— Knowledge of the rules (T 1).
-Cost / benefit (T 2): there is a lot
to win in storing and selling (illegal)
fireworks (large benefit factor).
—Acceptance of the rules (T 3) : rules
are for anyone but me.
—Severity of sanctions (T 11): sanction
rates are so low, that citizens often
take the risk.
Intervention mix:
Wholesalers:
— Heightening the perception of
monitoring, by selective action (T7).
—Communication: deterrence, use
of the media, shame and blame etc
(T2).
—Enforcement: frequent and severe
enforcement actions: administrative,
criminal, and civil. Selection of the
well known non-compliers (T2).
— Higher sanction rates (T11).
Citizens:
—Communication (T1, T3).
— Deterrence (T2 and T3).
— Enforcement (T2 and T11).
Appendix A
In order to get a feeling on how the
table of eleven is used in the Netherlands,
some questions can be formulated to get
an impression of the behavioural choices
the regulatee makes:
1. Knowledge of the regulation: the
acquaintance with and clarity of the
regulation within the regulatee group.
Does the regulatee know the rules? Is
the regulation not too extensive? What
should the regulatee do in order to
know the regulation?
Is there a possible doubt (within
the regulatee group) about the
applicability of the regulation? Does
the regulatee understand what is
meant by the regulation? Is a
certain level of (technical or juridical)
expertise necessary to understand the
regulation?
2. Cost / benefit: the financial and
material pro's and con's which follow
compliance or non-compliance of the
regulation in terms of time, money and
effort.
Financial:
How big is the effort to comply
(administrative, physical)? Are
there specific advantages due to
compliance, e.g. financial incentives?
Disadvantage of violation: Are there
specific (physical) circumstances,
which interfere with violation of the
regulations (is there a violation
threshold)?
Advantage of violation: does violation
of the regulation deliver advantages
for the regulatee in terms of time,
money?
Immaterial:
Is compliance (or non-compliance)
good for the image or reputation of
the regulatee?
Does compliance or violation of the
rules deliver other social pro's and
con's?
3. Degree of acceptance of the
regulation: the extent in which policy
and regulations are acceptable for
the regulatee.
Does the regulatee accept the
policy and the derived standards as
reasonable? Can the regulatee agree
with the underlying policy assumptions
or is there a difference in point of view
between policymakers and regulatees?
Are there other actors (branch
organisations or implementation
organisations), which can promote
compliance? Can the regulatee
himself contribute to the policy (self
regulation)?
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4. Loyalty and obedience of the
regulatee: the extent of conformance
of the regulatee to the power of
government.
Does the regulatee comply most of
the time? Does the regulatee respect
government, the law, and the
supervisor?
In what extend do the values of the
regulatees conform to the values of
government? Does the reguiatee have
other customs, which compete with
the rules?
5. Informal monitoring: the perceived
chance on positive/negative
sanctioning of the behaviour by
non-governmental actors.
Does the environment notice non-
compliance? Is there tight bond
between the regulatee and his
environment? Are there informal
monitoring structures? Is there a form
of social sanctioning?
6. Monitoring probability: the chance
that an act of non-compliance will be
reported tot government.
Does the environment of a regulatee
usually intent to report acts of non-
compliance to the government? Do
they know where to report to? Are
there means tot enlarge the probability
to report to the government?
(snitch-lines / blab-lines).
7. Monitoring probability: the perceived
chance of monitoring an act of
non-compliance.
How big is the actual chance
( monitoring density)? How big does
the regulatee think it is? On what
issues the subjective monitoring
probability depend?
8. Detection probability: the perceived
chance of detection of the violation
when supervised by the supervisor.
How difficult is it to detect the
violation? Are violations time- and/
or place bound and therefore more
difficult to detect? How difficult is it
to lead the violation back to the
regulatee? Is it easy tot falsify
important documents?
9. Selectivity of the inspector: the
(heightened) perceived chance on
monitoring and detection due to
selection of regulatees (firms, persons,
acts, domains).
Are there more non-compliers
detected by random / non-random
sampling? Does the regulatee think
he is monitored more often than the
ones who comply? What are the used
methods to track down offences?
10. Chance of sanctions: The perceived
chance of sanctions after detecting
an offence.
How big is the chance that a sanction
will be given after detection? How big
does the regulatee think it is? Is it
hard to prove an offence? Does the
regulatee think that the chance of
aquittance is high? What about the
tolerance strategy of the government?
11. Severity of sanctions: the height and
sort of sanctions and the negative
impact of sanctioning.
Does the regulatee know which
sanction can be given when non-
complying? Does he think it will be
high (long imprisonment, high penalty,
much effort to undo the loss)? Does
the sanction bring the financial
probabilities of the offender into
account? How fast will the sanction
be set? Is there a shame-and-blame
policy?
Is the fact that one is prosecuted
more important than the actual
sanction? Are there other impacts
at stake when sanctioned (loof
reputation, image etc)?
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KLEIN 95
MINIMUM CRITERIA FOR A PROFESSIONAL
ENVIRONMENTAL ENFORCEMENT PROCESS
KLEIN, WOUT
Project Manager, Inspectorate of Housing, Spatial Planning and the Environment, P.O.
Box 16191, 2500 BD The Hague, The Netherlands, wout.klein@minvrom.nl
SUMMARY
Environmental enforcement agencies (inspectorates) in the Netherlands adopted a
set of minimum criteria or quality standards that should be fulfilled by any inspectorate to
ensure a professional enforcement process. These criteria are based upon an approach of
total quality management: a professional process is reflected in professional people, poli-
cies, procedures, performance and products.
1 INTRODUCTION
From 2002 until 2005, a national
project was carried out in the Netherlands
by all environmental enforcement agencies
(inspectorates) of the local, provincial and
national governments to improve, or rather
ensure, a "Professional environmental
enforcement process" within all these
agencies.
This project set minimum criteria
for the professional enforcement process.
Consequently all agencies in the Nether-
lands did a self-evaluation to determine to
what extent they fulfilled these criteria on
January 1, 2003. As was expected, not one
of the approximately 550 agencies was
completely professional. A vast majority of
the inspectorates could not fulfil more than
half of the minimum criteria. This created a
perfect starting point for a collective
improvement action. All agencies commit-
ted themselves to fulfil the criteria by the
date of January 1, 2005. In January 2005,
another self-evaluation was conducted,
however results were unavailable.
This paper gives a summary of the
appointed minimum criteria. In volume 2 of
the proceedings the results of the final self-
evaluation will be presented, together with
a description of the project approach as a
whole.
2 MINIMUM CRITERIA
The minimum criteria or quality
standards are presented in four groups,
comparable with the well-known "Deming
circle" of Plan-Do-Check-Act, used in qual-
ity management schemes. The four groups
are (1) targets and conditions; (2) strategy
and working methods; (3) implementation
and operation; and (4) evaluation. Each
group consists of several criteria, summing
up to 19 criteria:
—Targets and Conditions
-Problem analysis.
-Priority setting and measurable targets.
-Guaranteeing human and financial
resources.
-Organisational conditions.
—Strategy and Working Methods
-Compliance strategy.
-Inspection strategy.
-Sanction strategy.
-Condoning strategy.
-Internal and external tuning.
-Protocols and working instructions.
-Protocols for communication,
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information management, control and
exchange.
—Implementation and Operation
-Inspection and enforcement programs.
-Size of inspection and enforcement
capacity.
-Quality of inspection and enforcement
capacity.
-Facilities supporting execution.
— Evaluation
-Quality assurance.
-Performance monitoring.
-Accountability of efforts, performance.
and results.
-Benchmarking and auditing.
These criteria are described in
detail in below in the "Overview of Quality
Standards."
3 OVERVIEW OF QUALITY
STANDARDS
This section provides an overview
of quality standards. This description splits
the criteria up in several elements of which
some are minimum and some are optional.
It should be noted that a criterion is fulfilled
only if all minimum elements are fulfilled.
3.1 Group 1: Targets And Conditions
3.1.1 Problem Analysis
The inspectorate acts based on an
analysis of the environmental problems,
the effects of non-compliance and the
expected rate of non-compliance, in order
to steer its inspection and enforcement
efforts.
—The analysis at least includes:
-all installation related and non-
installation related tasks and objects;
-all environmental problems within the
task of the inspectorate;
-the possible effects of potential and
actual offences;
-the frequency of these offences.
— Furthermore (amongst other things)
could be considered:
-a risk assets map.
3.1.2 Priority setting and
Measurable Targets
The inspectorate acts on the basis
of priority setting of the inspection and
enforcement task, elaborated in written
inspection and enforcement targets per
policy area and established in concrete,
measurable inspection and enforcement
targets.
—The priorities and targets at least
include:
-priorities, taking into account the
problem analysis (standard 1.1) and
the evaluations (standard 4.3);
-a description of the inspection and
enforcement target per policy area;
-measurable indicators for all targets,
including agreements on monitoring of
those indicators.
— Furthermore (amongst other things)
could be considered:
-to make transparent the used
methodology for prioritisation;
-to formulate targets (and indicators),
where possible, in terms of compliance
behaviour and environmental progress.
3.1.3 Guaranteeing Human and
Financial Resources
The inspectorate takes care of
adjustment between politically agreed
inspection and enforcement targets and the
employment of staff and use of financial
means and guarantees this in the organisa-
tion.
—Guaranteeing human and financial
resources at least includes:
-a transparent system connecting
politically approved inspection and
enforcement priorities with inspection
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KLEIN 97
and enforcement targets (standard 1.2)
as well as with the deployment of
personnel and other resources
(standard 3.2);
-fixing in the budget of human and
financial resources to be used for the
execution of the inspection and
enforcement task.
3.1.4 Organisational Conditions
The inspectorate acts based on an
organisational set up and regulations that
are necessary to achieve the inspection
and enforcement targets that were set.
—The organisational arrangements at
least include:
-a separation of licensing activities on
the one hand and inspection and
enforcement activities on the other at
staff level;
-a circulation system for inspectors for
companies with which there is a fixed
inspection and/or enforcement relation;
-document the powers, tasks and
responsibilities;
-procedures for contact and availability
outside office hours;
-document the management of
inspectors with police-powers (if
applicable);
-arrangements for putting out to
contract inspection tasks (if applicable).
— Furthermore (amongst other things)
could be considered:
-a separation of licensing activities and
inspection and enforcement activities
at organisation level.
3.2 Group 2: Strategy and
Working Methods
3.2.1 Compliance Strategy
The inspectorate acts based on a
compliance strategy, containing the instru-
ments with which compliance should be
reached and the role of inspection and
enforcement within that.
—The compliance strategy at least
includes:
-an inspection and enforcement
strategy, consisting of:
-an inspection strategy as mentioned
in standard 2.2;
-a sanction strategy as mentioned in
standard 2.3;
-a condoning strategy as mentioned
in standard 2.4;
-a strategy for the use of other
instruments, other then inspection
and enforcement.
3.2.2 Inspection Strategy
The inspectorate acts based on an
inspection strategy, containing which
inspection modalities can be distinguished
and which the basic work processes are at
each of them.
—The inspection strategy at least
includes:
-routine visits, including their frequency
and incidental visits;
-the inspection of administrations
and documents and the inspection
on reaching environmental quality
standards;
-investigation and verification of self
monitoring arrangements, that are
carried out by or on behalf of the
installation itself;
-supply of information and written report.
— Furthermore (amongst other things)
could be considered:
-carrying out in-depth investigation in
the form of audits or quick-scans.
3.2.3 Sanction Strategy
The inspectorate acts based on a
sanction strategy, containing the basic
approach for administrative and criminal
follow-up in case of non-compliance.
—The sanction strategy at least includes:
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
-a coherent administrative - criminal
approach towards offenders of environ-
mental legislation;
-an appropriate reaction to the
non-compliance found;
-a stringent reaction in case of
continued non-compliance;
-an arrangement for reactions to non-
compliance by the own organisation
and other authorities;
-transparency in setting terms to do
away with (standard) offences and to
the heaviness of the sanctions to be
imposed for these offences.
3.2.4 Condoning Strategy
The inspectorate acts based on a
condoning strategy, of which sanctions
against violators can temporary be
dropped.
—The condoning strategy at least
includes:
-an explicit adoption of the terminology,
contents and procedure of the condon-
ing policy drawn up by the Dutch
national government.
3.2.5 Internal and External Tuning
In the preparation and execution of
its inspection and enforcement tasks, the
inspectorate takes care of internal and
external tuning.
—The internal tuning at least includes:
-tuning with the license writer(s);
-tuning with other relevant departments
and persons inside the organisation.
—The external tuning at least includes:
-arrangements on co-operation with
other relevant organisations involved
in environmental inspection and
enforcement;
-arrangements about situations
where more than one organisation is
competent to inspect or enforce at
the same time;
-arrangements about cases where
more than one organisation is
competent to inspect or enforce
consecutively (chain control).
— Furthermore (amongst other things)
could be considered:
-broadening the programming of the
own inspection and enforcement task
towards co-operation.
3.2.6 Protocols and Working
Instructions
The inspectorate acts based on
protocols for internal and external tuning on
the preparation and execution of its tasks.
—The protocols at least include:
-a working-out in procedures and/
or work instructions of all obliged
elements mentioned in standards
2.1 -2.5.
— Furthermore (amongst other things)
could be considered:
-a working-out of the general
compliance strategy in specific
inspection and enforcement
handbooks, wherever meaningful;
-a working-out of the general inspection
strategy in specific inspection plans.
3.2.7 Protocols for communication.
information management.
information control and
information exchange
The inspectorate acts based on
protocols for communication, information
management, information control and infor-
mation exchange on inspection results,
announced or imposed sanctions and con-
doning decisions.
—The protocols at least include:
-the communication on inspection
results, sanctions and condoning
decisions;
-the information management of
inspection results, sanctions and
condoning decisions;
-the operational information exchange
internally and with other inspection
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KLEIN 99
and enforcement organisations of
inspection results, sanctions and
condoning decisions.
3.3 Group 3: Implementation
and Operation
3.3.1 Inspection and Enforcement
Programs
The inspectorate acts based on an
inspection and enforcement program, to
which the internal organisation is or has
been adjusted.
— Inspection and enforcement programs
at least include:
-a clear coherence/connection with the
priorities set under standard 1.2 and
with the targets;
-a description of the actual inspection
and enforcement activities and the
capacity needed for them;
-the elaboration of the inspection and
enforcement program in an actual
work planning for all parts of the
organisation that are involved.
—Furthermore (amongst other things)
could be considered:
-the elaboration of the inspection and
enforcement program in an actual work
planning at the level of individual staff
members.
3.3.2 Size of Inspection and
Enforcement Capacity
The inspectorate has sufficient
human resources, and/or financial
resources to hire staff capacity for the exe-
cution of inspection and enforcement tasks.
—Sufficient inspection and enforcement
capacity at least includes:
-insight in the capacity that is actually
available;
-sufficient capacity to carry out the
inspection and enforcement program
mentioned under standard 3.1.
3.3.3 Quality of Inspection and
Enforcement Capacity
The inspectorate has sufficient
expertise, and/or financial resources to hire
expertise for the execution of inspection
and enforcement tasks and stimulates the
development of knowledge and skills.
—Sufficient expertise at least includes:
-insight in the necessary expertise in
terms of knowledge, skills and attitude;
-a training plan, including the
determination of time and financial
resources needed to execute the plan.
— Furthermore (amongst other things)
could be considered
-determination and commitment to the
necessary expertise in job descriptions
and/or in a staff formation plan;
-periodical checks of the desired level
of expertise.
3.3.4 Facilities Supporting Execution
The inspectorate has sufficient
quantitative and qualitative resources and
provisions that make it possible to execute
its tasks in a legal, administrative, informa-
tion technological and environmental tech-
nological way.
— Facilities supporting execution at least
include:
-an automated system for planning,
programming and progress monitoring
of the inspection and enforcement task;
-an automated system for the
registration and monitoring of both
installation related and non installation
related inspection and enforcement
tasks;
-those provisions that are needed for
the execution of the inspection and
enforcement task, from a point of
view of information, environment,
legal provisions and administration;
-a good level of maintenance and
calibration of the equipment and
instruments being used.
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
3.4 Group 4: Evaluation
4.1 Quality Assurance
The inspectorate acts based on a
system of internal assurance (description,
assessment and improvement) of the way
in which inspectors carry out their work.
The system of quality assurance at least
includes:
-a process description of the way in
which inspectors have to carry out
their work;
-method to check the assurance of the
execution of the process descriptions;
-improvement mechanisms to facilitate
the adjustment of process descriptions.
— Furthermore (amongst other things)
could be considered:
-Designate a quality assurance
co-ordinator / apply official quality
care system;
-External check of the process
descriptions;
-certification of the process descriptions.
3.4.2 Performance Monitoring
The inspectorate acts based on
systematic monitoring of the inspection and
enforcement process and its results and
effects.
— Monitoring at least includes:
-The own indicators belonging to
targets and/or priorities;
-the monitoring of the results of the
inspection and enforcement activities
in terms of numbers concerning:
• executed inspections;
• detected offences;
• administrative actions (sanctions);
• criminel actions (sanctions).
— Furthermore (amongst other things)
could be considered:
-the own indicators belonging to targets
and/or priorities.
3.4.3 Accountability of Efforts.
Performance and Results
The inspectorate has a system of
internal and external accountability about
the inspection and enforcement process
and its results and effects.
—The accountability at least includes:
-a report on the own indicators
concerning the targets and/or priorities
formulated by the inspectorate itself;
-a report on the agreements made with
other inspecting organisations;
-an evaluation of the inspection and
enforcement results leading to
improvements in the policy process,
the regulatory cycle and the inspection
and enforcement policy;
-feedback on the results and
recommendations.
— Furthermore (amongst other things)
could be considered:
-a (special) version of the accountability
report for the public.
3.4.4 Benchmarking and Auditing
The inspectorate develops a sys-
tem to externally compare, test and judge
its efforts, its organisation and the results of
its inspection and enforcement.
— (Amongst other things) could be
considered:
-the inspectorate compares itself with
colleague organisations;
-benchmarking as a specific task for
one of the staff members inside the
inspectorate.
The set of quality standards mainly
consists of minimum elements, but some
are to be regarded as optional elements.
These optional elements contain sugges-
tions for improvements that can influence
the quality of inspection and facilitate the
implementation of the minimum elements,
but they are not mandatory. In the elabora-
tion the optional elements are always pre-
ceded by the construction: "furthermore
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KLEIN 101
(among other things) could be considered."
To evaluate whether a specific ele-
ment has been met by an agency, three
general preconditions must be fulfilled.
These are legitimacy, availability and topi-
cality.
—Statement of minimum element for
legitimacy: The statement is deemed
legitimate for the agency and its
staff members, if the responsible
politicians (policy plans, budgets) or
the responsible management have
determined an approved it.
—Statement of minimum element for
availability: The statement is deemed
available, if it was documented in a
traceable way in a separate
document/file or as part of a more
extensive document/file or as a system
of elements originating from several
documents/files.
—Statement of minimum element for
topicality: It is difficult to define
unambiguously when the statement is
up to date. This depends on the tasks
and the organisational structure of
the agency. Per element, however
the agency will have to show what it
considers 'topical' and whether it fulfils
this.
The quality standards are applica-
ble whatever accents an agency has in its
activities: inspection of industrial facilities,
controlling hazardous substances or waste
shipment, dealing with non-point sources of
pollution or any other kind of situations that
are in breach of environmental require-
ments. However, each field of activity might
deserve separate assessment to determine
whether quality standards are met in this
particular field.
A professional environmental
enforcement process, fulfilling all minimum
criteria, guarantees
—professional people
—professional policies
— professional procedures
—professional performance
—professional products.
A professional environmental
enforcement process gives a maximum
contribution to the compliance of environ-
mental regulations and to environmental
outcome.
4 REFERENCE
Klein, W. "Minimum criteria for a profes-
sional environmental enforcement process"
(in English), 2002, available at http://www.
lim-info.nl/professionalisering. Additional
material (in Dutch) on the Dutch project is
available at http://www.lim-info.nl/profes-
sionalisering.
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HOWES, ROWDEN, CHEESBROUGH 103
ENVIRONMENTAL MANAGEMENT SYSTEMS
AND REGULATORY COMPLIANCE
HOWES, CHRIS,1 ROWDEN, SANDY,2 and CHEESBROUGH, MARTIN3
1 Acting Head of Modernising Regulation. Environment Agency, Rio House,
Waterside Drive, Bristol BS32 4UD. United Kingdom.
Email: chris.howes@environment-agency.gov.uk
2 Policy Advisor, Modern Regulation, Environment Agency, Rio House, Waterside Drive,
Bristol BS32 4UD. United Kingdom. Email: sandy.rowden@environment-agency.gov.uk
3 Policy Manager, Remas Project. Environment Agency, Head Office, Block 1,
Government Buildings, Burghill Road, Westbury-on-Trym, Bristol, BS10 6BF, United
Kingdom. Email: MCheesbrough@remas.info
SUMMARY
This paper explores the relationship between the adoption of environmental man-
agement systems and regulatory compliance performance as measured in terms of com-
pliance with legislation. It provides background information for the certification systems,
including ISO14001 and other environmental management systems, workshop.
1 INTRODUCTION
1.1 Background
Since the introduction of formal
environmental management systems
(EMS) standards in the 1990s, there has
been debate on how these may support or
even replace parts of the regulatory
process. To date attempts to prove a link
between the presence of an EMS with an
outcome of environmental performance
have been inconclusive. Remas, one of the
most extensive surveys in Europe, is still in
progress. This paper provides a review of
the current position and provides back-
ground to workshop 1E where the debate
will be explored further.
1.2 Integrating EMS in Regulation
Regulators have increasingly limit-
ed resources to spend on checking compli-
ance activities. All regulators are looking for
ways to target these resources more effi-
ciently. EMS can be one tool to help this.
EMSs, such as ISO 14001, were
not designed specifically for use as part of
the regulatory process. However, with
increasing uptake, there is an opportunity
to explore the use of EMS in this context. In
order to do this there are fundamental
questions that need to be resolved.
— How should EMS be used in the
regulatory process?
—What are the essential parts of an EMS
that are important for regulation?
—What standard of registration/
certification is required to enable a
regulator use an EMS in regulation?
— How should the ISO 14001 requirement
for a "commitment to legal compliance"
be interpreted by certifiers/registrars
These questions are discussed fur-
ther in sections 4-6 of this paper.
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2 EMS LANDSCAPE
ISO14001 is the most widely
recognised EMS standard. The numbers of
companies certified as meeting the require-
ments of ISO 14001 grew at a rate of about
20% during 2004 - to around 74,000.
ISO14001 was first released in
1996 and was updated in 2004. The update
provides some significant changes to the
standard to improve the consistency of
implementation. The International Accredi-
tation Forum guidance is working on guid-
ance to improve conformance assessment
of regulatory compliance during the inde-
pendent certification process.
The Eco-management and Audit
Scheme (EMAS)1, is an EU regulation, but
can be applied worldwide. It contains all the
elements of ISO14001, but also places
greater emphasis on legal compliance,
environmental performance and requires a
verified environmental report.
In Europe, over 3000 companies
have adopted EMAS covering nearly 5000
sites. The European Commission centrally
holds details of registered companies and
their statements. EMAS was revised in
2002 mainly to introduce ISO14001 as the
basic EMS component. A third revision is
expected in 2007.
Other EMSs standards exist, for
example as part of the chemical industry's
Responsible Care Management system2.
There are also more localised EMSs, some
of which have their own certification
process, that target small and medium size
companies, or specific industrial sectors.
3 REVIEW OF RESEARCH
ON EMS AND COMPLIANCE
This review is not exhaustive, and
is focused on US and European examples,
but presents a summary of recent studies
where attempts have been made to corre-
late environmental performance and leg-
islative compliance with the presence of an
EMS.
3.1 University of North Carolina/
Multi-State Working Group
The University of North Carolina
and the US Multi-State Working Group3
provide a database of sites in North Ameri-
ca measuring use of EMS and performance
at sites in the United States. The final
report4 was published in 2003.
The study asked the question:
what effect does the implementation of an
EMS, certified to ISO 14001, have on a
facility's environmental performance, regu-
latory compliance, and economic perform-
ance? Performance measures included
self-reported regulatory compliance histo-
ries and annual improvements in emis-
sions.
The study found that the introduc-
tion of an EMS can benefit the environmen-
tal performance at a site, as well as opera-
tions and management, and in some cases
regulatory compliance. However, the evi-
dence also suggested that EMSs are high-
ly variable in content, priorities, and judge-
ment of what is environmentally significant.
The overall conclusion was that the exis-
tence or certification of an EMS did not pro-
vide clear information about the likely envi-
ronmental performance or regulatory com-
pliance of a site.
3.2 University of Sussex, UK
The Science and Technology Poli-
cy Research Unit at the University of Sus-
sex have provided two studies relating
environmental performance to the pres-
ence on an EMS. The Measuring the Envi-
ronmental Performance of Industry (MEPI)5
study, developed measures to compare
overall environmental performance of
industrial companies. Part of the study
compared environmental performance
between companies with no EMS,
ISO14001 EMS or EMAS. The study con-
cluded that there was no evidence to sug-
gest a correlation between having an EMS
and improved environmental performance.
In a second project, PERFORM^
the aim was to benchmark and improve
sustainability performance in industry by
providing companies with comparative
environmental performance data. The find-
ings were similar to the MEPI study.
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HOWES, ROWDEN, CHEESBROUGH 105
3.3 Environment Agency studies
(England and Wales)
A study prepared by the Policy
Studies Institute (PSI), on behalf of the
Environment Agency compared the per-
formance of certified EMSs of 800 major
industrial sites, based on a combination of
regulatory ratings, compliance assessment
and enforcement information. EMS
engagement was measured at three levels,
no EMS, certified ISO14001 and EMAS.
The study concluded there was no evi-
dence that the presence of an EMS
increased the likelihood of compliance with
environmental legislation7.
3.4 Organisation for Economic
Co-operation and Development
(OECD) studies
The OECD has supported a series
of studies in a number of regions in con-
junction with local expert groups to investi-
gate the effect of different policy measures.
The existence of an EMS and relationship
with environmental performance has been
included within many of the studies. In Ger-
many it reported8 that the existence of an
EMS has a crucial effect on performance;
in Norway9 and the United States10 the
EMS may have an effect.
3.5
Remas
The European project, Remas,
considers EMS use in industrial activities. It
aims to correlate types of EMS with envi-
ronmental performance. This is measured
by reference to compliance and enforce-
ment data and comparisons with European
industrial sector performance benchmarks.
The data gathering process is still under-
way. An initial analysis of the first 57 sites
indicates a positive correlation between
certification to ISO14001 and registration to
EMAS and improvement in aspects of envi-
ronmental performance on a site. However,
there is no evidence of better regulatory
compliance. The reasons for the lack of
correlation between EMS and regulatory
compliance are being investigated fur-
ther".
3.6 Summary of the reviews
These studies do not provide
strong evidence to link the presence of a
certified EMS with regulatory compliance or
improved environmental performance. Two
possible reasons for this are provided
below.
—The objectives of the management
system and its certification/registration
may be misaligned with those of
regulation. The scope of an EMS is
typically much wider than that of
regulation, thus reducing the opportunity
for common objectives.
— Not all certified EMSs are equivalent.
EMS standards and guidance are
internationally based and result from a
consensus building process. Terms and
phrases used are designed to be open
to interpretation to allow flexibility across
countries and regions. This can lead
to different standards of certification
in different sectors, in different
regions, and by different certification
organisations. For the regulator this
might mean that the certification to a
particular EMS standard can only be
trusted to the standard of the lowest
level of implementation.
4 ROLES OF AN EMS IN THE
REGULATORY PROCESS
4.1 EMS and compliance
An environmental management
system can be described as a structured
approach to controlling activities on a site
so that the environmental impacts are min-
imised. Environmental legislation created
by government, and enforced by regula-
tors, generally shares the same goal.
There is also a specific link that the
ISO 14001 standard requires whereby an
organisation must commit itself to legal
compliance.
Considering these statements, it
could be concluded that sites with an EMS
should be more likely to be compliant with
environmental legislation and demonstrate
good environmental performance. The
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
presence of an EMS could be used by a
regulator to reduce regulatory effort at
those sites. However, as outlined in section
3, many studies have concluded this rela-
tionship has not been demonstrated. There
is no clear statistical evidence that an EMS
provides regulatory compliance at a site.
4.2 Roles of an EMS to support
and go beyond compliance
There are other aspects of an EMS
that can complement traditional regulatory
activity. Regulation may focus on particular
environmental impacts of an activity. Point
sources of pollution are often addressed,
rather than the indirect environmental
impacts such as product design, trans-
portation, and natural resource consump-
tion. Typically, EMS often encompass wider
organisational activities such as supply
chain management and financial invest-
ment decisions. This is an example of how
an EMS can facilitate an organisation to go
beyond regulatory requirements and bring
wider environmental benefits.
An EMS can have procedural ben-
efits to a regulator. An EMS should provide
a more formal system, which can facilitate
regulation. For example, where compliance
assessment requires checking an opera-
tor's records and monitoring reports, it can
be much easier for an inspector to access
the documents if an EMS is in place. This
may reduce the time an inspector needs to
spend on the compliance activity.
In England and Wales, the Envi-
ronment Agency has developed a risk-
based scheme, which is used as a basis for
permit fees and to plan the resources need-
ed for compliance assessment at a particu-
lar site. This is known as OPRA (Operator
and Pollution Risk Appraisal scheme)12.
Where a site has an EMS, it will receive
credit during the OPRA assessment. The
basis of this is that it is quicker and easier
to regulate the site.
5 LINKS BETWEEN EMS
AND REGULATORY COMPLIANCE
There are many components of an
EMS (based on ISO 14001) that should be
valuable to regulators and industry in
maintaining legal compliance, including:
—identification of legal requirements
—training records
—operational control procedures
—monitoring records
—periodic evaluation of legal requirements
—internal audit
—external certification.
For example, if there were good
evidence that the identification of legal
requirements was comprehensive, and that
there were regular internal checks to
ensure the site was compliant, then the
regulator would have greater confidence in
compliance at the site.
The Remas Project is attempting to
answer some of these questions by first
considering the value of different types of
EMS in terms of the activities associated
with the above elements. These are
assessed in relation to both presence and
delivery of each activity. The results from
an initial set of data provide some confi-
dence that the introduction of an independ-
ently certified EMS at a site does improve
these essential regulatory activities13. This
is consistent to the other studies. Evidence
of an outcome of better regulatory compli-
ance or environmental performance is how-
ever much less conclusive.
6 REGISTRATION, CERTIFICATION
AND COMPLIANCE
Organisations may choose to have
their EMS certified as conforming to a stan-
dard - typically ISO 14001 (although EMAS
is also common in Europe). There is a sys-
tem of accrediting the companies that pro-
vide these certification services (Accredited
Certification). The most recognised is that
provided by the International Accreditation
Forum. This provides for countries to set up
organisations (such as UK Accreditation
Service in the UK, the Registrars Accredita-
tion Board in the US etc) to accredit the
work of certification bodies or registrars.
Typically, the accreditation of
organisations for the certification of man-
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HOWES, ROWDEN, CHEESBROUGH 107
agement systems is less than 5% of the
work of accreditation services. The majori-
ty workload includes supervision of medical
devices testing, engineering and structural
standards and accreditation of laboratories.
It is hard to define legal compliance
at a practical level. This may be one crucial
reason why the introduction of an EMS may
improve systematic activities but does not
necessarily result in improved regulatory
outcomes. For example, each of the follow-
ing may be construed as meeting the 'com-
mitment to legal compliance':
—absolute compliance: where compli-
ance is considered to be absolute, such
as meeting an emission limit value. Only
compliance with the written letter of the
law or permit will suffice,
—negotiated compliance: where regula-
tors agree not to take any action with
regard to a non-compliance. This might
include an agreement or timescale for an
organisation to come back into compli-
ance,
—promised compliance: where an organ-
isation is out of compliance but has an
improvement plan or objective to achieve
compliance in the future.
A first requirement to integrate reg-
ulatory activities with EMS must be to bal-
ance these expectations in both worlds.
This is an aspect of phase 2 of the Remas
project and will be debated at the confer-
ence. The International Accreditation
Forum are also considering providing guid-
ance on this subject.
7 CONCLUSION
This paper has reviewed some
issues in relation to the integration of activ-
ities undertaken in regulating a site and
those implementing a robust EMS. It is our
experience that an EMS brings administra-
tive benefits that help regulation of a site.
However, the joint desired outcome of both
activities, specifically good environmental
and regulatory performance does not
appear to be guaranteed by the introduc-
tion of any current EMS type (although it is
recognised that there are exceptions to this
a some sites).
One reason for this may be differ-
ent expectations regarding what should be
delivered by a certified EMS. A first step to
remedying this situation will be to better
understand these expectations and design
guidance and activities to meet these, per-
haps with commonly agreed performance
metrics. The workshop is invited to consid-
er:
— How should EMS be used in the
regulatory process?
—What are the essential parts of an EMS
that are important for regulation?
—What standard of registration/
certification is required to enable a
regulator use an EMS in regulation?
8 REFERENCES
1 Regulation (EC) No 761/2001 of the
European Parliament and of the Council
of 19 March 2001 allowing voluntary par-
ticipation by organisations in a Commu-
nity eco-management and audit scheme
(EMAS). 2001. http://europa.eu.int/
comm/environment/emas/index_en.htm
2 Responsible Care. International Council
of Chemical Associations (18 February
2005) available at http://www.icca-
chem.org/section02a.html
3 Multi State Working Group on Environ-
mental Performance, http://www.mswg.
org/
4 University of North Carolina. 2003. Envi-
ronmental Management Systems: Do
they improve performance.http://ndems.
cas.unc.edu/
5 University of Sussex. Science and Tech-
nology Policy Research. 2001. http://
www.environmentalperformance.org/out-
puts/FinalReport.PDF
6 University of Sussex. Science and Tech-
nology Policy Research. Project
PERFORM. 2003. http://www.sustain-
ability-performance.org/index.php
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7 Policy studies Institute, 2002. Regulatory
Relief and Certified Environmental Man-
agement Systems http://www.psi.org.uk/
research/project.asp?project_id=16
8 Zentrum fur Europaische wirtschafts-
forschung GmbH, Organisation for Eco-
nomic Co-operation and Development
and RWI Essen. Environmental Policy
Tools and Firm-Level Management Prac-
tices in Germany. 2004. http://www.oecd.
org/dataoecd/26/17/31685533.pdf
9 Norwegian School of Management,
Organisation for Economic Co-operation
and Development Environmental Policy
Tools and Firm-Level Management Prac-
tices in Norway. 2004. http://www.oecd.
org/dataoecd/25/37/31684454.pdf
0 North Carolina State University, Organi-
sation for Economic Co-operation and
Development Environmental Policy Tools
and Firm-Level Management Practices
in the United States. 2004. http://www.
oecd.org/dataoecd/25/60/31874334.pdf
11 Policy Studies Institute. 2004. Analysis of
an initial sample data for the United King-
dom. www.remas.info
12 Environment Protection Operator and
Pollution Risk Appraisal. Environment
Agency (18 February 2005) available at
www.environment-agency.gov.uk/epopra
13 Policy Studies Institute. 2004. Analysis of
an initial sample data for the United King-
dom.
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BELTAN 109
INSTRUMENTS FOR THE SUSTAINABLE DEVELOPMENT
OF COMPANIES: ENVIRONMENTAL AGREEMENTS
BELTRAN, Ma DE LOS ANGELES BARRECHEGUREN
Conselleria de Medio Ambiente; Xunta de Galicia; Santiago de Compostela; Spain,
chiqui.barrecheguren.beltran@xunta.es
SUMMARY
The promotion of a sustainable development as well as the principle of prevention
and reduction of contamination at source demands and requires that the companies
involved adopt appropriate environmental policies and management systems. Public
Administrations should encourage the environmental participation of companies in these
objectives by means of the adoption and of a commitment to continuous improvement of
their performance. The environmental agreement is the framework used to define voluntary
agreements between the Administration and the companies in order to plan better environ-
mental performance. In the Autonomous Community of Galicia, northwest of Spain, the
Decree 295/2000 has regulated this framework. It sets the guidelines for the companies to
conform to environmental regulations and also encourages strategies of a local or region-
al nature as an instrument towards the ironing out possible conflicts between environmen-
tal and industrial values.
1 INTRODUCTION
Any company in its normal every-
day operation can generate an impact on
its surrounding environment. Such impacts
are transmitted in the form of discomfort,
loss of resources or contamination of the
environment.
The company can undertake the
reduction of the damage to the environ-
ment from two different perspectives. One
is from that of development and the appli-
cation of the appropriate legislation: this
perspective is known as "command and
control" and imposes standard limits and
obligations for all companies, and so its
efficiency is limited: economically, because
a certain point is reached where the envi-
ronmental improvement obtained has a
social marginal cost superior to the social
benefit.
The other perspective springs from
the company's firm belief that protection of
the environment it is not just a legal obliga-
tion but also a profitable economic strategy,
which generates savings, gives access to
important market quotas and improves the
social image of the company. If the environ-
mental policy is part of the general policy of
the company which considers environmen-
tal protection as a business strategy, then
higher levels of commitment would ensue,
contributing progressively to the protection
of the environment through the use of good
environmental practices.
In fact, the sustainable company is
that which adopts the latter perspective,
because it not only helps itself but also the
environment in terms of social welfare.
Therefore, this concept of sustain-
able development is the foundation on
which all company initiatives should be
developed. It enables any project to be car-
ried out in a manner compatible with the
protection and conservation of the environ-
ment and consists of three areas: econom-
ic, social and environmental. The applica-
tion of the concept of sustainable develop-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
ment is closely linked to management
methods, which define, for better or worse,
the present and future relationship between
a company and the environment. To foster
this relationship, companies should be
increasingly aware of the concept of Corpo-
rate Social Responsibility.
2 CORPORATE SOCIAL
RESPONSIBILITY
The aim of Corporate Social
Responsibility (CSR) is to generate strate-
gies by which profit may be obtained in a
sustainable manner. The introduction of
CSR criteria into business management is
based on three principles: regulation of
policies and management systems in the
economic, social and environmental areas;
clear, transparent information on achieved
results; and the external scrutiny of the
obtained results. As such, it represents a
new model of business operation and aims
to guarantee sustainable growth, a concept
which is inherent to business success.
A company with social responsibili-
ty is conscious of its need to invest in the
community, because if this then thrives, the
consumer market would generate more
profit.
Consumer perception of the best
companies usually includes a factor of
social responsibility, which benefits the
company in terms of:
— Identification with the community
—Strengthening of image
—Greater faith in the trademark
—Marks a difference with competitors
— Increases client loyalty
—Enjoys a more favourable attitude from
consumers and communication media
Therefore, by incorporating Corpo-
rate Social Responsibility in the companies
strategic and management model, the con-
fidence of its clients can increase, it helps
optimize company management and
improves stock-market performance. Care-
ful monitoring and analysis of these CSR
strategies allow us to adapt them to the real
scenario.
Given the advantages taking on
CSR as a management model for the com-
pany, we have search for the means to
apply it in an organized manner. In achiev-
ing this aim the Environmental Agreement
has turned out to be a very potent tool
indeed.
Public administration should
encourage companies to participate by
means of adopting commitments aimed at
the continuous improvement of their per-
formance. To this end, the Consellerfa de
Medio Ambiente of the Xunta de Galicia
regulated the environmental agreement
with a Decree passed in December 2000.
The aim of such environmental
agreements is to promote voluntary agree-
ments between companies and the admin-
istration, in a way that establishes preven-
tative and correctional measures, particu-
larly in situations with conflictive environ-
mental scenarios, technological innovation
in production, contamination elimination
systems and, in general, the continuous
improvement of their performance.
3 IMPLEMENTING AN
ENVIRONMENTAL AGREEMENT
IN GALICIA
The environmental agreement
allows us to establish guidelines for compa-
nies to adapt to environmental legislation,
and also promote local or regional strate-
gies and environmental actions as means
to iron out possible conflicts between envi-
ronmental and industrial values, thus per-
mitting economically viable solutions.
Also, the principle of prevention
and reduction of contamination in its origin
coupled with the promotion of sustainable
development, demands that companies
adopt an adequate environmental policy.
This leads to the implementation of envi-
ronmental management systems, or, in
other words, it gets a commitment from the
company to improve its performance in a
reasonable and continuous manner. For
this reason, those companies signatory to
an environmental agreement with the
administration of the Autonomous Commu-
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BELTAN 111
nity of Galicia, will have to implement the
European Environmental and Audit Man-
agement System (EMAS) in those produc-
tion centres binding to the agreement.
The implementation of EMAS in an
installation involves the selection of envi-
ronmental indicators, their measurement
and publication in order to describe each of
its environmental impacts. The measure of
the chosen indicators is the fundamental
first step for the implementation of a series
of best available techniques and good envi-
ronmental practices, as well as for the
assessment of their effectiveness. These
indicators can also be used by companies
to write environmental reports on sustain-
ability in accordance with the model of the
Global Reporting Initiative (GRI), often
used by CSR.
EMAS is a guarantee of continuous
improvement in the environmental perform-
ance of the installation and establishes a
periodicity of environmental obligations,
which means that up and running compa-
nies must comply with the technical requi-
sites according to current legislation. Also,
it is a guarantee of environmental responsi-
bility and environmental protection. The
implementation of a management system
of this kind implies an improvement in the
production process, because, for example,
the decrease in the generated waste is
often associated with a conversion of part
of the waste into by-products which can be
partly re-introduced into the production
process. This also gives important eco-
nomic savings, because both the efficiency
and productivity of the installation are
increased.
Signing an environmental agree-
ment involves a commitment on the part of
the company to carry out a series of specif-
ic projects within a limited period of time.
The regularisation and development of this
agreement never should lead to a continu-
ing harm or damage to the environment.
Compliance with acquired commit-
ments is supervised by mixed commissions
of personnel from the company and the
Administration. These commissions control
and monitor the environmental agreement
and can modify the scope or the lifetime of
any projects pertaining to that agreement.
The economic viability of the proj-
ects is fundamental. For this reason the
signing of an environmental agreement will
benefit a company in the economic and fis-
cals measures which might be established
by the Administration to encourage envi-
ronmental prevention and promotion of the
best available techniques.
4 CONCLUSION
To this end, the Central Govern-
ment of Spain promulgated in 1997 the first
Royal Decree to regulate the issue of a cer-
tificate to validate the investment in envi-
ronmental protection. The Galician Admin-
istration passed a Resolution in 2002 to
decide the documentation required toob-
tain this certificate. This represents an
incentive for the companies because it
allows them to deduct a 10% of the total
amount invested in equipment intended to
protect the environment in their installa-
tions.
The Royal Decree 1777/2004, 30
July, Regulation of corporative tax, states in
its article 38 the necessary requisites for
such a deduction. These are the following:
—The investment should lead to
compliance with environmental
legislation on emissions to air and to
water as well as to production, recovery
and treatment of industrial waste and to
the improvement of the legislation
demands.
—The investment should be carried out
under plans, programs or agreements
passed or signed by the appropriate
environmental administration
Therefore, the correct development
of an Environmental Agreement between
the company and the Administration guar-
antees compliance with he requisites for
issuing the validation certificate for invest-
ment to protect the environment. Apart from
being a useful tool in environmental man-
agement, the environmental agreement
has turned out to be a key factor in the eco-
nomic management of a company, simply
because it defines the economic planning
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of investments as well as facilitating the
means to get money to finance invest-
ments.
All things considered, we can con-
clude that the signing of an environmental
agreement encompasses all the pillars on
which the CSR is based: it formulates com-
pany policy and plans long-term investment
and facilitates its finance. It imposes the
implementation of an environmental man-
agement system (EMAS) which eases
company management, increases the
transparency of information by means of
the environmental declaration and guaran-
tees external scrutiny of the results
obtained because that declaration has
been validated by an environmental verifier
and revised administrative personnel.
For these reasons, environmental
agreements serve as a big umbrella under
which the financial, social and environmen-
tal management of the company can devel-
op in a coordinated way and proves itself to
be an excellent instrument to enable sus-
tainable enterprise development.
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MORITA, ZAELKE 113
A REVIEW OF EMPIRICAL STUDIES ON
ENVIRONMENTAL COMPLIANCE
MORITA, SACHIKO1 & ZAELKE, DURWOOD2
1 Law Fellow, Institute for Governance & Sustainable Development
2 Director, INECE Secretariat; President, Institute for Governance & Sustainable
Development; and Co-Director, Program on Governance for Sustainable Development,
University of California, Santa Barbara's Bren School of Environmental Science
& Management
2141 Wisconsin Ave. NW, Suite D2, Washington, DC 20007, United States
dzaelke@inece.org
SUMMARY
In recent years, researchers have begun moving beyond case studies to analyze
broader datasets and test specific hypotheses generated by various theories of compli-
ance. These empirical studies offer policymakers insights about the success of specific
compliance strategies. However, these studies are still fairly sparse, and many are based
on self-reported data by industries and governments which raise questions of accuracy.
Some compliance agencies are beginning to collect broader datasets to help determine
what is working and what is not, and compliance officials are starting to turn to indicators
to measure the status of air and water quality, waste management, and land use. The prac-
titioners' community, including the International Network for Environmental Compliance
and Enforcement (INECE), should work together with the research community to generate
policy-relevant hypotheses and to further develop the available datasets to test such
hypotheses empirically.
1 INTRODUCTION
Most enforcement and compliance
agencies have limited and fixed budgets.
Therefore, policymakers and practitioners
are increasingly turning to empirical studies
to analyze the effectiveness of various poli-
cies and compliance strategies in order to
identify the optimal strategies that would
achieve the highest compliance rate at the
lowest cost. Academic and NGO
researchers also have begun to focus on
empirical analysis to test their hypotheses.
However, the empirical literature
on environmental enforcement is fairly
sparse, and only in recent years have com-
prehensive data on compliance become
available to researchers. Thus, a handful of
studies at the national level have focused
either on oil spills or on specific industries
such as the pulp and paper industry, where
public agencies like the U.S. Coast Guard
and U.S. Environmental Protection Agency
(EPA) have maintained or funded the data
collection.
Empirical studies at the internation-
al level are even more scarce. Much of the
data on the implementation of and compli-
ance with Multilateral Environmental
Agreements (MEAs) come from govern-
ments through national reports. As will be
discussed later in this paper, self-reporting
by governments can result in inaccurate or
untimely reporting. The key data, of course,
are not what the states say they are doing,
but what they actually are doing to imple-
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ment their obligations under various MEAs.
This includes passing national legislation;
providing appropriate training and funding
for the agencies responsible for compli-
ance; and undertaking the enforcement
and compliance assistance efforts needed
to achieve compliance.
Some efforts have been made to
build more available datasets on environ-
mental enforcement and compliance. For
instance, EPA now requires the disclosure
of specified chemical emissions by private
firms under threat of stiff penalties through
its Toxics Release Inventory program.1 At
the international level, Oran Young, Helmut
Breitmeier, Michael ZCirn and others have
created the International Regimes
Database (IRD) to empirically analyze 23
MEAs.2
Despite these efforts, most empiri-
cal studies done thus far are incomplete in
two ways. First, most available data today
are based on self-reported data from indus-
tries and governments, and these data
raise questions of accuracy. Inadequate
data or inaccurate datasets can lead to
misleading depictions of what is happen-
ing. Moreover, the lack of data also makes
it difficult to generate and empirically test
policy-relevant hypotheses. Second, most
empirical studies have not assessed where
on the "compliance spectrum" the targets of
their studies fall. Chester Bowles has said
that, "20 percent of the regulated popula-
tion will automatically comply with any reg-
ulation, 5 percent will attempt to evade it,
and the remaining 75 percent will comply
as long as they think that the 5 percent will
be caught and punished."3 If the targets of
empirical studies fall in the 20% category,
then those studies tell us little about the
success of the regulation. An appreciation
of where on the compliance spectrum firms
or industries fall is critical in order for empir-
ical studies to generate meaningful results.
There continues to be a great
demand for more well-functioning, reliable,
and comprehensive data gathering sys-
tems. NGOs and various international net-
works like INECE have already helped
gather and validate information, and they
will continue to be key players in the devel-
opment of such information gathering sys-
tems. In addition, collaboration between
the practitioner and research communities
also will be vital to developing more com-
prehensive empirical data on environmen-
tal compliance, as well as to generating the
most policy-relevant hypotheses.
2 AVAILABLE EMPIRICAL STUDIES
AT THE NATIONAL LEVEL
This section of the paper intro-
duces several empirical studies that have
been conducted at the national level. Due
to the space limitation, this paper will be
able to provide only a few examples of
these studies and is not meant to be
exhaustive. Moreover, this paper does not
necessarily endorse or affirm the conclu-
sions drawn by these empirical studies;
rather, it aims merely to provide a general
overview of a selection of the available
empirical studies on environmental compli-
ance.
2.1 Government Inspection
and Compliance
As stated above, many empirical
studies at the national level involve oil spills
or specific industries such as the paper and
pulp industry because relatively compre-
hensive data is available for these sources.
One set of these studies examines the
effects on compliance rates from increas-
ing inspections; another set examines the
effects on compliance from raising fines or
sanctions.
The earliest empirical analysis of
environmental monitoring and enforcement
activities appears to be Epple and Vissch-
er's 1984 study, which examined the U.S.
Coast Guard's enforcement of oil spill reg-
ulations and found that increased monitor-
ing activity results in lower oil spill volume.4
Cohen extended the Epple-Visscher analy-
sis in 2000 by empirically comparing the
effectiveness of different types of Coast
Guard monitoring activities, and concluded
that: (1) actual monitoring of oil transfer
operations was an effective deterrent; (2)
random port patrols designed to detect
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MORITA, ZAELKE 115
spills were also effective; and (3) inspec-
tions of vessels to determine whether or not
they were in compliance with oil spill pre-
vention regulations was ineffective in terms
of oil spill volume.5
In 1990, Magat and Viscusi studied
the impact of government inspections on
water pollution levels and compliance rates
in the pulp and paper industry in the U.S.6
Their study also suggested that higher lev-
els of inspections result in lower levels of
pollution. Liu replicated the Magat-Viscusi
study in 1995 with updated data and more
complete information on inspections and
their impacts on compliance rates.7 Unlike
Magat and Viscusi, Liu found that
increased inspections do not necessarily
reduce the number of known violations.
Nadeau's 1997 study of EPA
enforcement effectiveness extended the
previous analyses by including the length
of time of violation. Overall, he found that
an increase in monitoring and enforcement
activities resulted in reduced length of vio-
lation.8 Laplante and Rilstone's 1996 study
of pulp and paper mills in Canada conclud-
ed that even the mere anticipation of future
inspections leads to reduced emissions
and to an increased frequency of self-
reporting.9
Studies of other industries reveal a
similar relationship between inspections
and compliance rate. For instance, in 1996,
Gray and Deily examined steel industry
behavior and government inspections and,
consistent with most of the other published
empirical papers, found that increased
inspections lead to a higher compliance
rate.10
2.2 Sanctions and Compliance
Other studies have focused on the
effects of various sanctioning measures.
For example, Shimshack and Ward's 2004
study analyzed the effects of fines and
found that a fine helps to deter future viola-
tions by the sanctioned plant as well as
other plants in the same jurisdiction.11 The
study also compared the effects of these
monetary sanctions against those of inter-
mediate enforcement actions (lEAs), such
as formal administrative orders, formal
notices of noncompliance, and administra-
tive consent orders, and concluded that the
lEAs have statistically insignificant impacts
on compliance.
2.3 Information Disclosure and
Compliance
There have been a few empirical
studies on non-regulatory compliance tools
as well. One such study was done by
Konar and Cohen, who studied the impacts
of the EPA's Toxics Release Inventory pro-
gram (TRI). The study found that the firms
with the largest negative abnormal stock
price returns upon the initial announcement
of TRI emissions were the firms that subse-
quently reduced their emissions the most.12
2.4 Different Enforcement
Approaches and Compliance
Still other studies have focused on
the effectiveness of different enforcement
approaches. In a 1995 study, Harrison
compared the different approaches to com-
pliance policy that are found in the U.S. and
in Canada, focusing on the pulp and paper
industry.13 She found that there is higher
compliance in Canada, where there is a
more "cooperative" approach, than in the
U.S. In contrast, an earlier similar study by
Kagan, Thornton, and Cunningham found
that different compliance approaches do
not seem to have significantly different
impacts.14 They analyzed environmental
performance in 14 pulp and paper manu-
facturing mills in British Columbia, Canada;
Australia; New Zealand; and the states of
Washington and Georgia in the U.S., and
concluded that, despite the different types
of compliance approaches, there was no
consistent difference among regulatory
jurisdictions in the environmental perform-
ance.
3 EMPIRICAL DATA ON
ENVIRONMENTAL COMPLIANCE
AT THE INTERNATIONAL LEVEL
Empirical data at the international level
is even more scarce than at the national
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level. However, there have been some
efforts to build empirical datasets to study
environmental compliance with several
MEAs. For example, Young, Breitmeier,
Zurn and others have created the Interna-
tional Regimes Database (IRD). This rela-
tional database, which was assembled
over a ten-year period, allows researchers
to quantitatively analyze a set of 23
MEAs.15 It appears to be the only such
database yet assembled in the world, and
will allow researchers to move beyond case
studies and "to 'test' propositions regarding
the formation and performance of regimes
using relatively large numbers of records
dealing with specific variables." The
authors present an initial analysis showing
that specific regimes make a difference in
collective outcomes, that strong sanction-
ing measures in these regimes have impor-
tant effects on the compliance rate, and
that some "softer" measures and compli-
ance assistance also play a powerful role.16
Other studies have focused on a
particular international environmental
regime. For instance, Young and Levy, as
well Raustiala and a few others, have stud-
ied the effectiveness of the Convention on
Long-Range Transboundary Air Pollution
(LRTAP) and its subsequent protocols.17
They have concluded that the Convention
has enjoyed a relatively high compliance
rate, with many member states even going
well beyond the regulatory targets.
In 1999, Mitchell, McConnell,
Roginko, and Barrett conducted a detailed
study on the International Convention for
the Prevention of Pollution of the Seas by
Oil (OILPOL) of 1954 and the International
Convention for the Prevention of Pollution
from Ships (MARPOL).18 They analyzed
the amount of tankers' oil discharges
before and after the implementation of
these Conventions and concluded that the
Conventions likely helped reduce the oil
discharges.
In addition, Weiss has empirically
analyzed the Montreal Protocol on Sub-
stances that Deplete the Ozone Layer
(Montreal Protocol).19 She noted a large
reduction in the consumption levels of the
controlled substances but concluded that
the Protocol has suffered from member
states' significant noncompliance with its
reporting requirement.
Finally, Reeve has done an empiri-
cal study on the 1973 Convention on Inter-
national Trade in Endangered Species of
Wild Fauna and Flora (CITES).2° She
noted some success of the Convention in
curtailing illegal trade in wildlife but also
pointed out significant noncompliance rates
with the Convention's requirements for
reporting, passing of national implementa-
tion legislation, establishment of national
scientific authorities, and contribution to the
CITES Trust Fund.
4 CONCLUSION
Environmental protection and sus-
tainable development are data intensive
efforts. "Uncertainty seems to be the hall-
mark of the environmental domain. Dis-
agreements over how best to cope with
information deficits have translated into bit-
terly partisan and divisive environmental
politics and limited progress in recent years
in pollution control and natural resource
stewardship."21
We have made significant progress
in collecting empirical data at both the
national and international levels. Compli-
ance officials and enforcement agencies
have begun collecting data, and policymak-
ers have increasingly turned to indicators.
Indicators are an important part of a prag-
matic, empirically-grounded approach to
environmental management based on the
collection of hard data on actual conse-
quences of decisions that then inform sub-
sequent rounds of decision-making "in a
continuous information feedback loop that
enables dynamic readjustment of policy
and practice."22 INECE has significantly
contributed in this endeavor by developing
an indicators project.23 In addition, INECE
is helping coordinate the efforts of the
research community with the practitioner
community to ensure that the research
community focuses on the most important
questions and not just those where the
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MORITA, ZAELKE 117
datasets are most convenient.
All of these efforts have certainly
helped us understand the current state of
compliance with numerous national and
international environmental regulations.
However, the available datasets are still
scarce to conduct an accurate evaluation of
existing policies and strategies. Moreover,
environmental and health quality is contin-
uing to deteriorate. Therefore, it is essential
to continue and better support the efforts to
further build empirical studies on environ-
mental compliance. Moreover, it is equally
important to build feedback loops into poli-
cy and strategies so that law and gover-
nance take account of these empirical find-
ings, adjust accordingly, and get ahead of
the environmental problems they are
designed to address.
5 REFERENCES
1 See EPCRA Section 313 Questions and
Answers, at http://www.epa.gov/tri/
guide_docs/1998/1998qa.pdf.
2 BREITMEIER, HELMUT, YOUNG, ORAN R. &
ZURN, MICHAEL, ANALYZING INTERNATIONAL
ENVIRONMENTAL REGIMES: FROM CASE
STUDY TO DATABASE, Chapter 6 (forth-
coming 2005). The IRD contains infor-
mation for more than 50 states and the
European Union. Id. at Chapter 2, 33.
The IRD includes 23 regimes: Antarctic,
Baltic Sea, Barents Sea Fisheries, Biodi-
versity, CITES, Climate Change,
Danube River Protection, Desertifica-
tion, Great Lakes Management,
Hazardous Waste, Inter-American Tropi-
cal Tuna Convention, Conservation of
Atlantic Tunas, International Regulation
of Whaling, London Convention, ECE
Long-Range Transboundary Air Pollu-
tion, North Sea, Oil Pollution, Protection
of the Rhine Against Pollution, Ramsar
(Wetlands), Protection of the Black Sea,
South Pacific Fisheries Forum Agency,
Stratospheric Ozone, and Tropical Tim-
ber Trade. Id. at 19-21.
3 BOWLES, CHESTER, PROMISES TO KEEP: MY
YEARS IN PUBLIC SERVICE, 1941-1969, 25
(1971).
4 Epple, D. & Visscher, M., Environmental
Pollution: Modeling Occurrence, Detec-
tion and Deterrence, 27 J. LAW & ECON.,
29-60(1984).
5 Cohen, Mark A., Empirical Research on
the Deterrent Effect of Environmental
Monitoring and Enforcement, 30 ELR
10245 (2000). Epple and Visscher as
well as Cohen studied the monitoring
activities of the U.S. Coast Guard
because the Coast Guard is one of the
few entities that maintain a comprehen-
sive dataset. See id. at 10245.
6 Magat, W. & Viscusi, W.K., Effectiveness
of the EPA's Regulatory Enforcement:
The Case of Industrial Effluent Stan-
dards, 33 J. LAW & ECON. 331-60 (1990).
7 Liu, P.C., Regulator Inspection and Vio-
lation Deterrence Under Clean Water
Act Regulation of Pulp and Paper Mill
Water Pollution, Ph.D. Dissertation,
Stanford University, 5 (1995).
8 Nadeau, Lewis, EPA Effectiveness at
Reducing the Duration of Plant-Level
Noncompliance, 34 J. ENVTL. ECON. &
MGMT. 54, 77 (1997). The study found
that a 10% increase in monitoring activi-
ty, consisting of inspections and tests,
leads to a 0.6% to 4.2% reduction in the
duration of the time that plants violate
EPA regulations. Id. Moreover, a 10%
increase in enforcement activities,
including administrative orders, legal
actions, and imposition of penalties,
resulted in a 4 to 4.7% reduction in the
length of violation. Id.
9 Laplante, B., & Rilstone, P., Environmen-
tal inspections and emissions of the pulp
and paper industry in Quebec, 31 J.
ENVTL ECON & MGMT, 19-36 (1996).
10 Gray, W.B. & Deily, M.E., Compliance
and enforcement: Air pollution regulation
in the U.S. steel industry, 31 J. ENVTL
ECON. & MGMT, 96-111 (1996).
11 Shimshack, Jay P. & Ward, Michael B.,
Regulator Reputation, Enforcement, &
Environmental Compliance, J. ENVTL.
ECON. & MGMT. (forthcoming 2005).
Their analysis showed that the plants in
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
the same regulatory jurisdiction reduced
violations almost as dramatically as the
fined plant. Id. at 29. This "regulator rep-
utation spillover effect" caused an
approximately 64% reduction in the
probability of the same violation in the
regulated jurisdiction. Id. at 25.
12 Konar, Shameek & Cohen, Mark A.,
Information as Regulation: The Effect of
Community Right-To-Know Laws on
Toxic Emissions, 32 J. ENVTL. ECON. &
MGMT. 109(1997).
13 Harrison, Kathryn, Is Cooperation the
Answer? Canadian Environmental
Enforcement in Comparative Context,
14(2) J. POLICY ANALYSIS & MGMT, 221
(1995).
14 Kagan, R. A., Thornton, D., & Gunning-
ham, N., Explaining Corporate Environ-
mental Performance: How Does Regula-
tion Matter?, 37(1) LAW & Soc. REV. 51
(2003).
15 BREITMEIER, YOUNG & ZURN, supra note 2.
The IRD will become available to the
general public soon.
16 Id., Chapter 3 at 17 & Chapter 4 at 36.
17 Young, Oran & Levy, Marc, The Effec-
tiveness of International Environmental
Regimes, in THE EFFECTIVENESS OF
INTERNATIONAL ENVIRONMENTAL REGIMES
(Oran Young ed., 1999); Raustiala, Kal,
Compliance & Effectiveness in Interna-
tional Regulatory Cooperation, 32 CASE
W. RES. J. INT'L L 387 (2000); MUNTON,
DON, SOROOS, MARVIN, NIKITINA, ELENA, &
LEVY, MARC, Acid Rain in Europe and
North America, in THE EFFECTIVENESS OF
INTERNATIONAL ENVIRONMENTAL REGIMES,
182 (Oran Young ed., 1999).
18 Mitchell, Ronald, McConnell, Moira,
Roginko, Alexei & Barrett, Ann, Interna-
tional Vessel-Source Oil Pollution, in THE
EFFECTIVENESS OF INTERNATIONAL ENVI-
RONMENTAL REGIMES (Oran Young ed.,
1999); see also Mitchell, Ronald,
Regime Design Matters: Intentional Oil
Pollution and Treaty Compliance, 48(3)
INT'L ORG. (1994).
19 WEISS, E. BROWN, The Five International
Treaties: A Living History, in ENGAGING
COUNTRIES: STRENGTHENING COMPLIANCE
WITH INTERNATIONAL ENVIRONMENTAL
ACCORDS, 153 (1998).
20 REEVE, ROSALIND, POLICING INTERNATIONAL
TRADE IN ENDANGERED SPECIES: THE
CITES TREATY AND COMPLIANCE (2002).
21 Esty, Daniel C., Environmental Protec-
tion in the Information Age, 79 N.Y.U. L.
REV. 115, 118(2004).
22 Karkkainen, Bradley C., Toward a
Smarter NEPA: Monitoring and Manag-
ing Government's Environmental Perfor-
mance, 102 COLUM. L., REV. 903, 907-08
(2002) (citing DEWEY, JOHN, LOGIC: THE
THEORY OF INQUIRY 39-40 (1938) and
Dewey, John, Logical Method and Law.
10 CORNELL L.Q., 17(1924)).
23 Through the INECE Environmental
Compliance and Enforcement (ECE)
Indicators Project, an expert team of
practitioners from around the world is
collaborating to develop a scalable
framework to guide the development of
ECE indicator programs at the country
level. Performance Measurement Guid-
ance for Compliance and Enforcement
Practitioners, 7th INECE Conference
Proceedings (2005).
6 BIBLIOGRAPHY
Becker, Gary S., Crime and Punishment:
An Economic Approach, 76(2) J. POLITICAL
ECON., 169 (1968).
Cohen, Mark A., Monitoring and Enforce-
ment of Environmental Policy (Aug. 1998),
at 3-4, reprinted at http://www.worldbank.
org/nipr/work_paper/cohen/cohen.pdf.
Grossman, Dave & Zaelke, Durwood, An
Introduction to Theories of Why States &
Firms Do (& Do Not) Comply With Law, 7th
INECE Conference Proceedings (2005).
Heyes, A.G., Implementing environmental
regulation: Enforcement and compliance,
17(2) J. REG. ECON., 107-129 (2000).
INTERNATIONAL NETWORK FOR ENVIRONMENTAL
COMPLIANCE AND ENFORCEMENT, PRINCIPLES
OF ENVIRONMENTAL ENFORCEMENT, Chapter
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MORITA, ZAELKE 119
10, at 6-7, available at http://inece.org/
enforcementprinciples.html.
Oljaca, N., Keeler, A.G., & Dorfman, J.,
Penalty functions for environmental viola-
tions: Evidence from water quality enforce-
ment, 14 J. REG. ECON., 255, 256 (1998).
Rousseau, Sandra & Proost, Stef, The
Cost Effectiveness of Environmental Policy
Instruments in the Presence of Imperfect
Compliance, working paper series # 2002-
04, available at http://www.econ.kuleuven.
ac.be/ew/academic/energmil/downloads/et
e-wp02-04.pdf (2002).
Spence, David, The Shadow of the Ration-
al Polluter: Rethinking the Role of Rational
Actor Models in Environmental Law, 89
CALIF. L REV. 917, 966 (2001).
YOUNG, ORAN, COMPLIANCE & PUBLIC
AUTHORITY 112 (1979).
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GARVER 121
MEASURING PERFORMANCE THROUGH INDEPENDENT
ENFORCEMENT REVIEW: CHALLENGES AND OPPORTUNITIES FOR
INDEPENDENT REVIEWERS, THE PUBLIC AND THE GOVERNMENTS
AND OTHER INSTITUTIONS SUBJECT TO REVIEW
GARVER, GEOFFREY
Commission for Environmental Cooperation, 393 Rue St-Jacques Quest, bureau 200,
Montreal (Quebec) H2Y 1N9, Canada, ggarver@cec.org
SUMMARY
The submissions on enforcement matters process of North America's Commission
for Environmental Cooperation (CEC) has features similar to those of many other inde-
pendent review mechanisms across the globe that have the potential to examine the
enforcement performance of governments or other institutions, such as development
banks. These mechanisms pose challenges to the different actors that are involved in using
them and implementing them in a manner that yields valuable information. The experience
of the CEC's submissions process illustrates how the public, governments and the CEC
Secretariat have met such challenges in its first ten years. This experience may provide
insight to others involved with similar mechanisms that have as a goal the promotion of
effective enforcement of environmental law. With a focus on the CEC's citizen submissions
process, this paper outlines some of the challenges facing the principal actors in independ-
ent review mechanisms that examine performance of environmental enforcement or relat-
ed obligations: the governments or other entities reviewed, the public and the independent
reviewers.
1 INTRODUCTION
In the early 1990s, Canada, Mexi-
co and the United States took advantage of
the opportunity that the debate over the
North American Free Trade Agreement
(NAFTA) presented to create an institution-
al structure for examining environmental
issues on a continental scale. Established
in 1994 under the North American Agree-
ment on Environmental Cooperation
(NAAEC), the CEC was graced at its incep-
tion with a unique set of mechanisms for
protecting, conserving and enhancing the
environment in a new era of liberalized
trade among the NAFTA partners. Of the
tools in the CEC's innovative toolbox, none
has drawn more attention than the submis-
sion on enforcement matters (SEM)
process under Articles 14 and 15 of the
NAAEC, under which North American non-
governmental organizations and persons
may assert that one of the NAFTA govern-
ments is failing to effectively enforce its
environmental law.
Although submissions on enforce-
ment matters mechanisms have unique
attributes, they belong to a larger family of
independent review mechanisms, or
accountability mechanisms, that exist at
the international, national and sub-national
level. Some members of this family, most
notably the Supreme Audit Institutions that
exist in more than 170 countries across the
globe, generally retain the authority to
choose the topics of review themselves or
respond to requests from government offi-
cials or legislators (INTOSAI 2005). For the
NAFTA countries, these institutions are the
Auditor General in Canada, the Govern-
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ment Accountability Office in the United
States and the Auditorfa Superior de la
Federacion in Mexico.
Organizations whose mission
includes conducting independent investiga-
tions into governments' or other institutions'
performance of their responsibility to
enforce environmental laws or follow
required procedures can have utility to gov-
ernments or other entities reviewed, as
sources of feedback on their performance,
and to the public, in helping to ensure
accountability of governments or institu-
tions to those they represent or serve.
However, to work well and make a positive
contribution, mechanisms such as the
CEC's submissions process present chal-
lenges to the public, to the governments or
institutions whose performance is reviewed
and to the institutions responsible for con-
ducting the reviews.
2 THE CEC'S SUBMISSIONS PROCESS
Building on the emphasis in its pre-
amble on the importance of public partici-
pation in environmental protection, the
NAAEC threads public participation into the
fabric of the CEC. The agreement's explicit
objective in Article 1 (h) is to "promote trans-
parency and public participation in the
development of environmental laws, regu-
lations and policies" (NAAEC 1994). In sup-
port of this objective, the NAAEC commits
the Parties to providing for public participa-
tion in various ways, establishes a unique,
15-member tri-national public advisory
committee (called the Joint Public Advisory
Committee) to advise the CEC Council
(comprised of the top environment official
from each country) and allows persons and
non-governmental organizations in North
America to bring directly to the CEC their
concerns regarding enforcement of envi-
ronmental laws in the three NAFTA coun-
tries. In practice, providing opportunities for
public involvement in all aspects of the
CEC's work has become a hallmark of the
organization.
2.1
How the Process Works
The CEC's citizen submissions
process gives individual members of the
public and non-governmental organizations
their most direct means for focusing the
CEC's attention on a particular concern -
as long as the concern is related to envi-
ronmental enforcement. Article 14 of the
NAAEC provides that the CEC Secretariat
may consider a submission from any per-
son or nongovernmental organization
asserting that Canada, Mexico, or the Unit-
ed States is failing to effectively enforce an
environmental law.
Where these requirements are
met, the Secretariat may then request a
response from the government party con-
cerned, taking into account the factors in
Article 14(2), including (a) relevancy to the
person or organization filing the submission
and (b) that private remedies have already
been pursued.
Where the Secretariat requests a
party response, it forwards to the Party a
copy of the submission and any supporting
information provided with the submission.
Based on the submission and the
response, if any, the Secretariat can rec-
ommend to the Council under Article 15(1)
that a so-called "factual record" be pre-
pared.
If a majority of the Council author-
izes preparation of a factual record, the
Secretariat, in accordance with Articles
15(4) and 21(1)(a) of the NAAEC, under-
takes an in-depth investigation, gathering
facts from the governments and other
sources or developing information itself,
often with the assistance of technical or
legal experts. Ultimately, the Secretariat
produces a factual record and, if a majority
of the Council agrees, publishes it in accor-
dance with Article 15(7) of the NAAEC.
Factual records do not reach a conclusion
as to whether the Party is failing to effec-
tively enforce its environmental law.
Instead, they provide information regarding
asserted failures to effectively enforce envi-
ronmental law in North America that may
assist submitters, the NAAEC parties, and
other interested members of the public in
reaching their own conclusions and taking
any action they deem appropriate in regard
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GARVEH 123
to the matters addressed.
2.2 History and Status of the Process
As of February 15, 2004, the Sec-
retariat has received 50 citizen submis-
sions since the CEC's creation, including
17 concerning Canada, 24 concerning
Mexico, and 9 concerning the United
States. Ten submissions are currently
pending at the CEC. The CEC has pub-
lished ten factual records:
—the Cozumel factual record (October
1997), involving enforcement of
Mexico's environmental impact
assessment legislation in connection
with a pier terminal in Cozumel;
—the BC Hydro factual record (June
2000), involving Canada's enforcement
of the Canadian Fisheries Act in
connection with hydroelectric facilities
in British Columbia;
—the Metales y Derivados factual record
(February 2002), involving Mexico's
enforcement of its hazardous waste
laws in connection with an abandoned
lead smelter near the United States-
Mexico border in Tijuana;
—the Migratory Birds factual record (April
2003), involving the United States'
enforcement of its migratory bird law in
connection with logging operations;
—the Aquanova factual record (June
2003), involving Mexico's enforcement
of its environmental law in connection
with a shrimp farm in Nayarit;
—the BC Mining factual record (August
2003), involving Canada's enforcement
of the Canadian Fisheries Act in
connection with acid mine drainage from
the Britannia Mine, near Vancouver,
British Columbia;
—the BC Logging factual record (August
2003), involving Canada's enforcement
of the Canadian Fisheries Act in
connection with two logging operations
on Vancouver Island, British Columbia;
—the Oldman River II factual record
(August 2003), involving Canada's
enforcement of the Canadian Fisheries
Act and the Canadian Environmental
Assessment Act in connection with a
forest road in Alberta;
—the Rio Magdalena factual record
(December 2003), involving Mexico's
enforcement of its water pollution law
in connection with municipal water
discharges into the Rio Magdalena
from three communities in the state of
Sonora, Mexico; and
—the Molymex II factual record (October
2004), involving Mexico's enforcement
of various environmental laws in
connection with a molybdenum trioxide
plant in Sonora, Mexico.
Four additional factual records are
in preparation as of February 2005. Twice,
the Council has voted against a factual
record that the Secretariat recommended.
A registry of the submissions, as well as
factual records, the Secretariat's determi-
nations and notifications to the Council at
various stages in the process, and the
Council's resolutions on factual record rec-
ommendations and publication are avail-
able on the CEC's website (CEC 2003).
2.3 Factors Affecting the Suitability of
the Process to a Particular Matter
The CEC has opened a new set of
opportunities for addressing issues of con-
cern to the North American public. The citi-
zen submissions process in particular is a
bold innovation by the three NAFTA coun-
tries. In addition to being an accountability
mechanism, the process also has the
potential to dislodge thorny environmental
issues that have been difficult to resolve
domestically and to invigorate responsive
action by the public, government and other
stakeholders. That potential must have
been part of what drove the NAFTA coun-
tries, and others since, to create the citizen
submission mechanism.
The suitability of the process to a
particular situation, and hence its value to
members of the public who might want to
use it, depends on several factors, includ-
ing a consideration of the inherent features
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of the process.
First, it is essential that any CEC
submission involve an assertion that one of
the NAFTA countries is failing to effectively
enforce an environmental law. For purpos-
es of Article 14, "environmental law"
according to Article 45(2)(a) means:
[A]ny statute or regulation of a Party, or
provision thereof, the primary purpose
of which is the protection of the
environment, or the prevention of a
danger to human life or health, through
(i) the prevention, abatement or
control of the release, discharge, or
emission of pollutants or environmental
contaminants, (ii) the control of
environmentally hazardous or toxic
chemicals, substances, materials
and wastes, and the dissemination
of information related thereto, or (iii)
the protection of wild flora or fauna,
including endangered species, their
habitat, and specially protected natural
areas in the Party's territory, but does
not include any statute or regulation,
or provision thereof, directly related to
worker safety or health.
However, in Article 45(2)(b) the
agreement excludes from the definition of
"environmental law" any law for which "the
primary purpose ... is managing the com-
mercial harvest or exploitation, or subsis-
tence or aboriginal harvesting, of natural
resources." This definition might limit the
range of issues of concern to members of
the public that could be addressed in the
citizen submissions process. The CEC has
not yet had occasion to address that issue
in any detail.
Another feature of the citizen sub-
missions process is that it is not well-suited
for emergencies or other situations in which
a relatively quick response is desired. On
average, factual records have taken about
three years from the date the submission
was received to finalize and publish.
Indeed, while voting within two months on
some occasions, the Council has taken up
to fifteen months to take action on pending
factual record recommendations. Although
the creation of a separate unit to process
submissions and the hiring of additional
staff have improved timeliness, experience
to date suggests that normally it will be dif-
ficult to produce a final factual record in
less than approximately two years. It is
possible, however, as the first factual
record, for the Cozumel submission, was
published 21 months after the submission
was filed.
A further feature of the citizen sub-
missions process is that it touches upon
two particularly sensitive areas for national
governments: sovereignty and enforce-
ment discretion. Although the governments
consistently have expressed their support
for the process, Articles 14 and 15 confront
them with an inherent tension between
their roles as both creators and overseers
of the process and as potential targets of it.
That the process allows an international
organization to present information regard-
ing a country's enforcement of its own laws
likely exacerbates this inherent tension.
NAFTA chapter 11 is arguably a broader
relinquishment of sovereignty, in that
through binding arbitration chapter 11 can
require a country to compensate a private
investor for expropriation of an investment
contrary to NAFTA's terms (NAFTA 1992).
Nevertheless, the citizen submissions
process is at the frontier of North American
accountability mechanisms that give an
international organization a degree of inde-
pendence in reviewing the actions of one of
the three NAFTA countries. Shining light on
a country's enforcement actions can run up
against the potential reluctance of govern-
ments to provide details regarding enforce-
ment strategies and the exercise of
enforcement discretion. Further, the possi-
bility, however remote, that a citizen sub-
mission could trigger a dispute resolution
proceeding and monetary enforcement
sanctions under part V of the NAAEC,
which allows one NAFTA country to claim
that another has a "persistent pattern of
failure by that other Party to effectively
enforce its environmental law" in Article
22(2), potentially affects how the countries
handle the citizen submissions process.
The critical juncture at which the
parties' potential concerns over sovereign-
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GARVER 125
ty and their sensitivity regarding enforce-
ment matters are most likely to be reflected
is when the Council votes on factual record
recommendations. Although the Council
has authorized preparation of factual
records for fourteen submissions, in four of
those cases, BC Logging, BC Mining,
Migratory Birds, and Oldman River II (CEC
2003), it instructed the Secretariat to pre-
pare factual records significantly different in
scope than what the submitters sought and
the Secretariat recommended. These
Council decisions are likely an outgrowth of
the inherent tension that the governments
confront with respect to the submissions
process. The possibility that a factual
record might not address the enforcement
issues that a potential submitter sought to
raise might deter use of the process to
some extent, particularly when it is only at
the stage where the Council votes on a fac-
tual record recommendation that the scope
of a factual record is determined. Uncer-
tainty in this regard might dissuade a
potential submitter from investing
resources into gathering the information
necessary to support its assertions.
A potential submitter must also
take into account the likelihood that a sub-
mission will not proceed through the
process if the submitters have not pursued
private remedies available under the laws
of the party whose environmental enforce-
ment is questioned. Article 14(2) guides the
Secretariat to consider whether private
remedies have been pursued in deciding
whether to request a response from the
party. Although there is no explicit require-
ment that private remedies be pursued, let
alone exhausted, the NAAEC strongly sug-
gests that a submitter seek domestic relief
before filing a submission with the CEC.
A final major feature of the process
that could affect its suitability to a particular
situation is that a factual record cannot
impose sanctions or force a government to
do anything in regard to the matters
addressed. Indeed, as noted above, a fac-
tual record does not even reach a conclu-
sion whether the party is failing to effective-
ly enforce its environmental law. As a
result, reflecting frustration of some mem-
bers of the public that factual records are
not as effective as they might be, the Joint
Public Advisory Committee and others
have advised the Council to commit to
some kind of follow-up to a factual record,
for example by requiring the party whose
enforcement is addressed in a factual
record to report periodically to the Council
on follow-up actions (JPAC 2001). To date,
the Council has deemed follow-up to factu-
al records to be a matter exclusively of
domestic concern (Smith 2002). At its most
recent meeting, the Council committed
itself "to exploring ways for each Party to
communicate how matters raised in factual
records may be addressed over time" (CEC
2004).
2.4 Impact and Utility of Submissions
and Factual Records
Despite the potential limitations
noted above, submitters have found that
the filing of a submission or publication of a
factual record can fulfill at least some of the
goals of their submissions. For example,
the submitters of the Cozumel submission
found that the submission "led to additional
protection of coral reefs in the area,
improvements to Mexican law on environ-
mental impact assessment, and establish-
ment of a trust fund for reef protection"
among other benefits (Garver 2001). Like-
wise, the submitters of the BC Hydro sub-
mission have stated that substantive com-
mitments that the Canadian and British
Columbia governments made that were
recorded in the BC Hydro factual record
have helped keep on track a water use
planning process that responded to con-
cerns highlighted in the submission (Bow-
man 2001). Indeed, the Submitters found
that the mere filing of the submission
brought increased government attentive-
ness to their concerns regarding the impact
of hydroelectric facilities on fish habitat
(Bowman 2001).
Last year, an independent commit-
tee appointed by the CEC Council to review
the first ten years of the CEC noted addi-
tional impacts of citizen submissions and
factual records, beyond those noted above
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
(CEC 2004). The committee noted that as a
result of submissions and factual records:
—The Secretariat's investigation
conducted as a result of the BC Logging
submission uncovered deficiencies in
the procedures of Fisheries and
Oceans Canada that the Department
subsequently addressed.
—Fisheries and Oceans Canada
increased its presence in the prairie
provinces.
— In a letter to BC government authorities,
Environment Canada cited the BC
Mining submission when it rejected a
proposal to adopt a less costly, but less
effective, effluent treatment method at
the Britannia Mine.
—The submission related to the operation
of a shrimp farm in Mexico (Aquanova)
encouraged negotiations among the
submitters, local and environmental
authorities and the developer that led
to actions to reduce the impact of the
farms' waste water discharge and a
mangrove replanting program.
As well, factual records equip the
public with detailed information regarding
the environmental law at issue and the poli-
cies and practices employed to enforce and
seek compliance with it. This information
can serve as a basis for identifying criteria
of effective enforcement that can be
applied to draw conclusions regarding a
country's performance in a particular case.
For example, the BC Logging factual
record included a list of relevant indicia of
effective enforcement, which, while not
intended to be comprehensive or to estab-
lish a definition of effective enforcement,
served as a guide for those assessing the
matters addressed in the factual record.
The indicia identified were as follows (CEC
2003):
—Government agencies obtain, use and
maintain adequate information on the
forest activities subject to enforcement.
—Compliance is encouraged through
communication with parties affected by
the relevant laws and regulations, and
agencies establish, through operational
plan approval and related processes,
expectations for forest practices which
are enforceable and in accordance with
the law.
-Enforcement personnel administer the
law and accompanying regulations with
an emphasis on preventing harm to fish
and fish habitat.
-The public is encouraged to report
suspected violations of the habitat
protection and pollution preventions of
the Fisheries Act, and when information
or complaints are brought to the
attention of enforcement personnel,
additional inspections are carried out
as required.
-Government agencies have an effective
way of identifying risks associated
with forest activities and utilize risk in
inspection planning.
-A program of inspections to verify
compliance is carried out, prioritized on
the basis of compliance history and the
risk to the fishery resource. A sufficient
number of inspections are conducted in
a fair, objective and effective way with
the results accurately recorded and
reported.
-Investigations are conducted in all
applicable situations and only when
warranted. They are performed in a fair,
objective and consistent way and are
accurately recorded and reported.
-Determinations of non-compliance are
made in all applicable situations and
only when warranted. They are made
in a fair, objective, predictable and
consistent way and are accurately
recorded and reported. Rules, sanctions
and processes securely founded in law
are used.
-Priority to deal with suspected violations
is guided by the degree of harm to fish,
fish habitat or human use of fish caused
by physical alteration of habitat or
pollution of waters frequented by fish, or
the risk of that harm; whether or not the
alleged offense is a repeat occurrence;
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GARVER 127
and the intent of the alleged
violator, including attempts to conceal
information or circumvent the law.
— Enforcement measures are directed
towards ensuring that violators comply
with the law within the shortest possible
time and that violations are not
repeated.
—Enforcement personnel bring any
charges in as short a time as possible,
having regard for proper substantiation
of the alleged violation and gathering of
sufficient and appropriate evidence.
—Organizational structures, policies and
processes that contribute to and support
appropriate law enforcement are in
place.
—The decisions and actions of different
parts of government responsible for
law enforcement are appropriate and
coordinated.
— Reporting systems provide adequate
information on agency performance in
relation to enforcement objectives.
3 LESSONS LEARNED ON
CHALLENGES TO GOVERNMENTS
AND OTHER INSTITUTIONS SUBJECT
TO REVIEW, THE PUBLIC AND
INDEPENDENT REVIEWERS
The success of a mechanism such
as the CEC submissions process depends
on how the principle actors involved in its
implementation approach and use it. The
challenges facing these key actors - gov-
ernment, the public, and those conducting
independent reviews - are likely similar
across the spectrum of institutional mecha-
nisms that allow independent review of
governments' or other institutions' enforce-
ment of environmental laws or compliance
with mandatory environmental obligations.
3.1 Challenges to Governments and
Institutions Subject to Review
The experience of the CEC illus-
trates well the challenges governments
face when they both create and fund a
mechanism that allows for independent
review of enforcement performance and
also defines themselves as the subject of
that review. The inherent tension this cre-
ates is discussed above. As well, govern-
ments that rely on taxpayers to fund gov-
ernment programs have a responsibility to
use resources wisely, and in a manner that
the public accepts. In creating a mecha-
nism such as the CEC submissions
process, governments also assume the
challenge of marshalling the resources
necessary not only for the institution con-
ducting the reviews, but also for the gov-
ernment to respond to requests for informa-
tion necessary for those reviews. Beyond
these resource issues, however, are more
fundamental challenges. Inherent in the
creation of a mechanism such as the CEC
submissions process is the challenge to
governments to determine what benefits
they seek to achieve through such a mech-
anism. One theory of mechanisms that
expose facts regarding government per-
formance to public light is that "sunlight is
the most effective disinfectant." However,
posing the challenges of such a mecha-
nism in terms of shaming or embarrassing
governments likely shortchanges the
process if it implies only a backward-look-
ing focus; it is more constructive, yet per-
haps not always easy, for governments to
be open to receiving these reviews in a
manner that can highlight areas where
improvements in performance are possible.
The results to date of the CEC's submis-
sions process suggest that the govern-
ments, at least in some cases, may well be
taking the process seriously and treating it
as a potential source of constructive and
useful feedback.
3.2 Challenges to the Public
The most basic challenge to mem-
bers of the public seeking to use the
process to seek improvements in govern-
mental or institutional enforcement per-
formance is to weigh the costs and benefits
involved. Unlike litigation or other remedial
processes, the CEC's submissions process
and other similar petitioning processes
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
involve primarily an up-front, non-continu-
ing investment of time and resources. Once
the CEC receives a submission, the great-
est resource burdens fall on the Secretariat
and the government Parties. Nonetheless,
the up-front investment to submitters can
be significant, especially to meet the
expectations that the CEC Council has put
forth in regard to the kind of information it
will require in order to authorize the prepa-
ration of a factual record.
In fact, the Council previously
noted similar concerns regarding sufficien-
cy of information, albeit with less explana-
tion, most notably when it limited the scope
of the factual record it authorized for the
B.C. Logging submission (CEC 2001).
There, the Council "[recognized] that Cana-
da in its response indicated that the sub-
mission did not include sufficient informa-
tion to enable Canada to provide a mean-
ingful response to other matters raised in
the submission for which the Secretariat's
notification recommends a factual record."
(CEC 2001). The Council's decision with
respect to the information necessary to
support the B.C. Logging submission like-
ly placed a considerable additional
resource burden on the submitters, but, as
the Council notes, the submitters found it
worthwhile to expend those resources to
produce additional information to support
their assertions.
The CEC's submissions process
also challenges the public, and in particular
those who make submissions, to be pre-
pared to respond constructively once a fac-
tual record is produced. Submitters
expressing disappointment, as some have,
that a factual record is merely a record of
facts that does not force action or penalize
failure of enforcement do not fully under-
stand the process and its potential, as the
parameters of the process clearly do not
allow for injunctive orders or penalties.
Instead, factual records impose a chal-
lenge on the public to use the information
provided in a manner that may resolve the
problem underlying the submission. Under-
standing this at the front end of the process
may help ensure that submissions address
matters as to which factual records have a
reasonable potential to produce valuable
information.
3.3 Challenges to Independent
Reviewers
Those charged with implementing
an independent review mechanism, such
as the CEC's Secretariat in key stages of
the submissions process, confront a chal-
lenge to ensure that the mechanism
remains as accessible, transparent and
credible - to governments and the public
alike - as possible. Meeting this challenge
requires attentiveness to the timeliness
with which submissions are processed;
care in the selection of competent and
objective experts to assist in the processing
of submissions; and rigor in conducting
comprehensive, objective and independent
investigations. One way in which the CEC
Secretariat has sought to meet this chal-
lenge is through consultations with a distin-
guished panel of Special Legal Advisors,
who volunteer their time and expertise on
the questions of international and environ-
mental law that arise in the processing of
submissions. In preparing the processing
of submissions and preparing the factual
record, the Secretariat ultimately must
meet the challenge of gathering, develop-
ing and presenting sound and valuable fac-
tual information while abiding by the terms
of the NAAEC and the instructions of the
CEC Council.
4 CONCLUSION
The challenges that face govern-
ments and other institutions subject to
review, the public and those conducting
independent review of government or insti-
tutional performance are not unique to the
CEC's submissions process. Whether a
reactive mechanism focusing on environ-
mental enforcement concerns, such as the
CEC's citizen submissions process, will
prove valuable in regard to a particular mat-
ter will depend on the circumstances and
the goals of those who initiate its use, as
well as on how the various actors involved
meet the challenges they face in making
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GARVER 129
the mechanism work. Hopefully, the experi-
ence of the CEC, and a discussion of the
challenges facing the principle players in
that process, provides food for thought for
others involved in implementing the many
other similar mechanisms that exist across
the globe.
5 REFERENCES
Bowman, Jamie. 2001. "Citizen submission
process proves valuable in BC Hydro
case," Trio (Fall). Internet: (visited 25 June 2003).
Bulas Montoro, Jose Manuel. 2004. Letter
to Donna Tingley, JPAC Chair for 2004.
June 3, 2004.
Commission for Environmental Coopera-
tion (CEC). 2004. Puebla Declaration, June
23, 2004. Internet: < http://www.cec.
org/files/PDF/COUNCIL/Puebla-Declara-
tion-2004_en.pdf>
Commission for Environmental Coopera-
tion (CEC). 2004. Ten Years of North Amer-
ican Environmental Cooperation: Report of
the Ten-Year Review and Assessment
Committee. Internet: < http://www.cec.
org/files/PDF//TRACReport2004_en.pdf>
Commission for Environmental Coopera-
tion (CEC). 2003. Citizen Submissions on
Enforcement Matters. Internet: .
Commission for Environmental Coopera-
tion (CEC) 2003. BC Logging Factual
Record. CEC Submission SEM-00-004.
Internet: < http://www.cec.org/files/pdf/
sem/00-4-FFR_en.pdf>.
Commission for Environmental Coopera-
tion (CEC) 2001. Council Resolution 01-12.
November 16, 2001. Internet: < http://www.
cec.org/files/pdf/sem/00-4-Res-e.PDF>
Fisheries Act. 1985. Canada. R.S., ch. F-
14, sec. 1.
Garver, Geoffrey. 2001. "Citizen Spotlight Is
Beginning To Show Results," The Environ-
mental Forum (March/April): 34.
International Organization of Supreme
Audit Institutions (INTOSAI). 1995.
INTOSAI - an Overview. Internet:
Joint Public Advisory Committee of the
Commission for Environmental Coopera-
tion (JPAC). 2001. Lessons Learned: Citi-
zen Submissions under Articles 14 and 15
of the North American Agreement on Envi-
ronmental Cooperation, June 6, 2001.
Internet: .
North American Agreement on Environ-
mental Cooperation (NAAEC). 1994. Inter-
net: (visited 25 June 2003).
North American Free Trade Agreement
(NAFTA). 1992. Done at Ottawa, Mexico
City and Washington DC on December 17,
1992. Entered into force January 1, 1994.
Reprinted in 32 I.L.M. 289 (1993).
Smith, Norine. 2002. Letter to Jonathan
Plaut, JPAC Chair for 2002. June 14, 2002.
Internet: (visited 25 June
2003).
See Volume 1 of the Conference Proceed-
ings on the INECE Web site at http://
www.inece.org/conference/7/ for a full bibli-
ography.
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130 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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AVGERINOPOULOU 131
THE RISE OF GLOBAL ENVIRONMENTAL ADMINISTRATIVE
LAW - IMPROVING IMPLEMENTATION AND COMPLIANCE
THROUGH THE MEANS OF GLOBAL GOVERNANCE
AVGERINOPOULOU, DIONYSIA-THEODORA
Legal Adviser, Chamber for the Environment and Sustainability; Executive Director,
European Institute for Law, Science and Technology, 520 West 112th St., apt. 8-C,
New York, N.Y., 10025, U.S.A.; da2160@columbia.edu
SUMMARY
This article discusses the relationship between Global Governance and Environ-
mental Compliance as understood under the emerging field of Global Administrative Law
(GAL), the administrative law governing international institutions. Implementation of and
compliance with international environmental regimes is a duty imposed not only on states,
but also on international institutions. The new body of Global Administrative Law, and con-
sequently of Global Environmental Administrative Law, might be useful for enhancing
implementation of and compliance with international environmental regimes. Global Admin-
istrative Environmental Law should, for example, regulate the ways that international insti-
tutions assist states in coming into compliance. The purpose of environmental regimes
could be more easily fulfilled if the expert bodies of the international institutions were com-
petent to adopt "secondary" implementation laws and policies. If so, Global Administrative
Environmental Law should include international administrative procedures that guarantee
transparency, accountability, and democratic participation. Reform of international adminis-
tration could lead to enhanced implementation of and compliance with the current environ-
mental regimes.
1 INTRODUCTION
According to a common definition,
"compliance" means the fulfillment by the
contracting parties of their obligations
under multilateral environmental agree-
ments and any amendments thereto, and
other arrangements.1 Implementation of
environmental obligations - when the
agreements require further specification
through the enactment of laws, regulations,
policies, and other measures and initiatives
- is a prerequisite for compliance. The def-
inition is indicative of the fact that theories
on compliance have focused on the per-
formance of states, disregarding the role of
other actors, such as international institu-
tions. The traditional framework for
approaching compliance is hierarchical and
focused on states. The latest literature
speaks of alternative compliance strate-
gies, such as sunshine techniques, incen-
tives, and sanctions. Despite the enhanced
compliance that the international communi-
ty has achieved by using these techniques,
on many occasions states still do not per-
form well. As a result, even the objective of
the agreement could be nullified.
However, environmental agree-
ments have evolved over time.2 More
recently, they tend to include as recipients
of the obligations they impose, not only
states, but also many other actors, includ-
ing various international institutions. As a
result, current policymakers should under-
stand compliance as a multi-level issue.
International organizations are compliance-
monitoring bodies, compliance-facilitation
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
bodies, and recipients of obligations
imposed by environmental regimes to
which they must themselves comply. The
question is: what structures and decision-
making processes do international institu-
tions have to adopt in order to be able to
respond more effectively to the needs of
the related environmental regimes, assist
the states to comply with their obligations
under these regimes, and most of all, be
able to comply with their own obligations?
1 CURRENT CONTRIBUTION OF
ADMINISTRATIVE ORGANS TO
COMPLIANCE EFFORTS
1.1 Dissemination of Information,
Consultation, and Compliance
Monitoring
Until recently, the role of the inter-
national institutional arrangements in facili-
tating compliance was limited to hosting
meetings of the member-states or dissemi-
nating information. Secretariats to interna-
tional agreements play an important role in
securing compliance by member countries
and targeted non-state actors. They have
substantial influence in part because they
may be the only bodies with comprehen-
sive knowledge of the extent to which par-
ties are complying. When necessary, the
secretariats - assisted by expert bodies -
provide valuable information to states on
how better to comply with their obligations,
since compliance with international
regimes, particularly the environmental
ones, is apt to require a degree of scientif-
ic and technical expertise that not all coun-
tries possess. For example, scientific bod-
ies working in the framework of the
Mediterranean Action Plan (MAP/UNEP)
offer this kind of assistance to the signato-
ry states.3 In many instances, guidance on
the ways that states could comply with their
obligations is required, i.e. when there is no
clear explanation of the steps a state needs
to take in order to comply with its obliga-
tions under the agreement. Accordingly,
intergovernmental organizations could be
resources of technical assistance, legal
assistance, and know-how transfer, partic-
ularly at the stage of drafting national legis-
lation to implement international provisions.
Indeed, the role of international
institutions in ensuring implementation and
compliance has evolved over time. Cur-
rently, international bodies are directly
engaged in the implementation, compli-
ance, and enforcement procedures. Con-
ventions may provide for the establishment
of specific administrative positions, such as
an enforcement officer in the Convention
for the International Trade of Endangered
Species (CITES); the development of a for-
mal link with industry, as in the Montreal
Protocol; and the establishment of scientif-
ic and technical assessment bodies, as in
the Montreal Protocol and the Persistent
Organic Pollutants (POPs) Convention.4
Despite these developments, compliance
still remains an issue - raising the question
of whether further empowerment of the
international administration through a real-
location of powers between states and the
international organization's expert bodies,
and an elevation of the role of those expert
bodies, could promote compliance, and if
so, under what conditions.
1.2 The Methyl Bromide Case
There are many ways that a state
might not comply with its international obli-
gations. Usually, states try unlawfully to
unbind themselves from obligations that
they have previously undertaken. In other
cases, states might exercise their discre-
tionary power in a way contrary to the spir-
it and the purpose of the environmental
regimes, or they might use an "escape
clause" to unbind themselves from previ-
ously accepted obligations. In these cases,
the states may comply with the letter, but
not with the substance, of the law. This type
of "disguised" non-compliance is difficult to
detect and cope with. Until recently, these
cases were dealt with by the states or the
political organs of the institutions, which are
comprised of representatives of the states
and which could decide the non-compli-
ance issue based on political criteria not
necessarily relevant to the object and pur-
pose of the agreement. The participation of
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AVGERINOPOULOU 133
administrative and expert bodies in the
evaluation process for such cases - e.g., in
cases of retreat from previously accepted
obligations - has to a certain extent limited
the abuse of discretion and use of the
escape clauses contrary to the spirit and
purpose of the agreement. However, states
hold the final decision-making power. Inter-
national administrative and expert bodies
could only make recommendations on
these issues and not take any authoritative
decision or action against the "non-comply-
ing" party. One wonders whether the situa-
tion could be improved by giving these bod-
ies further powers.
Such is the case under the Montre-
al Protocol for Substances that Deplete the
Ozone Layer, which contains an escape
clause for countries to unbind themselves
from previously adopted obligations, e.g.
the ban on the use of ozone-depleting sub-
stances. According to the escape clause,
the states may decline to enforce the ban if
the use of the substance is critical, the ban
may result in a "significant market disrup-
tion", and "there are no technically and eco-
nomically feasible alternatives or substi-
tutes"^ Whereas, under previous regimes,
the signatory state or the political body
(Meeting of the Parties) would have been
the sole evaluator of a use as critical, there
is now an expert body - the Technology
and Economic Assessment Panel - that
intervenes in the decision-making proce-
dure and provides feedback. A recent case
under the exemption for critical use is the
application of the U.S. to unbind itself from
the obligation to ban the use of Methyl bro-
mide on financial grounds, namely the risk
to tomato and strawberry production (espe-
cially in the state of California).
Methyl bromide has been used
worldwide since the 1930s as a pre-plant
soil fumigant to control insects, pathogens,
and weeds. It has also been used for quar-
antine and pre-shipment application.
Because of its effectiveness, Methyl bro-
mide is one of the very few chemicals that
were approved for broad-spectrum use in
agriculture and pest control globally. In
1992, the Parties to the Montreal Protocol
recognized Methyl bromide as contributing
to the depletion of the ozone layer. Indeed,
Methyl bromide is a potent ozone-depleting
chemical, with a potential - 'atom-for-atom'
- to destroy 60 times more stratospheric
ozone than chlorine from CFCs. It is also
highly toxic to humans. Accordingly, the
Parties agreed to freeze the production and
importation of the substance in industrial-
ized countries in 1995 at the 1991 levels.6
In 1997, the Parties to the Protocol agreed
to a complete elimination of MeBr in indus-
trialized countries by 2005, with interim
reductions and with some exemptions for
quarantine and pre-shipment uses.7 In
1998, the U.S. amended the Clean Air Act
to adopt the phase-out date established
under the Montreal Protocol, but in 2003,
applied for an exemption from the Methyl
bromide ban. The U.S. held that the use of
methyl bromide was critical for its economy,
because tomato and strawberry farmers in
California could not replace it with any
other substance as cost-effective. The U.S.
applied through the critical use clause and
got an extension for some uses of Methyl
bromide until 2007. Currently, in 2005, the
U.S. has reapplied for a renewal of the
extension, which it seems very possible
that it will get. Methyl bromide still remains
in use.
Although the substitution of Methyl
bromide is technically possible, a country
may choose not to ban the substance after
a cost-benefit analysis, even if it agreed to
do so. In this legitimate non-compliance
case, the expert bodies of the Ozone
Regime have a say. The Methyl Bromide
Technical Options Committee, the basic
committee of the the Technology and Eco-
nomic Assessment Panel that mainly deals
with MeBr cases, renders recommenda-
tions to the Meeting of the Parties. Irre-
spective of the recommendations of the
expert bodies, however, the Meeting of the
Parties always has the last say. This proce-
dure allows for decisions potentially
grounded only on political criteria,8 and
illustrates that even one of the most suc-
cessful compliance regimes, such as the
Ozone regime, allows for non-compliance
opportunities. With the last say always
remaining with the states, the states have a
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"security valve" when they decide to enter
stringent legal regimes.
Perhaps compliance would be
more easily achieved if scientific checks
and balances were imposed for the charac-
terization of a chemical use as "critical," for
evaluation of the cost-effective and techni-
cally possible alternatives to ozone-deplet-
ing substances, and for other relevant
issues. If these evaluation tasks remained
mainly with the expert bodies, and the
expert bodies could have decision-making
powers, it could avoid this type of non-com-
pliance by the states. However, the delega-
tion of such powers to the expert bodies of
the international institutions will not be with-
out strong opposition from states, individu-
als, and other actors in the international
scene. Ways to delegate power to expert
bodies of the intergovernmental institu-
tions, in order to achieve advanced imple-
mentation and compliance with the envi-
ronmental regimes with the aim of strength-
ening the efficiency of international admin-
istration, are among the subjects of the new
field of Global Environmental Administra-
tive Law studies.
3 THE POTENTIAL CONTRIBUTION OF
GLOBAL ADMINISTRATIVE LAW TO
COMPLIANCE ISSUES
3.1 The Emerging Field of Globa
Administrative Law
According to the definition that the
leading Global Administrative Law
Research Project of New York University
School of Law has given, "global adminis-
trative law" is "the body of law that compris-
es the structures, procedures and norma-
tive standards for regulatory decision-mak-
ing including transparency, participation,
and review, and the rule-governed mecha-
nisms for implementing these standards
that are applicable to formal intergovern-
mental regulatory bodies; to informal inter-
governmental regulatory networks; to regu-
latory decisions of national governments,
where these are part of or constrained by
an international intergovernmental regime;
and to hybrid public-private transnational
bodies."9 "Global administrative law" cov-
ers a broad spectrum of action. It refers to
the structures and internal organization of
an international institution, to the compe-
tence of the bodies within the institution, to
the relationships among them, to the rela-
tionships between the administrative and
the political bodies that comprise the inter-
national organization, as well as the rela-
tionships among the administrative bodies,
national governmental bodies, and other
entities. Furthermore, Global Administrative
Law governs all the activities of the organs
that belong to the administration of an insti-
tution, even activities that are not tradition-
ally administrative. On the international
level there is no separation of powers. The
international administrative bodies enjoy
legislative powers and promulgate internal
regulations and rules, applicable directly on
the member-states of an intergovernmental
organization, individuals and actors. This
legislative function is usually based on their
expertise and serves the further specifica-
tion of the framework regimes that govern
the international organizations and the mul-
tilateral agreements that these administra-
tive organs serve.10 Further, various admin-
istrative organs hold supervisory and
quasi-judicial powers. Within this conceptu-
al framework, the body of law that will
potentially govern the administrative action
of international arrangements with compe-
tence on environmental issues defines
"global environmental administrative law."
The question is whether and how this
emerging instrument, could contribute to
achieving enhanced compliance with the
international environmental regimes.
3.2 Global Environmental
Administrative Law as the
new modus operandi
The rising body of global environ-
mental administrative law could create a
new modus operandi for the existing inter-
governmental organizations with compe-
tence on environmental issues, based on
sorting out the most successful organiza-
tional and regulatory decision-making mod-
els based on compliance and optimization
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AVGERINOPOULOU 135
of the system models.11 The above case
may suggest for example that global envi-
ronmental administrative law should pro-
vide for the empowerment of administrative
and expert bodies in the pursuit of imple-
mentation and compliance with environ-
mental obligations. In cases that require
expertise and not just political judgment,
such empowerment could occur either
through the appropriate restructuring of the
environmental regimes so that expert bod-
ies are included in every decision-making
process, or by the delegation of some law-
making powers to expert bodies. The way
to organize such redesign could be through
an international (environmental) adminis-
trative procedures act. Such an act could
be built on the following principles, among
others.
Power of initiative and proposal:
the Secretariat and the expert bodies of the
international organizations should have the
power to take the initiative and make pro-
posals for the identification of non-compli-
ance cases and their evaluation, and initia-
tion of non-compliance procedures. Apart
from the non-compliance cases, the power
of initiative and proposal could apply also to
amendments of the organization's treaties,
the conclusion of new treaties, inclusion of
new issues in the agenda for negotiations,
and directing research. Similar power is
held, for example, by the Secretary of the
Codex Alimentarius Commission and the
administration under the Montreal Protocol.
Opting-out procedures and quasi-
legislative powers: institutions with compe-
tence on environmental issues should
adopt decision-making processes and reg-
ulatory lawmaking procedures in ways sim-
ilar to the so-called "technical" organiza-
tions. Global intergovernmental organiza-
tions with competence on specific environ-
mental issues, such as the International
Civil Association Organization, the World
Meteorological Organization, the Food and
Agriculture Organization, and the World
Health Organization, are able to amend
technical and other regulations that
become binding on their member-states
without any further act of ratification. In this
way the states cannot avoid compliance
with their obligations through contrary leg-
islation or absence of appropriate imple-
menting legislation. It prohibits the states
from acting against the purpose of the pri-
mary rules. For example, the International
Civil Association Organization adopts envi-
ronmental standards on aircraft engine
emissions and aircraft noise according to
art. 37 (e) and (k) of the Convention on
International Civil Aviation (Chicago Con-
vention).12 The administration of the Inter-
national Maritime Organization clearly
declared that when its decision-making
structure was based solely on political bod-
ies, they could not achieve any satisfactory
results on progressive lawmaking and gov-
ernance. After having adopted similar law-
making procedures, International Maritime
Organization demonstrated success at the
mitigation of sea pollution by oil.13 Interna-
tional secretariats supporting multilateral
environmental agreements and other
expert bodies and committees that work
under models similar to the above-men-
tioned "technical" organizations are also
considered to be successful. These entities
participate in the lawmaking process
through the enactment of technical regula-
tions in annexes or amendments to con-
ventions and have a stronger role at the
implementation stage of the convention. In
addition, these procedures better serve the
quick adaptation of international environ-
mental law to new technological evolutions,
enhance the speed of response to environ-
mental emergencies, and avoid the slow-
ness that political negotiations de novo
may cause. If an environmental regime
requires the use of Best Available Technol-
ogy, for example, then the identification of
the Best Available Technology and its appli-
cation may happen quickly through the
enactment of legislation promulgated by
international administration, whereas
states may delay such legislation on pur-
pose, resulting in non-compliance. Within
the framework that general primary rules
create, being the constituent instruments of
intergovernmental organizations, multilat-
eral environmental agreements,14 and
"main" protocols15 - and according to pro-
cedures established by them - some cate-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
gories of secondary, more detailed, imple-
menting laws serve to specify the primary
laws. This secondary law could be promul-
gated exclusively by expert bodies. These
rules could be provisions in annexes, rules
of technical nature, rules specifying obliga-
tions already accepted by the political
organs, rules that do not impose legal obli-
gations, rules that do not impose additional
costs to states, or laws fully justified by
clear science.16 Notably, Global Administra-
tive Environmental Law has to identify
more criteria for categorizing these "sec-
ondary" rules.
The duty to give reasons: A further
example of a promising procedure required
by an international administrative act could
be the "duty to give reasons". In the case of
a debate between the consultative body
and the decision-making body, the latter
could either adopt rules according to the
proposal of the consultative body, or if they
choose to adopt different legislation, they
should either justify their different decision
or abstain from the regulation.17 In the
Methyl Bromide case, for example, the
Meeting of the Parties would have to justify
its decision, if it decided to abstain from the
recommendations of the Technology and
Economic Assessment Panel and Methyl
Bromide Technical Options Committee. A
similar duty to give reasons exists in the EC
Treaty (art. 253). Both civil law and com-
mon law legislation have adopted rules
similar to the duty to give reasons.18
Post-legislative scientific review:
Apart from democratic checks and bal-
ances, scientific checks are also neces-
sary. Procedures should be adopted so that
rules of international environmental law
could be examined for their scientific valid-
ity. A post-legislation scientific review
requirement for technical regulations
adopted by either the international bodies
or by states could be adopted. In the U.S.
legal system, this post-legislative scientific
review is combined with the judicial review.
Judicial review at the very end "is the most
effective means to ensure the accountabili-
ty of the regulators."19
Such delegation would unavoid-
ably create issues of democratic represen-
tation and accountability. Despite the
necessity of a science-based administra-
tive and lawmaking system for the environ-
mental issues, the democratic principle
raises limits to the delegation of lawmaking
powers to expert bodies.20 To face these
issues, Global Administrative Law may
suggest the application of administrative
procedures that could ensure internal and
external accountability of the work of the
administration and expert bodies,™ infor-
mation disclosure,21 transparency in deci-
sion-making, and democratic checks and
balances on the acts and laws by interna-
tional administration.
3 CONCLUSION
Long lasting issues, such as non-
compliance, require new approaches.
International institutions have an important
role to play in compliance reinforcement
through either compliance monitoring and
provision of assistance to states to achieve
compliance, or through more direct partici-
pation towards the implementation of the
environmental regimes and the develop-
ment of review mechanisms of states'
behavior. The reinforced status of the inter-
national institutions and expert bodies,
although justified on grounds of effective-
ness, should comply with the democratic
governance requirement. The development
of an international environmental procedur-
al act applicable to all international institu-
tions with environmental competence is
necessary. The emerging body of Global
Administrative Law could provide the
framework for the restructuring of interna-
tional institutions and for the promulgation
of procedural rules. Successful examples
of governance at either the national,
regional, or international level need to be
studied, to draw out the appropriate rules to
govern international environmental
regimes.
4 REFERENCES
1 See, Edith Brown Weiss, Strengthening
National Compliance with International
Environmental Agreements, 27 Envtl.
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AVGERINOPOULOU 137
Poly. & L. 297 (1997).
2 Supra, at 1.
3 Haas, P. M. 1990. Saving the Mediter-
ranean: the Politics of International Envi-
ronmental Cooperation: Columbia
University Press, Haas, P. M., R. O. Keo-
hane, and M. A. Levy. 1993. Institutions
for the Earth: Sources of Effective Envi-
ronmental Protection: The MIT Press,
Haas, P. M. Science Policy for Multilater-
al Environmental Governance, Interna-
tional Environmental Governance, Gaps
and Weaknesses, Proposals for Reform:
United Nations University.
4 For example, the implementation com-
mittee and noncompliance procedures of
the Montreal Protocol were used initially
to help non-complying Article V develop-
ing countries come into compliance with
reporting obligations.
5 Decision IX/6.
6 Art. 2H (1) of the Protocol.
7 Art. 2H (5) of the Protocol.
8 Notably, since there is no obvious non-
compliance, the Implementation Commit-
tee, which is the competent organ of the
Montreal Protocol to judge non-compli-
ance issues, could not be involved in the
case.
9 Kingsbury, B. Krisch N. and Steward B.
R., The Emergence of Global Administra-
tive Law, Draft Paper for the Global
Administrative Law Research Project of
the New York University School of Law
(2004). For further working papers and
project documents, please visit the proj-
ect website, available at: www.iilj.org.
10 Lately, there was reference to the "impe-
rial Security Council" when the UNSC
promulgated acts purely legislative in
their nature (e.g. Resolution 1267 and
1373) raising questions about the
authority that the UNSC had to proceed
to legislation. Paul C. Szasz, 'The Secu-
rity Council Starts Legislating" (2002), 96
American Journal of International Law,
901. This example shows that at the
international level, there is a gap of leg-
islation. There are many issues that
need to be regulated and the regulation
has to be on the international level.
11 Decleris, Michael, ed. 1986. Systems
Theory. Edited by G. S. Group. Athens -
Komotini: Ant. N. Sakkoulas.
12 For the law-making procedures of ICAO
see T. Buergenthal, Law-Making in the
International Civil Aviation Organization,
(1969).
13 See, (International Convention for the
Prevention of Pollution from Ships
(MARPOL), London 1973, in 12 ILM
1319 (1973). The Maritime Safety Com-
mittee (MSC), the highest technical com-
mittee of IMO, is able to adopt amend-
ments to conventions, such as the Safe-
ty of Life at Sea Convention (SOLAS).
Other technical committees that partici-
pate in the decision-making process of
IMO, but clearly do not hold any lawmak-
ing power, are the Marine Environmental
Protection Committee (MEPC), the nine
sub-committees that assist the MSC and
the MEPC and the Facilitation Commit-
tee. For a detailed reference to the evo-
lution of the rule-adoption techniques by
the organs of IMO, visit: www.imo.
org/home.asp. However, the research on
IMO will not be organ-specific, but treaty-
specific, because IMO Assembly decid-
ed not to amend IMO's Constitution
regarding the voting procedures, but
each convention separately. 14th Ses-
sion of IMO Assembly, Sept. 1972.
14 E.g. the Vienna Convention on the Sub-
stances that Deplete the Ozone Layer,
the Framework Convention on Climate
Change, and the Biodiversity Conven-
tion.
15 E.g. the Montreal Protocol, the Kyoto
Protocol, and the Cartagena Protocol
respectively.
16 Here I use the word "implementation"
under a broad sense that is different from
the rules that depict the implementation
process of a multilateral environmental
treaty, or the decision of an intergovern-
mental organization, or national rules of
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
implementation of international docu-
ments. Implementation rules under the
meaning in the present paper may
include a large part of rules of implemen-
tation under the usual meaning.
17 Greek administrative law also provides
for such a requirement.
18 For example, Canadian administrative
law provides for such a requirement.
See, e.g. Baker v. Canada, [1999] 2 CLR
273 (HCA).
19 Rose-Ackerman, Susan. 1992. Rethink-
ing the Progressive Agenda. New York:
The Free Press, p. 34. See, also:
Majone, Giandomenico. 1993. Control-
ling Regulatory Bureaucracies: Lessons
from the American Experience, EUI
Working Paper SPS No. 93/3. Badia
Fiesolana, San Domenico (FL): Euro-
pean University Institute, Florence,
Department of Political and Social
Sciences, p. 22; Majone, Giandomenico.
1994. Independence vs. Accountability?
Non-Majoritarian Institutions and Demo-
cratic Government in Europe. In EUI
Working Papers in Political and Social
Sciences. European University Institute,
Florence, p. 21.
20 The main argument for science-based
lawmaking versus democratic lawmak-
ing is the effectiveness that the above-
mentioned schemes have demonstrated
thus far. International, regional, and
national institutions base their success
mainly on their reliance on expertise and
not on politically elected bodies. Democ-
racy is a basis of legitimacy for lawmak-
ing powers but it is not the only one. Not
only could scientific expertise be a fur-
ther basis, but it could also increase the
perceived legitimacy of the regulations.
An additional argument for the science-
based lawmaking is that integration of
scientific expertise in lawmaking may
enhance the democratic rule. Experts
may come from civil society, giving
expert networks and non-governmental
organizations a direct voice at the inter-
national level. Incorporation of independ-
ent experts in schemes that participate in
the lawmaking procedures assists in the
problem of the inequality of weapons
available to interest groups in environ-
mental governance. For example, pro-
environmental coalitions may not have
adequate resources to sustain major
research programs, as corporations
have. For further relevant issues, see
Majone, Giandomenico. 1994. Indepen-
dence vs. Accountability? Non-Majoritar-
ian Institutions and Democratic Govern-
ment in Europe. In EUI Working Papers
in Political and Social Sciences. Euro-
pean University Institute, Florence.
21 Global Administrative Environmental
Law could endorse "internal accountabil-
ity" and create "external" accountability.
Most of the international organizations
have mechanisms that obligate them to
answer to their member-states ("internal
accountability") and then the member-
states' governments in turn answer to
their citizens by means of national
administrative law, if such provisions
exist. It is necessary that the "internal
accountability" mechanisms towards
member-states be endorsed and acces-
sible to every single member-state that
wants to initiate a procedure. It is also
important that mechanisms of "external
accountability" be created in order for the
individual to have direct access and be
able to question the rules and acts of the
international organization at the interna-
tional administrative level. These mecha-
nisms are very important, especially tak-
ing into account that judicial review
mechanisms on the international level do
not sufficiently exist. For the design of
accountability mechanisms, there are
examples from the constellation of inter-
national economic institutions, such as
the International Monetary Fund (IMF),
the World Bank (Inspection Panels), and
the European Central Bank. For further
details, see: One World Trust, Power
without Accountability?, The Global
Accountability Report 2003, p. 3.
22 Institutions should promote the direct
participation of the individual in the work
of the international institutions. The indi-
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AVGERINOPOULOU 139
vidual - scientist or any other citizen -
could have access to information con-
cerning the work of the institution, the
data that the decisions were based on,
and the deliberations of the organs. Indi-
viduals should have access to the pool of
information that the international organi-
zation holds in order to support their
case against non-complying states. The
provision of access to information is one
of the procedural rights that is easily ful-
filled without much effort or institutional
redesign of the international institution
upon which the obligation is posed.
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140 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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KREMLIS 141
THE AARHUS CONVENTION AND ITS
IMPLEMENTATION IN THE EUROPEAN COMMUNITY
KREMLIS, GEORGES-STAVROS
Head of Unit AS-Legal Affairs and Governance-DG Environment, European Commission,
200 Rue de la Loi, Brussels, Belgium, georges.kremlis@cec.eu.int.
SUMMARY
The Convention on Access to Information, Public Participation in Decision-making
and Access to Justice in Environmental Matters (Aarhus Convention) was signed on 25
June 1998 in Aarhus, Denmark, by the European Community. The European Community
has, since then, been adopting appropriate legislation both at the Member States level and
at the level of its institutions and bodies in order to fully implement this international legal
instrument with a view to its accession by the European Community. This paper will con-
sist of two parts: a first one that will focus on the Aarhus Convention per se, and a second
one that will provide an overview of what has been done at European Community level
regarding the implementation of this international legal instrument.
1 THE AARHUS CONVENTION
The Convention on Access to Infor-
mation, Public Participation in Decision-
Making and Access to Justice in Environ-
mental Matters (hereafter the Aarhus Con-
vention) was concluded as part of the Unit-
ed Nations Economic Commission for
Europe (UN/ECE) "Environment for
Europe" process. It entered into force on 30
October 2001.1
The signatories are the European
Community and thirty-nine European
States in which the current twenty-five
Member States of the European Union,
with the exception of Slovakia, and the
three of the accession countries (Bulgaria,
Croatia and Romania) are included. Turkey
is neither a signatory nor a party to this
Convention but participates as an observer
in the meetings of the Aarhus Convention
(as a member of UN/ECE). Also, a large
majority of these countries have already
ratified it (with the exception of Germany,
Greece, Ireland, Latvia, Luxembourg, Swe-
den, and the United Kingdom).
The subject matter of this conven-
tion is divided into "three pillars:" access to
information, public participation in decision
making and access to justice in environ-
mental matters. These three procedural
rights are tools to attain a substantive goal,
that of environmental protection. Moreover,
the Aarhus Convention also concerns gov-
ernment accountability, transparency and
responsiveness and it is considered as a
pioneer governance tool in the environ-
mental field.
The first Meeting of the Parties
(MOP1) took place in Lucca, Italy, on 21-23
October 2002. The Meeting adopted the
Lucca Declaration as well as a number of
decisions inter alia on Pollutant Release
and Transfer Registers, genetically modi-
fied organisms, access to justice, electron-
ic information tools, and rules of procedure
for the Meeting of the Parties, compliance,
capacity building, and a work programme.
The second meeting of the Parties
(MOP2) will take place in Almaty (Kaza-
khstan) on 25-27 May 2005. The meeting
will be an important milestone in the evolu-
tion of the Aarhus process. It will be an
opportunity both to take stock of the
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
progress achieved in the Convention's
implementation and to reflect on and plan
for the challenges that lie ahead. The meet-
ing will also discuss the main develop-
ments that are taking place at both global
and regiona levels in relation to Principle
10 of the Rio Declaration on Environment
and Development and how the experience
with the Convention may contribute to
efforts to make further progress in other
regions.
2 THE IMPLEMENTATION OF THE
AARHUS CONVENTION BY THE
EUROPEAN COMMUNITY
The Aarhus Convention enables
States and regional economic integration
organizations to sign it and ratify it accord-
ing to articles 17 and 19 respectively. The
European Community is the only Party to
the Convention that is not a State and falls
into the category of regional economic inte-
gration organizations.
The European Community is a sui
generis regional organization governed by
a complex set of legal rules. Amongst its
most prominent rules relating to compe-
tence matters are the principles of sub-
sidiary and conferred competences, as
described in Article 5 European Communi-
ty Treaty.
The subject matter of the Aarhus
Convention is ultimately environmental pro-
tection and falls largely within the European
Community's competence, pursuant to Arti-
cle 174 (1) European Community Treaty,
and it is to a great extend inspired by Com-
munity legislation such as the access to
environmental information Directive (Direc-
tive 90/313/EEC). So the European Com-
munity together with its Member States
(shared competence) have the power to
conclude it (mixed agreement), using the
procedure provided in Article 300 (3) Euro-
pean Community Treaty.
The European Community has fol-
lowed a "dualist approach" vis-a-vis the
Aarhus Convention considering that not
only will it accede to this international legal
instrument through its instrument of "ratifi-
cation" (Council Decision) but that it has to
adopt legislation to implement its require-
ments, both at the Member State and insti-
tutions level. This is not required under
recent European Court of Justice case law
("Bang de Berre" case law; case C-239/03
Commission of the European Communities
v. French Republic of 7 October 2004)
which states that the mere European Com-
munity accession would per se introduce
the Aarhus obligations into the Community
legal order as part of the "acquis commu-
nautaire" thus making them binding both for
the Member States and for the institutions
("monist approach").
With the view to its implementa-
tion, the European Community has adopt-
ed two directives in 2003, the first one deal-
ing with access to environmental informa-
tion2, which repeals the existing regime of
Directive 90/313/EEC,3 and the second
with public participation in environmental
decision making.4 This last Directive also
led to the amendment of other environmen-
tal legislation, as is the case of the Environ-
mental Impact Assessment5 and Integrated
Pollution Prevention and Control6 Direc-
tives,7 insofar as it introduces provisions
dealing with public participation and access
to justice. The Directives on access to envi-
ronmental information and public participa-
tion in environmental matters already con-
tain access to justice mechanisms linked to
the violation of the aforementioned rights.
Nevertheless a proposal for a directive on
access to justice in environmental matters8
was put forward in order to enable a mini-
mum level of harmonized requirements for
a general standing right in environmental
matters across the European Union, with a
view to also implement horizontally the
"third pillar" of the Aarhus Convention.
Other legal instruments designed
to contribute to the implementation of the
Aarhus Convention, at the European Com-
munity level, are in the course of adoption;
namely, a proposal for a regulation on the
application of the provisions of the Aarhus
Convention to European Community insti-
tutions and bodies9 and a proposal for a
Council decision on the conclusion, on
behalf of the European Community, of the
Aarhus Convention.10The later was already
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KREMLIS 143
formally adopted and deposited with the
United Nations on 17 February 2005 con-
sequently enabling the European Commu-
nity to become a party by MOP2.
The "Aarhus process" is not a stat-
ic one and will not end with the approval
and entering into force of the abovemen-
tioned proposals. Recently adopted acts,
such as the Water Framework Directive
2000/60/EC or the Directive 2001/42/EC on
Strategic Environmental Assessment,
already incorporate the requirements on
public participation in environmental deci-
sion-making. Also, all the new proposals for
legislation, plans, programmes and policies
relating to the environment will be under
continuous scrutiny with a view of incorpo-
rating the Aarhus requirements.
3 REFERENCES
1 Readers may refer to http://www.unece.
org/env/pp/welcome.html and http://
europa.eu.int/comm/environment/
aarhus/for more information on the Con-
vention.
2 Directive 2003/4/EC of the European
Parliament and of the Council of 28 Jan-
uary 2003 on public access to environ-
mental information, in OJ L 41 of
14.02.2003, p.26. Member States of the
ED have to implement it by 14 February
2005, at the latest.
s Council Directive 90/313/EEC of 7 June
1990 on the freedom of access to infor-
mation relating to the environment, in OJ
L 158, 23/06/1990, p.56.
4 Directive 2003/35/EC of the European
Parliament and of the Council of 26 May
2003 providing for public participation in
respect of the drawing up of certain
plans and programmes relating to the
environment and amending with regard
to public participation and access to
justice Council Directives 85/337/EEC
and 96/61/EC, in OJ L 156 of
25.06.2003. Member States of the EU
have to implement it by 25 June 2005, at
the latest.
s Council Directive 85/337/EEC of 25
June 1985 on the assessment of certain
public and private projects on the envi-
ronment, in OJ L 175, 5.7.1985, p.40.
Directive as amended by Directive
97/11/EC, in OJ L 73, 14.3.1997, p.5.
Hereafter, the EIA Directive.
6 Council Directive 96/61/Ec of 24
September 1996 concerning integrated
pollution prevention and control, in OJ L
257, 10.10.1996, p.26. Hereafter, the
IPPC Directive.
7 Vide supra footnote 4.
8 Proposal for a Directive of the European
Parliament and of the Council on access
to justice environmental matters [COM
(2003) 624], available at: http://www.
europa.eu.int/comm/environment/aarhu
s/index.htm (17.01.2005). Hereinafter,
this is the version to which this report will
refer to.
9 Proposal for a Regulation of the Euro-
pean parliament and of the Council on
the application of the provisions of the
Aarhus Convention on access to infor-
mation, public participation in decision-
making and access to justice in environ-
mental matters to EC institutions and
bodies [COM (2003) 622].
10 Proposal for a Council Decision on the
conclusion, on behalf of the European
Community, of the Convention on
access to information, public participa-
tion in decision making and access to
justice in environmental matters [COM
(2003) 625], available at: http://www.
europa.eu.int/comm/environment/aarhu
s/index.htm (17.01.2005).
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144 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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OPALKA 145
ENFORCEMENT INDICATORS AND CITIZEN SUBMISSIONS
ON ENFORCEMENT MATTERS UNDER THE NORTH AMERICAN
AGREEMENT ON ENVIRONMENTAL COOPERATION
OPALKA, KATIA
Legal Officer, Secretariat, Commission for Environmental Cooperation of North America,
393 St-Jacques St. West, Suite 200, Montreal, QC H2Y 1N9 Canada, kopalka@cec.org
SUMMARY
In North America, under a side agreement to North American Free Trade Agree-
ment, members of the public can complain to an international body when they feel that
Canada, Mexico, or the United States is failing to effectively enforce one of its environmen-
tal laws. The North American Agreement on Environmental Cooperation contains a com-
mitment by the three countries to effectively enforce their environmental laws and lists
measures of enforcement effectiveness agreed to by Canada, Mexico, and the United
States. The North American Agreement on Environmental Cooperation created the Com-
mission for Environmental Cooperation - the Montreal-based Secretariat of the Commis-
sion for Environmental Cooperation that receives submissions from the public regarding
environmental law enforcement. Citizen submissions to the Commission for Environmental
Cooperation Secretariat are filed in writing with supporting information, and they must meet
a list of admissibility criteria to be eligible for review. These submissions are often rich in
detail regarding what submitters expect from environmental law enforcement, and why sub-
mitters feel those expectations are not being met. This information is relevant to a consid-
eration of enforcement effectiveness, though in some cases, it may be more relevant to an
assessment of the government's overall approach to an environmental issue.
1 INTRODUCTION
Article 14 of the North American
Agreement on Environmental Cooperation
allows any nongovernmental organization
or person resident in North America to file a
submission with the Commission for Envi-
ronmental Cooperation Secretariat alleging
that a country that is a Party to the North
American Agreement on Environmental
Cooperation is failing to effectively enforce
its environmental law. If the submission
meets certain formal requirements set out
in Article 14(1), after considering the factors
listed in Article 14(2), the Secretariat can
ask the Party concerned to respond to the
submission. If the Party responds, the Sec-
retariat again reviews the submission and
decides whether it the complaint warrants
developing a factual record. If so, it recom-
mends to the Commission for Environmen-
tal Cooperation Council (composed of the
highest environmental official from each of
the three countries) the development of a
factual record. A factual record sets out
information gathered by the Secretariat rel-
evant to a consideration, by interested per-
sons, of whether the Party is failing to effec-
tively enforce its environmental law in the
disputed case. A factual record is made
public by a two-thirds vote of the Council.
The Commission for Environmen-
tal Cooperation citizen submissions
process zeroes in on domestic environ-
mental law enforcement from an interna-
tional platform, and does so at the request
of the public. At the heart of the process is
the elusive concept of effective enforce-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
ment, a concept that means different things
depending on whom you ask. In this paper,
I consider the text of the North American
Agreement on Environmental Cooperation,
the content of citizen submissions, and fac-
tual records developed by the Secretariat
as sources of information on enforcement
indicators. While this paper does refer to
notions such as "outputs" (like number of
inspections or prosecutions) and "out-
comes" (like compliance with the law or
achieving consistency in enforcement), on
the whole, "enforcement indicator" is taken
to mean simply what a given actor consid-
ers to be a measure of effective environ-
mental law enforcement, in general or in a
specific situation. For present purposes, an
indicator can be anything from "inspections
are carried out" to "enforcement action is
cost efficient" to "effluent meets permit
requirements." The focus here is not on
what the indicators may be, but rather there
may be as many indicators as there are
actors with an interest in environmental law
enforcement. Knowing who these actors
are, and what they expect from environ-
mental law enforcement is relevant to gain-
ing an understanding of the factual context
within which enforcement occurs and to
evaluating enforcement action.
In all likelihood, enforcement will
not always meet everyone's expectations.
However, the job of the Secretariat, in
preparing factual records under the North
American Agreement on Environmental
Cooperation, is to present facts relevant to
an alleged failure to effectively enforce the
law. While expectations are subjective,
from the perspective of the Secretariat,
they are "facts" which may be relevant or
may not, depending on the circumstances.
The Secretariat determines the relevance -
but does not assess the validity - of per-
formance measures that it identifies in its
research, and it does not develop or apply
its own.
2. THE NORTH AMERICAN
AGREEMENT ON ENVIRONMENTAL
COOPERATION AS A SOURCE OF
ENFORCEMENT INDICATORS
Article 5(1) of the North American
Agreement on Environmental Cooperation
reads as follows:
With the aim of achieving high levels
of environmental protection and
compliance with its environmental
laws and regulations, each Party shall
effectively enforce its environmental
laws and regulations through
appropriate governmental action,
subject to Article 37,1 such as:
(a) appointing and training inspectors;
(b) monitoring compliance and
investigating suspected violations,
including through on-site
inspections;
(c) seeking assurances of voluntary
compliance and compliance
agreements;
(d) publicly releasing non-compliance
information;
(e) issuing bulletins or other
periodic statements on
enforcement procedures;
(f) promoting environmental audits;
(g) requiring record keeping and
reporting;
(h) providing or encouraging mediation
and arbitration services;
(i) using licenses, permits or
authorizations;
(j) initiating, in a timely manner, judicial,
quasi-judicial or administrative
proceedings to seek appropriate
sanctions or remedies for violations
of its environmental laws and
regulations;
(k) providing for search, seizure or
detention; or
(I) issuing administrative orders,
including orders of a preventative,
curative or emergency nature.
While not exhaustive, the list in
Article 5(1) sets out actions that the Parties
to the Agreement deem to be appropriate
governmental actions for effective environ-
mental law enforcement.
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OPALKA 147
Article 45(1) defines what is not a
failure to effectively enforce an environ-
mental law for the purposes of the North
American Agreement on Environmental
Cooperation:
A Party has not failed to "effectively
enforce its environmental law" or to
comply with Article 5(1) in a particular
case where the action or inaction in
question by agencies or officials of that
Party:
(a) reflects a reasonable exercise
of their discretion in respect of
investigatory, prosecutorial,
regulatory or compliance matters; or
(b) results from bona fide decisions to
allocate resources to enforcement
in respect of other environmental
matters determined to have higher
priorities; [...]
Part Five of the North American
Agreement on Environmental Cooperation
sets out a procedure for settling disputes in
cases where a Party to the Agreement con-
siders that there has been a persistent pat-
tern of failure by another Party to effective-
ly enforce its environmental law. Article 45
defines "persistent pattern" as a sustained
or recurring course of action or inaction
beginning after the date of entry into force
of the North American Agreement on Envi-
ronmental Cooperation (1 January 1994).
As can be seen above, the North
American Agreement on Environmental
Cooperation contains a commitment by the
Parties to effectively enforce their environ-
mental laws. It also provides examples of
appropriate governmental actions in mak-
ing allowances for the exercise of enforce-
ment discretion and resource prioritization.
Finally, it contains a procedure for settling
disputes when a Party alleges that another
Party is engaging in a persistent pattern of
failing to effectively enforce its environmen-
tal law. Article 5(1), and Article 45(1) spell
out what the Parties to the North American
Agreement on Environmental Cooperation
expect from each other in regard to envi-
ronmental law enforcement. Article 45(1)
provides the basis for a defense to another
Party's allegations in a dispute under Part
V. Article 5(1) contains two outcomes ("high
levels of environmental protection" and
"compliance with its environmental laws"),
which can be tracked as enforcement indi-
cators by anyone wishing to monitor the
effectiveness of a Party's actions under this
article.
3 CITIZEN SUBMISSIONS UNDER
THE NORTH AMERICAN
AGREEMENT ON ENVIRONMENTAL
COOPERATION AS A SOURCE OF
SOFT ENFORCEMENT INDICATORS
To be admissible for consideration
by the Commission for Environmental
Cooperation Secretariat, a citizen submis-
sion must allege a failure by a Party to the
North American Agreement on Environ-
mental Cooperation to effectively enforce
its environmental law. This gives submis-
sions good potential as "public response
indicators," soft indicators that have been
described as follows: "[...] behaviors, atti-
tudes and opinions of the public, including
stakeholders, which are, or may be, reliable
and useful measures of environmental
compliance and enforcement programs,
policies and strategies."2
Only about fifty submissions have
been filed with the Secretariat since 1994,
on a wide range of topics, attempting to
glean meaningful information about
enforcement effectiveness through statisti-
cal analysis of submissions is not a worth-
while endeavor. On the other hand, it is
important not to view individual submis-
sions as lacking the objectivity required of
enforcement indicators; sometimes subjec-
tivity is a good thing! It would also be unfor-
tunate to use submissions only outside the
enforcement context, for example, as indi-
cating the success or failure of government
communications initiatives (i.e., proxy pub-
lic opinion indicators). Article 14 of the
North American Agreement on Environ-
mental Cooperation provides a set of crite-
ria, and a range of factors that must be met
and considered before the Secretariat can
request that a Party respond to a submis-
sion. The submissions may contain valu-
able information on submitters' expecta-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
tions around environmental law enforce-
ment. This information could be useful to
governments in considering their approach
to enforcing the law or to addressing an
environmental issue. Failing to look to indi-
vidual submissions as potential public
response indicators would be a missed
opportunity.
For example, submitters may view
treaties, laws and policies related to the
environment as "promises" from govern-
ment to civil society. Submissions yield
information on what submitters think has
been promised to them, and how and why
they feel that the promise is being broken.
Submissions also contain information
regarding submitters' procedural prefer-
ences (do submitters favor prosecutions
over compliance promotion, and why?),
and regarding expectations as to outcome
(is the desired outcome proof of compli-
ance with the law or proof of environmental
conservation or restoration, and why?).
It may be tempting to dismiss sub-
mitters as "not having all the facts." At the
very least, this suggests that governments
would do well, in formulating a response to
a submission, to provide the Secretariat
with ample information in support of
enforcement decisions in a given context.
However, that is beside the point: the value
in a submission, from a government per-
spective, should lie not in whether the sub-
mitters have all the facts, but rather in the
insight a submission can yield on the sub-
mitters' expectations regarding environ-
mental law enforcement. After all, submit-
ters may have the ability to use the submis-
sions process to mobilize public opinion
against the government and the regulated
industry.
Finally, a submission can indicate
whether the outcome of enforcement action
desired by submitters is consistent with the
objectives of an enforcement program. If it
is not, and if the outcome desired by sub-
mitters is well beyond the capacity of an
agency to deliver, using existing resources
and enforcing the laws on the books, then
submissions may be of more use in consid-
ering the government's overall approach to
an environmental issue, rather than in
assessing the effectiveness of enforcement
action. This may be so even though sub-
missions focus, as they must, on an alleged
failure to effectively enforce an environ-
mental law.
4 FACTUAL RECORDS AS
REPOSITORIES OF INFORMATION
ON EXPECTATIONS OF DIFFERENT
ACTORS AROUND ENVIRONMENTAL
LAW ENFORCEMENT
The North American Agreement on
Environmental Cooperation does not
define what a factual record is. It simply
states that the Secretariat shall prepare a
factual record if the Council, by a two-thirds
vote, instructs it to do so (Article 15(2)), and
then spells out that in developing a factual
record, the Secretariat shall consider any
information furnished by a Party and may
consider any relevant technical, scientific
or other information, including information
developed by the Secretariat (Article
15(4)). In developing factual records, con-
sistent with Council's instructions, the Sec-
retariat gathers information relevant to a
consideration of whether a Party is failing to
effectively enforce its environmental law in
regard to the matter raised by the submit-
ters. The factual record does not contain a
conclusion regarding the allegations made
by the submitter, nor does the Secretariat
make any recommendations. Rather, the
document is intended to provide informa-
tion that will be useful to interested persons
in taking whatever actions they deem
appropriate in connection with the matters
addressed.
When it is developing a factual
record, the Secretariat can gather informa-
tion on enforcement expectations of differ-
ent actors (within and outside government)
around environmental law enforcement. A
good example is the information gathering
process for the BC Mining factual record,
made public by the Commission for Envi-
ronmental Cooperation Council in 2003.3
In that case, the Council had instructed the
Secretariat to prepare a factual record con-
cerning allegations that Canada was failing
to effectively enforce a federal Fisheries
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OPALKA 149
Act prohibition on depositing deleterious
substances into fish-bearing waters in con-
nection with the discharge of acid mine
drainage to Howe Sound from the aban-
doned Britannia copper mine in British
Columbia.
In preparing the BC Mining factual
record, the Secretariat sought to identify
the principal actors with an interest in the
enforcement of pollution prevention legisla-
tion in a mining context, eventually narrow-
ing its focus to enforcement of s. 36(3) of
the Fisheries Act in connection with aban-
doned mines in general and the Britannia
mine in particular. The main actors identi-
fied were: Fisheries and Oceans Canada,
Environment Canada, and Justice Canada;
the mining industry and its industry associ-
ations; nongovernmental organizations; the
Canadian Council of Ministers of the Envi-
ronment; the Government of British Colum-
bia (Mining and Environmental Depart-
ments); Parliament (in particular the House
of Commons standing committees on Nat-
ural Resources and the Environment and
Sustainable Development); the Commis-
sioner of the Environment and Sustainable
Development (part of the Office of the Audi-
tor General of Canada); the Secretariat of
the Treasury Board of Canada; and the
Auditor General of British Columbia.
The Secretariat then identified
sources of information on expectations of
each of these actors around enforcing and
ensuring compliance with s. 36(3) of the
Fisheries Act in the context of mining /
abandoned mines / the Britannia mine. For
government agencies, sources of informa-
tion included the Fisheries Act (and rele-
vant provincial legislation), compliance and
enforcement policies, prosecution policies,
reports on plans and priorities, annual per-
formance reports, and, any government
information creating an expectation regard-
ing enforcement of s. 36(3) that could serve
as basis for explaining and/or evaluating
actions taken in the Britannia mine. For the
mining industry, the Secretariat considered
a multi-stakeholder initiative from the early
1990's intended to put the industry on the
path toward sustainable development, as
well as industry submissions to the House
of Commons Standing Committee on Nat-
ural Resources and industry submissions
to the annual Canadian Mines Ministers'
meetings. The Secretariat considered non-
governmental organization briefs to Parlia-
mentary committees. It also considered the
Canadian Council of Ministers of the Envi-
ronment's principles for a consistent
approach to the remediation of contaminat-
ed sites across Canada and the Canadian
Council of Ministers of the Environment's
federal-provincial regulatory and enforce-
ment harmonization initiatives. House of
Commons standing committee debates
and reports provided valuable information
on enforcement expectations from repre-
sentatives of the electorate. Reports of the
Commissioner of the Environment and
Sustainable Development and the Auditor
General of British Columbia provided
insights on what government auditors
expect from environmental law enforce-
ment, including enforcement of s. 36(3) in
connection with mining, abandoned mines,
and the Britannia mine.
After identifying actors and setting
out their enforcement expectations, the BC
Mining factual record lays out all the infor-
mation made available to the Secretariat
and considered relevant regarding enforce-
ment and compliance promotion activities
carried out at the Britannia mine. All of this
information, taken together, is intended to
allow for a consideration of whether Cana-
da is failing to effectively enforce s. 36(3) of
the Fisheries Act in the context of the Bri-
tannia mine. The inclusion of background
information on the multiplicity of expecta-
tions of different actors regarding enforce-
ment of s. 36(3) at mines in Canada and at
the Britannia mine in particular is intended
to allow for an informed, nuanced, and real-
istic appreciation of the enforcement con-
text and an evaluation of the enforcement
choices that were made regarding the Bri-
tannia mine.
5 REFERENCES
1 Art. 37: "Nothing in this Agreement shall
be construed to empower a Party's
authorities to undertake environmental
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
law enforcement activities in the territory
of another Party."
2 Swanson, E., "Public Response Indica-
tors as Measures of Effective Environ-
mental Compliance and Enforcement
Programs, Policies and Strategies: A Sur-
vey and Analysis of Canadian Experi-
ence" in Indicators of Effective Environ-
mental Enforcement - Proceedings of A
North American Dialogue - Report of the
Law and Policy Program of the Commis-
sion for Environmental Cooperation
(Montreal: Commission for Environmental
Cooperation, 1999) at A4-7, available at
http://www.cec.org/files/pdf/LAWPOLICY/
indic-e.pdf.
3 Commission for Environmental Coopera-
tion, Factual Record - BC Mining Sub-
mission (SEM-98-004). N.A.E.L.P., Vol.
13, 2004, available at http://www.cec.
org/citizen.
6 BIBLIOGRAPHY
Barrett, F. and Pascoe, D., "Environmental
Compliance and Enforcement Indicators:
Environment Canada Pilot Projects -
Addressing Challenges" in INECE-OECD
Expert Workshop on Environmental Com-
pliance and Enforcement Indicators: Mea-
suring What Matters, November 2003,
Paris, available at http://inece.org/indica-
tors/proceedings/04d_canada.pdf.
Goyenechea, A., "Profepa's Strategic Infor-
mation System" in INECE-OECD Expert
Workshop on Environmental Compliance
and Enforcement Indicators: Measuring
What Matters, November 2003, Paris,
available at http://inece.org/indicators/pro-
ceedings/04k_mexico.pdf.
Stahl, M., "Performance Indicators for Envi-
ronmental Compliance and Enforcement
Programs: The U.S. EPA Experience," in
INECE-OECD Expert Workshop on Envi-
ronmental Compliance and Enforcement
Indicators: Measuring What Matters,
November 2003, Paris, available at
http://inece.org/indicators/proceedings/04p
_us.pdf
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BAREMAN 151
GETTING A GRIP ON THE ASBESTOS CHAIN
BAREMAN, PETER
Inspectorate of Housing, Spatial Planning and the Environment, P.O. Box 16191, 2500
BD The Hague, The Netherlands, peter.bareman@minvrom.nl
SUMMARY
While asbestos has a long history of use, it is now known to pose a serious health
risk in dust form. This is due in particular to its carcinogenic properties. The production and
use of asbestos are prohibited in Europe. Because asbestos was widely used as a build-
ing material in the past (e.g. for insulation, as roof cladding and as a fire-resistant materi-
al), it is mainly released into the environment during the demolition of buildings and other
objects (such as trains and ships). On the initiative of the Inspectorate of Housing, Spatial
Planning and the Environment, and in cooperation with other enforcement agencies, an
enforcement approach that focuses specifically on the asbestos chain was developed in
2004, and tested in practice by means of a pilot project.
1 BACKGROUND
The presence of asbestos is not
always recognized (whether consciously or
unconsciously) and, as a consequence,
this material can 'disappear' into the build-
ing and demolition waste disposal chain.
These building and demolition waste flows
are largely recycled into secondary building
materials. If asbestos surfaces in these
reusable building materials, e.g. in crushed
demolition waste, recycling is not possible,
thus frustrating the re-use of such second-
ary raw materials.
There are two European directives
in force whose objective is to prevent and
reduce environmental pollution by
asbestos (Council Directive 87/217/EEC)
and to protect workers from the risks relat-
ed to exposure to asbestos at work (Coun-
cil Directive 83/477/EEC). In the Nether-
lands, these European directives have
been taken as a basis for a set of detailed
rules concerning the handling of asbestos.
1.1 Organisation of Asbestos
Removal in the Netherlands
Asbestos removal is subject to a
system of certification in the Netherlands.
A large number of government bodies are
responsible for the enforcement of rules
concerning asbestos. These include the
Inspectorate of Housing, Spatial Planning
and the Environment (VROM-lnspectie)
(demolition of objects), the Health and
Safety Inspectorate (Arbeidsinspectie)
(working conditions), the municipal authori-
ties (demolition of buildings and other
structures) and the provincial authorities
(processing of building and demolition
waste). In order to prevent asbestos enter-
ing the recycling chain, it is necessary to
establish a system of supervision that
focuses on this chain, with coordinated
government control of all stages of the
asbestos chain.
Under this system, only certified
companies are allowed to carry out
removal work. In order to ensure that
asbestos is properly removed from build-
ings and other objects prior to demolition,
the process has been split into three sepa-
rate stages: (1) inventory, (2) removal, and
(3) (visual) inspection.
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
1.1.1 Inventory
The purpose of preparing an inven-
tory is to ensure that all asbestos is located
before demolition work begins. A person
who is properly trained and experienced in
such work makes this inventory. A report is
made of the inventory, and is then sent to
the company contracted to remove the
asbestos. Only a certified survey company
or consultant may prepare the inventory.
1.1.2 Removal
An asbestos inventory report
serves as the basis for all work to remove
asbestos. Only a certified company may
carry out the removal of asbestos. The
process is aimed at the selective removal
of asbestos, the separate packaging of the
asbestos recovered and its transportation
as hazardous waste to a recognised waste
disposal facility.
1.1.3 (Visual) Inspection
In order to ensure that all the
asbestos has been expertly removed
before work may commence on demolish-
ing the rest of the building or object, an
independent laboratory must declare that
all the asbestos has been removed. Only
an accredited laboratory may carry out the
(visual) inspection. In order to guarantee
their objectivity, such laboratories are inde-
pendent of the asbestos removal compa-
nies. Once the building or object has been
released, the remainder can be demol-
ished. The building and demolition waste
produced is taken away to processing com-
panies that recycle the waste into reusable
crushed demolition waste.
1.2 The Asbestos Removal Chain
Within the asbestos removal chain
there are several 'hand-over moments': the
demolition of structures and objects con-
taining asbestos, the transport of asbestos
waste and other building and demolition
waste produced, the dumping of asbestos
waste, the storage and processing/han-
dling of building and demolition waste and
the use of recycled building and demolition
waste as a building material. This chain is
shown in figure 1.
These 'hand-over moments'
require particular attention within the con-
text of enforcement since they entail a
change of actor (e.g. the owner of the build-
ing - demolition contractor) and of applica-
ble regulations. Certain players in this
chain, such as asbestos removal contrac-
tors and transport firms, are 'mobile' and,
consequently, they frequently operate
regionally or nationally. This makes them
more difficult to 'identify' and hence to keep
tabs on. These particular issues call for a
specific organisation of the enforcement
effort, and this can be achieved by means
of chain enforcement - in other words,
coordinated government control of actions
in the asbestos chain.
2 APPROACH
In 2004, the government bodies
Figure 1. Chart showing Asbestos Removal Chain
cluster
nauaeof
•clashed
damoiliMt
wasle
-------
BAREMAN 153
concerned conducted a pilot chain enforce-
ment project. The aims of this pilot project
were:
—to supervise the compliance behaviour
of private players in the asbestos
removal chain in relation to the
regulations governing asbestos;
—to follow the flows produced and
re-used by the actions occurring in the
demolition chain; this relates to the
removal of waste materials containing
asbestos and other waste materials
produced at the same time (including
building and demolition waste) and
the re-use of materials, such as the
recycling of crushed demolition waste;
—to check how market parties assure
compliance with the asbestos rules (by
means of procedures, documents, etc.).
3 RESULTS
In this survey, seven (large-scale)
demolition sites were selected and followed
from beginning to end. The survey revealed
a number of violations (some of them seri-
ous) in several links of the chain.
—The most common violations and
shortcomings were as follows:
— It was noted on more than one occasion
that the inventory prepared prior to
removal did not include all the asbestos
present. This leads to risks for the
working conditions of the employees
who are required to remove the
asbestos later as well as for the
environment, since the asbestos that
has not been included in the inventory
can end up in the building and
demolition waste during demolition and,
later, via a rubble crusher in crushed
demolition waste.
—The asbestos was not removed
separately in advance and, as a result,
may be scattered in the environment
through building and demolition waste.
The presence of asbestos in building
and demolition waste renders such
waste incapable of being recycled into
reusable crushed demolition waste.
—An asbestos content exceeding the
regulation level of 100 mg/kg was
discovered in several shipments of
building and demolition waste that were
sampled. As a result, these shipments
could no longer be accepted and
recycled in a rubble crusher, and they
had to be dumped as asbestos-
containing waste.
— It was noticed on several occasions
during the dumping of asbestos at
waste sites that careless handling of the
bags in which the asbestos-containing
waste had been packed led to these
bags bursting open, resulting in the
risk of fibres being released into the
environment.
4 ASSURING COMPLIANCE
The parties responsible for com-
missioning the demolition of buildings and
other structures containing asbestos (prop-
erty management companies) that were
surveyed were not doing enough to assure
compliance with the asbestos rules. The
reasons for this can be traced to inade-
quate implementation of the applicable
asbestos rules in the companies' own
administrative organisation, shifting
responsibility on to others and, in some
cases, a lack of internal checks on the work
outsourced to contractors and subcontrac-
tors.
The absence of the aforemen-
tioned assurance and the impenetrability of
the asbestos removal chain, particularly in
the demolition phase, means that risks are
introduced of behaviour that does not meet
the relevant standards. This includes the
insufficiently selective removal of asbestos.
5 CONCLUSION
This survey has shown that the
implementation of an enforcement
approach that focuses specifically on the
asbestos chain has a strong preventive
effect, partly due to the dispersal effect of
such enforcement. By enforcing rigidly at
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154 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
certain stages in the chain, particularly in is possible to prevent asbestos being scat-
the demolition phase, a larger group of tered in the chain. It is essential, in this
actors is made aware of the fact that they respect, that the provision of information is
too may be subject to inspection (increased streamlined and that the authorities coordi-
chance of being caught). By implementing nate their activities. The chain enforcement
focused and coordinated supervision of the approach will be implemented nationally in
parties involved in the demolition phase, it 2005.
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GROEN 155
LEGIONELLOSE PREVENTION IN THE NETHERLANDS
GROEN, BERT
Ministry of Housing, Spatial Planning and the Environment (VROM)
Inspectorate, Northern Region, P.O. Box 30020, 9700 RM Groningen,
The Netherlands, bert.groen@minvrom.nl
SUMMARY
New legislation has been introduced for the prevention of legionella pneumonia in
drinking water systems. A temporary Emergency Act was withdrawn after two years. New
rules appeared in the Water Supply Decree. The norm is 100 "colony-forming-units per
liter" for water that is nebulized, e.g., water from a shower. The owner of the installation has
to document a self-inspection program and has to analyze the water twice a year for the
presence of legionella bacteria. The rules are restricted to high-risk locations, such as hos-
pitals, hotels and swimming pools.
1 INTRODUCTION
Legionella bacteria have been
identified as an important cause of commu-
nity and hospital acquired pneumonia. The
disease is caused by inhalation of a con-
taminated aerosol containing legionella
bacteria. The lower respiratory system is
infected. The disease develops as a severe
pneumonia with a mortality of about 15%.
Morbidity is also high because of toxic and
chronic effects on the body. The disease is
not transmitted from person to person. An
outbreak is therefore always pinpointed to
a certain location and there is no danger of
an uncontrolled spreading of the disease.
The pathogeneses for humans is
controlled by the hosts' susceptibility. Chil-
dren and young people are seldom affected
but elderly people and immuno-suppressed
patients run a high risk of infection.
It is difficult to distinguish infections
caused by legionella bacteria from other
bacterial or viral infections of the human
lung. Of all causes of pneumonia the
legionella bacteria is believed to be respon-
sible in approx. 5 % of all cases. The official
number reported to the health authorities is
several times less then the real occurrence
as shown by different studies. Therefore
many legionella infections are probably not
documented.
2 LEGIONELLOSE PREVENTION
BEFORE 1999
In 1986, a report from the Health
Council of the Netherlands urged effective
measures to be taken in all hospitals to pre-
vent hot tap water from being contaminated
with the legionella bacteria. In all other
large establishments preventive measures
were not as urgent but a raise in tempera-
ture of hot water to 60°C at the tap should
be seriously considered. The water in
whirlpools should contain at least 0.5 mg
chlorine. Also the adequate measures
should be taken at air conditioning installa-
tions and cooling towers. Further measures
should only be considered if epidemical
evidence occurs. The importance of tem-
perature management for hot tap water and
regular cleaning and disinfection of air con-
ditioning installations was recognized. The
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
Dutch Association of Water Supply Compa-
nies (VEWIN) arranged for an update of the
installer standard for drinking water sys-
tems (MEN 1006). The hospitals reported
every year about 45 patients with legionel-
lose disease. The awareness about the
danger of legionella infections remained
low but that attitude changed dramatically
in 1999.
3 THE OUTBREAK OF INFECTION
A large outbreak in the Nether-
lands in 1999 was caused by one non-dis-
infected whirlpool on a flower show at the
city of Bovenkarspel. About 200 people
were hospitalized and 28 persons died.
The suspected whirlpool had been filled
with tap water and the bath was demon-
strated at high temperature for two weeks
without refreshing the water or using a dis-
infectant. These circumstances allowed for
growth of Legionella pneumonia. After 4
days the first persons were infected. The
tap water used for filling the tub was seen
as the origin of the real hazard. In a very
short time people neither did trust their
domestic shower. There was a strong urge
in society for action and the final elimination
of this kind of danger.
The legionella hazard got high
political interest. The Parliament asked for
appropriate, sufficient and timely actions.
Attention was not restricted to demonstra-
tion whirlpools but was focused on all water
systems of domestic or industrial origin.
4 RISK OF INFECTION
The risk of infection is dependent
on a number of factors. No dose-response
model is known for the infection of humans
by the legionella bacterium. Only when a
group of people is exposed during an out-
break it is possible to derive the attack-rate.
The attack-rate in Bovenkarspel was
approx 0,2 percent. Other outbreaks else-
where show about the same percentage.
The risk of death is therefore 0,02 %. That
kind of risk is not an acceptable value of
protection for an exposed population to a
contaminated drinking water system. To
determine a tolerable risk other factors
must be taken into account such as the
economic costs, the social preferences, the
technical feasibility and the benefits.
5 PREVENTION IN COLLECTIVE
DRINKING WATER SYSTEMS
The aim of drinking water guide-
lines is to provide values of protection for
an exposed population. A negative health
impact should be negligible. No guideline
against protection of the legionella bacteri-
um was available in the Water Supply Act.
For the protection of the exposed con-
sumer the Ministry of VROM issued in 2000
an Temporary Emergency Act on Legionel-
la Prevention in Drinking water for a period
of two years. The aim of the legislation was
directed to the sanitation of the so called
collective drinking water installations at;
hospitals, hotels, swimming pools, office
buildings, industrial buildings, shops and
flats. (No prevention rules were made for
the domestic households).
The Ministry of VROM chose for
measures for all collective drinking water
installations. The measures were aimed at
creating an environment that is not con-
ducive to survival or multiplication of
Legionella. Those include adjusting of the
correct temperature for cold and hot water
and maintain the installation according to
the technical standard MEN 1006.
6 RISK ASSESSMENT OF
THE INSTALLATION
A mandatory risk assessment for
the prevention of growth of the organism
inside the installation was introduced by the
Temporary Emergency Act for the collective
drinking water installation. This self-inspec-
tion program consists of a risk-inventory
and analysis based on a time/temperature
scheme and a technical inspection of the
installation. When a risk for the propagation
of legionella is detected, technical meas-
ures must be taken to remove the risk or
the risk must be controlled by hot-water
flushing procedures as described in a con-
trol-plan.
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GROEN 157
]7 THE OWNER OF THE
COLLECTIVE INSTALLATION
The different owners of all collec-
tive installations were required to carry out
an assessment of the safety of their drink-
ing water. The Emergency Act contained a
detailed scheme of the inventory- and risk
analysis requirements. This leads to a self-
inspection program that can be audited by
a second party.
8 EVALUATION OF THE
TEMPORARY EMERGENCY ACT
At the end of 2001 the Ministry of
VROM started an evaluation on the compli-
ance of the emergency regulation for the
prevention of legionella in drinking water
installations.
Public exposure to nebulization of
possible contaminated water at small
installations was low. A risk-assessment for
this specific category showed a low hazard
value, slightly above the household level.
Also the epidemic survey for the source of
infections by the health care authorities
showed no record of incidents at these
locations. Subsequently this low priority -
but in size very substantial -category was
removed from the Emergency Act.
The Inspectorate visited during the
term of the Temporary Emergency Act
approx. 500 installations. Water samples
were taken from the cold and the hot drink-
ing water system and analyzed for the
presence of the bacterium. Most of the
inspected locations were classified as
priority sites, such as hotels, hospitals and
swimming pools. Inspection of the larger
and more complex installations showed
good compliance with respect to the pres-
ence of the mandatory risk-assessment.
9 EXIT TEMPORARY
EMERGENCY ACT
The Temporary Emergency Act
had to be withdrawn after a period of two
years. The reduced prevention scheme is
now introduced in the Water Supply Decree
(28/12/2004) The number of locations with
a mandatory self-inspection program is
restricted to the larger public places, such
as hospitals, hotels and swimming pools.
The number of locations is reduced till
approx. 12.000. This approach has been
approved by the Parliament. The norm is
increased to 100 "colony-forming-units per
liter" and the mandatory microbial analysis
is introduced. Because of these microbial
analyses a better feedback for the effec-
tiveness of the self-inspection program is
assured.
The water supply companies have
been assigned in the Water Supply Decree
as auditor of the collective drinking water
systems. They have to control the perform-
ance of the legionella prevention system.
Furthermore they will control the technical
quality of all collective installations
(600.000) as demanded by the rules of
MEN 1006. The water supply companies
report their findings to the Inspectorate.
The Inspectorate will enforce the law when
needed.
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158 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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HAKE, THOLEN 159
ENFORCEMENT IN RURAL GRONINGEN
HAKE, DANIEL W.1 and THOLEN, PETER E.2
1 Former Inspector, VROM Inspectorate, Region North,
Ministry of Housing, Spatial Planning and the Environment
2 Inspector, VROM Inspectorate, Region North, Ministry of
Housing, Spatial Planning and the Environment
P.O. Box 30020, 9700 RM Groningen, The Netherlands
SUMMARY
The Dutch province of Groningen is a prosperous region with a high degree of
urban and rural development. The historic landscape and nature must be protected against
degradation by unregulated development. However, enforcement of relevant laws is divid-
ed between several government agencies and levels. The project 'Enforcement in rural
Groningen' aims at improving co-operation between these agencies, in order that they
detect and tackle more violations. The essence of the enforcement method is setting prior-
ities together, doing fieldwork together, and putting a higher enforcement priority on rural
areas.
1 ENFORCEMENT IN
RURAL GRONINGEN
This paper reports on the project
'Enforcement in rural Groningen' and the
method of enforcement that was developed
during this project. The aim is to preserve
the quality of our living environment by joint
enforcement of laws by various agencies.
2 CONTEXT OF THE PROJECT
2.1 The Province of Groningen
The Province of Groningen is one
of the 12 provinces in the Netherlands and
lies in the north of the country. It has a size
of 2400 km2 and 575000 inhabitants1; pop-
ulation density is 240 inhabitants/km2. The
province borders the Wadden Sea, an
internationally acclaimed area of mudflats
and salt marshes that forms the habitat for
several endangered species. The province
consists of several areas with a different
character. The northern part has been
reclaimed from the Wadden Sea and has
many characteristics of a tidal area. The
inhabitants had to protect themselves from
the sea through the ages. As a result of this
struggle the area contains many villages
built on flood mounds, old dikes and former
tidal creeks. UNESCO is evaluating a part
of the province in which this landscape has
been preserved best as a World Heritage
Site. The southeastern and western parts
of the province are above sea level and
consist of sandy soils and reclaimed peat
bogs.
Most of the province is in agricul-
tural use, mostly arable but also some dairy
farming. There are nature reserves, such
as woods and marsh; these must be man-
aged carefully, because they are relatively
small and are thus liable to negative influ-
ences from outside.
The province is getting more
urbanised and developed. Around 10% of
Dutch chemical production takes place in
Groningen. The province is prosperous,
just like the rest of the Netherlands. Income
per head was around US $10,000 in 2000.2
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
The local and provincial governments want
to encourage further economic develop-
ment. At the same time, the historic land-
scape must be preserved and nature must
be protected against degradation. For this,
there are many laws and regulations that
must be implemented, complied with, and
enforced.
2.2 The Organisation of Enforcement
Several agencies are responsible
for compliance and enforcement in rural
Groningen. The provincial government has
tasks in the field of regional planning, large-
scale soil pollution, regulating industrial
pollution, quarrying, ground water extrac-
tion, nature conservation and hunting.
In the province, there are 25 local
governments, and municipalities. They
have tasks in the field of building regula-
tions, regulating industrial pollution, small-
scale soil pollution, and storage of manure
and waste. There are also two water man-
agement boards, which are responsible for
managing water quantity through the
extensive drainage and irrigation system,
and managing the quality of surface water
through prevention and tackling of pollu-
tion. The police deal with violations of laws
on hunting, wildlife, waste and manure.
Furthermore, there are a number of spe-
cialist agencies, such as the agricultural
inspectorate, and one NGO, in the field of
nature conservation, that has its own
enforcement officers. The Ministry of Hous-
ing, Spatial Planning, and the Environment
inspects how municipalities and provinces
fulfil their environmental and planning
tasks.
At the national level, there are reg-
ular meetings between representatives of
ministries, provinces and municipalities
about how to tackle enforcement. Here,
national priorities are set and the manner of
enforcement is defined. The provinces
coordinate the implementation of these
decisions on the regional level. In the end,
the individual agencies are autonomous in
how they carry out their tasks, within the
power granted them by national laws. In
order to be effective, it is often necessary to
co-operate. This cannot be enforced from
above, but can be encouraged and facilitat-
ed. The project 'Enforcement in rural
Groningen' is an example of this.
3 THE PROJECT 'ENFORCEMENT IN
RURAL GRONINGEN'
3.1 Background of the Project
Because the rural parts of the
province are used intensively, the environ-
mental, natural, and historical values are
under threat. This threat does not come as
much from planned development, such as
urbanisation, as from many small actions
that, taken together, may adversely affect
rural areas temporarily or permanently.
For example, valuable landscape
features are often removed. Old dikes are
demolished, natural watercourses are
straightened or filled in, and characteristic
hedgerows are cut down. In Groningen,
these characteristic landscapes are pro-
tected. The province, the agricultural
inspectorate and municipalities take
enforcement measures against those who
destroy these features without permission.
Also, rural landscapes are affected by
small buildings on agricultural land. These
buildings have the tendency to grow into
barns that are used for storing manure or
hay, or for keeping animals or agricultural
equipment. These activities are only
allowed next to the main farmhouse, to
avoid the landscape being cluttered with
buildings.
There are laws that protect the
present quality of the living environment.
However, citizens and enterprises do not
always comply with these laws properly
and government agencies sometimes fail
to enforce them. Rural areas are often low
on the enforcement priority list. This is com-
pounded by enforcement divided between
many different institutions which each
enforce certain laws.
These problems occur not just in
Groningen, but in every rural part of the
Netherlands. Therefore, at the national
level, representatives of various govern-
ment agencies decided that in 2003-2004
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HAKE, THOLEN 161
enforcement in rural areas is a priority and
should be improved through co-operation
between agencies. Government agencies
in the province of Groningen implemented
this policy through the project 'Enforcement
in rural Groningen'. The aim of this project
is a joint approach to maintain the quality of
the living environment.
3.2 Project Content
The project covers 4 categories of
violations, which in the Netherlands are
colour-coded for convenience (see figure
1). The project is divided into three phases:
awareness building, method development
and implementation.
3.2.1 Awareness Building
The project started with a meeting
with functionaries and enforcement officers
to explain the proposed project. Next, field
visits were conducted in various parts of
the province. These were meant to gain an
impression of the natural and cultural val-
ues in the area and of the violations that
threaten these values. Enforcement offi-
cers of different agencies were deliberately
brought together and sent to explore the
area. This way, they learned to look at the
area from the perspective of another
agency. The officers found the experience
quite inspiring, educational and interesting.
3.2.2 Method Development
After the awareness building phase
an enforcement method was developed.
This is a practical set of instructions for the
various agencies to improve enforcement
of red, blue, green and grey laws (see
above for the meaning of the colour codes)
and regulations in rural areas. The aim is to
improve compliance with all these laws and
regulations. To ensure that the method is
useful to the target group, the method
developers conducted questionnaires
among enforcement officers, interviewed
specialists and submitted the method to a
test group of enforcement officers before
finalising it. A summary of the method is
given below.
3.2.3 Implementation
After the method was completed, it
was approved by the law enforcement
agencies in the province and presented to
enforcement officers in 2004. It is now up to
the agencies to use it in practice. They may
apply aspects of the method in their
enforcement policy and programme for
2005.
4 SUMMARY OF THE
ENFORCEMENT METHOD
The method follows the policy life
cycle: policy - programme - implementa-
tion - monitoring - evaluation. We will now
go in to a couple of aspects particular to
this project.
4.1 Setting Priorities
According to enforcement expert
Malcolm Sparrow3 "one thing is essential in
enforcement: knowing what your most
important problems are and knowing how
to solve them". In order to do this, enforce-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
ment agencies must first have an idea of
what problems there are and which ones
are the most important. This is something
the agency must do itself - but together
with others. The limited amount of detec-
tion capacity must be used mainly for cases
that have a high priority. Other cases need
only be tackled after complaints. Less
important violations are not enforced.
Instead, spontaneous compliance should
be encouraged, for example through
informing violators about the law.
Of course, priorities must be deter-
mined periodically, based on information
from the field. Priorities should be deter-
mined based on the rate of non-compliance
and the risk or effect of violations.
4.2 Program
Agencies are encouraged to put
joint activities in their annual plan and to act
accordingly.
4.3 Structure of Cooperation
There is already some local coop-
eration between enforcement officers and
policy makers of various agencies through
local enforcement meetings. These could
operate more effectively if agencies make a
joint programme for enforcement in rural
areas.
4.4
Detection
The aim of detection is not only to
detect violations, but also to gain insight
into the extent of compliance. The method
encourages enforcement officers to detect
and report violations on behalf of other
agencies. Various means of detection can
be used for this: surveillance by police and
enforcement officers, joint surveillance,
special investigations, aerial photography,
complaints from citizens and administrative
checks.
4.5 Reporting
Agencies can report violations to
each other orally, in writing, or through a
camera phone.
4.6 Registration
All violations should be registered
by the competent authority, not just those
violations that have a high priority. That
way the competent authority will maintain
an overview of the rate of compliance with-
in its jurisdiction.
4.7 Dealing with violations
The method aims that every viola-
tion detected is dealt with in some way.
This does not always mean strict enforce-
ment, but could also under circumstances
be legalising the situation. Immediate, irre-
versible violations, such as illegal logging,
will be prosecuted through criminal law,
with the intent of punishing the culprit. Per-
manent, but reversible violations, such as
illegal construction, can be tackled by gov-
ernment agencies themselves through
fines, with the intent of ending the violation.
5 RESULTS OF THE PROJECT
It is still rather early to tell what the
results of the project are. It takes a while for
a new ways of working to enter an enforce-
ment agency's policy and be integrated into
its next annual plan of work. However, the
enforcement officers in the field have
already experienced the added value of co-
operation and are enthusiastic about it. In
addition, a couple of municipalities have
now decided to do fieldwork together with
the police and the water management
board in their jurisdiction. As a result of this
project, the first signs of improved law
enforcement in rural Groningen are already
visible.
6 REFERENCES
1 Website province of Groningen, available
at www.provinciegroningen.nl
2 Website province of Groningen, available
at www.provinciegroningen.nl
3 Kees Versteegh, ' De handhaving is hier
doorgeslagen,' NRC Handelsblad (20
December 2003) available at http://www.
identificatieplicht.nl/artnrc201203
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HORNUNG-COUWENBERG 163
ENFORCEMENT AT GROUP LEVEL
APPLIED TO WASTE DISPOSAL GROUPS
HORNUNG-COUWENBERG, D.C.
Deputy Inspector, Inspectorate of Housing, Spatial Planning and the Environment,
Southern Region, P.O. Box 850, 5600 AW Eindhoven,
The Netherlands, dorine.hornung@minvrom.nl
SUMMARY
In 2003, the Inspectorate of Housing, Spatial Planning and the Environment decid-
ed, as part of a secondary supervision strategy, to take steps towards adopting a different
approach to the waste disposal market. In the Netherlands, five waste disposal groups
dominate 40% of this market. The new approach focuses on the waste disposal chain with-
in a single group, with inspections being carried out at the different plants belonging to one
group across provincial boundaries (in The Netherlands, twelve separate provinces are
authorised to implement the Environmental Management Act). In this way a national pic-
ture emerges of the quality of the licence issuing process and enforcement across the
provinces as well as the level of compliance by the group and its companies.
This survey concludes that enforcement at group level supplements regular super-
vision at plant level. Chain enforcement within a waste disposal group ("across the group")
yields clear added value. Additionally, enforcement at group level makes it possible to
improve the supervision of individual plants. Finally, it was noted that while the national
government essentially operates in the national sphere, the large waste disposal groups
commonly operate on an international scale. The use of licensed waste exchange between
domestic and international sites may have unintended and undesirable effects. It is in the
interests of all countries that a grip should (once again) be established on the waste dis-
posal groups and that a clear picture be gained of the intra-group transport of waste mate-
rials. For this reason, the feasibility of an international project on enforcement at group level
within the EU will be explored in 2005.
1 DEFINITION OF TARGET AND
AUDIT METHODOLOGY
1.1 Background
Companies active in the Dutch
waste disposal market are, more and more,
experiencing both a horizontal increase in
the scale of their activities (widening) and a
vertical increase in the scale of their opera-
tions (expansion to include several links in
the waste disposal chain). In 2003, five
groups of companies accounted for more
than 40% of turnover in the Dutch waste
disposal market.
An increase of operations of this
nature carries with it the risk that the mar-
ket will become impossible to fathom, and
hence the possibility of a lack of trans-
parency concerning the issue of licences
and supervision. These matters are of
importance in the Netherlands because
the issue of licences and enforcement of
the provisions of the Environmental Man-
agement Act in this country are carried out
by twelve separate provinces.
For this reason, the Inspectorate of
Housing, Spatial Planning and the Environ-
ment undertook in 2003, as part of a sec-
ondary supervision strategy, a different
approach to the waste disposal market. It
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
was decided to adopt an approach that
focuses on the chain within a single group.
In 2003, one group of companies was cho-
sen to be audited on the basis of objective
selection criteria. A second group was
audited in 2004.
1.2 Targets
The following targets were formu-
lated for the audit:
—to promote positive compliance behav-
iour by the audited group and its plants;
—to promote uniform licence issuing and
enforcement by the provinces concerned
at the plants belonging to a single group;
—to gain an understanding of the working
methods employed by a group and the
possible risks for licence issuing and
enforcement;
—to develop a methodology for enforce-
ment at group level and to gain experi-
ence with a group-focused approach by
the Inspectorate.
1.3 Audit Methodology
An innovative audit methodology
was developed for the audit, which will also
be used in future Inspectorate audits at the
other nationally operating waste disposal
groups. In order to allow a proper assess-
ment of the audit targets, it was decided to
conduct a chain audit of pre-selected waste
flows at different plants within the same
group. This was done to gain an insight into
the relationship between the different
plants in the same group, and to assess
whether this has any effect on their compli-
ance behaviour. Allied to the selected
waste flows, the licensing and enforcement
at the audited plants were also audited.
A second innovative element within
the audit was the fact that the audits were
carried out within a short period of time,
spanning just a few weeks. This was the
first time that a decision had been taken to
conduct a nationwide Inspectorate audit as
a means of carrying out audits of this
nature. The reason for this was to gain the
best possible and most reliable impression
of the level of compliance of the plants. The
group was not informed of the inspections
in advance, and a visit to the head office of
the Dutch plants was therefore planned on
the first day of inspection in order to
announce the audit.
1.4 Preparation and Implementation
During the preparation and imple-
mentation stages, audit decisions were
gradually taken to ensure a well-defined
and controllable audit. Firstly, the group to
be audited was selected on the basis of
objective criteria. Next, several waste flows
were selected as the focus of the audit. As
the audited group has almost 70 plants in
the Netherlands, the third step comprised
the selection of the plants to be audited.
These were plants that may be considered
to play a central role in the group. In other
words: plants to which and from where a lot
of waste is transported. Additionally, a
regional spread across the Netherlands
was also taken into account, which is in line
with the second target of the audit: to
assess the level of uniformity amongst the
various provinces. Fourthly, in order to be
able to compare the data obtained from the
audited plants, it was decided to focus the
(administrative) audit at the plants on
inspection dates that were determined in
advance.
Once these preparations had been
made, a ruler was developed for licence
inspection and operational control. A plan-
ning document was also developed for the
actual implementation. In addition, an audi-
tor was asked to explain by reference to
data that are freely available to the public
the possible effects on enforcement of
keeping group (financial) accounts.
It turned out that if a group reports
its results through consolidated annual
accounts, it is not possible for third parties
to check how well a particular plant is per-
forming on the basis of the published data.
This problem is exacerbated if there is a
single legal entity comprising several differ-
ent plants, and if no financial records are
kept of the origin (release) and destination
(receipt) of waste flows between the vari-
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HORNUNG-COUWENBERG 165
ous plants of that legal entity. In other
words: if two plants are part of the same
legal entity, the need to account properly
for all deliveries and receipts between the
two from a financial/administrative per-
spective disappears. This has negative
consequences for the authorities' ability to
inspect the plant.
Furthermore, it is possible that a
situation may arise whereby the actual
'route' taken by the waste materials
between the different plants does not corre-
spond to the financial 'route', making it hard
to trace. This was also found to be the case
with the audited group.
2 RESULTS AND CONCLUSIONS IN
RELATION TO THE GROUP
2.1 Compliance Behaviour By The
(Plants Of The) Audited Group
It was discovered that the account-
ing records and registering details that the
plants kept with regard to intra-group waste
material deliveries were not sufficiently
consistent. It has not proved possible to a
satisfactory degree to adequately follow the
selected waste flows, check the accounting
records relating to the selected waste
flows, and ensure proper (chain) enforce-
ment within the group. The specific licence
issued to the plants under the Environmen-
tal Management Act states that certain data
relating to waste materials that are deliv-
ered and transported must be registered. A
failure to register is, therefore, a breach of
the licence. The poor quality of the
accounting records meant that it was not
possible in all cases to show which plant
was in breach (the delivering or the receiv-
ing plant). Where possible, the provincial
authorities were asked to take action and
the group was asked to improve its
accounting records.
An observation of this nature with
regard to the quality of the accounting
records will only surface in the context of
cross-provincial (chain) enforcement at
group level. The general conclusion that
may be reached is that enforcement at
group level gives more insight into the com-
pliance behaviour at plant level.
2.2 Uniformity of Licence Issuing
There is no consistency between
the provinces regarding the content of the
licence applications pursuant to the Envi-
ronmental Management Act, nor the con-
tent of the decision granting the licence.
For that matter, they are not required to do
so. The conclusion is justified nonetheless
that a coordinated national approach to
licences would lead to more uniform and
easily enforceable licences. For the sake of
completeness, it is noted that this conclu-
sion also applies to similar companies that
do not belong to one and the same group.
The conclusion applies to a lesser degree
to those plants within a group that carry out
special activities and actions with regard to
(specific) (hazardous) waste flows. Compa-
rability and a need for uniformity amongst
these licences are no less significant and
tangible than amongst 'ordinary' plants not
belonging to one and the same group.
2.3 Uniformity of Acceptance
Procedures
In the audit, extra attention was
focused on the acceptance terms or proce-
dures. After all, if there is no efficient and
unambiguous acceptance procedure in
place, a situation will arise in which
enforcement and inspection become diffi-
cult.
It was discovered that the audited
group prefers a group-standard accept-
ance procedure, which may or may not be
tailored to the specific situation of each
plant. Each province is responsible, sepa-
rately, for assessing and, where necessary,
requesting modifications or additional infor-
mation (regarding hazardous waste) for
each plant. There was no evidence of syn-
chronised activity in this respect. Nor was
there any synchronisation of assessment of
the procedure by the Ministry of Housing,
Spatial Planning and the Environment and
the authorised provinces in relation to the
licence to collect.
The parties involved were therefore
expressly recommended to improve their
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
coordination, i.e. amongst themselves, of
(the assessment of) the acceptance proce-
dures for plants processing hazardous
waste within the same group. In the case of
the audited group, the Inspectorate has
already taken action to ensure such coordi-
nation.
2.4 Uniformity of Enforcement
As has already been stated with
regard to the compliance behaviour results,
it has proved to be difficult to carry out
proper supervision of the accounting
records. Supervision of the accounting
records is important and essential if a clear
insight is be gained into the working meth-
ods of the group and the proper enforce-
ment of the Environmental Management
Act.
It was discovered that intra-group
shipments are only weighed at the receiv-
ing plant after which such data are account-
ed for in the records of the releasing party.
The licences do not allow for a plant to be
forced to keep records on the basis of data
obtained from its own weighings. All this did
not lead to the records being consistent
with one another, for that matter.
The indicative enforcement
assessment revealed that each competent
authority carries out enforcement in its own
way and maintains different frequencies of
visits. There is a potential risk, which was
touched upon in the background to this
audit, that the group might exploit differ-
ences in enforcement. This was not shown
in the investigation.
2.5 Uniformity of Licence Issuing And
Enforcement of the EU Waste
Shipment Regulation
When defining the parameters of
this audit, it was decided to restrict the
audited intra-group waste material chain to
within national borders. During the audit,
however, it became clear that exports of
waste materials and the related intra-group
transportation of these materials within the
country make up a significant proportion of
all transports between the plants and cen-
tralised group activities. Each day the
group decides at the national level which
EU Waste Shipment Regulation decision
will be used via which plant to transport
materials. Then the group as a whole
makes optimum use of the EU Waste Ship-
ment Regulation decisions awarding
licences to the various plants.
With regard to enforcement of the
EU Waste Shipment Regulation, it is noted
that there must be clear agreement within
the Inspectorate as to when it is permissi-
ble to export waste on a decision awarding
a licence to another plant, and when it is
not. The Inspectorate has now made
agreements in this regard in a set of inter-
nal procedures.
It was also discovered that the
wording in the EU Waste Shipment Regula-
tion decisions with regard to the export of
waste is often not in line with the terms of
the licence awarded under the Environ-
mental Management Act, or what happens
in actual practice.
A commitment has been given to
the political parties in the Netherlands that,
where necessary, steps will be taken to
check whether the wording of the export
notices is in line with what a company may
or can do under the Environmental Man-
agement Act. The State Secretary at the
Ministry of Housing, Spatial Planning and
the Environment has said that although an
inconsistency of this nature does not form a
ground for refusal under the EU Waste
Shipment Regulation, a competent authori-
ty may nonetheless take action pursuant to
the Environmental Management Act.
2.6 Insight into the Working Methods
Of Groups And Possible Risks
As stated above, it is not possible
to gain insight into the financial position of
individual plants belonging to the same
group on the basis of data freely available
to the public. Additionally, the actual 'route'
taken by waste materials between the
plants does not always correspond to the
financial 'route'. This makes it more difficult
to follow the paper trail of waste flows.
Generally, it can be stated that
there is evidence of a national policy and
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HORNUNG-COUWENBERG 167
efforts to promote professionalism within
the audited group, combined with speciali-
sations, such as specific activities, that
have been developed at plant level. This is
expressed by, for instance, a comparison of
the licences issued by the various
provinces, but also through the daily optimi-
sation (maximum return at minimum cost)
of which waste materials are stored or
transferred, or processed or handled, at
which site or through which site, and
exported using which EU Waste Shipment
Regulation decision.
This method of working and a
breakdown of the different sites into region-
al private limited companies mean that it is
no longer possible to talk of separately
functioning plants.
The centralisation, moves towards
increased professionalism, and degree of
coordination within the group that were
noted have not (yet) been mirrored in a
similar move by the government with
regard to the issue and enforcement of
licences. This audit has shown that there is
added value in such a move towards
greater coordination and more cross-plant
(and cross-provincial) inspections of waste
disposal groups.
3 REVIEW OF ENFORCEMENT
AT GROUP LEVEL
Enforcement at group level supple-
ments the regular supervision of individual
plants. There is clear added value to be
gained from (chain) enforcement within a
waste disposal group. Implementing
enforcement at group level reveals inade-
quacies and shortcomings in accounting
records (with regard to the intra-group
transport of waste flows) that are not
revealed during the regular supervision of
individual plants. Accordingly, chain
enforcement enables better supervision to
take place of the individual plants under the
Environmental Management Act and allows
action to be taken against shortcomings at
plant level.
The audit methodology that was
developed has proved to be a useful tool
for assessing the aims of the audit. A
"cross-group" inspection that focuses on
pre-selected waste materials is an effective
way of gaining insight into a group's work-
ing methods with respect to waste materi-
als and the level of compliance amongst
the individual plants. The methodology will
be fine-tuned on the basis of the findings
and experiences and will be used in future
audits to be conducted by the Inspectorate
of waste disposal groups that operate on a
national scale.
It is further noted that the waste
disposal groups operating in the Nether-
lands are international business groups
that determine their policy and strategies in
international, i.e. cross-border, terms. The
conclusion may therefore be drawn that the
(inspection of) imports and exports of
waste materials should be a major focus of
any audit of a group. The Inspectorate is
recommended to embed enforcement at
group level in its inspection schedule and to
take the first steps from national to interna-
tional enforcement at group level.
Finally, the audited group reacted
positively to the inspection methodology
and the working method employed by the
Inspectorate. The group has taken positive
action on the points raised with regard to
the individual plants and has given an ade-
quate response to remedy the breaches.
The group also stated that this was the first
time they had experienced this type of
approach and that they considered that the
audit had the look and feel of an external
audit.
4 BIBLIOGRARPHY
Hornung-Couwenberg, D.C., management
summary, "Toezicht afvalconcern: keten-
handhaving bij een landelijk opererend
afvalconcern", 2004 (Supervision of waste
disposal groups: chain enforcement in
respect of a nationwide waste disposal
group) (available in Dutch only).
Hornung-Couwenberg, D.C., "Toezicht
afvalconcern: ketenhandhaving bij een lan-
delijk opererend afvalconcern", 2004
(Supervision of waste disposal groups:
chain enforcement in respect of a nation-
-------
168 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
wide waste disposal group) (available in van de Nederlandse afvalmarkt: de Neder-
Dutch only). landse afvalmarkt anno 2003" (Description
"The waste market, the Netherlands and of tn,e Dutc0n waste mark?t: th? Dutch waste
neighbouring countries", AGO, 2003-12. market 'n 20_03)', annual Publication (ava.l-
a y able in Dutch only.
PricewaterhouseCoopers, "Beschrijving
-------
RUESSINK, HUIZINGA 169
ENVIRONMENTAL AND HEALTH RISKS FROM
ABANDONED INDUSTRIAL SITES - A STRUCTURED APPROACH
RUESSINK1, HENK and HUIZINGA2, KEES
1 Department Head, VROM Inspectorate, Region North, Ministry of Housing,
Spatial Planning and the Environment
2 Senior Inspector, VROM Inspectorate, Region North, Ministry of Housing,
Spatial Planning and the Environment
P.O. Box 30020, 9700 RM Groningen, The Netherlands; kees.huizinga@minvrom.nl or
henk.ruessink@minvrom.nl
SUMMARY
Industrial sites that have been abandoned in the past may cause risks for humans
and the environment. The dangers often originate from hazardous materials that are left
behind. Additional risks may be imposed by the structural disintegration of the premises
over the years. To counteract further risks and to improve the situation, a structured and
stepwise approach was developed that can be applied by the competent authorities at the
local or regional level.
1 INTRODUCTION
Industrial sites that have been
abandoned in the past may cause risks for
humans and the environment. The dangers
often originate from hazardous materials
that are left behind by the last enterprise
that has been operating the facilities. For
instance, such materials can be released
because of deterioration of their original
containment. This often is the case with
asbestos that was applied frequently as
insulating, fire protection and construction
material. Another possibility is that tanks
with residual fuels or chemicals have start-
ed leaking in the years after proper mainte-
nance has stopped. Also, it may turn out
that (hazardous) waste was dumped on the
terrain by the last operator. In other cases,
third parties may have used the abandoned
site to get rid of their waste materials in an
illegal manner.
In many situations an additional
risk may be imposed by the structural disin-
tegration of the buildings over the years.
This may lead to a direct danger that parts
of the constructions could come down.
Also, the fire safety and/or electrical safety
are frequently insufficient. Risks are partic-
ularly at hand when the terrain is not prop-
erly fenced off and is used for habitation or
small businesses. Also children are often
attracted to the premises because they see
it as a good playing ground.
To counteract further risks and to
improve the situation, the VROM- Inspec-
torate of the Netherlands worked out and
facilitated a structured approach that can
be applied by the competent authorities at
the local or regional level.
2 STEPWISE METHOD OF APPOACH
To assess and tackle the problem,
a structured approach was followed, con-
sisting of three important steps.
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
2.1 Inventory of Abandoned Sites
with a Potential Health or
Environmental Risk
First of all it is important to define
the target group. Depending on the local or
regional situation, the focus will be on spe-
cific types of industries/branches. In the
North of the Netherlands, several factories
producing potato-starch, strawboard, and
dairy have been active until the sixties of
last century. After the production stopped,
the sites were abandoned and left. Since
then, a process of deterioration took place,
leading to the problems indicated.
Several sources could be used to
complete the inventory, e.g. local permitting
and enforcement authorities, data from
authorities in charge of conservation of
monuments and historic buildings, industri-
al consultants, historical archives, surveys
of selected industrial areas or local media.
After scrutinizing the list, the next step can
be taken.
2.2 Site Visits And Risk Assessments
All sites identified in the inventory
are subsequently visited in order to investi-
gate the actual situation. Depending on the
estimated human and environmental risks,
the cases are divided into four classes:
—Class 1: High risks: short term
measures required (including fencing
off the site)
—Class 2: Medium risks: medium term
measures required
—Class 3: Low risks: limited measures
required
—Class 4: No risks: no need for
measures
Situations are classified as high
risk when: (a) there is a wide-spread con-
tamination in and around the buildings or
when the constructional integrity is severe-
ly affected and (b) when safety or health of
humans is directly at risk. Sites classified
as high risk or medium risk need adequate
follow-up.
2.3 Further Investigation And
Treatment Of Sites With
High Risks
As a third step, specialists make
detailed assessments of the high-risk
objects in terms of contamination, danger
of constructional collapse and fire safety. If
appropriate, samples are taken for more
detailed analysis. Depending on the results
of the investigations, an action programme
to solve or mitigate the problems is initiat-
ed. For example, it could be decided to
decontaminate the site, to shore up or pull
down dangerous walls, or to fence off the
terrain against unwanted access.
3 RESULTS
The above stepwise approach
worked well in the Netherlands. From 69
potentially hazardous sites identified in the
northern part of the Netherlands in 2003
(step 1), 47 were actually visited and
assessed (step 2). Of these, the situation in
7 cases was classified as high risk and 7 as
medium risk. Up to now measures have
been taken at 5 of such sites (step 3).
An important issue is of course are
the costs of the required measures. In prin-
ciple, the current owner of the site has to
pay ('the polluter pays' principle). However,
there will be cases in which this does not
work, e.g. when the last owner went bank-
rupt. In such circumstances, for the sake of
the health and well-being of the population,
the local authorities will have to take their
responsibility and to come up with some
budget. In a number of cases funds for con-
servation of (industrial) monuments or
more general funds for redevelopment/revi-
talisation may successfully be applied for.
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DE KOSTER 171
CONTAMINATION OF THE TWENTE CANAL:
ENSCHEDE'S DRINKING WATER SUPPLY UNDER THREAT
DE KOSTER, JAN
Inspectorate of the Ministry of Housing, Spatial Planning and the Environment, Eastern
Region, Pels Rijckenstraat 1, P.O. Box 136, 6800 AC Arnhem, the Netherlands,
jan.dekoster@minvrom.nl
SUMMARY
On 22 August 2003, a fire broke out in the raw materials store of a tire factory in
Enschede, necessitating the use of a large quantity of water to extinguish that fire. This
water became heavily contaminated with chemicals used in the factory's production
processes. Much of the water then found its way into the nearby Twente Canal, causing
serious contamination with various substances, some of which are classed as toxic. This
paper discusses the response of the Ministry of Housing, Spatial Planning, and the Envi-
ronment (VROM) Inspectorate.
1 INTRODUCTION
On 22 August 2003, a fire broke
out in the raw materials store of a tire fac-
tory in Enschede. Huge quantities of water
were used to extinguish the fire, causing
serious toxic pollution to the upper section
(the 'third compartment') of the Twente
Canal. This section of the canal included an
abstraction point for the city's drinking
water supply. The local water company,
Vitens, was forced to temporarily relocate
its abstraction activities to a point some five
kilometres away (in the second compart-
ment) in order to ensure water safety.
When the water in the second com-
partment also became polluted, the emer-
gency abstraction was discontinued.
Means of transporting water from else-
where had to be developed very quickly.
Because the water quality of the Twente
Canal remains inadequate to this day,
Enschede's drinking water supply contin-
ues to be transported from other areas in
the region, with some being 'imported' from
across the German border.
Under the provisions of the Water
(Supply) Act, the Ministry of Housing, Spa-
tial Planning, and the Environment (VROM)
is responsible for the regulation of drinking
water supplies in the Netherlands. The
VROM Inspectorate carries out the rele-
vant regulatory and enforcement activities
on behalf of the minister. In light of its
enforcement responsibilities, the VROM
Inspectorate (Eastern Region) has been
closely involved in the situation affecting
the water supply for Enschede and the sur-
rounding area. It must ensure that the con-
tinuity of supply is restored to the former
(pre-fire) level and maintained thereafter.
Prompted by the fire, the VROM
Inspectorate (in its capacity of second-line
supervisory authority) also carried out a
study of the manner in which the tire com-
pany fulfilled its licensing and compliance
obligations further to the Environmental
Management Act. This study reveals that
the raw materials storeroom failed to meet
the requirements of the Commission for the
Prevention of Disasters due to Dangerous
Substances (CPR) 15-2 Directive in a
number of essential aspects, including pro-
visions to intercept and retain the water
used in extinguishing a fire.
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
2 STUDY OF SITUATION REGARDING
ENVIRONMENTAL PERMITS
Following the VROM Inspec-
torate's study of the permits held by the
company and the supervision exercised by
its authorized directors, it was determined
that the raw materials storeroom had not
been constructed according to the terms
imposed by the permit. The building did not
comply with the requirements of Directive
CPR 15-2, which includes statutory guide-
lines laid down by the Commission for the
Prevention of Disasters following the 1986
fire at the Sandoz chemicals factory in
Basel, Switzerland. This incident caused
serious contamination of the Rhine.
The revised permit issued to the
Enschede tire factory on 3 December
2002 explicitly includes all the provisions of
Directive CPR 15-2. According to the per-
mit, the raw materials storeroom was to
have been in full compliance with these
provisions by 1 January 2004. The study
found that the storeroom failed to meet a
number of the Directive's essential require-
ments, including those relating to fire
detection, preventative measures, intercep-
tion of water and incident registration. The
company has since built a new storeroom
which does indeed meet all the require-
ments of the CPR Directive.
3 POLLUTION OF THE
TWENTE CANAL
The Twente Canal connects the
River Ussel (at Zutphen) to the harbours of
Enschede, via Lochem and Hengelo. It is
divided into three sections, or 'compart-
ments,' by means of locks. The first section
is that between Zutphen and Delden; the
second is between Delden and Hengelo
and the third between Hengelo and
Enschede (see maps and diagrams). The
Twente Canal is classed as a national
waterway, whereby responsibility for the
quantity and quality of the structure, soil
and water rests with the Minister of Trans-
port, Public Works and Water Manage-
ment.
By closing the lock at Hengelo, it
was possible to confine the pollution of
August 2003 to the third compartment of
the canal. Measurements revealed that the
chemical substances released into the
canal during the fire had spread throughout
this third compartment.
In order to prevent the third com-
partment from overflowing (it is closed at
one end and has a water drainage func-
tion), the Department of Public Works
installed an active carbon filter at the Hen-
gelo lock, through which treated water from
the third compartment could be released
into the second compartment under strictly
controlled conditions. However, it soon
proved very difficult, if not impossible, to fil-
ter all the substances from the water to the
level required for drinking water abstrac-
tion. To provide the maximum degree of
protection for the Vitens abstraction point, it
was decided (in consultation with the vari-
ous stakeholders) to lay a pipeline that
would discharge the filtered water at a loca-
tion some five kilometres away from the
abstraction point. This situation was an
ongoing point of attention for the VROM
Inspectorate.
In order to resolve the problem per-
manently, the third compartment had to be
completely decontaminated. A two-phase
plan was devised for this purpose. The first
phase covered the decontamination of the
canal bed adjacent to the tire factory (the
source). The second phase involved the
decontamination of the rest of the third
compartment. With the permission of the
Department of Public Works (the compe-
tent authority) the tire manufacturer, being
responsible for the contamination, conduct-
ed the first phase of the decontamination
process, which was completed in Decem-
ber 2003. The preparatory study for the
second phase revealed that after some two
months, the substances released by the
fire had created a sedimentary deposit in
the form of a thin layer of contaminants
across the bed of the entire third compart-
ment. Further investigations concluded that
the planned second stage of the decontam-
ination process was not feasible, either
technically or financially.
The lock was reopened to shipping
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DE KOSTER 173
in early May 2004. The Department of
Public Works has now started work on a
restoration plan (based on increasing the
throughflow of water in the canal) in order
to return water quality to pre-fire levels. To
date, however, this plan has failed to pro-
duce the desired results. Depending on cli-
matic conditions, it seems unlikely that
Vitens will be able to resume activities at its
former drinking water abstraction point until
at least the middle of 2005.
4 WATER QUALITY AND DRINKING
WATER SUPPLIES
The pollution of the third compart-
ment of the Twente Canal was so serious
that Vitens was unable to abstract water at
any point in this section. Even as the fire
was in progress, water supplies were safe-
guarded by discontinuing abstraction from
the canal and making use of the water
reserves kept at the pumping station for
use in emergencies such as this. In this
way, Vitens could continue to supply drink-
ing water to the residents of Enschede and
the surrounding area pending further
measures.
However, because the reserve
supply was not sufficient to cover the entire
period of the canal compartment's decont-
amination, a temporary pipeline was laid to
a point beyond the Hengelo lock, enabling
water to be taken from the second, unpol-
luted compartment. With additional purifi-
cation of the water abstracted here, the
continuity of the water supply was once
again assured, at least for the time being.
However, this contingency supply was
more vulnerable than the regular supply,
whereby it was important that it should not
be used for longer than absolutely neces-
sary.
When untreated water was dis-
charged into the second compartment (the
causes of which have yet to be deter-
mined), Vitens was constrained to discon-
tinue its temporary abstraction of water
here too. At the urgent request of the
VROM Inspectorate, Vitens quickly devel-
oped and implemented plans to transport
water from other parts of the region, includ-
ing areas across the German border. With
the cooperation of the relevant authorities,
most of the necessary infrastructure was
completed and brought into use in 2004.
In December 2004, all stakehold-
ers agreed to continue monitoring the water
quality (i.e. the decrease in pollutant con-
tent) in the third compartment of the Twente
Canal. Once the water quality has regained
the desired level, the Department of Public
Works, being the directly responsible body,
will continue monitoring for a further six
months. For its part, the VROM Inspec-
torate (Eastern Region) will continue to
ensure that the continuity of the water sup-
ply (including use of the original abstraction
point in the third compartment) is restored
to pre-fire levels.
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174 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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KROES, RUESSINK 175
COOPERATION PAYS: INTEGRATED INSPECTIONS
REDUCE BURDEN ON PRIVATE SECTOR
KROES, ABEND and RUESSINK, HENK
Department Heads, Ministry of Housing, Spatial Planning and the Environment (VROM)
Inspectorate, Northern Region, P.O. Box 30020, 9700 RM Groningen, The Netherlands,
arend.kroes@minvrom.nl; henk.ruessink@minvrom.nl
SUMMARY
Reducing the time and resources which private-sector companies have to devote
to government inspections aimed at enforcing regulations, is one of the spearheads of cur-
rent government policy. This reduction of the 'regulatory burden' forms part of the 'Modern-
ization of Government' programme, which was given a significant boost in 2004 by a pilot
project designed to promote interdepartmental cooperation. The conclusions that may be
drawn from the results of the project are summed up in the title of this paper: 'cooperation
pays!'
1 NTRODUCTION
1.1 An I nspection A Week....
Government inspectorates worked
together with the chemicals industry in a
project conducted in the Eemsmond/Delfz-
ijl region, in the northern Netherlands. The
project was prompted by the disturbing
report that one company had been subject
to no fewer than 52 inspections in the past
year alone: an average of one a week. The
Federation of Netherlands Chemical Indus-
tries brought this to the attention of the
Netherlands Ministry of Housing, Spatial
Planning, and the Environment (VROM)
Inspectorate and the Traffic, Transport, and
Roads Inspectorate, which initiated the
pilot. Eventually, seven official inspec-
torates at either national or regional level
took part. The aim was to achieve a clear
reduction in the regulatory burden on pri-
vate-sector companies, while also increas-
ing the efficiency of the inspection services.
1.2
Initial Situation
A large number of organizations
are required to carry out regular inspec-
tions to ensure that companies observe
safety and environmental legislation.
Everyone acknowledges the importance of
independent, expert inspection to both the
business sector and society as a whole.
However, such inspections demand con-
siderable time, manpower, and therefore
financial resources on the part of the com-
panies concerned. Some companies
believe that the lack of coordination
between the inspection services results in
inefficiency and inconsistency. Accordingly,
the inspections represent an unnecessary
burden, in terms of both quantity and qual-
ity. Companies complain of insufficient
knowledge of business processes on the
part of inspectors, inadequate coordination
of reporting obligations and the lack of any
incentive to 'good behaviour'. This erodes
confidence in the government.
2 THE FORM OF THE PILOT PROJECT
Following consultation with the
Federation of Netherlands Chemical Indus-
tries, eighteen regional chemicals compa-
nies were invited to take part in the pilot
project. At first, only four government
inspectorates were to take part, namely the
Health and Safety Inspectorate; the VROM
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
Inspectorate; the Traffic, Transport, and
Roads Inspectorate; and the National
Inspectorate of Mines. However, given the
degree of overlap with the programmes of
other authorities, the regulatory depart-
ments of the Province of Groningen, the
Hunze and Aa Water Management Author-
ity, and the Groningen Fire Department
were also eager to take part.
The pilot project involved three
phases. The first phase entailed making a
reference measurement ('zero situation').
Interviews, workshop sessions, and a sur-
vey were used to gain a better understand-
ing of the regulatory burden currently expe-
rienced by the companies concerned, as
well as the efficiency of the inspection serv-
ices. During the second phase, integrated
inspections were carried out jointly by the
regulatory authorities. The main focus of
these inspections was safety, although a
number of subsidiary areas such as CFC
emissions and process control technology
were also examined. The third and final
stage was to quantify the gains achieved by
both the companies and the inspection
services.
3 RESULTS
The results of the pilot were very
well received by all stakeholders in both the
private-sector companies and the govern-
ment inspection services. The approach
adopted was warmly welcomed, as were
the results - particularly from the perspec-
tive of practical implementation and the
actual gains achieved.
3.1 Gains through Cooperation
The cooperation between the
organizations produced gains at various
levels.
Firstly, the exchange of information
between the various supervisory authori-
ties ensured that they were better informed
and better prepared for the task in hand,
whereupon they were able to command
greater respect from the companies to be
inspected. Secondly, the improved coordi-
nation of the activities reduced or obviated
duplication of work by both inspectorates
and the companies inspected. The coordi-
nation also enhanced the clarity and com-
prehensiveness of the reports (e.g. through
the use of standardized terms), as well as
ensuring better coordination of the follow-
up actions required further to any short-
comings identified. The integrated inspec-
tions reduce the amount of time and
resources that companies have to devote
to such activities, and enable further coor-
dination between the inspection depart-
ments with regard to their findings during
the inspection visits. The third clear visible
gain, is the ability to have one inspection
department undertake certain tasks on
behalf of another, thereby increasing the
efficiency of the inspectorates while also
reducing the regulatory burden on the com-
panies by avoiding unnecessary duplica-
tion.
3.2 Particular Gains in Similar or
Non-Specialist Areas
During the pilot project, it was
found that the greatest efficiency gains are
to be made in inspections which cover the
same topics, or topics of a non-specialist
nature. For example, the national and
regional water quality managers were able
to develop a single system for the evalua-
tion of process control technology (i.e.
measuring and registration systems), and
to share many of their respective tasks.
This resulted in efficiency gains of up to
50% for the authorities concerned, while
the regulatory burden for the companies
inspected fell by between 20 and 40%. The
joint performance of more specialist
inspections did not result in any marked
improvement in efficiency, given the
diverse nature of the aspects to be inspect-
ed.
3.3 Conditions: Coordination,
Direction, Embedding, Trust
Integrated inspections can result in
significant gains, both qualitative and quan-
titative. The benefits will be felt by the pub-
lic and private sectors alike. However,
those benefits also demand some invest-
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KROES, RUESSINK 177
ment and effort, largely in the form of coor-
dination activities. Provided the inspec-
torates meet in good time to make agree-
ments regarding the division of tasks and
responsibilities, there are rewards to be
gained. A crucial factor here is direction.
One of the parties concerned must take the
lead. Cooperation cannot be an ad hoc
undertaking, since it is likely to crumble as
soon as the organization comes under
pressure. Rather, cooperation must be
embedded to become a 'standard' opera-
tional process. The organizations taking
part must therefore have the courage to
experiment with new inspection methods
and to identify the minimum required
enforcement levels. All partners must have
the utmost trust and confidence in each
other's integrity and quality. They will then
be able to devolve certain tasks to other
inspectorates, or indeed to the companies
themselves, based on their own control and
monitoring systems.
3.4 A Single Point of Contact?
It must be conceded that the origi-
nal aim of a 50% average reduction in reg-
ulatory burden and 20% greater efficiency
in the government departments was not
achieved during the pilot project. However,
a system that includes a single point of
contact for all inspection departments may
go some way to achieving this goal, since it
will then be possible to introduce a single
inspection, a single inspection report, a sin-
gle reporting obligation, and perhaps even
a single permit.
4 THE FUTURE
All stakeholders view the pilot as
successful and wish to continue striving to
achieve the stated ambitions. The pro-
posed 'single point of contact' system could
go a long way towards further improvement
of the results. Ongoing study to identify the
optimum form for such a system is there-
fore recommended.
In the meantime, the government
inspectorates will encourage further trials
of the method adopted in Delfzijl, with
refinements made as part of this process.
They also wish to conduct similar experi-
ments in other parts of the country and
involving other industrial sectors. Business-
es, industrial federations, and regional
authorities will then be able to 'roll out' the
pilot project to their own area.
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178 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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ROELOFS 179
ROAD TRANSPORT INSPECTIONS
ROELOFS, JOLANDA
Deputy Inspector, Inspectorate of the Netherlands Ministry of Housing, Spatial Planning
and the Environment (VROM), Eastern Region, Waste Department, Pels Rijckenstraat 1,
P.O. Box 136, 6800 AC Arnhem, the Netherlands, jolanda.roelofs@minvrom.nl
SUMMARY
A growing quantity of waste is being transported to, and processed in, a country
other than the country where it was produced. Alongside processing and recovery, trans-
portation forms part of the 'waste chain.' Carrying out inspections of waste in transit is one
of the ways in which waste flows can be monitored and illegal shipments intercepted. The
organization of transport inspection demands cooperation with other authorities, promotes
the mutual exchange of knowledge and expertise. Transport inspections demand careful
planning, including the location of the inspection, the methods to be employed, and the
action to be taken where illegal practices are identified. Transport inspections have already
proven their worth in the Netherlands and have brought many instances of illegal waste
transport to light. In addition, they have a deterrent effect as the government demonstrates
that the regulations are indeed being enforced.
1 WHY ROAD TRANSPORT
INSPECTIONS?
Much of the waste produced in the
countries of the European Union is trans-
ported across national boundaries. There
are several reasons for this: perhaps there
are no processing facilities in the country of
origin, processing may be less expensive
elsewhere, or substances regarded as use-
less waste in one country may have some
usefulness, and hence value, in another. In
order to protect the environment and to
maintain an overview of the transnational
shipment of waste products, European leg-
islation has been put in place, namely
Council Regulation (EEC) no. 259/93 of 1
February 1993 on the supervision and
control of shipments of waste within, into
and out of the European Community. This
regulation is more conveniently known as
the Waste Shipments Directive (WSD).
The WSD directive is mandatory
for all members of the European Union. It
contains procedures relating to a large
number of hazardous waste substances,
classified according to the 'amber' and 'red'
lists. The procedures are designed to
ensure that the substances concerned are
transported in an appropriate and environ-
mentally safe manner.
Waste is produced, transported
and processed. Together, these activities
are known as the 'waste chain'. Control of
this chain entails control of each of its links.
One of those links is transport. Experience
has shown that waste substances are fre-
quently transported without the correct pro-
cedures being observed or the relevant leg-
islative requirements fulfilled. Moreover,
processing is not always undertaken in the
most appropriate or environmentally safe
manner. Most illegal shipments of waste
substances are never identified as being
waste at all. Approximately 90% of all
waste transported involves substances on
the 'green list,' which are therefore not sub-
ject to WSD procedures. The method to be
employed in processing is not established
beforehand through the permit process.
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
The majority of these shipments are not
identified as containing waste by means of
the regular enforcement practices. Trans-
port inspection is one of the enforcement
instruments available to identify and inter-
cept illegal shipments. Such inspections
also provide a better understanding of the
routing of the waste flows, and have a
deterrent effect.
2 HOW ARE ROAD TRANSPORT
INSPECTIONS ORGANIZED?
2.1 Preparation
In the Netherlands, road transport
inspections are organized in cooperation
with various enforcement partners. The
Inspectorate of the Ministry of Housing,
Spatial Planning and the Environment
(VROM Inspectorate) rarely conducts
inspections alone. The other authorities
involved may include Customs and Excise;
local and national police forces; the Royal
Netherlands Military Constabulary; and the
Traffic, Transport, and Roads Inspectorate.
Joint inspection offers a number of advan-
tages:
—The VROM Inspectorate does not have
enough WSD inspectors to conduct
regular transport inspections unaided.
—The joint inspections promote the
exchange of information and expertise.
The partners will then incorporate
WSD requirements into their regular
inspection activities.
—The enforcement partners are
operational departments that are
regularly active in the field. In general,
they have more frequent contact with
transport operators than the VROM
Inspectorate, and have many times
more inspection staff.
— Each of the various organizations
contributes specialist knowledge.
—Because various aspects of legislation
can be enforced simultaneously, the
burden inspections place on the
transporters themselves will be reduced.
Transport inspection is an impor-
tant means of promoting cooperation
between the various partners and of creat-
ing and maintaining support for the
enforcement of WSD regulations. The form
of cooperation between the various part-
ners has been established by means of a
covenant.
The promotion of cooperation
between the enforcement partners is not
confined to the Netherlands, but extends
to neighbouring countries as well. Regular
border inspections are conducted along-
side Belgian and German authorities. The
first step in the preparations is to contact
the other enforcement partners. The date,
time and location of an inspection are then
mutually agreed, although one of the part-
ners will often take the lead role in making
the necessary arrangements. A written
inspection plan of is produced in which all
details of the planned inspection are
recorded: the exact date, time, and loca-
tion, a list of the various participants with
contact telephone numbers, the tasks and
responsibilities of each participant, the
safety measures to be taken, and the
inspection method to be employed.
2.2 Form of Inspections
Transport inspections can be
organized in various ways. In general,
these can be classified as either 'mobile' or
'static,' although hybrid forms are also pos-
sible.
2.2.1 Mobile Inspections
This method involves the use of
clearly identifiable marked vehicles. The
occupants, usually police or customs offi-
cers accompanied by a WSD expert, patrol
the highways or park at some suitable spot
(a lay-by or flyover) and select the transport
vehicles to be inspected. The trucks are
then directed to the nearest parking lot,
where the inspection of the load and the
relevant paperwork is undertaken. The
advantages of this inspection method are
its flexibility and the ability to cover a rela-
tively large area.
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ROELOFS 181
2.2.2 Static Inspections
In this method, transport vehicles
are selected by officials on motorcycles or
in clearly marked vehicles. The trucks are
then escorted to a static inspection loca-
tion, which may be a parking area equipped
for the purpose. Here, inspectors working
in pairs check the vehicle's load and the rel-
evant paperwork. The advantages of this
method are that a large number of vehicles
can be inspected within a short period, the
inspections bring together people with
complementary areas of expertise, the
inspections are 'high-profile' and various
facilities (such as on-site fax machines) can
be organized more easily.
2.3 The Inspection
The inspection session begins and
ends with a briefing covering aspects of
safety, logistics and the points to which
special attention must be devoted. The
actual selection of vehicles to be inspected
requires expertise in the field of waste sub-
stances. The selectors must know which
haulage companies regularly carry waste
and must be able to identify the vehicles
likely to contain waste.
Once a transport vehicle has been
selected, the inspection proper can begin.
Inspectors check the load against the vari-
ous documents carried by the driver. This
will certainly include scrutiny of WSD docu-
mentation. The inspector notes the regis-
tration number and operator of the vehicle,
together with the type of waste being trans-
ported, on a report form. This enables
waste transport flows to be monitored over
time and any trends to be identified.
Wherever possible, the load is
physically inspected. The description of the
waste in the documents is compared to the
actual load. Samples may be taken for fur-
ther analysis. The inspectors will also
attempt to determine whether the load is
destined for a registered waste processor,
and whether that company is authorized to
accept delivery of the waste substances. If
no irregularities are found, the driver is
allowed to continue his journey.
2.4
Infractions
Any breach of the regulations dis-
covered by the inspectors is dealt with
under civil (administrative) law or criminal
law, depending on the nature of the infrac-
tion. The VROM Inspectorate is authorized
to implement administrative law proceed-
ings. Customs or police officers usually
complete the report required for criminal
proceedings. Where an illegal shipment is
discovered, the inspector will contact the
relevant authorities in the country of origin
to arrange its return to that country. In many
cases, an official visit to the company pro-
ducing or processing the waste will be
arranged with the relevant authorities.
3 WHAT HAS BEEN THE OUTCOME
OF THE INSPECTIONS?
An average of 10% to 15% of
waste shipments are found to be in contra-
vention of the regulations. The infractions
are diverse in nature. Many relate to ship-
ments claimed to consist solely of sub-
stances on the 'green list', which do not
require a permit. However, such shipments
are then found to contain substances on
the 'amber' and 'red' lists, which are there-
fore being transported illegally. In other
cases, waste substances are listed as
being 'products' in an attempt to circumvent
the relevant legislation.
In the Netherlands, nationwide
transport inspections have been held, with
inspectors at work at various locations
simultaneously. Such inspections have a
high deterrent value.
Such transport inspections have
discovered many illegal waste flows over
the years. In many cases, a criminal
enquiry is then instituted. Examples of ille-
gal flows include household waste being
transported as 'building or demolition
waste'. Coal tar pitch (classified as haz-
ardous waste) was transported without the
proper documentation for many years,
while generators containing PCBs were
imported to an unauthorized processing
plant. Refrigerators containing CFCs have
been exported to several African countries,
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182
SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
while sewage sludge was landfilled in dis-
used mines without the necessary permits.
Waste from the Dutch electronics industry
is often illegally exported to Asian and
African countries, where it is then
processed in a manner that causes
adverse effects to both the environment
and human health.
4 EUROPEAN ENFORCEMENT
PROJECTS
International cooperation is neces-
sary because the level of enforcement of
European legislation varies greatly from
country to country. Moreover, some essen-
tial terms such as 'useful re-use' and 'per-
manent removal' are subject to different
interpretations. The private sector itself suf-
fers because the burden of enforcement
differs between member states. These fac-
tors have prompted three major internation-
al enforcement projects to be conducted
under the auspices of The European Union
Network for the Implementation and
Enforcement of Environmental Law Trans-
Frontier Shipping Network (IMPEL-TFS), a
network of enforcement authorities of the
member states and a number of other
European countries that deals with the
transnational shipment of waste. One such
project is the TFS Seaport project, the
background and results of which are
described in the paper 'IMPEL-TFS Sea-
port Project: European Enforcement Initia-
tive To Detect Illegal Waste.'
Another IMPEL-TFS enforcement
project is 'Verification of Waste Destina-
tions,' conducted between October 2003
and November 2004. The project involved
Austria, Ireland, Belgium, the Czech
Republic, Malta, and Finland, with the
Netherlands acting as project manager.
This project focused on permitted process-
ing of waste flows between the countries
taking part, and on verifying that waste
shipments were indeed being transported
to the destination stated on the permit. The
results are described in a report that can be
downloaded at http://www.europa.eu.int/
comm/environment/impel/report.
Based on the evaluation of the Ver-
ification of Waste Destinations project pre-
sented at the TFS Conference held in
Malta in June 2004, it was decided to com-
mence a follow-up project to involve a
greater number of countries and to cover
the exported waste flows on the 'green list',
which do not require a permit. This project
is entitled 'Verification of waste destina-
tions: a second step towards chain enforce-
ment' and has now commenced. Twelve
countries, including a number of new EU
members, are taking part. During the proj-
ect, simultaneous inspections will be held
on various major transport routes through-
out Europe, at or near national borders,
whereby neighbouring countries will coop-
erate directly with each other. In the week
following the inspections, authorities in the
destination country will ascertain whether
the waste shipments have indeed arrived at
their stated destination and whether they
are being processed in the authorized man-
ner. A handbook for the organization of
road transport inspections has been pro-
duced for this project and will be made gen-
erally available in due course.
These projects attempt to ensure
that waste substances from all European
member states are processed in an envi-
ronmentally responsible manner and that a
comparable burden of enforcement exists
throughout the European Union.
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SAPOZHNIKOVA 183
ENVIRONMENTAL PROTECTION IN RUSSIA:
THE EVOLUTION FROM STRICT ENFORCEMENT MEASURES AND
ENVIRONMENTAL COMPLIANCE CONTROL TO NEW COMBINED
APPROACHES BASED UPON PREVENTIVE STRATEGIES
SAPOZHNIKOVA, DR. VICTORIA
Head, Division of State Ecological Control and Waste Management Supervision,
Federal Ecological, Technological and Atomic Supervision Service, Government
of the Russian Federation, Kedrova St., 8/1, 117784, Moscow, Russian Federation,
victoria@ecoinfo.ru
SUMMARY
This paper analyzes the current status of environmental protection in Russia,
including the gaps and new challenges to improve the state environmental system. It dis-
cusses all the components of the state system for environmental protection in Russia,
including ecological legislation, economic and administrative enforcement instruments,
institutional arrangements, and the system of environmental compliance control. The paper
also describes new strategies for environmental protection in Russia, which range from the
"end-of-pipe" approach to pollution prevention strategies (through the Technical Regulation,
Best Available Techniques, voluntary instruments, and "cleaner production" methodology).
1 INTRODUCTION
During the 20th century, Russia's
economic crises limited the rate of environ-
mental destruction. However, the transition
during the last five years to improved eco-
nomical conditions has been characterized
by the extensive growth of industrial pro-
duction, accompanied by an increased
impact to the environment resulting from
both extensive use of natural resources
and environmental pollution due to imple-
mentation of old technologies. The main
ecological problems in Russia caused by
environmental pollution are:
—the high level of air pollution resulting
from both industrial emissions and
transport pollutants emission at urban
centers;
—increasing water pollution due to
industrial discharges;
—continuously increasing levels of
hazardous wastes generation;
—soil pollution, plant cover depletion,
landscape degradation, lack of
biodiversity.1
All these reasons created the
necessity of elaborating and putting into the
force of the state system for environmental
protection. In Russia, the system is charac-
terized by strict enforcement measures and
ecological compliance control. The "end-of-
pipe" strategic approach is not leading to
pollution prevention and gives no stimula-
tion for environmental protection.
2 STATE SYSTEM FOR
ENVIRONMENTAL PROTECTION IN
RUSSIA: CURRENT SITUATION
2.1 Main Components of the
State System for Environmental
Protection in Russia
As any system of management, the
state system for environmental protection
in Russia consists from the following main
components:
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184
SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
—Legislative basis;
— Enforcement instruments and
institutional framework;
—Compliance control and supervision;
— Informational resources; and
—Analysis of results and improvement of
the system
2.2 Strategic Approach and Legislative
Basis for Environmental
Enforcement and Compliance
in Russia
2.2.1 Legislative Basis
The current legislative framework
in the field of environmental protection in
Russia consists of the set of federal laws
and many "under-law" legislative acts
(Governmental Regulations, Directives,
etc.) for each of those laws. The most
important "ecological" laws in Russia are
the following:
— Federal Law "About Environmental
Protection" (2002);
— Federal Law "On Environmental Impact
Assessment (Ecological Expertise)"
(1995);
— Federal Law "On Specially Protected
Areas" (1995);
— Federal Law "On Atmospheric Air
Protection" (1998);
— Federal Law "On Wastes of Production
and Consumption" (1998);
—Water Code of Russian Federation
(1995);
— Forest Code of Russian Federation
(1997); and
—Land Code of Russian Federation
(2001).
The above-mentioned legislative
acts form the basis for the state policy of
the Russian Federation in the field of envi-
ronmental protection. These laws estab-
lished the institutional arrangements in the
field of environmental protection, both
administrative and economic instruments
for environmental enforcement and compli-
ance, as well as the set of requirements for
enterprises in the field of environmental
protection.
The most common requirements
for enterprises are: the obligatory environ-
mental impact assessment (so-called eco-
logical expertise) for the planned activities
which may cause negative environmental
impacts; maintenance of the good quality of
environment components (atmospheric air,
water, soil, living organisms); non-accept-
ance of excessive negative impact to the
environment; necessity of evaluation of
impact to the environment and receiving
the special permits for air emission, water
discharges, and waste disposal; necessity
of payment for the environmental pollution
(polluter pays principle); and environmental
compliance control.
2.2.2 Strategic Approach: "End-of-Pipe"
Until now, in Russia, the main
strategic approach in the field of environ-
mental protection is the "end-of-pipe"
approach. The assessment, evaluation,
monitoring and control of the actual indus-
trial pollution characterize this approach.
Within this approach, each plant
should receive special permits for air emis-
sions, water discharges, and for waste dis-
posal. Such permits set the Emission Lim-
its Values, calculated to meet ambient stan-
dards (Maximum Allowable Concentra-
tions), but usually permit pollution values
according to the actual emissions of indus-
trial facility.
At the same time, the "end-of-pipe"
approach includes the "polluter pay" princi-
ple, characterized by the requirement of
payment for environmental pollution (eco-
logical fees, fines, and compensation pay-
ments for environmental damage). The
"end-of-pipe" approach includes environ-
mental compliance controls for working
facilities and administrative fees and penal-
ties for non-compliance. Thus, the "end-of-
pipe" approach is not leading to pollution
prevention and gives no stimulation for
environmental protection.
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SAPOZHNIKOVA 185
2.3 Enforcement Instruments and
Institutional Framework
2.3.1 Economical and Administrative
Enforcement Instruments
Administrative tools used in Russia
in the field of environmental enforcement
and compliance include the following:
— Environmental pollution permitting.
which includes the evaluation of Envi-
ronmental Quality Standards and Emis-
sion Limits Values on the base of exist-
ing Maximum Allowable Concentrations
for the harmful components;
—Environmental impact assessment (eco-
logical expertise); and
— Ecological compliance control.
Economical instruments for envi-
ronmental protection actually in force are
the following:
— Ecological fees. Special obligatory pay-
ments for air emissions, water dis-
charges, and waste disposal. Includes
the individually calculated payments
agreed with Emission Limits Values
specified in permits, and 5-multipletime
payments when a plant exceeds permis-
sible levels of emissions or operates
without appropriate permit.
— Environmental fines. Administrative
fines (penalties) for non-compliance.
The effectiveness of those fines is limit-
ed due to their low rates; it's more con-
venient for polluters to pay low adminis-
trative fine, than implement all the envi-
ronmental requirements and invest in
pollution prevention and control.
All the finances collected from
abovementioned fees and fines are accu-
mulated in the Federal Budget of Russia
and at the appropriate Regional Budgets. A
part of the money collected is spent accord-
ing to the aimed budget planned for envi-
ronmental protection activities and for pro-
vision of executive authorities carrying out
the ecological compliance control.
2.3.2 Institutional Arrangements
In fall 2004, administrative reforms
in Russia created a new governmental
body: the Federal Ecological, Technologi-
cal and Atomic Supervision Service (or, in
Russian, 'Rostechnadzor'). According to
the Governmental Directive "About the
Federal Ecological, Technological and
Atomic Supervision Service," this Service is
the competent authority both for elabora-
tion of legislative acts in the field of environ-
mental pollution prevention, and for carry-
ing out the ecological compliance control.
2.4 Environmental Compliance
Control in Russia
Environmental compliance control
includes both permitting and inspection. In
Russia, these activities are carrying out by
the Federal Ecological, Technological and
Atomic Supervision Service.
2.4.1 Environmental Permitting
System in Russia
The environmental permitting sys-
tem in Russia includes the issuance of dif-
ferent permits for environmental pollution
(separate permits for air emission, water
discharges and waste disposal) and the
licensing of hazardous waste handling.
2.4.2 Ecological Control
Ecological control (inspectorate) in
Russia is a part of environmental compli-
ance control. According to Russian legisla-
tion, there are two types of Ecological Con-
trol that currently exist in Russia: Federal
Ecological Control and Municipal Ecologi-
cal Control. With the aim to divide the
industrial plants subjected to inspectorate
between federal and municipal levels and
to target inspectorate resources, the State
Register of main polluters was formed and
subjected to the Federal Ecological Con-
trol; while others are under the scope of
Municipal Ecological Control. An additional
component of ecological control (inspec-
torate) is the so-called analytical control
and monitoring, carrying out by the labora-
tories, which belong to the Federal Ecolog-
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186
SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
ical, Technological and Atomic Supervision
Service.
2.5 Analysis of Results and Needs
to Improve the State System for
Environmental Protection
The State system for environmen-
tal protection in Russia based upon the
"end-of-pipe" approach shows insufficient
effectiveness. The main gaps occurred
from the strict enforcement measures com-
bined with low rates of non-compliance
administrative fines, which do not stimulate
plants to prevent environmental pollution
and are not leading to environmental com-
pliance.
Moreover, new challenges in the
field of environmental protection arise from
market forces: industrial plants certified for
the ISO 14000 compliance have an advan-
tage in selling their products in the interna-
tional market.
All the above-mentioned reasons
require improvements to the State system
for environmental protection in Russia. The
preferred way toward such improvement
seems to be the development of an envi-
ronmental compliance promotion policy by
government, including provisions for a
broader application of "cleaner production"
measures and other preventive strategies.
3 THE EVOLUTION OF STRATEGIC
APPROACHES: FROM "END-OF-
PIPE" TO POLLUTION PREVENTION
Nowadays, environmental enforce-
ment and compliance systems in Russia
are evolving from "end-of-pipe" to new pre-
ventive strategies. Russian officials, elabo-
rating the new approaches for environmen-
tal compliance promotion, were supported
by the international assistance within multi-
lateral environmental agreements and
other kinds of international cooperation.
For example, the OECD Secretari-
at provided assistance within the frame-
work of Environmental Action Program
Task Force and made a great contribution
to improvement of the environmental
enforcement and compliance system in
Russia. The Environmental Action Program
Task Force provides a lot of recommenda-
tions for Newly Independent States coun-
tries assisting with capacity building, pro-
moting environmental enforcement and
compliance, and reforming permitting sys-
tem based upon new preventive principles
(Integrated Pollution Prevention and Con-
trol Directive, "best available technolo-
gies," etc).
In addition, the Barents-Euro Arctic
Region cooperation by the Cleaner Produc-
tion Task Force provided appreciable con-
tributions to the reforming of environmental
protection approaches in Russia. The
Cleaner Production Task Force prepared
the Policy Document on "cleaner produc-
tion," approved by the Barents-Euro Arctic
Region Environmental Ministers at the Min-
isterial meeting in Luleo, Sweden, in
August 2003. The policy document
includes a set of measures for environmen-
tal compliance improvement through the
pollution prevention approaches, voluntary
instruments, raising awareness, application
of the new preventive instruments (Envi-
ronment Management Systems, ISO
14000, "best available technologies," etc.),
and the elaboration of a new legislative
basis for "cleaner production" develop-
ment.
Along with the international experi-
ence, Russian officials used national
achievements, such as the system of Tech-
nical Regulations (2003), for reforming the
environmental enforcement and compli-
ance. Currently, the new federal law "About
the Common Technical Regulations for
Ecological Safety" is under construction
and is expected to be approved in 2006.
This federal law is expected to be the foun-
dation for the new system of environmental
legislation, stipulating the norms for an
improved system of environmental enforce-
ment and compliance, based on pollution
prevention principles.
At the same time, Russia is prepar-
ing the draft law "About the Environmental
Payments", which stipulates new principles
for economic incentives and targeted finan-
cial support actions. For example, industri-
al plants using "best available technolo-
-------
SAPOZHNIKOVA 187
gies" in their operation, are free from eco-
logical fees; which stimulates investments
in pollution prevention.
Thus, taking into account interna-
tional experience and national peculiarities,
the new environmental policy based on
preventive strategies is now elaborating in
Russia.
4 CLEANER PRODUCTION
DEVELOPMENT IN RUSSIA AS A
WAY TO POLLUTION PREVENTION
The Ministerial Declaration adopt-
ed at the meeting of European environmen-
tal ministers in Sophia, 1995, stipulated
that "cleaner production" means the contin-
uous implementation of integrated environ-
mental strategies for production and
processes, directed to decrease harmful
effects on humans and the environment.
"Cleaner production" methodology in Rus-
sia is considered the universal way to shift
perspective from "end-of-pipe" regulation to
the preventive strategies and effective
mechanism for strengthening environmen-
tal compliance and enforcement.
4.1 10 Years of Cleaner Production
Program in Russia: Good
Theory, More Practice, and
Amazing Results
"Cleaner production" development
in Russia began in 1994 thanks to activities
of Russian-Norwegian Cleaner Production
Center. They began the "cleaner produc-
tion" Program, which consists of three com-
ponents: (1) the "cleaner production" train-
ing program (includes "cleaner production"
theoretical base); (2) the financial engi-
neering and investment projects for "clean-
er production;" and (3) preparing enterpris-
es to develop Environmental Management
Systems and ISO 14000 certification.
The main theoretical principles of
"cleaner production" Program are:
—education "from engineer to engineer;"
— revealing the primary sources of envi-
ronmental problems at the enterprise;
—pollution prevention through projects
aimed at decreasing air emission, water
discharges, waste generation and ener-
gy saving.
The first steps of "cleaner produc-
tion" in Russia were focused on training
programs at the industrial plants in North-
west Russia. During the 10 years of Russ-
ian-Norwegian Cleaner Production Center
activities in Russia more than 1600 engi-
neers from 600 enterprises were trained.
The "cleaner production" Program led both
to economical benefits (for each $1 invest-
ed to "cleaner production" Program obtain-
ing the $2-5 economical profit) and great
ecological effect through pollution preven-
tion and energy saving at the enterprises.
4.2 The Governmental Assistance
For Cleaner Production And
Preventive Strategies Spreading
All Over The Russia
The amazing results of "cleaner
production" Program introduction in the
North-West of Russia created the need to
spread the "cleaner production" methodol-
ogy all over the Russia as a way to prevent
pollution. Governmental assistance is nec-
essary for "cleaner production" to be an
effective mechanism for strengthening
environmental compliance and enforce-
ment. The Federal Ecological, Technologi-
cal, and Atomic Supervision Service is the
competent authority for elaboration of leg-
islative acts in the field of environmental
pollution prevention, and is taking appropri-
ate steps for "cleaner production" develop-
ment.
The International Conference
"Cleaner Production as a way to Sustain-
able Development" took place in December
2004 in Russia. The results of the develop-
ment of Cleaner Production in Russia pre-
sented at that Conference shows that in
Russia due to mutual interests and com-
mon efforts of governmental bodies, non-
governmental organizations and enterpris-
es, "cleaner production" become the uni-
versal way of achieving a cleaner future
through pollution prevention.
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5 CONCLUSION
The results of implementation of
the current State system for environmental
protection in Russia, based upon the "end-
of-pipe" approach, shows it to be insuffi-
ciently effective and needs improvement.
The preferred way to achieve such
improvement seems to be the development
of an environmental compliance promotion
policy by government, including provision
for a broader application of preventive
strategies, economic incentives and target-
ed financial support actions. Cleaner Pro-
duction methodologies are considered the
integrated way to shift from "end-of-pipe"
regulation to the preventive strategies due
to the good results of its 10-years realiza-
tion in Russia.
6 REFERENCES
1 State Report "About the Environmental
Condition and Environmental Protection
in Russia at 2003 year". Moscow, 2004.
484 p.
7 BIBLIOGRAPHY
Sapozhnikova V. State system for waste
management regulation in Russia. J.
Industrial Ecology, 2005, ?1, pp. 30-36.
Sapozhnikova V. Legislative basis for
Cleaner Production development in Rus-
sia. Available at: .-http://www.lawtek.ru/
analysis/problems/8991
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STAHL 189
USING INDICATORS TO LEAD ENVIRONMENTAL
COMPLIANCE AND ENFORCEMENT PROGRAMS
STAHL, MICHAEL M.
Director, Office of Compliance, United States Environmental Protection Agency, Ariel Rios
Building, 1200 Pennsylvania Avenue, N.W., Washington, DC 20460,
stahl.michael@epa.gov
SUMMARY
Many environmental compliance and enforcement (ECE) programs around the
world are making good progress in identifying and implementing performance indicators.
But at present, very few countries have moved into the next stage of actually using per-
formance indicators to: 1) monitor and manage operations; 2) improve program effective-
ness; and 3) enhance accountability to political overseers and the public. This article
explains why ECE programs need to develop and use performance indicators, describes
patterns emerging from the progress being made by many countries toward identifying and
implementing ECE indicators, discusses how indicators can be used to manage and
improve ECE programs, and suggests ways to ensure continued progress for ECE indica-
tors and programs.
1 WHY DO ECE PROGRAMS NEED
PERFORMANCE INDICATORS
For many years, international
organizations, environmental protection
agencies of national and provincial govern-
ments, and various non-governmental
organizations (NGOs) interested in envi-
ronmental matters have used indicators to
characterize environmental conditions.
These indicators provide a sense of the
current condition of the air, land, and water
and help identify whether their quality is
improving or deteriorating.1
Many forces contribute to the state
of environmental conditions. In the "pres-
sure/state/response" model used by the
Organization for Economic Cooperation
and Development (OECD), various human
activities (often involving energy, transport,
industry, agriculture, and others) put direct
and indirect pressure on the air, water,
land, and other living resources, and these
pressures are mitigated by various societal
responses, including economic forces
and actions by government agencies and
programs.2
Among the responses of govern-
ment are programs designed specifically to
protect the environment by setting stan-
dards and regulating behavior and industri-
al practices that have an adverse impact on
the environment. A fundamental element of
environmental protection programs at the
local, provincial, national, and international
level is to ensure compliance with environ-
mental laws and regulations.
1.1 The Special Mission and
Obligation of ECE Programs
A premise of this article is that pro-
grams to ensure compliance with environ-
mental laws deserve and need their own
distinct effort to develop and use perform-
ance indicators. There are three arguments
in support of this premise. The first argu-
ment is that environmental protection sys-
tems cannot be effective in improving envi-
ronmental conditions if the laws and regu-
lations designed to protect the environment
are not known, respected, and obeyed.
ECE programs play a crucial role in ensur-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
ing compliance with environmental laws, it
is their primary mission to bring about such
compliance. Second, the absence of a
credible environmental compliance pro-
gram will mean that a major incentive for
voluntary efforts to go beyond compliance
will also be absent if no one is even bother-
ing to comply, why even consider going
beyond compliance? Thus, programs
designed to ensure compliance are not just
a building block in an environmental protec-
tion system, they provide the foundation on
which the system is built. The third and less
recognized argument is that ECE programs
often use tools (e.g., enforcement actions)
that impose penalties and/or obligations.
These programs are, in turn, obligated to
use these authorities fairly and wisely. Per-
formance indicators, especially when
shared with the public, can help determine
whether authorities and resources are
being used appropriately.
For all of the above reasons, it is
crucial for environmental ministers, staff
and managers of ECE programs, regulated
industries and facilities, legislative over-
seers, and the public to know if environ-
mental compliance efforts are succeeding,
and if they are not, how they can be
improved. ECE indicators can help provide
this knowledge.
A well-designed set or system of
performance indicators can be a powerful
tool to direct ECE programs toward the
most important results. Indicators can be
used to:
1. Monitor and manage day-to-day
operations of ECE programs;
2. Identify and correct performance issues
and problems in ECE programs;
3. Adjust strategies and resource
allocation to improve the effectiveness
of ECE programs;
4. Provide an account of program
performance to political overseers and
the public.
Each of these uses will be
described further in this article under Sec-
tion 3, "Using Indicators to Manage and
Improve ECE Programs."
2 PROGRESS TOWARD
IDENTIFYING AND IMPLEMENTING
ECE INDICATORS
Under the auspices of organiza-
tions such as the International Network for
Environmental Compliance and Enforce-
ment (INECE), the World Bank Institute,
and the OECD, good progress is being
made by many countries in developing per-
formance indicators for their ECE pro-
grams. While one uniform set of indicators
is not emerging from these efforts, some of
these countries are being guided by a
three-stage framework which suggests: 1)
identifying indicators; 2) designing and
implementing indicators; and 3) using indi-
cators as three steps on a path to follow for
developing ECE indicators.3 For each of
these three stages a set of best practices
has begun to emerge to help countries
manage their ECE indicators projects. Fig-
ure 1 lists the best practices for each of the
three stages of the indicators framework.4
2.1 Emerging Patterns
As more countries make progress
along the path of developing ECE indica-
tors, there are some patterns that can now
be identified.
2.1.1 Most Participating Countries
in Identification and
Implementation Stages
In addition to providing a path for
countries to follow, the framework also
serves as a set of basic milestones for
assessing the progress of countries cur-
rently developing ECE indicators. Many
countries are now on this path and have
progressed to the first milestone (i.e., they
are identifying indicators) or even to the
second (i.e., they are designing and imple-
menting indicators). Projects in Brazil, Mex-
ico, Argentina, and Costa Rica, among oth-
ers, are currently involved in identifying and
implementing indicators. Only a few coun-
tries have taken the path all the way to the
point of using indicators to manage their
programs, and these countries are only in
the early stages of using indicators as a
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STAHL 191
management tool. Projects in the United
States and Canada are beginning to use
indicators to manage all or part of their
ECE programs.5
2.1.2 Indicators Tailored to
Unique Circumstances
Most countries in the identification
and implementation stage are developing
indicators that are tailored for their unique
circumstances. While many ECE programs
are learning from examples used by other
countries, indicators are being selected for
implementation based on institutional
needs and conditions of individual agen-
cies or programs. This means that there is
not one universal set of ECE indicators
being adopted, but varying sets with some
common indicators or characteristics.
2.1.3 Four Types of Indicators Projects
The ECE indicators projects going
on around the world fit into one of four cat-
egories, depending on whether they are
comprehensive or focused with respect to
the laws and requirements they include,
and whether they are national or sub-
national in terms of the jurisdiction they
cover. The four categories are:
—Comprehensive national indicators -
These are used to assess effectiveness
of national ECE programs' efforts to
ensure compliance with all national
statutes and regulations. Developing a
set of comprehensive national indicators
is very complex, since it involves many
persons, multiple agencies, collection of
data from many sources, and may
necessitate development of a national
data system.
—Comprehensive sub-national indica-
tors - These are used to assess
effectiveness of an ECE program of a
regional or district office of a national
agency, a state/provincial environmental
agency, or a local or municipal agency.
This type of effort has the advantage of
being a more manageable size than a
comprehensive national effort, and can
often provide a means of testing a
system of indicators that can later be
applied to the national program.
— Focused national indicators -
These are used when a national
environmental agency wants to
assess the effectiveness of a focused
national initiative to address a specific
noncompliance pattern or environmental
risk. For example, focused national
indicators might be developed for an
inspection and enforcement initiative
to improve compliance among the
petroleum refining industry, a targeted
enforcement initiative to improve
compliance with all air pollution
requirements, or a strategy that
integrates incentives and enforcement
to reduce emissions of a specific
pollutant into water bodies.
— Focused sub-national indicators -
These are used when a regional,
provincial/state, or local/municipal
agency wants to assess the
effectiveness of a focused initiative
to address a specific non-compliance
pattern or environmental risk. For
example, this type of indicator system
might be developed for a regional or
state effort to use inspections and
enforcement to control deforestation,
or a municipal initiative to combine
assistance followed by enforcement
actions to limit illegal dumping of waste
on the land.
2.1.4 Common Set of Barriers
Another pattern that can be identi-
fied from the indicators projects going on
around the world is a set of barriers that
many ECE programs confront as they try to
develop indicators. Those barriers are:
—Compliance culture in formative
stages - In some countries, the
obligation to comply with environmental
(and other) laws is not yet ingrained
deeply and the rule of law is not yet
embraced fully by citizens, businesses
and institutions of government.
—Environmental laws not fully
implemented - Environmental laws may
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
be relatively new, they may have been
changed significantly, and there may
be impediments to implementation of
specific sections of a law.
—Environmental agencies not mature -
The operation of environmental
agencies may not be very sophisticated,
they may possess limited capabilities,
or they may have resource shortages.
—Systematic data collection lacking -
Some countries may lack data systems
or may be only beginning to develop
them.
— Duration of implementation -
Identifying and implementing a useful
set of performance indicators takes
a significant amount of time and
commitment of personnel, and the
effort required may sometimes seem
disproportionate to the value to be
gained from developing and using
performance indicators.
— Lack of analytical skills -Agencies
often lack the ability to interpret the
meaning of indicators, i.e., to determine
what's behind the numbers, as this
requires a sophisticated understanding
of program operations and a skill for
diagnosing problems.
— Misuse by external audiences - The
prospect of performance indicators
being inadvertently or knowingly
misused by advocacy groups or
legislative overseers sometimes
discourages program managers from
developing and using indicators.
3 USING INDICATORS TO MANAGE AND
IMPROVE ECE PROGRAMS
Public management literature sug-
gests that performance indicators can be
used for a wide range of purposes in public
sector programs and organizations. In his
article entitled, "Why Measure Perfor-
mance? Different Purposes Require Differ-
ent Measures," Robert Behn of Harvard
University6 identifies eight specific mana-
gerial purposes that can be served by per-
formance indicators. According to Behn,
the eight purposes are to evaluate, control,
budget, motivate, promote, celebrate,
learn, and improve. Behn asserts that no
single indicator is appropriate for all eight
purposes, and that each purpose address-
es a different management question and
requires specific input, output, or outcome
indicators. A very similar list of uses of per-
formance indicators was previously offered
by Harry Hairy of the Urban Institute.7
3.1 Four Uses of ECE Indicators
These purposes are relevant (in
varying degrees) to any public program or
organization, not just ECE programs. Build-
ing on these eight broad purposes, it would
be useful to adapt them to describe the
specific uses that ECE practitioners are
making of performance indicators. For ECE
practitioners, four distinct but related uses
seem appropriate.
The first use of performance indi-
cators for ECE practitioners is to monitor
and manage program operations. Monthly
or quarterly reports to program managers
and staff about key outputs and outcomes
can be a very useful management tool to
ensure that resources are being used
appropriately to produce specific activities
or results. Such reports can be organized
to break out data for a program as a whole
(e.g., the national enforcement program),
for specific program components (e.g., the
enforcement of air pollution laws), and for
particular organizational units (e.g., a
regional or provincial office of a national
program).
The second use of performance
indicators for ECE practitioners is to identi-
fy and correct performance issues and
problems. Data from input, output, and out-
come indicators can be organized to com-
pare the current year to the previous year,
illustrate a trend over a longer period of
years, compare the performance of one
program component or organizational unit
to another during the same period, and to
assess performance in achieving a particu-
lar goal or target. Indicators can highlight
deficiencies and anomalies, allowing staff
and managers to further analyze the cause
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STAHL 193
of performance which deviates from past
trends or current targets.
A third use of indicators by ECE
practitioners is to evaluate and adjust pro-
gram strategies and resource allocation to
improve effectiveness. By analyzing pat-
terns between inputs, outputs, and out-
comes, ECE practitioners can learn more
about what combination of activities pro-
duces the most important results. Such
analysis can build a chain that improves the
effectiveness of the ECE program B
resources are shifted to produce more of
the right combination of activities, which
increases the contribution of the ECE pro-
gram to important outcomes that protect
the environment.
A fourth use of indicators by ECE
practitioners is to report to political over-
seers and the public about program per-
formance. ECE programs can be well-
served by providing to external audiences
an annual (or more frequent) account of
activities performed and results achieved.
Reports that emphasize results and out-
comes achieved through activities and out-
puts of the program can enhance support
for the compliance and enforcement mis-
sion. By describing accomplishments in
terms that emphasize results - pounds of
pollution reduced through enforcement
actions, improved environmental manage-
ment practices at facilities from compliance
assistance, improved rates of compliance
in an industry sector - an account of per-
formance is provided that is meaningful to
multiple audiences.
3.2 Lessons that Inform Use of
ECE Indicators
As ECE practitioners use perform-
ance indicators for these purposes, they
should be informed by two lessons from the
experience of countries that have begun
using indicators to manage their ECE pro-
grams. The first lesson is that the limita-
tions of indicators need to be understood.
Indicators that show the amount of an out-
put or outcome produced do not tell pro-
gram personnel all they need to know
about that output or outcome. For example,
an indicator can tell ECE program man-
agers that the number of inspections con-
ducted in 2004 is fifteen percent lower than
the number conducted in 2003, but it can-
not explain why the number is lower. To
learn that, more analysis is needed of pro-
gram operations, sometimes using qualita-
tive information to understand the reasons
for the reduction in inspections. Thus, indi-
cators provide a kind of warning light that
signals a need for deeper analysis or fur-
ther investigation of the forces and influ-
ences that shape program performance.
A second lesson learned from the
use of ECE indicators is that intermediate
outcomes provide very valuable manage-
ment information. Efforts to develop indica-
tors often attempt to leap from measuring
basic outputs (e.g., the number of enforce-
ment actions taken) to measuring complex
end outcomes (e.g., improvements in ambi-
ent air quality), ignoring many valuable
results that are produced between activities
and ultimate outcomes. Hatry defines inter-
mediate outcomes as events, occurrences,
or changes in conditions, behavior, or atti-
tudes "expected to lead to the ends desired
but are not the ends themselves."8 Thus, in
the context of ECE programs, examples of
intermediate outcomes might be invest-
ment in pollution control equipment or
implementation of improved environmental
management practices resulting from
enforcement actions taken at facilities.
These outcomes will contribute to the end
outcome (e.g., an improvement in ambient
air quality) but they are not the end them-
selves.
Hatry points out two advantages of
intermediate outcomes that are relevant
and important for ECE practitioners and
programs.9 Intermediate outcomes, by def-
inition, occur before and are expected to
help lead to the end outcomes. As a result,
intermediate outcomes usually provide
more timely information than end out-
comes. A second advantage is that pro-
grams almost always have more influence
over intermediate outcomes than they do
over end outcomes. Stated another way,
there is often a direct causal link between a
program activity (e.g., an enforcement
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action) and an intermediate outcome (e.g.,
an investment in pollution control equip-
ment required as a condition of the enforce-
ment settlement). This direct causal link
allows ECE programs to make a clear and
credible claim that they have produced out-
comes that would not have occurred in the
absence of the program.
3.3 Benefits of Using ECE indicators
When used appropriately, indica-
tors have been able to provide a variety of
benefits to ECE practitioners.
3.3.1 Improved Control of
Program Operations
Even a very basic set of outcome
indicators will increase understanding
about what is being accomplished, and
when combined with data about inputs,
judgments can be made about whether
resources are being used efficiently. At a
minimum, basic output indicators can help
determine whether program staff are per-
forming fundamental program activities.
3.3.2 Improved Goal-setting and
Strategy Development
By using indicators as a manage-
ment tool, goals can be set regarding the
amount of activities or results that should
be produced over a period of time. Indica-
tors can also be used to identify needed
adjustments in the mix of activities or
results the program is producing.
3.3.3 Improved Resource
Allocation Decisions
Output and outcome indicators can
be analyzed to determine whether
resources need to be increased, shifted, or
altered in some way to meet goals and
achieve desired results. Indicators provide
an understanding of the relationship
between outputs and outcomes, thereby
enhancing the ability of program managers
to increase resource investments in pre-
ferred outcomes.
3.3.4 Improved Identification
and Correction of
Performance Problem
Indicators that can be organized by
type of output or outcome, by organization-
al unit, and by program area increase pro-
gram managers' ability to identify perform-
ance problems and investigate them further
to design solutions.
3.3.5 Improved Ability to
Motivate Employees
There is much truth to the oft-
repeated statement, "What gets measured
gets done." Performance indicators send a
clear signal to program personnel about
what needs to be accomplished. Setting a
goal to achieve a certain amount of a spe-
cific output tends to organize and focus
some portion of resources on achieving the
goal.
3.3.6 Improved Ability to
Communicate with the Public
Performance indicators help exter-
nal audiences understand and support pro-
gram activities. Output indicators can con-
vey to the public that funds are producing
some amount of inspections, enforcement
actions, or other activities. Outcome indica-
tors can convey that these activities are
resulting in important outcomes such as
reduced pollution, increased compliance,
and improved environmental management
at facilities.
Although the challenges and barri-
ers associated with identifying and imple-
menting ECE indicators are formidable, the
benefits derived from using the indicators
to manage and improve programs are sig-
nificant. Countries that have made it to the
third milestone on the path - i.e., using indi-
cators - have recognized that the benefits
of using indicators outweigh the costs of
implementing.
4 ENSURING FURTHER PROGRESS
FOR ECE INDICATORS AND
PROGRAMS
ECE practitioners using indicators
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STAHL 195
as a management tool need to form a com-
munity of practice to learn from each oth-
ers' experience and to show the way for
other practitioners who are on the path of
identifying, implementing, and using indica-
tors. Such a community is necessary if
ECE programs want to receive the maxi-
mum benefit from performance indicators.
4.1 The Need for a Community
of Practice
While the creation of sets or sys-
tems of indicators is an important step
toward making ECE programs more effec-
tive, systems of indicators by themselves
cannot bring about improved performance
in ECE programs. Setting up a system of
indicators can be seen as acquiring a tool,
but the tool needs to be used continuously
by program managers and staff. Over time,
program personnel gain more experience
and skill in using the tool, they hone and
sharpen the tool to make it more useful,
and ultimately the program to which they
apply the tool becomes more effective.
There is not much accumulated
experience in using ECE indicators for pro-
gram management and improvement,
since most countries are still in the identifi-
cation and implementation stages of their
ECE indicators projects. But a community
of practice for ECE indicators could make a
significant contribution to creating a cadre
of experienced, thoughtful program leaders
who document their knowledge, report it to
interested colleagues around the world,
and advance the collective learning of ECE
practitioners. This community of practice
should encourage its members to report
periodically to a central repository about
the progress or challenges associated with
their indicators projects. Members should
also be encouraged to post "indicator bul-
letins" to provide examples of how indica-
tors are being used to manage and improve
ECE programs, and e-dialogues about spe-
cific topics can be used to promote more
frequent communication among members
about ideas and developments in perform-
ance measurement.10
4.2 Toward Performance-Based
Management for ECE Programs
Ultimately, if ECE programs are to
make their maximum contribution to envi-
ronmental protection, they will need to join
other government programs in moving
toward performance-based management.
This movement toward performance-based
management is global, as described in var-
ious books and articles about global trends
in public management reform.11 In his arti-
cle entitled "Performance-Based Manage-
ment: Responding to the Challenges,"
Joseph Wholey defines performance-
based management as "the purposeful use
of resources and information to achieve
and demonstrate measurable progress
toward agency and program goals."12 The
United States Government Accountability
Office (GAO) describes three key steps in
performance-based management: (a)
developing a reasonable level of agree-
ment on mission, goals, and strategies for
achieving the goals; (b) implementing per-
formance measurement systems of suffi-
cient quality to document performance and
support decision making; and (c) using per-
formance information as a basis for deci-
sion making at various organizational lev-
els.13 Wholey suggests that in coming
years there will be a premium on managers
and staff with the knowledge, skills, and
abilities to apply performance-based man-
agement to their programs. This will require
training on how to use performance infor-
mation: in agency and program manage-
ment systems; to provide accountability to
key stakeholders and the public; to demon-
strate effective or improved performance;
and to support resource allocation and
other policy decision making.14
ECE practitioners, through their
work on indicators, have established a
steady pace of progress toward "imple-
menting performance measurement sys-
tems of sufficient quality" and applying per-
formance-based management to their pro-
grams. Managers and staff of ECE pro-
grams can determine whether they have
succeeded in becoming performance-
based programs by watching for specific
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changes. (Perhaps these are best viewed
as five indicators of program improvement.)
ECE programs have reached the threshold
for high performance when they are:
addressing significant environmental, pub-
lic health, and compliance problems; using
data to make strategic decisions for better
utilization of resources; using the most
appropriate tool to achieve the best out-
come; assessing the effectiveness of pro-
gram activities to ensure desired program
performance; and effectively communicat-
ing the environmental, public health and
compliance outcomes to the public. When
this threshold is reached, the hard work of
identifying, implementing, and
5 REFERENCES
1 A relatively recent example of indicators
pertaining to environmental conditions
can be found in, EPA, "Draft Report on
the Environment 2003,"EPA-260-R-02-
006, June 2003, also available at
http://www.epa.gov/indicators/.
2 Linster, Myriam, "OECD Work on Envi-
ronmental Indicators," in Measuring
What Matters, Proceedings from the
INECE-OECD Workshop on Environ-
mental Compliance and Enforcement
Indicators, November 3 - 4, 2003, pg.
168.
3 Stahl, Michael, "Performance Indicators
for Environmental Compliance and
Enforcement Programs: The U.S. EPA
Experience," in Measuring What Matters,
Proceedings from the INECE-OECD
Workshop on Environmental Compliance
and Enforcement Indicators, November
3-4,2003, pg. 150- 157.
4 These best practices are described in an
upcoming INECE publication entitled,
"Performance Measurement Guidance
for Compliance and Enforcement Practi-
tioners," written by Michael Stahl in con-
sultation with the INECE Indicators
Expert Working Group.
5 Descriptions of many of these projects
can be found at the INECE web site,
http://www.inece.org/forumsindicators.
html.
e Behn, Robert D., "Why Measure Perfor-
mance? Different Purposes Require Dif-
ferent Measures," Public Administration
Review, Vol. 63, No.5., September/Octo-
ber 2003, pg. 586 - 606.
7 Hatry, Harry, Performance Measure-
ment: Getting Results, The Urban Insti-
tute Press, Washington, D.C., 1999,
p. 158
8 Hatry, Harry, IBID, p. 16.
9 Hatry, Harry, IBID, p.19.
10 The INECE web site currently provides
many useful features for practitioners
interested in ECE indicators, and could
easily be adapted to provide a visible
forum for "indicators bulletins." INECE
has also conducted e-dialogues on indi-
cators topics on their web site.
11 See, for example, Kettl, Donald R, The
Global Public Management Revolution,
Brookings Institution Press, Washington,
D.C., 2000, pg. 2. Kettl describes
"accountability for results," and a "focus
on outputs and outcomes instead of
processes and structures "as a core
characteristic of the global movement
toward reform of public management.
12 Wholey, Joseph S., "Performance-
Based Management: Responding to the
Challenges," Public Productivity and
Management Review, Vol. 22, No. 3., pg.
288.
13 Wholey, Joseph S., IBID, pg. 289.
14 Wholey, Joseph S., IBID, pg. 303.
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BUTLER, FEKETE 197
MEASURING COMPLIANCE PROGRAM PROGRESS
AND IMPACTS: LESSONS FROM USEPA'S NATIONAL
PETROLEUM REFINERY COMPLIANCE PROGRAM1
BUTLER, KATHLENE1 AND FEKETE, GABRIELLE2
11200 Pennsylvania Avenue, Northwest, Mail Code 2460T, Washington,
District of Columbia, 20009, USA, Butler.Katie@epa.gov
2109 T.W. Alexander Drive, Research Triangle Park, North Carolina, 27709, USA,
Fekete.Gabrielle@epa.gov
United States Environmental Protection Agency, Office of Inspector General, Office of
Program Evaluation, Cross-Media Issues
SUMMARY
An evaluation of the US Environmental Protection Agency's (USEPA) National
Petroleum Refinery Program demonstrates how choosing performance measures that do
not measure program impacts can lead to uncertainty about results. Public reports on the
petroleum refinery program claimed that the program eliminated 200,000 tons of pollutants
from the air surrounding refineries every year. However, USEPA and refineries reported
predicted emissions reductions instead of actual reductions achieved. Moreover, USEPA
did not actually know how much pollution participating companies had eliminated. USEPA
claimed the program a success based on the modeling of predicted emissions reductions,
most of which would not occur for 10 years or more, and the number of companies partic-
ipating in the program. This case study demonstrated the challenge program managers
face in choosing performance measures that clearly connect outputs, intermediate out-
comes, and end outcomes. Enforcement personnel must demonstrate that their program
improved compliance within the targeted population, or that the risk posed by the popula-
tion decreased. Given the challenge of choosing measures that capture the data most
indicative of a program's relative success or failure, the USEPA Office of Inspector Gener-
al (OIG) developed a list of key assessment questions for performance measures so that
program managers can improve their performance measurement schemes. Thereafter, the
OIG recommends for testing the key assessment questions by evaluating sample enforce-
ment programs in the spring of 2005.
1 INTRODUCTION
In this paper, we discuss the impor-
tance of performance measurement for
environmental enforcement and compli-
ance programs and outline criteria for
developing and assessing performance
measures. We discuss how performance
measurement for the USEPA National
Petroleum Refinery Compliance Program
could be improved to better demonstrate
program outcomes (based primarily on the
22 June 2004 USEPA Office of the Inspec-
tor General evaluation report EPA Needs to
Improve Tracking of National Petroleum
Refinery Compliance Program Progress
and Impacts, Report No. 2004-P-00021).
Finally, we describe a set of key questions
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
for assessing existing performance meas-
ures and performance measurement suites
developed for environmental enforcement
and compliance programs, and make rec-
ommendations for testing the questions
and subsequent use.
1.1 Challenge of Performance
Measurement for Environmental
Enforcement and Compliance
Activities
Public officials responsible for envi-
ronmental enforcement and compliance
personnel face unique performance meas-
urement challenges: (1) they must demon-
strate that their programs improve compli-
ance with regulations across the entire reg-
ulated community in order to demonstrate
that their programs improve regulatory
compliance, in general; (2) at the same
time, they must demonstrate that they tar-
get significant non-compliers to ensure that
their activities address the most significant
risks to human health and the environ-
ment.2 They must meet these challenges
and report results in a way that enhances
their credibility and accountability with law-
makers, the public, and the regulated com-
munity.3
With over 40 million regulated enti-
ties in the United States,4 demonstrating
improvements in compliance across all reg-
ulated entities is a challenging endeavor for
the USEPA. USPEA allocates scarce mon-
etary and staff resources between random-
ized inspections (for determining statistical-
ly-valid compliance rates) and targeted
inspections (for ensuring that they regular-
ly inspect the most high-risk violators). In
addition, USEPA must measure these con-
ditions in the face of a multitude of addition-
al factors contributing to environmental
compliance - prevailing economic condi-
tions and market forces, inconsistent and
competing local, state, and federal priori-
ties, environmental advocacy and citizen
groups' efforts, and media attention among
others.5
Recently, some public watchdog
groups have criticized USEPA for a report-
ed decline in enforcement actions, saying
that the agency relaxed its enforcement
efforts.6 However, others could have attrib-
uted the reported decline to increased com-
pliance - perhaps fewer enforcement
actions were necessary because fewer
regulated entities required enforcement.
Counting how many people or companies
the agency found in violation gives no infor-
mation about the severity of the violation,
whether the facility corrected the violation,
whether the company was a repeat-offend-
er, or whether Americans and their natural
environments will be safer because of the
enforcement action.7
Because USEPA did not have
measurable environmental results to com-
plement its enforcement and compliance
assurance claims, it faced pressure to
increase the number of enforcement
actions.8 USEPA officials recognized that
they should improve measurements of
enforcement and compliance accomplish-
ments, and did not want to be held to pre-
conceived expectations that more enforce-
ment actions meant better compliance in
the regulated community.9
Experts in performance measure-
ment and regulatory programs also stress
the importance of effective performance
measures. In operating integrated compli-
ance programs, Kiener, et al. said that
effective planning depended on agencies'
abilities to gather data, measure perform-
ance, and monitor environmental condi-
tions.10 They said doing these things would
enable an agency to establish baselines,
identify and prioritize compliance problems,
and manage programs in response to
incoming performance information. Met-
zenbaum agreed, saying that a good per-
formance measurement system holds an
organization accountable, and improves
outcomes, including increasing awareness,
sharpening focus, motivating improved per-
formance, encouraging innovation, and
allowing for adaptation in response to
results.11
Behn says performance measures
enable public managers to accomplish sev-
eral necessary tasks: evaluation, control,
budgeting, motivating staff and stakehold-
ers, promoting their programs, celebrating
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BUTLER, FEKETE 199
successes, learning about what works and
what does not work, and improving upon
programs based on that information.12 In
addition, Sparrow said regulatory enforce-
ment performance measurement systems
cover six factors: (1) customer or client
satisfaction, (2) employee satisfaction, (3)
likelihood of identifying a complier as a
non-complier or not correctly identifying a
non-complier, (4) ensuring that most activi-
ties are aimed at high-risk groups and non-
compliance is meaningful (contributes to
environmental or human health problems),
(5) measuring internal productivity, and (6)
measuring efficiency.13
To ensure that they adequately
characterize program performance, pro-
gram managers can use logic modeling or
a similar tool to demonstrate logical con-
nections between outputs (also called
activity counts, such as the number of facil-
ities inspected), intermediate outcomes
(such as pounds of pollution reduced by an
enforcement action), and end outcomes
(human health improvements as a result of
an enforcement action).
By using these and other criteria to
choose, change, and use performance
measures, enforcement and compliance
program operators can manage programs
based on results to ensure they use the
best techniques and achieve the best pos-
sible outcomes.14
2 DEVELOPMENT OF USEPA'S
PETROLEUM REFINERY STRATEGY
USEPA began a targeted strategy
in the petroleum refinery sector in 1996
because they accounted for significant
releases of pollution into the environment.
In 2001, refineries released over 35,000
tons of toxic air pollutants according to
USEPA's Sector Facility Indexing Project
data (a publicly available on-line database
retired in 2004). In 1999, according to the
most current data from USEPA's AirData
system, refineries released approximately
243,000 tons of nitrous oxides, 396,000
tons of sulfur dioxide, and 412,000 tons of
other common air pollutants.15
Petroleum refinery emissions seri-
ously impact human health and the envi-
ronment. In 2000, USEPA reported that 45
percent of all refineries at that time were
within 3 miles of population centers con-
taining 25,000 or more people, and 26 per-
cent were within 3 miles of population cen-
ters containing 50,000 or more people.
Varying environmental and human health
effects resulted from the following common
air pollutants released at refineries: volatile
organic compounds, sulfur dioxide, nitrous
oxides, particulate matter, carbon monox-
ide, hydrogen sulfide, and toxic air pollu-
tants. Toxic air pollutants include pollutants
known or suspected to cause cancer or
other serious human health effects.16
USEPA and the U.S. Department
of Justice developed and implemented a
petroleum refinery compliance strategy to
address important noncompliance prob-
lems in the industry. USEPA and regional
officials used inspections, formal USEPA
information requests to refineries, and
industry trade journals to identify refinery
priority areas. USEPA used the results of
these initial research efforts to focus (or tar-
get) investigations on the noncompliance
areas indicated by their research. USEPA's
national experts continued gaining experi-
ence regarding compliance issues within
the refinery industry, and helped select the
four Clean Air Act priority areas that
became the refinery program's focal
point.17
USEPA's national refinery compli-
ance program evolved as USEPA learned
more about the noncompliance issues and
applied various tools and strategies to
address those issues. In 2000, USEPA
began pursuing voluntary global settle-
ments with refinery companies that result-
ed in consent decrees. USEPA and region-
al officials coordinated with the U.S.
Department of Justice, who led all of the
global settlement negotiations. USEPA
offered corporate officials the opportunity to
avoid possible investigation and litigation
by signing consent decrees. USEPA's strat-
egy included coordinating with interested
States and local authorities.
The first two consent decrees
entered the implementation phase in early
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
2001. The consent decrees spanned 8 to
10 years and required coordination and
communication among USEPA, USEPA
regions, States, and industry. The signing
of a consent decree ended the settlement
process for that company and began a new
process of oversight by USEPA and inter-
action between USEPA, states, and the
companies. As of 2004, USEPA continued
to conduct negotiations, assist regions in
assuming a larger role with the refinery pro-
gram, and work with refiners to implement
consent decrees.18
3 METHODOLOGY AND SCOPE
We evaluated USEPA's national
petroleum refinery program between June
2003 and March 2004 to determine what
impact the program had on compliance
among refineries.
To understand the nature and
extent of the petroleum refinery universe
and what strategies USEPA and its part-
ners developed to address compliance at
refineries, we interviewed and collected
documents from USEPA staff, USEPA's
National Enforcement Investigations Cen-
ter, regions, States, industry, environmental
groups, and the U.S. Department of Jus-
tice. To determine what impact the program
had on compliance among refineries, we
evaluated the performance measurement
and reporting approach for petroleum
refineries by interviewing staff in USEPA's
Office of Regulatory Enforcement, Office of
Compliance, and USEPA refinery issue
experts in Headquarters, USEPA Region 5,
and the National Enforcement Investiga-
tions Center, and by analyzing supporting
documentation.19
After discovering inadequacies in
refinery program performance measures,
we determined to develop key questions for
environmental enforcement and compli-
ance performance measure assessment.
In developing the key questions, we
reviewed public policy literature to summa-
rize up-to-date criteria for developing and
assessing performance measures (see
References). We also interviewed national
performance measurement, environmental,
and enforcement and compliance experts
to discuss assessment tools' criteria, and to
inquire about any additional criteria that
may be appropriate. These included indi-
viduals from government agencies, non-
profit policy groups, and universities. Our
literature summary and interviews provided
the basis for developing the key assess-
ment questions for the identification of
strengths and weaknesses of measures.
4 RESULTS
USEPA's strategy to improve com-
pliance at US petroleum refineries reported
outputs and predicted intermediate out-
comes, but did not track or report actual
results (intermediate or end outcomes).
The outputs and predicted intermediate
outcomes demonstrated success in reach-
ing settlements and getting companies to
promise emissions reductions. However,
because USEPA did not measure or report
outcomes, it did not have information about
the actual program results. In fact, a recent
investigative news report indicated that
refineries in the program were not achiev-
ing the promised emissions reductions, and
that EPA was not reporting that information
to the public.20 If program managers
assessed the refinery program's perform-
ance measures during the program,
USEPA could better determine what pro-
gram improvements would increase
accountability and credibility for the pro-
gram among regulated entities, lawmakers,
and the public. They would have been able
to demonstrate whether their program
improved compliance within the targeted
population, or whether the risk posed by
the population decreased as a result of the
program.21
To provide sound criteria for
assessing performance measures, we
summarized criteria and suggested key
questions for assessing performance
measures so that program managers can
ensure that they are measuring the best
indicators of success.
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BUTLER, FEKETE 201
4.1 Settlements Projected to
Result in Significant
Emissions Reductions22
By January 2005, USEPA had
entered into 12 global settlements (or con-
sent decrees) covering 48 of the 145
refineries. The settlements covered more
than 40 percent of total U.S. petroleum
refining capacity. Based on settling compa-
nies' estimates, EPA predicted it would
achieve annual atmospheric emissions
reductions of approximately 50,000 tons of
nitrous oxides and 120,000 tons of sulfur
dioxide, as well as reductions in benzene,
volatile organic compounds, and particu-
late matter once companies fully imple-
mented the consent decrees. The settling
companies agreed to invest more than $2.1
billion in pollution control technologies and
pay civil penalties of $40.4 million. These
refineries also agreed to implement supple-
mental environmental projects valued at
approximately $30 million. In exchange,
USEPA offered a "covenant not-to-sue," or
a release from liability for any pre-consent
decree regulatory violations associated
with the four priority areas.
The global settlements also
relieved USEPA from having to conduct
resource-intensive investigations at each
refinery a company owned. According to
USEPA, a refinery-by-refinery, issue-by-
issue approach, in which USEPA conduct-
ed an individual inspection or investigation
at each and every refinery followed by
information requests, notices of violation,
negotiations and/or litigation, could take
many years and require resources beyond
USEPA's means. The refinery consent
decrees required each company to take
various actions over the next several years.
These actions include implementing air pol-
lution controls as well as developing poli-
cies and procedures that go beyond com-
pliance with existing regulations. In addi-
tion, USEPA and the companies agreed to
test and use innovative technologies.
4.2 Performance Measures
Focused on Outputs and
Projected Outcomes23
The performance measures
tracked internally and reported to the press
focused on outputs, such as the number of
companies in consent decrees and the per-
cent of the refining capacity covered by
consent decrees, and on projected rather
than actual environmental outcomes.
USEPA reported program results in two
ways:
First, USEPA reported results to
the public through press releases. USEPA
used press releases to communicate the
signing of consent decrees to the public,
the projected emissions reductions at full
implementation of consent decrees (con-
sent decrees lasted 8 to 10 years), and the
dollars companies agreed to pay in penal-
ties as a result of consent decrees. USEPA
management did not plan to issue press
releases or other reports to the public
detailing the end outcomes of consent
decree implementation because USEPA
management did not believe the press
would be interested.
Second, USEPA reported results to
Congress using a compliance information
system. For refinery consent decrees,
USEPA input data into the system repre-
senting (1) the projected annual emissions
reductions that would be realized once
implementation was complete, (2) the dol-
lar amount of penalties generated, and (3)
the dollar value of required supplemental
environmental projects. According to
USEPA, the system was not designed to
capture, and did not capture, information
about environmental outcomes from the
consent decrees, such as demonstrated
environmental and human health benefits.
USEPA used three systems for col-
lecting information on consent decree
implementation for internal use: (1) compa-
ny data collected through consent decree
reports, (2) monthly conference calls
between USEPA managers and staff work-
ing on consent decree implementation, and
(3) a contractor-developed consent decree
tracking system. However, USEPA did not
use these systems to demonstrate
progress toward meeting consent decree
goals.
Consent decrees required compa-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
nies to provide quarterly reports that includ-
ed actual emissions data related to the
most significant emissions issues con-
tained in consent decrees. USEPA used
the information to set some emissions lim-
its that consent decrees did not specify, but
did not use this information to monitor, ver-
ify, or report progress toward achieving
consent decree goals. An assessment of
their performance measures could have led
USEPA to incorporate this existing informa-
tion into their performance measurement
system for the refinery consent decrees,
providing them with actual knowledge
about the state of emission reductions and
the ability to make program changes as
necessary to improve compliance.
USE PA's internal and external per-
formance measurement system did not
account for intermediate outcomes or end
outcomes, even though the effort relied on
new, unproven technologies, and even
though USEPA reported predictions to the
public.
4.3 External Report Suggested
Refineries Were Not Achieving
Projected Results
A 12 December 2004 investigative
report in the Fort Worth [Texas] Star Tele-
gram indicated that USEPA allowed two of
every three companies to miss consent
decree deadlines, and did not notify the
public, courts, or local pollution control
authorities, as required by the settlements.
Therefore, the Star Telegram said, USEPA
had not achieved promised environmental
benefits. They found that the program had
reduced about 40,000 tons of nitrous
oxides, sulfur dioxide, and particulate mat-
ter combined from 2001 to 2004, while
USEPA claimed in the press that reductions
totaled 200,000 tons per year. When
pressed, USEPA said it did not actually
know how much pollution the initiative had
reduced.
Further, the Star Telegram found
that USEPA was not sure that some tech-
nologies would work when companies
signed the consent decrees, and some
technologies were not reducing pollution as
predicted. Although several companies told
USEPA that a new technology employed
did not have the intended pollution-reduc-
ing effects, USEPA continued to require the
technology in subsequent consent
decrees. The article said that the refinery
program gave "'the illusion of progress
without actual progress'."24
4.4 A Method for Assessing
Enforcement and Compliance
Performance Measures
To ensure that compliance pro-
grams achieve the intended results, pro-
gram managers should be able to periodi-
cally assess their performance measures
to ensure that they are still reliable, rele-
vant, feasible, and comparable with others'
efforts. If program managers in the refinery
program assessed the program's perform-
ance measures, they could have made
improvements to consent decree outcomes
and could have improved subsequent
negotiations based on accessible outcome
information reported to the agency.
Experts considered USEPA's
enforcement and compliance measure-
ment program to be a national and interna-
tional model.25 However, while USEPA
assessed its performance measures for
enforcement and compliance based on
internal criteria, neither USEPA nor the lit-
erature had a systematic methodology for
assessing enforcement and compliance
performance measures. We subsequently
developed a series of key assessment
questions based on the literature, and a
scoring system for determining strengths
and weaknesses based on key criteria
(Appendix A).
Key Performance Measure
Assessment Questions
Below, we summarize major issues
in performance measure adequacy and
propose questions for program mangers
that address these issues.
4.4.1.1 Measuring Outcomes
Performance measurement and
environmental professionals agree that
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BUTLER, FEKETE 203
performance measures should relate to
intended outcomes and activities as close-
ly as possible. They say that users should
be able to clearly understand performance
reports that organizations present to them.
Existing literature recommends developing
performance measures that are relevant to
overall program goals, policies, manage-
ment decision-making, other users' needs
(both user-friendly and user-focused), and
intended results, and that provide connec-
tions between activities and outcomes.26
However, the connection between program
activities and end outcomes is especially
difficult to prove in enforcement and com-
pliance programs (due to other influencing
factors and the sometimes-substantial time
lag between program activities and envi-
ronmental results), so program managers
should focus on demonstrating their suc-
cess at focusing programs on risks and
subsequently decreasing the risks identi-
fied.27 By describing how they connect
activities with inputs, outputs, intermediate
outcomes, and end outcomes, program
managers can demonstrate how different
types of measures establish connections
between activities and outcomes, including
organizational goals and objectives.28 To
address connections to outcomes, we ask
the following questions:
—Are the measure's connections to orga-
nizational goals and objectives demon-
strated through logic modeling or a simi-
lar method?
— Is the measure categorized as an input,
output, intermediate outcome, or end
outcome measure?
—Are the important aspects of perform-
ance (based on program goals) included
in the family of measures (such as
change in compliance for the targeted
population, or change in risk posed by
the targeted pollutant)?
— Do measures meet needs of users
(such as geographically-specific infor-
mation)?
4.4.1.2 Making Measures Useful
In order for performance to actual-
ly improve through the use of performance
measures, program operators must give
constant attention to measures - as fre-
quently as on a weekly basis,29 using the
information to improve the program as nec-
essary. In addition, public use of perform-
ance measures requires that managers,
lawmakers, and the public have access to
information within a reasonable time peri-
od. To address data use, we ask the follow-
ing questions:
— Does the suite of measures provide all
the information that is important for pro-
gram decision-making?
—Are compliance data reported within a
timeframe that allows users to take
action or make decisions based on the
results?
—Are stakeholders' comments on compli-
ance data, measures, and reporting sys-
tematically considered (e.g., collected,
assessed, and addressed)?
—Are there plans to incorporate, develop,
or implement compliance measures into
the suite that would improve
relevance/reliability of the suite?
4.4.1.3 Using Accurate Data
To make sure that program man-
agers make decisions based on analytical-
ly-sound information, we ask the following
questions:
— Did the activities and results reported
actually occur in the time period
indicated?30
— If the measure is based on modeling
or predictions, has it been verified to
ensure reliability and validity of the
estimate?
—Was counting of transactions,
conditions, and events accurate
and complete (no over- or under-
counting)?31
—Did the measure adequately represent
the population so that inferences can
be drawn?32
—Were performance measure data
calculations correct (e.g., computations
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
of field data, incorporations into
measure reports, etc.)? (Assessor
should check a sample of data for
accurate computation from collection
sheets through incorporation into
measure reporting.)33
—Are data from different sources (e.g.,
offices, projects, or organizations) based
on similar definitions of compliance and
compliance assessment procedures, or
did you make them comparable?34
— Do repeated compliance measurements
or measurements by different parties
(e.g., states versus EPA) yield the same
results?^
—Has the organization recognized and
addressed known flaws or errors in
collecting, reporting, presenting, or
transcribing data that is used in
performance measures?36
—Are there systems in place to detect
abnormalities in compliance measure
values?37
—Are there adequate procedures in
place that ensure compliance data
records are not altered, lost, or
incorrectly transferred (e.g., data
storage, certification)?38
4.4.1.4 Making Measures Feasible
Although recent efforts to assess
government programs in the United States
focused heavily on measuring ultimate out-
comes, like "human lives saved",39 this may
not be possible to measure using current
data sources and technologies, or given
current funding or training limitations.
Agencies could consider including this type
of measure as "developmental" to indicate
that they intend to move toward measuring
it. To address this issue, we ask the follow-
ing questions:
—Are data required for the measure
measurable (ie. does the technology
exist for measuring)?
—Are the costs associated with the
measure achieving maximum benefits?
— Is there sufficient staff and funding for
data collection, analysis, and reporting?
—Do staff collecting the information have
the training to accurately measure
compliance —e.g., collect sufficiently
complete, consistent, and accurate
data?
4.4.1.5 Making Measures Comparable
To compare results with those from
other, similar programs, measures should
be comparable with those used by other
major colleagues' programs. For example,
the North American Agreement on Environ-
mental Cooperation has developed cooper-
ative enforcement programs across Cana-
da, the United States, and Mexico. Com-
munication of compliance information using
similar measures or indicators requires that
the countries involved generally agree
about what should be measured.40 Differ-
ing definitions of "compliance" among
reviewers could lead to inconsistent
inspections; for example, non-compliers
may accidentally be identified as "in compli-
ance", or compliers may accidentally be
identified as non-compliers.41 If this hap-
pens, decisions about enforcement and
compliance activities may be made using
inaccurate compliance information. To
address comparability, we ask the following
questions:
—Can compliance measures be
compared against baselines, previous
performance, or others who conduct
similar activities?
—Are data from different states, countries,
or other pertinent organizations based
on similar definitions of compliance and
compliance data collection procedures?
—To address this issue, we asked the
following question:
—Are data from different offices, projects,
or organizations based on similar
definitions of data elements and data
collection procedures?
4.4.1.6 Reporting Performance Measures
In preparing external reports on
performance measures, program man-
-------
BUTLER, FEKETE 205
agers should provide enough information
for users to correctly understand results,
including information about how present
performance compares with past perform-
ance or performance against a baseline,
and explanations of results.42 To address
reporting, we ask the following questions:
—Are performance measures presented
along with comparison data that
illustrate the adequacy of performance
(e.g., performance trends, performance
against benchmarks)?
—Are changes in performance,
methodology, or compliance explained?
Are data limitations (e.g., missing
data, lag time, etc.) described in perform-
ance communications?
— Is the measure explained, interpreted,
and presented, so users can understand
what the measurements say about
changes in compliance?
By asking these key questions,
program managers will have considered
the key criteria for ensuring that perform-
ance measures are feasible, and provide
reliable, relevant, and comparable informa-
tion about on-going programs.
4.4.2 Proposed Method for
Determining Strengths
and Weaknesses
After assessing how well measures
meet the criteria listed in the previous sec-
tion, we propose that managers score
answers based on five overall criteria: rele-
vance, accuracy, feasibility, comparability,
and reporting. Appendix B offers a template
for scoring according to these criteria,
based on the answers chosen on the ques-
tionnaire presented in Appendix A. We
determined that neither questions nor over-
all criteria would be weighted during scor-
ing to enable program managers to assess
the relative importance of each question
and criterion for their programs as they see
fit. The end result for a measure scored
using the proposed system would be a
series of histograms for each category.
Program managers could assess how well
a given measure met each criterion repre-
sented. Finally, once program managers
assessed a suite of measures for a given
program, they could look across the his-
tograms for each criterion to determine
which measures met which criteria. This
information would help them to make spe-
cific decisions about how to improve exist-
ing measures or add additional measures
to better demonstrate results, and to
improve credibility and accountability for
the program.
5 CONCLUSIONS
Successful enforcement and com-
pliance programs change the performance
of targeted companies, including behaviors
(such as implementing environmental man-
agement systems) as well as actual compli-
ance with regulations.
Improved performance measures
for the USEPA National Petroleum Refinery
Compliance Program could have better
demonstrated changes that resulted from
the program (outcomes), and alleviated
perceived problems in public accountability
posed by reporting predicted outcomes.
Consent decrees required companies to
provide quarterly reports that included
actual emissions data related to the most
significant emissions issues contained in
consent decrees. USEPA used the informa-
tion to set some emissions limits that con-
sent decrees did not specify, but did not
use this information to monitor, verify, or
report progress toward achieving consent
decree goals. An assessment of program
performance measures could have led
USEPA to incorporate this existing informa-
tion into their performance measurement
system for the refinery consent decrees,
providing them with actual knowledge
about the state of emission reductions and
the ability to make program changes as
necessary to improve compliance.
In order to ensure that program
managers choose the best measures of
program performance, they should assess
performance measures on a regular basis
to determine how well they meet estab-
lished criteria. The key assessment ques-
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206
SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
tions and scoring system we proposed
based on extensive performance measure-
ment and regulatory program literature
could aid program managers in such an
assessment. The USEPA Office of Inspec-
tor General intends to test the key assess-
ment questions and scoring system by
evaluating a sample of enforcement and
compliance measures at USEPA. We
intend to validate our assessment by ask-
ing a panel of enforcement and compliance
personnel to duplicate our evaluation and
offer comments on ease of use and per-
ceived accuracy for the assessment tool.
6 REFERENCES
1 This work would not have been possible
without the generous contributions of
Erin Barnes-Weaver, Kim Bryant,
Andrew Creath, Jeffrey Harris, PhD,
Director, Jeff Hart, Assignment Manager,
and Benjamin Webster, PhD, all of the
United States Environmental Protection
Agency, Office of Inspector General,
Office of Program Evaluation, Cross-
Media Issues.
2 Sparrow, M. K., The Regulatory Craft:
Controlling Risks, Solving Problems, and
Managing Compliance. Council for
Excellence in Government, Brookings
Institution Press: Washington, DC, 2000.
3 Metzenbaum, S. 1998. Making Measure-
ment Matter: The Challenge and
Promise of Building a Performance-
Focused Environmental Protection Sys-
tem. The Brookings Institution.
4 www.epa.gov/oeca/
5 Hatry, H. 2004. Personal communication.
6 See, for example: Environmental Integri-
ty Project. States Forced to Act as Bush
Administration Fails to Control Air Pollu-
tion. January 12, 2004.
7 Sparrow, M. K. 2000.
s Sparrow, M. K. 2000.
9 Metzenbaum, S. 2003. More Nutritious
Beans. In The Environmental Forum.
The Environmental Law Institute: Wash-
ington, DC; and Stahl, M. 2003. Perfor-
mance Indicators for Environmental
Compliance and Enforcement Programs:
The U.S. EPA Experience. In: Measuring
What Matters. Proceedings from the
INECEJDECD Workshop on Environ-
mental Compliance and Enforcement
Indicators, OECD Headquarters, Paris,
France. 3-4 November 2003;
i°Kiener, S., L Paddock, and M.
Stoughton. 2003. Beyond Enforcement?
Environment, Compliance Assistance,
and Corporate Leadership Programs in
Five Midwest States. Tells Institute, Envi-
ronmental Law Institute and National
Academy of Public Administration.
11 Metzenbaum, S. 1998.
12 Behn, R. D. 2003. Why Measure Perfor-
mance? Different Purposes Require Dif-
ferent Measures, Public Administration
Review, 63(5): 586-606.
14 Sparrow, M. K. 2000.
14 Stahl, M. M. 2003.
15 USEPA Office of Inspector General. EPA
Needs to Improve Tracking of National
Petroleum Refinery Compliance Pro-
gram Progress and Impacts, Report No.
2004-P-00021. 22 June 2004
16 Ibid.
17 Ibid.
is ibid.
19 More information about methodology and
scope for the OIG evaluation of the
USEPA refinery program can be found in
USEPA Office of Inspector General. EPA
Needs to Improve Tracking of National
Petroleum Refinery Compliance Pro-
gram Progress and Impacts, Report No.
2004-P-00021. 22 June 2004.
2°Streater, S. EPA Hasn't Won the
Improvements it Touted, Ft. Worth Star
Telegram, December 12, 2004.
21 Sparrow, M. K. 2000.
22 Section 3.1 from USEPA OIG 2004.
23 Section 3.2 from USEPA OIG 2004.
24 Streater, S. 2004.
-------
BUTLER, FEKETE 207
25 Sparrow, personal communication, Jan-
uary 10, 2005; Markowitz, Ken, INECE,
personal communication, August 31,
2004.
26Linster, M. 2003. Environmental Indica-
tors: Development, Measurement and
Use. In: Measuring What Matters, Pro-
ceedings from the INECE_OECD Work-
shop on Environmental Compliance and
Enforcement Indicators, OECD Head-
quarters, Paris, France. 3-4 November
2003; Discussion Paper: INECE-OECD
Workshop on Environmental Compliance
and Enforcement Indicators: Measuring
What Matters; Soniat, E. 2004. Assess-
ing the Reliability and Relevance of Per-
formance Measures, USDA Graduate
School Course AUDT9201; Keel, J. and
Hawkins, A., 2000, State of Texas Guide
to Performance Measure Management,
2000 Edition; Wnoley, J. 1999. Quality
Control: Assessing the Accuracy and
Usefulness of Performance Measure-
ment Systems. In Performance Measure-
ment: Getting Results by Hatry, H., The
Urban Institute.; Metzenbaum, S. 1998;
Keiner, S., et al., 2003.; Morgan, S. and
Slusher, D. 2002. Appendix D: Perfor-
mance Measurement and Reliability
Issues, Memo from Austin City Auditor,
and, City of Austin Managing for Results
Business Planning Guide (revised 2003).
Austin City Budget Office; Mihm, J. C.
2000. GAO Letter Report B-285312 Sub-
ject: Managing for Results: Assessing
the Quality of Program Performance
Data. Chemical and Pesticides Results
Measures project. CAPRM II Project
Document: Chemical and Pesticide
Result Measures II. Accessed on
December 7, 2004 at http://www.
pepps.fsu.edu/CAPRM/doc2.html: Flori-
da Department of Environmental Protec-
tion, Office of Inspector General. 1998.
Performance Based Program Budgeting
Assessment Blueprint. Report No. IA-06-
01-98-002; and, Stahl, M. 1997. Measur-
ing the Performance of EPA's Enforce-
ment and Compliance Assurance Pro-
gram: Final Report of the National Per-
formance Measures Strategy. USEPA.
27 Sparrow, 2000.
28 Sparrow, 2000.
29 Behn, R. D. On the ludicrous search for:
The Magical Performance System. Bob
Behn's Public Management Report. Vol.
2 no.5 (January 2005).
30 Soniat, 2004.
si Ibid.
32 Ibid.
33 Soniat, 2004, and Florida Department of
Environmental Protection 2002.
34 Soniat, 2004.
ss Ibid.
36 Florida Department of Environmental
Protection 2002.
37 Ibid.
SB Ibid.
39 United States Office of Management and
Budget, Program Assessment Rating
Tool (PART) available at http://www.
whitehouse.gov/omb/part/index.htnnl and
http://www.whitehouse.gov/omb/part/200
4 program eval.pdf.
40Harman, S. A. and L. I. Lawrence.
Emerging Networks of Environmental
Enforcement and Compliance Coopera-
tion in North America and the Western
Hemisphere. In: Measuring What Mat-
ters, Proceedings from the INECE_
OECD Workshop on Environmental
Compliance and Enforcement Indicators,
OECD Headquarters, Paris, France. 3-4
November 2003.
41 United States General Accounting Office.
1998. Head Start. Challenges in Monitor-
ing Program Quality and Demonstrating
Results. Report to Congressional
Requesters, June 1998; Linster, M.
2003; Sparrow, 2000.
42Tate, R. L. 2004. Auditing Performance
Measures: Lessons Learned, AGA Con-
ference; and Tate, R. L. 2004. Managing
for Results: Performance Measure Certi-
fication, Maricopa County, Arizona, Audit
Report.
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208 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
-------
Di PAOLA 209
PILOT PROJECT ON ENVIRONMENTAL COMPLIANCE
AND ENFORCEMENT INDICATORS IN LATIN AMERICA:
THE CASE OF ARGENTINA
DI PAOLA, MARIA EUGENIA
Director, Research and Training Area, Fundacion Ambiente y Recursos
Naturales (FARM),1 Monroe 2142, 1425, Ciudad de Buenos Aires, Argentina;
medipaola@farn.org.ar
SUMMARY
This paper presents an analytical account of the Argentine experience based on a
research project started at the beginning of 2004, which aims at identifying and analyzing
environmental compliance and enforcement (ECE) indicators regarding selected water and
air indicators in order to identify which critical needs and aspects are needed to create a
system of indicators, using an interdisciplinary perspective that congregates the legal, eco-
nomic, and environmental management aspects. Preliminary conclusions regarding the
Argentine system, which lacks a systematic environmental compliance and enforcement
indicators approach, basically include considerations related to: legal rationale and needs;
role of enforcement authorities and bodies of control of public services; governmental
authorities with institutional powers of control; the necessity of an adequate information
system and use of existing capacities; interrelation of output with intermediate and final out-
come indicators; program's budget and interrelation of indicators; and citizen participation
during ECE indicatorse design and use.
1 INTRODUCTION
Environmental compliance and
enforcement are basic concepts, the basis
of which are the analysis and assessment
of the implementation of the law. Conse-
quently, it is very important to count ele-
ments that allow an evaluation of such
assessment. Precisely, the need to have
indicators that facilitate the evaluation of
environmental compliance and enforce-
ment and the possible trends for their
improvement, responds to this framework.
An indicator is an evaluation and manage-
ment tool, useful to strengthen programs
or/and activities of environmental compli-
ance and enforcement. The compliance
and enforcement indicators are used to
assess the level of application of the envi-
ronmental regulation, and to measure the
level of compliance of such regulation com-
ing from the regulated community.2
This paper presents an analytical
account of the Argentine experience based
on a research project started at the begin-
ning of 2004, the pilot project on ECE indi-
cators in Latin America, which is substan-
tively and financially supported by the
World Bank Institute. Fundacion Ambiente
y Recursos Naturales (FARM) works on the
research in Argentina, and partners of the
initiative for the region are: Centra Interdis-
ciplinario de Biodiversidad y Ambiente
(CelBA) from Mexico, Lawyers for a Green
Planet from Brazil, the Economic Commis-
sion for Latin America and the Caribbean
(ECLAC) and the International Network for
Environmental Compliance and Enforce-
ment (INECE).s
This project aims at identifying and
analyzing environmental compliance and
enforcement indicators in Argentina regard-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
ing selected water and air indicators in
order to identify which critical needs and
aspects are needed to create a system of
indicators, using an interdisciplinary per-
spective that congregates the legal, eco-
nomic, and environmental management
aspects.
The objective is to know the state of
selected environmental compliance and
enforcement indicators for air and water
quality and to suggest recommendations to
improve the process in Argentina.
Research has been carried out at the
national, provincial, and municipal levels
and using a pilot action in the Municipality
of Moron, Province of Buenos Aires - which
has been chosen by diverse factors.
Among them:
—Three levels of government are
involved in addressing issues related
to water and air quality (Federal
Government, Province of Buenos
Aires, and \Municipality of Moron).
Analysis of ECE indicators in the
three governmental levels and their
interaction are fundamental in a federal
country like Argentina.
—The Mayor of the Municipality of Moron
is very interested in the project, to such
a point that an agreement between this
Municipality and FARN was signed in
order to develop it together.
The methodology used to carry out
the present research in Argentina was
developed considering the document of the
ECE Indicators Experts group from INECE.
Likewise, this methodology has been
refined and improved taking into account
the experiences of the World Bank Insti-
tute, ECLAC, the project on indicators of
access to information and to public partici-
pation in Argentina under the coordination
of FARN, the contribution from Dr. Michael
Stahl, the work of the research teams from
Brazil and Mexico, the analysis of the
research team from Argentina, and the
workshops with officials and stakeholders.
It is important to highlight that
ongoing activities of the pilot project are
focusing the analysis on specific ECE
national and sub-national indicators select-
ed due to their importance, and will be pre-
sented in a future publication.
2 TRENDS
After preliminary work that shows
the existence of diverse indicators lacking a
systematic approach in Argentina, the most
important issue we can conclude is that
there is a need to create a system of envi-
ronmental compliance and enforcement
indicators. We understand that the elabora-
tion of the system should consider the fol-
lowing guidelines.
2.1 Legal Rationale and Needs
The development and use of the
environmental compliance and enforce-
ment indicators should be included in the
annual environmental report that the
National Executive Power must elaborate
according to the Environmental General
Law in section 18. In addition, section 18
states that National, Provincial and Munici-
pal authorities must inform about the state
of the environment. The national budget,
regarding its elaboration and execution,
constitutes a very useful base and frame-
work in relation to indicators of this kind.
Despite the mentioned grounds, it would be
very useful to pass a law of minimum stan-
dards (applicable to the whole country and
the different levels of government) requir-
ing the development and use of ECE indi-
cators by the three levels of government.
2.2 Enforcement Authorities and
Bodies of Control of Public
Services
The Entities that control public
services carried out by private companies
have concrete guidelines regarding the
obligation of generating concrete ECE indi-
cators. This situation is not presented with
the same emphasis as when enforcement
is exercised directly from the state over the
regulated community. On the one hand, it is
necessary for the enforcement authorities
to incorporate these indicators systemati-
cally. On the other hand, it is important to
promote entities that control public services
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Di PAOLA 211
supplied by private companies to system-
atize the information on ECE indicators.
2.3 Governmental Authorities
With Institutional Powers
Of Control
It is also very relevant at the feder-
al level to consider the governmental
authorities that have control over the public
administration according to their different
functions (Ombudsman, National Legal
Audit (control of the Executive Power from
the Legislative Power), General Trustee of
the Nation (Department of the Executive
Power, which controls other departments of
the Executive Power)). Such authorities
can interact in this framework and give
more objectivity to the choice and the appli-
cation of ECE indicators, avoiding a slant
from the unique evaluation of the enforce-
ment authority.
2.4 Information System And
Use Of Existing Capacities
An information system within the
framework of transparency and free access
should be developed, according to what
was already established by the Environ-
mental General Law and the Law of Access
to Environmental Public Information. Con-
sequently, the existing capabilities should
be used and enhanced.
A clear example was the identifica-
tion of diverse information systems, which
could be pivotal for the comprehensive
development of ECE. (Examples: Register
of authorized interjurisdictional transport
and register of claims of the National Com-
mission of Regulation of Transport, reports
from Aguas Argentinas (the supplier of
drinking water and sewage services) and
reports and claimse register from ETOSS
(the entity which controls Aguas Argenti-
nas), necessary interrelation and links with
the Information System of the Federal Envi-
ronmental Authority).
2.5 Interrelation of Output
With Intermediate And
Final Outcome Indicators
It is very important to compare
information of the output, intermediate and
final outcome indicators. The analysis is
two-fold: on the one hand, the existence of
diverse indicators on different areas of the
government and its impact in the environ-
ment; on the other hand, the possible and
important interaction of technical and aca-
demic institutions to support this frame-
work. We have detected that academic and
technical institutions have, in many occa-
sions, appropriate techniques and staff that
could be useful for the government in the
development of ECE indicators (Example:
air monitoring developed by a research
institute of the University of Buenos Aires
(INQUIMAE), agreement between the
Technology University and the Municipality
of Moron)
2.6 Program's Budget And
Interrelation Of Indicators
Another important aspect is the
need to link the information regarding out-
put and outcome indicators with the
expenses budgeted and executed. In this
sense, program's budget system (that
counts on, with its different dates in motion,
a major development in the Federal Admin-
istration, a minor one in the Province of
Buenos Aires, and a tiny one in the Munic-
ipality of Moron) constitutes an adequate
framework for the development of compli-
ance and enforcement indicators. Never-
theless, to achieve that result, an improve-
ment in the implementation of the present
system is needed, as are a major develop-
ment of general indicators in the programs,
more details in environmental programs,
and a desegregation of the goals and activ-
ities according to the affected natural
resource.
Currently, there is a trend, which is
about carrying out, in the budget depart-
ment, a management evaluation to be pre-
sented to the public. This is a recent trend
that is being perceived in the budget-areas
of the three analyzed governmental levels
and in the auditing areas of the different
departments. This trend implies the use of
indicators in a more continuous basis.
Another aspect that is not included in the
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
budgetary calculations, but would be
important to take into account, is the cost of
existing deficiencies on environmental
compliance and enforcement issues to the
state.
2.7 Citizen Participation,
Indicators Design and Use
In relation to this issue, it is very
important to consider the role of the com-
munity and the importance the indicators
have when contributing to the improvement
of environmental management. It is funda-
mental that work on ECE indicators be
more than a formal report, whose content
tries to justify actions of the government in
its processes and in its results. Conse-
quently, it is fundamental that from the
identification, design and use of indicators,
there exists not only intergovernmental
coordination, but also institutionalized par-
ticipation of the civil society, in order to put
in motion a process that responds to a
global and not a partial view of the problem.
3 REFERENCES
1 Thanks to Adriana Bianchi for her sugges-
tions regarding this paper.
2 The need to count on indicators was iden-
tified in the: 6th INECE Conference in
Costa Rica and in the First International
Conference on Environmental Compli-
ance and Enforcement in Latin America in
Buenos Aires, 2002 organized by FARN,
with the support of the World Bank Insti-
tute and (WBI) the Government of the
Netherlands, and the endorsement of the
following institutions: Federal Environ-
mental Authority, Environmental Authority
of the City of Buenos Aires, Environmen-
tal Commissions from the Legislative,
U.S. Embassy, Business Council for Sus-
tainable Development in Argentina,
Lawyers for a Green Planet Institute
Brazil, Peruvian Society of Environmental
Law (SPDA), Bolivian Society of Environ-
mental Law, IUCN Environmental Law
Program and International Network for
Environmental Compliance and Enforce-
ment (INECE). http://www.farn.org.ar/
investigacion/enforcement/conferencia.
html. Likewise, this issue was considered
highly important in the Symposium of
Judges and Prosecutors of Latin America
- Environmental Compliance and
Enforcement. Steering Committee -
Executive Board: FARN, WBI, United
Nations Environmental Program and the
Lawyers for a Green Planet Institute
Brazil. Steering Committee - Advisory
Board: Defense of the Environment
(FIMA)- Chile-, Institute of Environmental
Law and Economy (IDEA) -Paraguay-,
SPDA- Peru, INECE, IUCN Environmen-
tal Law Program and ECLAC, carried out
on September 23rd & 24th 2003. For fur-
ther information, see http://www.
farn.org.ar/investigacion/enforcement/sim
posio.html.
3 FARN Research team: Coordination:
Maria Eugenia Di Paola, Consultants:
Carlos Galperin, Eduardo Ortiz,
Researcher: Maria Esperanza Alonso.
-------
RAMPEDI 213
EXPERIENCES IN ENVIRONMENTAL COMPLIANCE
AND ENFORCEMENT IN LIMPOPO PROVINCE, SOUTH AFRICA
RAMPEDI, DR. MOSHIBUDI P.
General Manager, Department of Economic Development, Environment and
Tourism, 46 Hans Rensburg Street, Polokwane, 0700, South Africa,
rampedimp@finptb.norprov.gov.za
SUMMARY
This paper seeks to share experiences of the Environmental Management Author-
ity of the Department of Economic Development, Environment and Tourism in Limpopo
Province, South Africa, in regard to compliance and enforcement strategies. The paper will
highlight the national environmental cooperative governance model of the Republic of
South Africa, describe the national and the provincial environmental legislative framework,
and provide examples of compliance and enforcement with specific reference to Limpopo
Province.
1 INTRODUCTION
It is a challenge to a developing
country's government to develop, proclaim,
and implement policies regarding environ-
mental legislation that is acceptable to all
stakeholders. The challenge at times is
compounded by perceptions of the stake-
holders regarding conservation priorities.
Botha and Huntley (1991) stated that the
South African perspective of conservation
is seen as synonymous with preservation
of the country's natural resources, mainly
through rigorous policed nature reserves.
Over the years, the public's perceptions are
assumed to be gradually changing more so
that the Constitution of the Republic of
South Africa has given the environment
and conservation a more pronounced role.
Hence, stakeholders are beginning to real-
ize and appreciate that the healthy condi-
tion of the environment underpins econom-
ic development and the need for the envi-
ronmental policy framework.
South Africa has nine provinces
with their own administrations. Limpopo is
South Africa's fourth largest province. The
province borders Mozambique in the East,
Zimbabwe in the North, and Botswana in
the West (Limpopo Government, 2005).
2 THE CO-OPERATIVE
GOVERNANCE MODEL
Section 24 of the Constitution of
the Republic of South Africa states the
rights that are guaranteed to the citizens,
with regard to the environment. Further-
more, the Constitution stipulates that man-
agement of the environment is a concurrent
competency between the national Ministry
of Environmental Affairs and Tourism and
South Africa's nine provincial governments.
Such concurrent competency includes joint
policy decision making with regard to
issues such as pollution and waste regula-
tion, environmental impact assessment,
authorizations, compliance monitoring, and
enforcement.
There are structures in place such
as a Ministerial Technical Committee and
Sector Working Group to ensure co-ordina-
tion and co-operation between the national
ministry and the provinces. The Committee
consists of the National Director General
and the heads of Environment Depart-
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214
SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
ments in the provinces. Furthermore, the
National Minister meets quarterly with the
provincial Members of the Executive Coun-
cils. Co-operation and collaboration
between the National Ministry and the
Provinces include assistance and technical
support, information sharing, and mandat-
ed consultative processes in regard to pol-
icy formulation and implementation.
3 THE ENVIRONMENTAL
LEGISLATIVE FRAMEWORK
A lot has been achieved in South
Africa post 1994 to develop policies and
legislation that regulate environmental
management (Limpopo Environmental
Implementation Plan, 2001). The environ-
mental legislative framework covers issues
such as land reform and planning, natural
and cultural resource use, conservation,
biodiversity, genetically modified organ-
isms, marine and coastal management,
environmental assessment, pollution and
waste management. Notably progressive
and developmental policies approved by
the post 1994 African National Congress
(ANC) government include White Papers
on Environmental Management Policy
(1998), Integrated Pollution and Waste
Management for South Africa (2000), Con-
servation and Sustainable Use of South
Africa's Biological Diversity (2000) and
Spatial Planning and Land Use Manage-
ment (2001).
The National Regulatory Frame-
work intends to ensure sustainable devel-
opment through slowing down biodiversity
loss, fragmentation of habitats, resource
depletion and impaired ecosystem func-
tioning. This ensures that the rights
enshrined in South Africa's Constitution are
honored (see Annex II). This also gives
other national policies and legal framework
that have defined the development and bio-
diversity management agenda post 1994. It
is worth noting that the development and
enactment of South Africa's environmental
policies are through a legitimate process
that ensures that public participation. Envi-
ronmental non-governmental organiza-
tions, trade or labour unions, the public,
local government councils are guaranteed
environmental management that is fair and
transparent. Interested and affected stake-
holders can appeal against government rul-
ings, they can appeal complain about iden-
tified environmental problems to National
or Provincial governments. Communities
are guaranteed a right to live or work in an
environment that is not harmful to their
well-being.
In addition to the national regulato-
ry framework, South Africa has ratified a
number of international conventions. The
conventions ratified are the Convention on
International Trade in Endangered Species
of Wild Fauna and Flora (CITES), Conven-
tion on Biological Diversity, Convention on
Wetlands of International importance,
Framework Convention on Climate
Change, Protocol for the Protection of the
Ozone Layer, Montreal Protocol Conven-
tion on the Prevention of Pollution by
Dumping of wastes and other Matter, and
the Convention on the Prevention of Pollu-
tion by Dumping of Wastes and other Mat-
ter. The ratification strengthens the compli-
ance of national and provincial environ-
mental legislation.
Having noted the National environ-
mental legislative framework, I will now
share some of the practical experiences in
our Province. Limpopo has succeeded in
enacting the Limpopo Environmental Man-
agement Act No. 7 of 2003 through a con-
sultative process. This Act repealed the for-
mer Lebowa, Gazankulu, Venda and North-
ern Province Acts and Ordinances (Sched-
ule 13 of LEMA). Lebowa, Gazankulu and
Venda were former homelands demarcated
and established by the previous apartheid
government in the pre-1994 era to control
movement of persons of African origin. The
three homelands were part of the geo-
graphic area that now forms Limpopo. The
Northern Province Act or Ordinances were
intended to control areas classified geo-
graphically as 'white.'
The objectives of the Limpopo
Environmental Management Act are to:
manage and protect the environment in the
Province, to secure ecologically sustain-
able development and responsible use of
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RAMPEDI 215
natural resources in the Province, to con-
tribute to the progressive realization of the
fundamental rights contained in Section 24
of the Constitution of the Republic of South
Africa, 1996 (Act No. 108 of 1996), and to
give effect to international agreements
effecting environmental management
which are binding on the Province.
Limpopo Province interprets and
applies the Environmental Management
Act in accordance with the National Envi-
ronmental Management Act principles
thereby adhering to the principles of co-
operative governance. The chapters of the
Environmental Management Act has provi-
sions for the management of Environmen-
tal Advisory Bodies, Protected Areas, Wild
and alien animals, Professional hunting,
Aquatic biota and aquatic systems, Inverte-
brates, Indigenous plants, CITES, Preser-
vation of caves and cave formation, Limited
development areas, Mountain catchments
areas, Environmental Pollution, Environ-
mental Compliance officers, Permits, per-
missions, exemptions and exclusions and
Offences, evidence, penalties and forfei-
tures.
4 COMPLIANCE AND
ENFORCEMENT MEASURES
Compliance and enforcement
measures are in their developmental phase
following the promulgation of the Act. The
province will succeed in managing biodi-
versity in as far as resources are set aside
to ensure advocacy and compliance with
the provisions of the Act. The highlight of
compliance and enforcement measures is
encapsulated by Section 96 of the Limpopo
Environmental Management Act. Before
looking at enforcement measures, I will cite
incidences of compliance with specific ref-
erence to the last three months of the year
2004.
4.1 Compliance
This compliance is with regard to
trade in wildlife and environmental impact
assessment. Starting with trade in wildlife
for the period October to December 2004,
Limpopo Province issued about three hun-
dred (300) permits for the export of CITES
listed species. About thirty (30) permits
were issued for import and fourteen (14)
permits were issued for re-export of CITES
listed species.1 The exemplar figures given
for a period of the last three months of 2004
indicates that there is a willingness to com-
ply with the legislative framework by the cit-
izens of the province.
4.2
Enforcement Measures
Section 96 of the Environmental
Management Act gives the powers
assigned to Environmental Compliance
Officers. Environmental Compliance Offi-
cers are empowered to do the following, if
the officer has reasonable suspicion a pro-
vision of the Act has been breached, the
officer will: enter upon any land, premises,
building tent, camping place, vessel or con-
tainer; direct the person in charge of a ves-
sel to stop, or use such force as may be
reasonable to stop the vessel, seize any-
thing, question a person, demand from any
person who performs an act, or suspected
of performing an acts that require permits,
written permission, exemption to produce
such a document, and seize stock or other
animal trespassing in a protected or
reserved areas.
An assessment of the enforcement
measures reveals that Limpopo has a func-
tional system that does apprehend persons
who violate the provisions of the legislative
framework. Table 4 (see Annex III) gives
examples of recorded contraventions of the
Environmental Management Act and previ-
ous ordinances. It should be noted that
finalization of cases remains a challenge
for the Department of Economic Develop-
ment, Environment, and Tourism. Cases
may remain pending because their finaliza-
tions require resources and co-operation
with the Department of Justice and the
South African Police Services. It has been
observed that in some instances the State
Prosecutors regard environmental crime as
'petty' when compared with other serious
crimes. The National Government has initi-
ated a process called 'greening the judici-
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216
SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
ary'. The Department of Justice has under-
taken to increase the level of awareness
and capacity in regard to Environmental
Law.
5 CONCLUSION
Our experience in Limpopo is that
the dynamic multidisciplinary nature of
environmental issues and that implementa-
tion mechanisms require interaction, con-
sultation and agreements among interest
groups. The existing frameworks that are
subject to periodic review to remain rele-
vant to the needs of the people of Limpopo
Province and South Africa.
South Africa's overt challenge is
the cost of ratifying international conven-
tions vis a vis the imperative to implement.
South Africa has to meet the cost to
belonging and further translate its own
national policy into a proactive, develop-
mental framework that allows its citizens to
comply rather than expend resources on
enforcement. Considering these chal-
lenges one can therefore asks whether the
many laws that international organizations,
non-governmental, governments and other
institutions and environmental lawyers
spent a lot of time and energy on are nec-
essary. Cullinan (2002) contents that regu-
lation of human impacts is critical, environ-
mental laws form the backbone of our gov-
ernance system, Earth has to be defended
and that the regulatory function plays a role
in constituting and forming society. What is
required is maybe a paradigm shift towards
the goal of environmental governance, it
should be seen a developmental in
approach and not restrictive.
6 REFERENCES
1 Please note that the full version of this
paper, along with tables on The Constitu-
tion of the Republic of South Africa, South
Africa's national environmental regulatory
framework, Permits issued by Limpopo
Province for other activities from October
- December 2004, and Environmental
Impact Assessments reporting, October
to December 2004, Limpopo Province is
available on the INECE 7th International
Conference Web page, at http://www.
inece.org/conference/7/.
7 BIBLIOGRAPHY
Botha, P. R. & Huntley B. J., 1991 Outlines
of national environmental policy for South
Africa in Huntley B. J., 1991 Biotic diversity
in Southern Africa: concepts and conserva-
tion, Oxford University Press, Cape Town
Cullinan, C., 2002 Wild law, governing peo-
ple for earth, Siber Ink, Claremont
Huntley, B. J. ed. 1991 Biotic diversity in
Southern Africa: concepts and conserva-
tion, Oxford University Press, Cape Town
Limpopo Environmental Management Plan,
2001
Limpopo Environmental Management Act
no 7 of 2004
Limpopo Government, 2005 Department of
Economic Development, Environment and
Tourism
National Environmental Management: Bio-
diversity Act, 2004
National Environmental Management: Pro-
tected Areas Act, 2003
Quarterly Report, Regulatory and Environ-
mental Impact Management, Department
of Economic Development, Environment
and Tourism, Limpopo Province, December
2004
Secretariat of the Convention on Biological
Diversity, 2001 Handbook of the Conven-
tion on Biological Diversity, Earthscan
Publications Ltd, London
State of the Environment, South Africa
1999, An overview of the State of the Envi-
ronment Report, Department of Environ-
mental Affairs and Tourism
The Constitution of the Republic of South
Africa, Ac 108 of 1996
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PASCOE 217
FOCUSED NATIONAL INDICATORS WORKSHOP
PASCOE, DAVE
Manager, Emergencies and Enforcement Division, Environmental Protection Branch
Ontario, Environment Canada, 4905 Dufferin Street, Downsview, ON, Canada,
dave.pascoe@eg.gc.ca
SUMMARY
This paper provides a basic introduction to the use of indicators, drawing
heavily from the information provided in the "Performance Measurement Guidance for
Compliance and Enforcement Practitioners" document.1 It also describes the structure and
initial results of the initial environmental compliance and enforcement indicators pilot proj-
ect in Canada.
1 INTRODUCTION
The International Network for Envi-
ronmental Compliance and Enforcement
(INECE) has devoted considerable effort to
developing and promoting the use of envi-
ronmental compliance and enforcement
(ECE) indicators to measure the effective-
ness of environmental laws. The need for
ECE indicators was raised by several coun-
tries at the 6th INECE Conference in Costa
Rica in 2002. In 2003, the Organisation for
Economic Co-operation and Development
and INECE was given the opportunity to
jointly sponsor a workshop to bring coun-
tries together to allow the exchange of
ideas and experiences with regard to the
development and use of ECE indicators.
That workshop led to the development of a
document entitled "Performance Measure-
ment Guidance for Compliance and
Enforcement Practitioners" by an interna-
tional working group under the leadership
of the Michael Stahl, Director of the U.S.
Environmental Protection Agency's Office
of Compliance and the INECE Secretariat.
Many countries contributed to the docu-
ment through an e-dialogue established by
INECE in late 2004.2 The Guidance Docu-
ment sets out a process for developing,
testing, and using ECE indicators. It is a
valuable resource for countries considering
the use of indicators, those countries that
have begun to develop them, or those that
are well advanced in their use. This back-
ground paper relies heavily on the informa-
tion provided in the Guidance Document;
portions of it have been reproduced in this
background paper. Readers are encour-
aged to review the Guidance Document in
its entirety.
2 WHAT ARE ENVIRONMENTAL
COMPLIANCE AND
ENFORCEMENT INDICATORS?
Simply put, indicators are quantita-
tive or qualitative measures that can be
used to represent the state of the environ-
ment, and illustrate the effects of certain
stresses or behaviors on that environment.
The table below is a logic model that
describes and provides some examples of
the basic indicators (outputs, intermediate
outcomes, and final outcomes). Logic mod-
els graphically depict the relationships
between resources invested, activities
undertaken and the results of those activi-
ties.
As stated during the INECE Indica-
tors e-dialogue, ECE indicators are intend-
ed to respond to three needs:
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218
SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
Table One
Inputs
Resources
Personnel
Funds for
salaries,
contracts,
IT, etc.
Outputs
activities
Inspections
conducted
Enforcement
actions taken
Fines assessed
Intermediate Outcomes
behavior change
Greater understanding
of how to comply
Improved facility
management practices
Increased compliance
Final Outcomes
environmental impact
Reduced pollution
emissions
Improved ambient
water quality
Reduced contaminant
burden in wildlife species
—to assist program management in
monitoring operations of compliance
and enforcement programs;
—to enhance the accountability of
environmental compliance and
enforcement programs; and
—to provide a framework to assess
he performance of environmental
compliance and enforcement programs.
For details on these three ele-
ments, refer to the Guidance for Practition-
ers document.
As discussed in the Guidance Doc-
ument, there are four categories of indica-
tors: comprehensive national indicators;
comprehensive sub-national indicators;
focused national indicators; and focused
sub-national indicators. This background
paper addresses focused national indica-
tors, the subject of workshop 2D at the 7th
INECE Conference.
2.1
Focused National Indicators
Focused national indicators are
used when a national environmental
agency wants to assess the environmental
conditions associated with a particular sec-
tor or regulation; or the effectiveness of a
national initiative related to that sector or
regulation. For example, focused national
indicators might be developed to address a
specific national non-compliance pattern or
environmental risk associated with a given
industrial sector. They might also be used
to measure the effectiveness of a targeted
enforcement initiative to improve compli-
ance with all national air or water pollution
requirements. They could also be used to
determine the relative effectiveness of
compliance promotion and enforcement
programs in attaining compliance with a
regulation.
A program involving focused
national indicators is more manageable
than one using a comprehensive national
approach because it focuses on a specific
component or piece of the national pro-
gram. For a focused national effort it is
often advisable to develop indicators that
are short-term and specifically tailored for
the initiative being measured, rather than
developing permanent long-term indicators
that would be necessary for a comprehen-
sive national set of indicators.
3 WHAT ARE THE VALUES,
BENEFITS, AND NEEDS FOR
A ECE INDICATORS?
As stated in section 2, ECE indica-
tors are intended to respond to three key
needs. Specific examples of the benefits
and values of ECE indicators for each of
these needs are provided below.
3.1 Monitoring Program Operations
Even a very basic set of output
indicators will increase understanding
about what is being accomplished, and
when combined with data about inputs,
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PASCOE 219
judgments can be made about whether
resources are being used efficiently. At a
minimum, basic output indicators can help
determine whether program staff are per-
forming fundamental program activities.
3.2 Enhancing Accountability
When programs or agencies are
able to establish a set of performance indi-
cators for their compliance and enforce-
ment efforts, the indicators provide a win-
dow through which the public can view
results and ensure program accountability,
and a demonstration to regulated facilities
and companies that compliance is expect-
ed and taken seriously. Performance indi-
cators help these external audiences
understand and support program activities.
Output indicators can convey to the public
that funds are being used to conduct
inspections, enforcement actions, or other
activities. Outcome indicators can convey
that these activities are resulting in impor-
tant outcomes such as reduced pollution,
increased compliance, and improved envi-
ronmental management at facilities.
There is much truth to the state-
ment that "What gets measured gets done."
Performance indicators send a clear signal
to program personnel about what needs to
be accomplished. Setting a goal to achieve
a certain amount of a specific output tends
to organize and focus some portion of
resources on achieving the goal.
3.3 Assessing Program Performance
By using indicators as a manage-
ment tool, goals can be set regarding the
activities or results that should be produced
over a period of time. Indicators can also
be used to identify needed adjustments in
the mix of activities or results the program
is producing.
Output and outcome indicators can
be analyzed to determine whether
resources need to be increased, shifted, or
altered in some way to meet goals and
achieve desired results. Indicators provide
an understanding of the relationship
between outputs and outcomes, thereby
enhancing the ability of program managers
to increase resource investment in pre-
ferred outcomes.
Indicators that can be organized by
type of output or outcome, by organization-
al unit, and by program area increase pro-
gram managers' ability to identify perform-
ance problems and design solutions.
4 HOW DO YOU ESTABLISH A
FOCUSED INDICATOR PILOT
PROJECT?
The process for developing ECE
indicators is shown in the diagram from
"Performance Measurement Guidance for
Compliance and Enforcement Practition-
ers." The diagram illustrates three stages:
identifying indicators; designing, testing
and implementing indicators; and using
indicators. Each stage contains several
recommended steps from which to select
when developing ECE indicators. Imple-
mentation of pilot projects is one of the
steps in stage 2.
4.1
The Process
The example pilot project being
used to demonstrate the application of the
process is the agriculture sector study
being conducted in Canada. This project
involves the selection of specific water-
sheds in which to measure the effects of
various compliance promotion and enforce-
ment actions to address pollution resulting
from poor manure management practices.
Baseline measurements were taken in
2002-03, a period during which farms were
visited by compliance promotion officers to
educate farmers about the methods and
benefits associated with manure manage-
ment practices. A second set of measure-
ments was conducted the following year
(after the period of compliance promotion),
and a further set of measurements was
conducted after a period of enforcement (a
further year).
By reviewing the results we intend-
ed to measure the outputs, and also
hoped to determine the intermediate out-
comes (the things farmers had done to
improve their operations) as a result of both
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220
SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
compliance promotion and enforcement
actions. We also hoped to get some under-
standing of improvements in the environ-
mental quality (final outcomes) as a result
of our compliance promotion and enforce-
ment work over the multi-year period.
4.2
Initial Results
Results are still being evaluated,
however, the following findings can be stat-
ed:
—outputs are generally easy to measure,
and provide a short-term indication of
what was done (although not the effect
of what was done);
—some outputs and intermediate out-
comes are far easier to measure than
others;
—some results can be misleading, and
therefore require thorough explanations;
—quantitative final outcomes are extreme-
ly difficult to tie to specific inputs or
activities;
—pictures can be used as valuable final
outcome indicators.
4.3 Costs
The costs associated with the indi-
cator pilot project were not significant in
terms of the overall compliance promotion
or enforcement work.
4.4 Lessons Learned
Design and testing of new indica-
tors is a critical step that may be over-
looked in the rush to begin using indicators.
Time should be taken to define accurate
and reliable performance indicators in
detail, pilot test them and correct mistakes
before reporting indicator data to the public
or using it to assess and improve perform-
ance.
The following lessons were taken
from the Canadian agriculture pilot project:
—be as creative/open as possible when
setting potential measures at the start of
a project (don't limit your selection of
potential outputs and outcomes);
— if an indicator doesn't work, discard it;
—obtaining meaningful results takes time
(be prepared to stick with a project for
several years);
—there are benefits to close cooperation
between compliance promotion and
enforcement.
5 REFERENCES
1 For the full text of the Performance Mea-
surement Guidance for Compliance and
Enforcement Practitioners document, visit
http://www.inece.org/conference/7A
2 Introduction to the INECE Indicators E-
dialogue, available at http://inece.org/
forumsindicators_dialogue_bkg.html.
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MORGULEC, RUBIN, GEYSELS, VAN DEN BERGHE, VANDEWAL 221
INTERNATIONAL ENVIRONMENTAL ENFORCEMENT INITIATIVE:
LESSONS LEARNED FROM U.S.-BELGIAN DIALOGUE REGARDING
ENVIRONMENTAL CRIMINAL ENFORCEMENT
MORGULEC, JAMES A.1, RUBIN, JAMES W.2, GEYSELS, FRANS J.E.3, VAN
DEN BERGHE, JUDGE JAN4 and VANDEWAL, CHRISTIAN G.F.s
1 Senior Counsel, Environmental Crimes Section, Environment and Natural Resources
Division, U.S. Department of Justice, 950 Pennsylvania Ave., N.W., Washington, D.C.,
jim.morgulec@doj.gov
2 Assistant Chief, Law and Policy Section, Environment and Natural Resources Division,
U.S. Department of Justice, jim.rubin@doj.gov
3 Chief Commissioner, Federal Belgian Police, Head of the Environmental Crime Service,
Fritz Toussaintstraat 47, Brussels, Belgium
4 Vice President of the Court of First Instance, Ghent, Koophandelsplein 23, Ghent,
Belgium, vandenberghe.jan@pi.be
5 Deputy Prosecutor General, Brussels Court of Appeals, Place Poelaert, Brussels,
Belgium, Christian.Vandewal@just.fgov.be
SUMMARY
In mid-November 2004, three senior U.S. Department of Justice prosecutors and
an experienced criminal investigator from the U.S. Environmental Protection Agency trav-
eled to Brussels, Belgium for a two-day workshop on environmental criminal enforcement.
The successful workshop marks the beginning of what officials from both countries hope
will become an on-going exchange of ideas and information amongst rank-and-file environ-
mental law enforcement officials from the U.S., Belgium, and other European Union mem-
ber countries. The program touched on virtually every aspect of environmental criminal
enforcement, from goals and objectives, through investigative techniques and prosecution,
all the way to the determination of appropriate fines and sentences. One of the most note-
worthy aspects of the conference was the ease with which participants were able to recog-
nize and then move beyond the differences between legal and judicial systems in order to
identify, compare, and consider the many significant similarities in goals, methods, and pro-
cedures. Another important feature of the program was how it drew together officials from
both countries over an extended period of time before, during, and after the workshop. The
exchange of information and experiences during this period laid the foundation for a long-
lasting relationship, and provides a model for building enforcement networks worldwide.
1 BACKGROUND OF THE WORKSHOP shop was the product of sustained and high
level contact between the United States
1.1 How it All Began and Belgian governments. That contact
The environmental crimes work- was initiated bV a visit to Bel9ian national
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
environmental and judicial authorities by
Thomas Sansonetti, Assistant Attorney
General for the Environment and Natural
Resources Division of the Department of
Justice. Environment and Natural
Resources Division, comprised of more
than 400 attorneys, is responsible for judi-
cial enforcement of all federal environmen-
tal and natural resource laws in the United
States and works with a variety of agen-
cies, including the Environmental Protec-
tion Agency. During Assistant Attorney
General Sansonetti's initial visit to Belgium,
the U.S. Embassy in Brussels and the Bel-
gian Justice Ministry developed a seminar
that brought together for the first time all
federal Belgian prosecutors who worked on
environmental matters, along with police
and environmental officials. Belgian judicial
officials, spurred on by the seminar and
visit, then came to the U.S. for a brief but
intensive study tour organized by the U.S.
Embassy to see firsthand how the various
U.S. federal and state enforcement agen-
cies and courts operate. In June, 2004,
Assistant Attorney General Sansonetti visit-
ed Belgium a second time while conducting
other work in Europe and, again with the
assistance of the U.S. Embassy and Bel-
gian national officials, gave a presentation
to a gathering of prosecutors, judges, and
police officials on more specific issues
relating to environmental crimes that had
been selected by the Belgians in advance.
Seeing the success and interest
generated by these seminars, Belgian and
U.S. Embassy officials met with Assistant
Attorney General Sansonetti during his
second visit to begin planning a workshop
that would elaborate on some of the topics
briefly discussed at the earlier seminars.
U.S. and Belgian officials then commenced
a detailed planning process, including sev-
eral video conferences, to share perspec-
tives on each country's legal systems and
criminal law practice. Planners from both
countries reached out to other agencies
and officials outside their particular areas of
expertise to ensure broad coverage of top-
ics. For example, an Environmental Protec-
tion Agency criminal investigative agent
was brought into the process to discuss
investigative matters.
These regular contacts allowed the
workshop planners to focus on those
issues most relevant to a Belgian audience.
In the course of preparation, both sides
learned about the other's legal regimes and
environmental authorities. The sustained
contact ensured not only that the workshop
would be interesting and useful, but that it
would have sufficient government support
from both countries. The planning process
generated working relationships between
U.S. and Belgian enforcement officials that
have continued beyond the conclusion of
the conference.
1.2 Primary Participants
and Objectives
A key ingredient in the success of
the program was the inclusion in the plan-
ning process of high level, highly experi-
enced representatives of each major com-
ponent of the environmental law enforce-
ment community in Belgium. Christian G.F.
Vandewal, Deputy Prosecutor General in
the Brussels Court of Appeals, identified
subjects of interest to prosecutors who
would be attending; Frans J.E. Geysels,
Head of the Environmental Service and
Chief Commissioner in the Belgian Federal
Police, articulated Belgian police interests
in the program; and Judge Jan Van den
Berghe, Vice President of the Court of First
Instance, Ghent and president of the envi-
ronmental law training program for judges
and prosecutors, represented the views of
Belgian judges. All three are influential in
their respective spheres and have demon-
strated a long-standing commitment to the
investigation and prosecution of environ-
mental crimes in Belgium.
All three Belgian officials involved
in planning the program, as well as the Bel-
gian High Counsel of Justice, viewed it as
an opportunity to bring together law
enforcement officials from jurisdictions
across the country to generate interest in
environmental crimes prosecution in gener-
al and to provoke discussion on ways to
improve enforcement in Belgium.
As noted above, three of Depart-
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MORGULEC, RUBIN, GEYSELS, VAN DEN BERGHE, VANDEWAL 223
ment of Justice's most experienced envi-
ronmental crimes prosecutors attended the
conference to describe the U.S. program in
detail. These included John Webb, an
Assistant Chief in the Environmental
Crimes Section and the foremost authority
on U.S. criminal cases involving wildlife
smuggling and unlawful takings of endan-
gered species and other wildlife. Eileen
Gleason, the Principal Assistant Chief in
the Environmental Crimes Section, and
James Morgulec, Senior Counsel in that
same section, are authorities in the prose-
cution of offenses involving pollution,
including their statutory and regulatory
underpinnings, and in building and coordi-
nating a national multi-agency enforcement
program. The U.S. Team also included
David M. Dillon, Assistant Special Agent in
Charge, Environmental Protection Agency
Criminal Investigative Division, to share his
considerable expertise in investigative
techniques and procedures.
The U.S. team, which enjoyed sub-
stantive and logistic support from the U.S.
Embassy in Brussels, also saw the pro-
gram as an excellent opportunity to gener-
ate interest in environmental criminal
enforcement in Belgium and - potentially -
other European Union countries, and to
demonstrate both the commitment by the
U.S. to vigorous environmental enforce-
ment and the program's successes. Finally,
it was believed that such an exchange
would bolster the relationship between the
U.S. and EU countries on environmental
matters.
Thus, the objectives of U.S. and
Belgian planners were complementary,
inasmuch as both viewed a detailed
description of the U.S. program as a way of
generating interest, awareness, and dis-
cussion amongst Belgian attendees in
enhancing and invigorating their own
efforts. In addition, both countries hoped
that the program could provide some train-
ing on specific enforcement techniques and
best practices.
The audience consisted of approx-
imately one hundred Belgian police offi-
cers, prosecutors, and judges from various
jurisdictions around the country. The Envi-
ronmental Law Center of the Ghent Univer-
sity (Prof. L. Lavrysen) also participated in
the program.
1.3 The Program
After initial introductory remarks by
Deputy Prosecutor General Vandewal and
Assistant Attorney General Sansonetti, the
U.S. team embarked on an analysis of its
national environmental crimes program
that focused on topics that were of special
relevance and interest to the Belgian audi-
ence. Major topics of discussion included
the following, among others:
—Overview of U.S. environmental law
and how environmental criminal
prosecutions fit into the overall effort to
protect health and the environment.
—Goals of environmental criminal
enforcement.
— Roles of the various federal, state,
and local environmental enforcement
agencies in investigating and
prosecuting cases, and the importance
of interagency coordination and
cooperation.
— Investigative methods and procedures,
including the handling of cases involving
releases of hazardous wastes into the
environment.
— Prosecution techniques, including the
prosecution of corporate entities as well
as individuals.
— Resolving cases by trial or plea
agreement; assessing the costs to
the public of unlawful conduct; and
determining the appropriate fine,
sentence, restitution amount,
compliance program, and other
conditions and requirements.
— Investigation and prosecution of wildlife
cases, including wildlife smuggling and
unlawful takings.
— Using the news media as an aid to
deterrence in environmental criminal
cases.
—The status of the environmental crimes
enforcement within the European Union.
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
The last topic was covered in a
presentation by Francoise Comte, Principal
Administrator, European Commission,
Directorate General Environment. The final
afternoon session of the conference was
devoted to an open panel discussion of the
various topics.
In this and other exchanges over
the course of the two day program, partici-
pants readily acknowledged the many sig-
nificant differences between the U.S. and
Belgium in the structure of each country's
legal and judicial system, in the geopolitical
circumstances each country faces, and in
the size and scope of each country's envi-
ronmental criminal enforcement program.
2 OBSERVATIONS AND CONCLUSIONS
From the perspective of the partic-
ipants, it was striking to see the remarkable
similarities in perspectives shared by offi-
cials from both countries and the common
challenges faced by both countries in their
efforts to protect the environment. Among
other things, U.S. and Belgian officials
agreed that:
—The motives for environmental crime
are largely the same everywhere -
intentional failure to undertake
appropriate environmental compliance
efforts in order to save money and gain
an advantage on competitors;
— Environmental law enforcement officials
in each country must continue efforts
to educate the general public and the
law enforcement community at every
level on the importance of vigorous
environmental criminal enforcement and
the real economic harm and threats to
public health and the environment these
crimes present;
— Interagency cooperation and coordina-
tion among the various levels of
government (federal, state/regional,
local and international) and across
agencies (investigatory, prosecution,
regulatory) - though difficult to
establish and maintain - are essential
components of a successful national
environmental criminal enforcement
program;
—Though the tools available to
investigators and agents in each
country differ somewhat, U.S. and
Belgian law enforcement agents
and officers use many of the same
investigative techniques, especially with
respect to the gathering of information
about targets from all available sources;
—Both U.S. and Belgian law enforcement
officials have struggled with similar
questions involving the determination of
appropriate sentences, fines, and resti-
tution. The U.S. has had the benefit of
federal sentencing guidelines to help
courts determine prison sentences for
individuals convicted of environmental
crimes and other offenses.1 Both
Belgian and U.S. officials, however,
continue to seek more effective ways of
calculating and determining appropriate
fines, restitution, and other remedies
to impose on corporations. Such
penalties and remedies should take into
consideration the harm or potential
harm the conduct has caused to the
environment and to any victims, the
benefit that the guilty received as a
result of unlawful conduct, and the need
to deter others from committing the
same types of violations;
—The investigation and prosecution of
wildlife offenses, including smuggling
and unlawful takings, is an especially
important area in need of more wide-
spread enforcement and international
cooperation;
—The news media, when used fairly
and properly, can be an effective tool
in enhancing the deterrent effect of
environmental criminal prosecutions,
and may therefore be useful in
furthering the goals of environmental
criminal enforcement.
In addition to the common themes
discussed above, the Belgians considered
a number of enforcement techniques and
authorities that might deserve further atten-
tion in their country (not all of which are
practiced in the U.S.), including: the use of
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MORGULEC, RUBIN, GEYSELS, VAN DEN BERGHE, VANDEWAL 225
plea agreements, special investigation
techniques, wire tapings, longer sentences
for environmental violations, use of the
recovered goods and fines for the benefit of
law enforcement, compensation for envi-
ronmental damages; and rewarding
whistleblowers with a part of fines or
monies recovered.
Thus, even though the U.S. and
Belgium may have different judicial sys-
tems and different priorities in their environ-
mental crimes policy, both programs share
the same fundamental objectives, confront
many of the same issues, and must over-
come the same obstacles. There is,
accordingly, far more room for the useful
exchange of information and technology
than anyone might have imagined. The
course planners hope that the two-day con-
ference will serve as springboard for future
cooperative efforts between the two coun-
tries and with others in the region, and will
strengthen the international network of
environmental enforcement officials.
4 REFERENCE
1 United States Sentencing Guidelines §§
2Q1.1- 2Q2.1. The United States
Supreme Court recently determined that
federal sentencing guidelines that have
guided U.S. federal courts for more than
a decade are advisory in nature rather
than mandatory. United States v. Booker;
United States v. Fanfan, 2005 WL 50108
(Jan. 12, 2005). Significantly, the Court's
ruling does not negate the guidelines as
a useful source for determining an
appropriate sentence.
5 BIBLIOGRAPHY
COMTE, Francoise, "Protection of the
Environment through Criminal Law:
Destiny of the Various European Initia-
tives," in "Europe and the Environment,
Legal Essays in Honour of Ludwig Kramer"
(Preface R. Prodi - Europa Law Publishing
2004).
CRUDEN, John, Environmental Compli-
ance and Enforcement at the United States
Department of Justice and the Role of
Enforcement in Good Domestic Gover-
nance," Proceedings from the 6th INECE
International Conference, April 2003,
http://www.inece.org/conf/proceed-
ings2/18-Env.%20Compliance.pdf.
CRUDEN, John & GELBER, Bruce, "Fed-
eral Civil Enforcement: Process, Actors
and Trends," Natural Resources & Environ-
ment, Vol. 18, No. 4, Spring 2004 (ABA)
GEYSELS, Frans, "Monetary Compensa-
tion in Crimes against Nature - Proceed-
ings of the International Expert Workshop
on the Enforcement of Wildlife Trade Con-
trols in the EU" - Frankfurt 05/06 November
2001 - TRAFFIC - IUCN, p. 48 - 53.
RUBIN, Jim, "Department of Justice's Role
in Implementing Multilateral Environmental
Agreements," Natural Resources & Envi-
ronment, Vol. 18, No. 4, Spring 2004 (ABA)
RUBIN, Jim, "Fighting Black Markets and
Oily Water: The United States Department
of Justice's National Initiatives to Combat
Transnational Environmental Crime," Sus-
tainable Development Law & Policy, Vol. IV,
Issue 1, Spring 2004 (American University
School of Law)
VAN DEN BERGHE, Jan, Report to the
European Forum for Environmental Judges
on the Belgian situation in respect of train-
ing and specialization of judicial officers in
environmental law. (This report was made
for the EUFJE conference at Den Haag,
Netherlands, December 3, 2004, and will
be published later on http://www.eufje.org)
VAN DEN BERGHE, Jan, (ed.), "La repres-
sion des infractions en matiZre d'environ-
nement," Kluwer, Belgium, 2002.
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226 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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MREMA 227
LUSAKA AGREEMENT AS A MECHANISM FOR
ENFORCEMENT OF CITES
MREMA, ELIZABETH M.
Legal Officer, United Nations Environment Programme, Division of Environmental Policy
Implementation, P.O. Box 30552, Nairobi, 00100, Kenya, Elizabeth.Mrema@unep.org
SUMMARY
This paper reviews some of the crucial provisions of Convention on International
Trade in Endangered Species of Wild Fauna and Flora (hereinafter referred to as CITES)
which are relevant to the Lusaka Agreement in order to assess whether the Lusaka Agree-
ment, which deals with similar species but at regional level, will succeed to strengthen and
address some of the CITES flaws and thus serve as a model for other Regions. Effective
implementation of the Lusaka Agreement will depend on the appropriate measures taken
by the Parties at national level to incorporate the provisions of the Agreement in national
legal systems. This paper will highlight discussions of the required measures needed to be
taken at national level.
1 INTRODUCTION
The rate at which wildlife popula-
tions are declining, in most of their histori-
cal ranges, continues to intensify. It has
been widely proven that poaching, unau-
thorized or illegal international trade, rapid
degradation of habitats, and man and ani-
mal conflict at the point of interface are
driving certain species of wildlife to the
verge of extinction. Illegal trade in wild
fauna and flora in many parts of Africa has
been going on unabated, notwithstanding
the existence of international instruments
such as Convention on International Trade
in Endangered Species of Wild Fauna and
Flora (hereinafter referred to as CITES).
The transboundary character and
threats created by cross-border illegal deal-
ers has made several States realize that
individual efforts and the traditional
enforcement methods are no longer capa-
ble of providing effective protection to the
African species from illegal trade arranged
by international organized crime syndi-
cates. Consequently, States feel there is a
critical need for closer co-operation among
designated national law enforcement agen-
cies to save the precious African wild fauna
and flora. That need has led to more rigor-
ous and concerted efforts at regional levels
to complement the already existing global
mechanisms or instruments. The develop-
ment and adoption of the Lusaka Agree-
ment on Co-operative Enforcement Opera-
tions Directed at Illegal Trade in Wild Fauna
and Flora (hereinafter referred to as the
Lusaka Agreement), is one of the attempts
by African (the Eastern and Southern)
countries to adopt stricter measures to
reduce, and eliminate illegal trade in wild
fauna and flora. It will also implement and
enforce CITES at a regional level. The
Agreement aims at easing the administra-
tive difficulties currently hampering cross-
border efforts to restrict trade.
The paper reviews some of the
crucial provisions of CITES which are rele-
vant to the Lusaka Agreement in order to
assess whether the Lusaka Agreement,
which deals with similar species but at
regional level, will succeed to strengthen
and address some of the CITES flaws and
thus serve as a model for other Regions.
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228
SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
Effective implementation of the Lusaka
Agreement will depend on the appropriate
measures taken by the Parties at national
level to incorporate the provisions of the
Agreement in national legal systems. This
paper will highlight discussions of the
required measures needed to be taken at
national level.
2 CITES AND HOW IT WORKS
At the global level, CITES has
established a legal framework to regulate
international trade in endangered species
of wild animals and plants listed in the
appendices. In spite that the text of the
CITES does not expressly state its objec-
tive, it is clear that the Convention intends
to ensure, that international trade in speci-
mens of endangered wild fauna and flora is
regulated and does not threaten conserva-
tion status of declining species. The Con-
vention does this by controlling and regulat-
ing international trade in three ways.
First, it prohibits, with only few
exceptions, international commercial trade
in species listed in Appendix I; that is, those
threatened with extinction. (Articles II (1)
and III) The species listed, as at March
2004, in Appendix I include well over 800
endangered species (827 species, 52 sub-
species and 19 populations).
Second, it gives the responsibility
to the exporting State to regulate, through
the issuance of permit, trade in specimen of
species listed in Appendix II that is not
already threatened with extinction to war-
rant inclusion in Appendix I but which may
become so if not controlled. (Articles II (2)
and III). Over 30,000 species (32,540
species, 49 sub species and 25 popula-
tions) are listed in Appendix II.
Third, CITES gives an option to the
Parties to gain other nations' cooperation,
by enforcing their domestic legislation,
which regulate export of species not listed
in either Appendix I or II by listing them
under Appendix III. (Articles II (3) and V)
Over 200 species (291 species, 12 sub
species and 2 populations) are listed under
Appendix III.
Notwithstanding its potential value
to enforce domestic legislation, only about
21 States have listed a total of about 240
species (229 species, 11 subspecies and 1
population) in Appendix III. Where trade is
permitted in exceptional circumstances
under Appendix I or under Appendices II
and III, the regulation of such international
trade is performed through the issuance of
permits and certificates which go with any
specimen of endangered species listed in
those appendices. (Article VI).
Each Party is required to designate
one or more Management Authorities to
issue permits and certificates and as well
as Scientific Authorities for consultation, in
specific cases, prior to the issuance of per-
mits and certificates. Nonetheless, the
practical aspects of the control trade has
been left to the Parties which are required
to take appropriate measures at national
level to enforce the provisions of the Con-
vention and to prohibit trade in specimens
in violation thereof. Measures to be taken
at national level include penalizing trade
that violates the provisions of the Conven-
tion, confiscating illegally traded speci-
mens, designating special ports of exit and
entry points of wildlife, and maintaining
records of exports and imports of speci-
mens of the listed species. Other measures
include submission of annual reports to the
Secretariat summarizing the trade, biennial
reports on the legislative, and regulatory
and administrative measures that have
been taken to enforce the provisions of
CITES. CITES further permits its Parties to
adopt stricter domestic measures to regu-
late international trade of species. Its provi-
sions shall in no way affect any domestic
measure or obligations of the Parties
derived from any international instrument
relating to other aspects of trade in species.
In fact, many Parties have taken such
measures for different reasons which are
not limited under CITES. For instance,
Venezuela and Brazil have been imple-
menting CITES laws that prohibit the export
of virtually all wildlife.
From the above, it is clear that
even at the time of negotiating the CITES,
States realized that it was difficult to adopt
similar measures to regulate international
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MREMA 229
trade in endangered wild species which
could be uniformly implemented or applied.
Thus, the Convention gave room for stricter
measures to control such trade to be adopt-
ed at national and regional levels or
through other global arrangements. In any
case, an international treaty, which aims at
the participation of all states will, more
often than not be drafted in general terms.
In this way, the agreement will be able to
deal with all needed situations in the world
and be covered by the respective instru-
ment and in softer terms so as to obtain the
greater number of Parties. Since the effec-
tiveness of the Convention is related to the
overall membership, the number of Parties
to the Convention continues to increase
and the increasing external pressure will
continue to encourage non-members to
become parties to it. CITES currently has
164 Parties, as at 6 March 2004 and is gen-
erally regarded as one of the most suc-
cessful of the international conservation
treaties.
3 EFFECTIVENESS OF CITES
Opinions seem to be divided on the
issue whether or not the CITES has
achieved its objectives after three decades
of its existence. While a few are of the opin-
ion that tangible progress has been made
under the CITES, others think that only lim-
ited success can be seen and are worried
that CITES may have even promoted over-
exploitative trade. Writers like Lyster and
Birnie and Boyle argue that real progress
has been made in the over two decades of
the Convention's existence. The progress
could effectively be measured by the
increasing number of Parties to it (over
145) and the improving level of its enforce-
ment. That the Convention provides a high-
ly practical mechanism with structures to
deal with complex issues on the interna-
tional trade of wildlife species is one indica-
tor. And the existence of a permanent Sec-
retariat and administrative obligations
imposed on the Parties to set up Manage-
ment and Scientific Authorities to enforce
the CITES as well as the requirement of the
Parties to meet regularly to review the
implementation of the Convention are addi-
tional critical factors guarding the Conven-
tion from becoming a "sleeping treaty".
Nevertheless, writers such as Hux-
ley, Gakahu and Favre argue that imple-
mentation of CITES, though working well,
has still met with several drawbacks, both
nationally and internationally. For instance,
they argue that Management and Scientific
Authorities are mostly understaffed and
with inadequately trained staff; communica-
tion between Management Authorities of
different Parties in exporting and importing
countries, and between those authorities
and the Secretariat are still very poor.
Annual and biennial reports continue to be
submitted long after the deadlines and,
even when submitted, most of them are
incomplete and inaccurate. National legis-
lation and administrative procedures of
many Parties to enforce the Convention are
still inadequate. Furthermore, many Parties
continue to have problems to effectively
comply with and monitor the thousands of
species listed in the appendices coupled
with the changing list of species protected
after each Conference of the Parties. Cor-
ruption, use of fraudulent documents,
movement of specimens without CITES
documentation, failure to notify the Secre-
tariat of shipments, and acceptance of
shipments by importers without confirma-
tion by the Secretariat have all made it dif-
ficult for the CITES to effectively regulate,
monitor and control trade in endangered
species.
Fitzgerald on the other hand
argues that too many exemptions under the
Convention which allow trade in listed
species without the issuance of usual per-
mits have created several weak points in
the enforcement of CITES. Much as she
agrees that these exemptions were
designed to make CITES more effective
and acceptable to many States, they also
expose the Convention to deficiencies in
the process. Article VII of the Convention,
for instance, exempts wildlife trade related
to circuses, or wildlife for noncommercial
purposes (in museums, research centers,
zoos, etc.). The article also exempts wildlife
for personal items (such as pet yellow-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
naped amazon, stuffed tortoise, fur coats
etc.), or wildlife shipments in transit from
one country to another, or captive-bred ani-
mals and artificially propagated plants, or
ranched wildlife which have qualified to be
transferred from Appendix I to II. The deci-
sion at the tenth Conference of the Parties
to CITES to downlist African elephants from
no trade at all in Appendix I to regulated
trade in Appendix II further aggravated the
situation. Notwithstanding the good inten-
tions CITES had to exempt the above
species from the permit requirements, the
practical effect has been the creation of
loopholes for illegal trade in wild fauna and
flora.
It is further argued by Fitzgerald,
an opinion also shared by Gakahu, that
pre-Convention specimens have been
used to legalize illegal trade under CITES.
For instance, CITES exempts species list-
ed in the Appendices which were acquired
by a country before CITES came into effect
or before the country became a Party. In
practice it has been difficult to enforce this
provision, thus providing loopholes for ille-
gal trade in endangered species. It is no
surprise that in 1983 Burundi, then a non-
Party to CITES, had twelve tons of ivory
with only one elephant in a zoo. This ivory
apparently originated from Tanzania and
Zaire. When CITES adopted the ivory
quota system in 1986 as a measure to curb
poaching and illegal ivory trade, Burundi
joined CITES to be able to export the ivory.
Similarly, in 1989, Somalia had stockpiled
eight thousand elephant tusks, while its
elephant population was less than five hun-
dred. The ivory originated from elephants
poached in Kenya. In this scenario, there-
fore, CITES could be criticized for legaliz-
ing poached ivory.
Furthermore, Article XXIII permits
Parties to grant themselves exceptions to
CITES controls by entering reservations,
when acceding to it, on individual species
listed in the Appendices I and II. The provi-
sion thus permits Parties to act as though
they are not Parties to CITES when import-
ing or exporting those species once they
have entered a reservation. Such an
exemption weakens the ability of CITES to
regulate and control endangered wildlife
especially on Appendix I species since
such Parties are kept on an equal footing
with the non-parties with whom trade is per-
mitted, thus avoiding CITES controls.
Notwithstanding the criticisms,
most of which are accepted by the defend-
ers of CITES, it must be appreciated that in
today's world of better equipped and organ-
ized poachers, CITES Secretariat has suc-
ceeded to effectively implement the Con-
vention. It monitors wildlife trade and acts
as a switchboard for passage of informa-
tion between enforcement agencies. Reso-
lutions passed by the Conferences of the
Parties, no matter their numbers and com-
plexity, indicate positively how the Parties
are trying to improve enforcement mecha-
nisms of the Convention while the increase
in the number of the Parties demonstrates
commitment that cannot, whatever the crit-
icism, be ignored.
The adoption of the Lusaka Agree-
ment should be seen as a complementary
effort to implement, enforce and strengthen
CITES by adopting stricter enforcement
measures at regional level to curb illegal
trade in wildlife species. The Parties'
national law enforcement officers to be sec-
onded to the established Task Force, and
who will retain their national law enforce-
ment powers in their countries, will go
along way to address some of the CITES
identified flaws and in particular on cross-
border issues. Attention will now be
focused on the Lusaka Agreement.
4 REASONS BEHIND THE
DEVELOPMENT OF THE
LUSAKA AGREEMENT
Lusaka Agreement was conceptu-
alized during the first African Wildlife Law
Enforcement Co-operation Conference
held under the auspices of CITES and the
Zambian Ministry of Tourism in Lusaka
from 9-11 December 1992, by senior
wildlife law enforcement officers as a
mechanism to deal with the problems faced
by national law enforcement agencies in
attempting to combat international wildlife
smuggling syndicates and in particular lack
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MREMA 231
of formal means to enable cross-border
cooperation. Other problems identified
include: difficulties associated with investi-
gations, cross-border poaching, customs
and the size and fluidity of the borders
between many African countries, such as
Tanzania's Selous Game Reserve, which
makes cross-border smuggling between
Lindi, Iringa, and Coast region an attractive
business for poachers. Ill-equipped wildlife
technicians, limited helicopters to conduct
surveillance and field patrols, lack of
trained law enforcement officers to conduct
undercover intelligence operations coupled
with lack of administrative capacity, made it
difficult for countries to adequately respond
to sophisticated and well resourced cross-
border smugglers.
Furthermore, cooperation between
national law enforcement agencies such as
the police, customs and wildlife service and
coordination between relevant CITES man-
agement authorities and enforcement offi-
cials was found lacking. The failure of
domestic entities to cooperate effectively at
national level is also duplicated at interstate
level because of lack of cross border rela-
tionships with the law enforcement agen-
cies in neighboring countries. Inadequate
cooperation between national law enforce-
ment officers and their colleagues in neigh-
boring countries to prevent illegal trade has
been exploited by international crime syndi-
cates who, at times, receive considerable
support from the local communities in com-
mitting crimes related to poaching and
smuggling of wildlife species.
Poor or inadequate laws were also
considered as impeding factors to the
national efforts to combat illegal trade or
smuggling of wildlife species. For instance,
the powers of enforcement officers are lim-
ited and restricted to their national jurisdic-
tions and the officers are powerless across
borders while in hot pursuit or to institute
legal proceedings against known poachers,
unless legal mechanisms, such as extradi-
tion agreements, exit. Even where extradi-
tion arrangements exit, rules of evidence
which differ from country to country make it
difficult for the prosecution cases to suc-
ceed as they could be knocked down on
technical grounds. Additionally, the extradi-
tion procedures do not necessarily allow for
swift action to be taken. Besides low penal-
ties and unevenness in the severity of the
penalties imposed by most African coun-
tries against illegal smugglers of wildlife
species compared to the value of the spec-
imen poached or smuggled has always
been a discouraging factor in undertaking
legal processes against the offenders and,
hence, fail to deter people from engaging in
such lucrative business.
Political instability, military and civil
conflicts and economic insecurity have pro-
vided major impediments to the effective
enforcement of African wildlife laws. Gueril-
la war in Mozambique in the 1980s, in
Angola, civil war in Somalia, and civil con-
flicts in DR Congo have devastated natural
resources and facilitated cross-border
incursions by poachers into game reserves
and parks. Weapons from Mozambique to
Swaziland and from Somalia to Kenya
have been used by poachers to seriously
decrease those countries' endangered
species. Poaching has also provided a
source of revenue for guerilla movements
in strife to an African continent.
Consequently, UNEP facilitated
and coordinated three expert group meet-
ings (March, June and September, 1994) to
negotiate and develop the Lusaka Agree-
ment. The last and fourth Expert Group
meeting was then followed by the Ministers
meeting which adopted the Agreement on 9
September 1994 and opened it for signa-
ture with six countries (Kenya, Uganda,
South Africa, United Republic of Tanzania,
Swaziland and Zambia) signing immediate-
ly while Ethiopia signed later. Three resolu-
tions, including one on implementation,
were adopted unanimously. A decade later
the Agreement is under evaluation and
review of the experience to date of the
instrument among its limited parties.
5 STATUS OF THE LUSAKA
AGREEMENT
Although the Agreement was
closed for signature on 13 March 1995,
with seven signatures on board, it is still
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232
SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
open for accession by any African State.
(Article 12 thereof) To date six States
(Zambia, Uganda, Tanzania, Kenya,
Lesotho and Republic of Congo) have rati-
fied or acceded to the Lusaka Agreement.
The Agreement entered into force on 10
December 1996, that is, on the 60th day
after deposit of the fourth instrument of rat-
ification or accession.
The effective operation of the Task
Force as established under the Agreement
inevitably entails effective institutional set
up at national level. This will ensure two-
way collaborative mechanisms to effective-
ly curb illegal wildlife trade in the region.
Consequently, building the requisite capac-
ities, particularly through the training of per-
sonnel of the national entities became con-
ditio sine quo non for the Task Force to suc-
ceed in its operational activities. Subse-
quently the capacity building efforts of the
national bureaus through the training of
national enforcement officers have been
emphasized.
The two weeks training courses on
law enforcement conducted by national
experts from Kenya and South Africa
between 1996 to 1998 to sharpen enforce-
ment officers skills in combating an ever
increasing illegal trade in wild fauna and
flora and also being able to effectively
implement the Agreement countries that
benefited include Tanzania, Uganda,
Zambia, Ethiopia and Swaziland. Similar
and more advanced courses have been
held and continue to be organized both in
the countries and outside to further
strengthen the ability and capacity to net
and combat environmental crime. The use
of national law enforcement experts from
within the participating countries to the
Agreement to train and coach others clear-
ly indicated the divergence of law enforce-
ment capabilities in the Agreement's coun-
tries. While most of the participating coun-
tries lack technical expertise in law enforce-
ment, intelligence and investigation capa-
bilities to combat illegal trade in endan-
gered species, a few, like Kenya and South
Africa, have the knowledge and expertise
required for the task and to facilitate effec-
tive enforcement of the Agreement. To
ensure that all participating countries were
ready and prepared to work together in
undertaking, where necessary, joint and
undercover cross border operations when
the Task Force was established, law
enforcement officers from Kenya and
South Africa offered to assist other coun-
tries by conducting training courses. The
Task Force officers have also been
exposed to operations and training outside
Africa in UK and Israel, among others. All
those national enforcement officers who
have been trained in these programs under
the Agreement continue to be useful in
organizing other similar courses when they
serve as resource persons.
6 HOW THE LUSAKA
AGREEMENT WORKS
Unlike CITES which has estab-
lished a global framework to regulate and
control international trade in endangered
species of wild animals and plants listed in
the three appendices, the Lusaka Agree-
ment without providing any list of species,
intends to reduce and ultimately to elimi-
nate illegal trade in wild fauna and flora. It
establishes, per article 5, a Task Force
which, in conjunction with the National
Bureaus and the Governing Council, is to
make sure that this objective is achieved
without compromising State Parties' nation-
al sovereignty.
Parties to the Agreement under-
took in article 4 to cooperate and take
action to implement the Agreement by: (a)
investigating and prosecuting cases of ille-
gal trade, (b) providing relevant informa-
tion and scientific data to Task Force, (c)
providing technical assistance to the Task
Force, (d) encouraging public awareness
campaigns, (e) paying their annual
assessed contributions to the budget of the
Task Force, and (f) returning to the country
of original export or country of re-export
any specimens or species of wild fauna and
flora confiscated in the course of illegal
trade.
However, to ensure effective
enforcement, Parties are required and
expected to adopt and enforce legislative
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MREMA 233
and administrative measures to give effect
to the Agreement. In practice only Uganda
has a Statute on this. It is anticipated,
therefore, that as Parties implement the
Agreement, efforts will also be taken to
ensure that the relevant wildlife laws and
regulations, criminal and penal laws are
reviewed, redrafted and/or amended or
strengthened and also harmonized and
synchronized with each other to avoid con-
flicts and contradictions. Furthermore, Par-
ties to the Lusaka Agreement are required
to adopt necessary enabling legislation in
their countries to incorporate the normative
demands of the Lusaka Agreement into
their national laws.
7 ADMINISTRATIVE MECHANISMS
UNDER THE LUSAKA
AGREEMENT
In order to implement its provi-
sions, three bodies are established under
the Agreement, namely, the Task Force, the
National Bureau, and the Governing Coun-
cil.
7.1
Task Force
While CITES established the Sec-
retariat to monitor international trade in
contravention of the Convention, the Lusa-
ka Agreement establishes, under Article 5,
a unique permanent multi-national institu-
tion called the Task Force, composed of
national law enforcement officers of each of
the Parties capable of operating interna-
tionally against international wildlife smug-
gling rings. Unlike the CITES Secretariat,
the Task Force has powers to:- (a) facilitate
cooperative activities among the National
Bureaus in carrying out investigations per-
taining to illegal trade; (b) investigate viola-
tions of national laws pertaining to illegal
trade, at the request of the National
Bureaus or with the consent of the Parties
concerned, and to present to them evi-
dence gathered during such investigations;
(c) collect, process and disseminate infor-
mation on activities that pertain to illegal
trade, as well as establishing and maintain-
ing databases; (d) provide, upon request of
the Parties concerned, available informa-
tion related to the return to the country of
original export, or country of re-export, of
confiscated wild fauna and flora; and (e)
perform such other functions as may be
determined by the Governing Council, (arti-
cle 5 (a).)
Unlike the CITES Secretariat, the
Task Force comprises of field officers, com-
manded by the Director appointed by the
Governing Council, an Intelligence Officer
and such other Officers as the Governing
Council may appoint. These officers have
been seconded to the Task Force by the
Parties. While retaining their national law
enforcement powers, they carry out cross-
border operations and investigations in
close cooperation with National Bureaus. It
is important to underline the importance of
Article 5(13) which states that, "The Task
Force shall not undertake, or be involved in
any intervention, or activities of a political,
military, religious or racial character." Its
activities are therefore to be strictly within
the ambit of the Agreement.
A small Task Force, with only two
field officers - the Director and the Intelli-
gent Officer, was officially launched on 1st
June 1999 and has now expanded to
embrace officers from each of the parties.
During the initial phase of the Task Force
operations, nominated field officers were
deployed at the national bureaus until when
the secretariat is fully established, or when
sufficient resources have been procured to
run the operations of the Agreement.
7.2
National Bureaus
Unlike the Management and Scien-
tific Authorities designated or established
by each Party to CITES to grant permits
and certificates on behalf of that Party, the
Lusaka Agreement has National Bureaus
established or designated by each Party to
work in close liaison with the Task Force
and Uganda, Tanzania, Kenya and Zambia
have done so. For the purpose of the
Agreement, the functions of the National
Bureaus include providing to and receiving
from the Task Force information on illegal
trade, and coordinating with the Task Force
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on investigations that involve illegal trade.
In practical terms, the National
Bureaus are expected to work hand in hand
with the Task Force in undertaking cooper-
ative enforcement measures to combat ille-
gal trade in endangered species. The Task
Force shall facilitate the collection, interpre-
tation and dissemination of information and
intelligence. For this purpose a wildlife
criminal intelligence database will be estab-
lished. The Task Force also facilitates the
co-operative enforcement activities
between National Bureaus. This is
achieved through coordinating joint opera-
tions, designing, planning and investiga-
tions. On the long term, once the database
is fully established and operational, the
Task Force will undertake analysis of
wildlife crime trends for the purpose of
measuring extent of crime and determining
appropriate proactive and reactive meas-
ures. The measures may include profiling
of repeated offenders and criminal network
operating at national, sub regional and
regional levels with emphasis on interna-
tional syndicates.
7.3 Governing Council
Just like the Conference of the Par-
ties under CITES, the decision making
body of the Lusaka Agreement is the
Governing Council established under the
Agreement. Each Party is a member of the
Governing Council, represented at Ministe-
rial level. The Council is, therefore, the
highest policy-making organ. Parties shall
be represented on the Governing Council
by Ministers who would be joined by their
"high ranking officials dealing with wildlife
law enforcement affairs" or officers whose
duties are connected with the activities of
the Task Force or experts in the subjects on
the agenda.
Since the entry into force of the
Agreement six Governing Council meet-
ings of the Parties have been held thus far
in March 1997, March 1999, and July 2000,
2001, July 2002 and July 2003.
8 WILL LUSAKA AGREEMENT
SUCCEED TO ADDRESS
CITES FLAWS?
The Task Force, dubbed "African
Interpol", commenced its activities on 1st
June 1999. One can only speculate
whether or not it will succeed to address
some of the problems of implementation
and enforcement of CITES and/or strength-
en it. The Management and Scientific
Authorities are designated or established
by the Parties to CITES while the CITES
Secretariat itself has no control in the inter-
nal affairs of those Parties apart from only
urging them to fulfill their obligations under
the Convention. The Lusaka Agreement
has gone beyond intentions and ushered in
an implementation phase, starting with a
few parties, and building in numbers hope-
fully to eventually cover the whole Africa
region.
The six State Parties to the Lusaka
Agreement are also Parties to the CITES.
The Management Authorities established
by the Parties to CITES are actually the
same national entities designated as
National Bureaus under the Lusaka Agree-
ment. The fact that the same national enti-
ties which facilitate the implementation and
enforcement of CITES are the same for the
Lusaka Agreement ensures that these
working modalities under the Lusaka
Agreement are in harmony and thus would
strengthen the effectiveness of CITES and
vice versa.
The Task Force, on the other hand,
is composed of field officers seconded from
the Parties' designated National Bureaus
and who continue to retain their national
law enforcement powers. This actually
means that, the Task Force field officers
are also the enforcement officers of their
countries' National Bureaus. When fully
operational, it would be easier for the field
officers to obtain any required information
from their National Bureaus since either
they are the information source themselves
or they will know which button to press for
the right information when required. The
same officers could be dispatched to their
country's National Bureaus to retrieve the
required information and/or evidence.
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MREMA 235
These officers would also lead the Task
Force to their countries in the event of joint
undercover and cross-border operations to
curb illegal trade of wildlife species. The
problems which CITES faces in relation to
communication channels, inaccurate
reports etc. would not be easily felt under
the Lusaka Agreement and hence will suc-
ceed to strengthen CITES. While the
CITES Secretariat has to depend on the
goodwill of the offices of Management and
Scientific Authorities to furnish information,
reports, etc., the Task Force would depend
on its own seconded officers to provide the
required information.
Efforts to build the capacity of the
National Bureaus go hand in hand with
building the capacity of the Task Force. For
the Task Force to coordinate with the
National Bureaus on investigations of
undercover operations that involve illegal
trade, it will also undertake joint training
programs to ensure the same level of
capacity building to conduct such intelli-
gence activities. Once the national law
enforcement officers of both the Bureaus
and those seconded to the Task Force are
well trained, equipped, and funded, the
Lusaka Agreement will obviously receive
credit for its efforts to combat cross-border
illegal trade and enforce CITES at regional
level. Further the enforcement officers,
whether in the Task Force, or in the Nation-
al Bureaus, remain colleagues in operation
only from time to time alternating between
national bureaus and the Task Force.
9 THE TASK FORCE IN ACTION
Understandably, the Lusaka
Agreement Task Force has had the usual
teething problems related to lack of finan-
cial, human and technical resources neces-
sary for its operations. However, the diffi-
culties notwithstanding, the Unit has had
several major successful operations. To
mention but a few:
The Task Force in joint collabora-
tion with the Kenya Wildlife Service recov-
ered in June 1999, 61 elephant tusks
weighing about 425 kilograms in Maralal
Town of Samburu District of Kenya was
seized and two suspects arrested. The
ivory was destined for export. Following a
request from the Kenya Wildlife Service,
the Task Force conducted a joint operation
in August 1999 with the Anti-poaching Unit
of Tanzania Wildlife Division. They arrested
three Tanzanians suspected to be involved
in cross-border poaching of elephants in
Tsavo West National Park of Kenya. During
the arrests at Gonja area, same district in
Tanzania a .458 caliber rifle was recovered.
The Task Force conducted in October 1999
a joint operation with Kenya Wildlife Ser-
vice at Kakongi, Turkana District in Kenya.
Twenty-eight elephant tusks weighing
247.2 kilograms were recovered and three
people arrested.
At the Third Governing Council
Meeting in July 2000, it was reported that in
four overt operations, which were preceded
by intelligence activities, the Task Force,
with Tanzania's National Bureau (Wildlife
Protection Unit) and Kenya's National
Bureau, Kenya Wildlife Service (KWS), net-
ted a total of 91 elephant tusks (weighing
about 630 kilograms) and one 404 rifle, and
12 suspects arrested and prosecuted. In
addition, in collaboration with the Task
Force, four suspected poachers were
arrested in Tanzania in August 1999. As a
result of the arrests made at Kakong
(Kenya) and Same (Tanzania), it was
reported that poaching of elephants had
declined in Nasalot/South Turkana Nation-
al Reserves and Tsavo West National
Park/Mkomazi Game Reserve. It was fur-
ther reported that the Task Force also
worked closely with other law enforcement
and related organizations outside Africa in
investigations which resulted in various
seizures of specimens of ivory in Bangkok
(500 kilograms), Tokyo (250 kilograms),
Taipei (2189.42 kilograms), as well as, in
collaboration with KWS, the seizure of
assorted species of reptiles in Mombasa in
May 2000.
At the Fifth Governing Council
Meeting in July 2002 it was reported that
the Task Force had collected intelligence
information, and also conducted successful
operations in Kenya, Congo, Tanzania and
Zambia. Collaborative operations between
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
the Task Force, the respective National
Bureaus and international law enforcement
agencies, had enabled the Task Force to
apprehend 25 suspects in various areas of
the African continent. They seized 556
pieces of raw elephant tusks weighing
6,306.38 kilograms, 40,810 pieces of pol-
ished/worked ivory, 13 raw zebra skins,
various other animal skins, bush meat, nets
and metallic traps. At the Sixth Governing
Council Meeting, it was reported that the
Task Force had successfully conducted
joint operations in collaboration with the
National Bureaus of Kenya, Tanzania,
Congo and Uganda. These operations had
resulted in seizures of wild animal trophies,
predominantly skins and processed ivory.
10 NEED TO HARMONIZE LAWS
TO IMPLEMENT LUSAKA
AGREEMENT AND
ENFORCE CITES
The work of the Task Force entire-
ly depends on how effective the designated
National Bureaus and the individual nation-
al wildlife laws and regulations facilitate the
operations of the Task Force. The effective-
ness of the laws and regulations is crucial
and must go hand in hand with the harmo-
nization of laws with neighboring States
since the Task Force will inevitably deal
with cross-border operations.
There is, therefore, an urgent need
to review the existing national wildlife laws
and regulations with the view to identify
gaps and drawbacks that exist in the legis-
lation and make the necessary amend-
ments. Such review would go hand in hand
with the incorporation of normative
demands of the international instruments,
such as the CITES and the Lusaka Agree-
ment, into each country's national legal
systems. For the Parties to the Lusaka
Agreement to co-operate with one another
and with the Task Force for the effective
implementation of the Agreement as pro-
vided under Article 4, the Parties should
inevitably take appropriate measures, indi-
vidually and/or jointly, to investigate and
prosecute cases of illegal trade.
Parties would only be able to fulfill
that obligation if they adopt and enforce
necessary legislative and administrative
measures to give effect to the CITES and
the Agreement in their territories and to har-
monize their relevant laws. Such harmo-
nization would permit uniform application
of, for instance, penalties and punish-
ments, the requirement to return the confis-
cated species in the course of illegal trade
to the country of original export, and mak-
ing wildlife offences serious and extra-
ditable. The Parties will have to ensure that
special and deterrent punishments are pro-
vided to wildlife offenders. In such cases,
not only should the fines be heavy, but
should include mandatory long-term impris-
onment to induce compliance. The manda-
tory forfeiture by the State of any wildlife
species or specimen illegally obtained,
together with any weapon and vehicles that
may have been used in the commission of
the crime should also be considered and
provided for in the relevant laws.
Simpler mechanisms could also be
sought to avoid the long process and the
inconvenience of carrying out frequent
amendments to the national laws in order
to incorporate the contents of such interna-
tional instruments and subsequent modifi-
cations thereof that the country may adopt
from time to time in future. States may opt
to specify under their wildlife laws that the
prescribed authority may, when necessary,
promulgate rules and regulations in order
to give effect to the international instru-
ments to which they are Parties.
In the alternative, the legislation
may provide for the delegation of rule-mak-
ing powers to the prescribed authorities.
Under such vested powers, the authorities
could fix license fees, terms and conditions
of operating the licenses, and restrictions
and obligations of visitors to the national
parks and protected areas. It could also
establish the procedure for disposal of
seized species, and other specific aspects
which would unnecessarily hamper and
make the main legislation cumbersome.
Such a provision would enable the detailed
operation of the enactment to be more flex-
ible as it would allow the authorities imple-
menting the legislation to modify the provi-
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MREMA 237
sions when need arises without having to
undergo the lengthy and complicated pro-
cedures of the amendment of national laws.
Furthermore, in view of the impor-
tance of the wildlife resources to the coun-
tries, there might be need for relevant laws
to establish special tribunals to try wildlife
offences and to train special prosecutors to
prosecute wildlife cases. However, since
there is a current move in the recent frame-
work environmental laws to provide for the
establishment of special tribunals to deal
with environmental cases, similar mecha-
nisms could be used to avoid proliferation
of such tribunals. It might even be salutary
for the legislation to provide for economic
incentives, such as the payment of rewards
for services rendered in connection with the
detection and prosecution of wildlife
offences under the law, to induce compli-
ance. The law may provide that upon con-
viction, the court may direct that one-half
(or an accepted percentage) of any fine
recovered in wildlife cases be paid into a
special fund to be maintained and operated
by the Director responsible for wildlife con-
servation. Such funds could then be
ploughed back to benefit the local commu-
nities and other wildlife activities. East
African Magazine of 15-21 January 1996
reported that Tanzania has been able to
recover US$ 1.5 million realized from the
sale of 9.7 tons of ivory from Tanzania
impounded and sold by Belgian Govern-
ment ten years ago. In a special agreement
concluded with the Belgian Government,
the funds were to be used in the protection
of elephants in the country. The money
came from the sale of 1,889 elephant tusks
found hidden in two containers shipped
from Tanzania and destined for Dubai.
False documents indicated the content to
be Beeswax. In addition, mechanisms
need to be sought and agreed upon where-
by all other wildlife revenue collected can
be ploughed back to wildlife conservation
activities so as to enable such institutions
to be self-generating bodies for activities
and commitments without depending too
much on central governments which are
also faced with meager resources.
Local communities need to be part
and parcel of the government's efforts to
protect wildlife. Communities which live
amongst wildlife in the rural areas need to
derive adequate and direct benefits from
the use of these resources in order to make
them have an interest in their conservation
and protection. The relevant laws should
therefore include provisions for the partici-
pation of the local communities in the
enforcement measures directed at illegal
trade of wildlife and for part of the revenue
accrued from combating such illegal trade
benefiting these communities. In fact work-
ing with the communities, the national
bureaus will be able to identify intruders
and follow them up to arrest and prosecu-
tion.
There are many aspects to be
taken into account in the review of wildlife
laws and regulations; only a few have been
dealt with in this paper. The wildlife laws in
most countries are many and diverse and
they will all be required to be studied and
revised in their totality for better analysis.
However, for the East African countries of
Kenya, Uganda and Tanzania, review of
their national wildlife laws for harmoniza-
tion purposes was made and discussed at
a workshop held at Kisumu, Kenya, in
February 1998. It is hoped that other Par-
ties to the Lusaka Agreement will follow suit
to ensure its effective enforcement and
compliance. In any case any other African
country intending to ratify or accede to the
Agreement had better be on notice on this
aspect.
11 SUMMARY AND CONCLUSION
The Lusaka Agreement and the
institutional structures established for its
effective implementation are designed to
overcome some of the law enforcement
problems which hinder increased compli-
ance with CITES and thus assist more
effective wildlife conservation and manage-
ment. Hence, the ratification of or acces-
sion to the Lusaka Agreement or even
CITES, is not an end in itself. Parties need
to implement its provisions as is indeed
desired for all such regional and global
instruments. Entry into force, and even
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
establishing the Task Force to work with the
relevant enforcement agencies (National
Bureaus) in the countries will be ineffective
if not coupled with the adoption, amend-
ment or strengthening of the relevant laws
and regulations in the countries and if all
relevant agencies and officials do not work
in a coordinated manner to curtail the com-
mon menace through concerted action.
Importantly, the Parties need to harmonize
the relevant laws between and among
States Parties to the Agreement.
It has been underscored that the
Agreement reinforces CITES which was a
partner of UNEP and the States during the
negotiating process, and which remains a
partner in the further efforts to ensure the
Agreement is effectively implemented at
regional level so as to strengthen CITES.
CITES has established the legal framework
whereby participating States to the Con-
vention have agreed to regulate interna-
tional trade in certain species of wild ani-
mals and plants as specified in the appen-
dices. Nevertheless, the practical aspects
of creating the necessary infrastructure to
control this trade is left to the Parties con-
cerned to take appropriate measures to
enforce the provisions of the Convention. If
Parties to the Lusaka Agreement succeed
to create the necessary environment to
reduce and/or eliminate illegal trade in
wildlife species, it will surely thrive and
manage to address some of the criticisms
or concerns which have been leveled
against CITES by a number of writers, as
summarized in the paper.
The Lusaka Agreement as an off-
shoot of CITES, therefore, seeks to imple-
ment and reinforce the provisions of CITES
by conducting undercover investigations in
close co-operation with designated nation-
al law enforcement agencies in different
countries. However, unlike CITES which
lists specific species under the appendices,
the Lusaka Agreement is broad in its scope
as it deals with all species of wild fauna and
flora at regional level and in this respect
also reinforces the 1992 Convention on
Biological Diversity as well. Consequently,
Lusaka Agreement as a regional agree-
ment, just like CITES at a global instru-
ment, is not, in itself, a self-executing
instrument. Its terms and contents need to
be incorporated into national legislation of
each Party to it. The ball is, therefore, in the
Parties' courts to make it really work and
reinforce the CITES to which most coun-
tries are Parties and are therefore commit-
ted.
The Task Force, in collaboration
with relevant national bureaus, has so far
succeeded to recover several elephant
tusks and arrested several offenders
involved in cross-borders poaching and
recovered a several weapons. These are
positive beginnings. It can well be ascer-
tained that given time and adequate
resources, more will be achieved in their
efforts to curb illegal trade in wild fauna and
flora in Africa. In fact, if the Lusaka Agree-
ment continues to work in this spirit, it could
easily serve as a blueprint and model for
similar co-operative regional law enforce-
ment mechanisms to be replicated in other
parts of the world plagued with similar men-
ace.
However for any region anticipat-
ing to initiate similar infrastructure as under
the Lusaka Agreement countries, political
will and commitment on the part of the
members coupled with adequate human
and financial resources as well as institu-
tional capacity to handle the challenges
involved will be required to support such a
regional body. These elements are neces-
sary and are sine quo non for any success-
ful regional law enforcement mechanism
intended to strengthen not only CITES, but
any other environmental concern
addressed.
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RUBIDIRI 239
IMPLEMENTATION OF INTERNATIONAL ENVIRONMENTAL
AGREEMENTS: THE CASE OF BOTSWANA
RUBADIRI, DESIRE
P.O Box 641, Gaborone, Botswana, rubadiri@botsnet.bw
SUMMARY
Botswana has ratified many key multilateral and regional environmental agree-
ments. Although its status as a party to these agreements is indicative of a commitment to
environmental protection, the country's status of developing and enforcing national legisla-
tion to execute these treaties tells another story. This paper describes the current status of
implementation in Botswana and identifies political and legislative causes for the country's
weak environmental law.
1 INTRODUCTION
Botswana is party to a number of
multilateral and regional environmental
agreements these being the Convention on
Wetlands of International Importance
(Ramsar Convention 1971); the Conven-
tion on International Trade in Endangered
Species of Wild Flora and Fauna (CITES,
1973); the Convention on Biological Diver-
sity (1992); the Climate Change Conven-
tion (1992); Kyoto Protocol to UN Frame-
work on Climate Change; Vienna Conven-
tion for the Protection of the Ozone Layer
(1985); Montreal Protocol of Substances
that deplete the Ozone Layer (1987) the
UN Convention to Combat Desertification
(1994); the Basel Convention on the Trans-
boundary Movements of Hazardous
Wastes and their Disposal (1989) the Per-
manent Okavango River Basin Agreement
(1994); the SADC Protocol on Wildlife
Coservation and Law Enforcement (1999)1.
In essence this should demonstrate a
strong commitment to compliance with
these Multilateral Environmental Agree-
ments by the State.
Botswana is also signatory to a
number of international and regional
human rights agreements that have envi-
ronmental protection concerns for instance
the International Covenant on Civil and
Political Rights (ICCPR) and the African
Charter of Human and Peoples Rights
(ACHPR). Reference is made here to these
agreements in light of the fact that the "right
to life" has been applied in the context of
environmental protection. The first African
country to apply this was Tanzania in the
case of Joseph D Kessy v Par es Salaam
Civil Case No 29 of 1998. It is a case in
which foul smells and air pollution had
caused respiratory problems in area resi-
dences exposing them to health hazards.
The City Council was ordered to cease
dumping garbage in the area and construct
a dumping ground where no health hazards
would be visited on the residents i.e. they
were accorded the right to a healthy envi-
ronment.2
Notwithstanding the above
Botswana's compliance has been far from
satisfactory. Whilst there are a host of gov-
ernment policies on sustainable resource
use such as the National Policy on Natural
Resource Conservation and Development
(1990); the Tourism Policy (1990), the Agri-
culture Policy (1991), the National Water
Master Plan (1992), the National Settle-
ment Policy (1998) and pieces of legislation
related to the same issues of environment
and resource management their implemen-
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tation is wanting.3 These policy documents
naturally do not have the force of law and
so do not assist the environmental norma-
tive system. Some of them make direct ref-
erence to international environmental
treaties
2 IMPLEMENTATION OF
INTERNATIONAL AND REGIONAL
ENVIRONMENTAL TREATIES
Implementation of international
and regional environmental law and com-
pliance to the MEA's in Botswana is fraught
with a number of difficulties. The mere exis-
tence of a body of environmental law
though essential in a basis for action does
not in itself provide a solution to environ-
mental problems.4 Infact legislation on the
stature books and policies have had the
effect of lulling the public into a false belief
that environmental concerns are of great
importance in a number of jurisdictions.
From a lega perspective Botswana is eas-
ily outplaced by most of her contempo-
raries in the African continent in that she
does not have a constitutional environmen-
tal constitutional norm as do Namibia,
South Africa, Lesotho, Malawi, Uganda etc.
Is this a question of different national prior-
ities or the lack of an intention to comply?.
In a celebrated Botswana case the
Attorney General vs. Unity Dow 1991 heard
by the Court of Appeal the highest court of
the land the late Judge President Amissah
stated that:
"A written constitution is the legislation
or compact which establishes the state
itself. It paints in broad strokes on a
large canvass the institutions of the
state; allocating powers, defining
relationships between such institutions
and the people within the jurisdiction of
the state, and the people themselves.
A constitution often provides for the
protection of the rights and freedoms of
the people, which rights and freedoms
have thus to be respected in all future
state action".
Botswana having ratified a number
of international and regional agreements
should give its people the "right to a healthy
environment". In the same judgement Jus-
tice Aguda refers to Botswana's interna-
tional obligations stating that
"By the law of Botswana relevant
international treaties and conventions
may be referred to as an aid to
interpretation, (p.49) Even if it is
accepted that those treaties and
conventions do not confer enforceable
rights on individuals within the State
until Parliament has legislated its
provisions into the law of the land the
Courts should so far as is possible
interpret domestic legislation so as not
to conflict with Botswana's obligations
under the African Charter or other
international obligations".
The African Charter of Human and
Peoples Rights which is a regional treaty to
which Botswana is a signatory does have
such a right in Article 24. Unfortunately
even where other African states have incor-
porated constitutional environmental provi-
sions there has been little interpretation or
application of the right owing to various fac-
tors such as the lack of public interest litiga-
tion, lack of judicial familiarity with such and
the failure of governments to set up the
machinery to implement their constitutional
and international obligations.5
We see the lack of a normative
basis in Botswana's domestic law to enable
international environmental law norms to
have their place in the canvass of its con-
stitutional development. Botswana, unlike
most of its contemporaries in the develop-
ing world, does not have politically and eco-
nomic instability, endemic corruption and
the lack of a functioning State. One would
assume that then compliance would be
implemented through national legislation,
regulations, institutions and other domestic
measures.
3 SOURCES OF FAILURE
The key national environmental
institutions however demonstrate the
source of many of its failures. The most pri-
mary institution being the National Conser-
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RUBIDIRI 241
vation Strategy Agency which was estab-
lished in 1991. It is directed by a Board
chaired by the Minister of Environment,
Wildlife and Tourism. Its membership
includes senior officials from seven min-
istries, and others from the university,
NGO's, mass media and the private sector.
Its existence has failed to give leadership to
the integration of environmental issues into
the constitutional framework of the country.
Its accomplishments to date include the ini-
tiation of an environmental education pro-
gram and other policies but it has failed to
get government to promulgate a National
Environmental Management Act or even an
Environmental Impact Assessment Act.
These would enable an institutional mech-
anism by which compliance to MEA's would
have been enabled domestically.
The reason for this is the fact that
the NCSA lacks a firm political and legisla-
tive foundation as a national administrative
body. This brings into question the national
intent and capacity to comply. If as in other
jurisdictions it was established as a legal
body with defined legislative functions,
powers, duties, responsibilities and its
supervisory and co-ordinatory authority
was stipulated in law over all other govern-
mental departments on environmental mat-
ters this would indeed set the stage for an
able environmental management agency.6
This gives an indication of how low a prior-
ity is the environmental agenda with the
government of the day and as such issues
pertaining to implementation of policies and
compliance.
Much of the existing environmental
legislation in Botswana is out of line with
the environmental policy as laid down in the
National Conservation Strategy (1990).
Apart from being fragmented into numer-
ous pieces of legislation which are adminis-
tered through a range of different adminis-
trative bodies leading to incoherent deci-
sion making there is still a need for environ-
mental management legislation. This would
be necessary to bring the environment into
a constitutional and policy framework to
give it an institutional basis on which to
comprehensively co-ordinate management
and integrate it into development policies. It
would further facilitate effective law
enforcement, enhance compliance with
environmental management standards and
promote and increase public awareness for
sound conservation both domestically and
internationally.
Where there are statutes in place
in Botswana those discharged with imple-
mentation either fail or partially discharge
their duties making implementation where it
exists difficult. Compliance systems as stip-
ulated in MEA's would assist in remedying
these issues. MEA mechanism have in
them monitoring measure, site visits,
review procedures, public awareness
mechanisms which enhance the ability of
the State to keep up with its obligations
under them7.
Various challenges exist with
respect to the level of public awareness of
issues related to natural resource utilisa-
tion. Deforestation, rangeland degradation,
the overuse of veld products and the killing
of endangered wildlife species are threats
to Botswana's biodiversity yet the public
concern with respect to these issues are
confined to a small group of dedicated con-
servationists.8 There is much degradation
from commercial enterprises through the
extraction of sand from riverbeds for con-
struction or the dumping of industrial waste
in rivers or close to settlements for which
affected communities are unaware of any
recourse.9 There is little public understand-
ing of global warming and its potential
impact on climate, livestock, wildlife, flora
and human population.10 These are also
issues that MEA mechanisms would assist
the State address.
Monitoring of natural resource utili-
sation is equally wanting which compounds
the depletion of natural resources. Where
monitoring does exist it is fragmented
between government departments often
without much success. Recently Botswana
has with the help of Danish co-operation
started a system the Environmental Plan-
ning Program to make possible existing
data readily available for planning purpos-
es and to identify needs for supplementary
data. In addition the government is estab-
lishing a system for developing indicators
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
to monitor environmental trends which will
lead to the publication of a State of the
Environment Report. This initiative is to
enhance sustainable development through
the inclusion of environmental considera-
tions in all development planning.11 The
assistance of funds such as the GEF fund
under the auspices of UNDP can go a long
way to providing manpower, technical and
financial assistance to complement govern-
ment initiatives for compliance with MEA's.
International environmental law is
quite obviously the basis on which the new
norms established in the MEA's that have
been signed can permeate into Botswana's
legal system. However these will only be
domesticated by the will and intent of the
government or State. No State is bound by
any treaty unless it has given its consent to
do so (pacta sunt servanda "a state is
bound by its agreements"). The precise
legal effect of such a treaty within a state
will depend on the constitutional laws of the
country. Compliance with these MEA's only
stands to the benefit of the State.
As stated earlier, there are a host
of agreements that Botswana has ratified
and incorporated into domestic law but it
has been the courts that have been most
progressive in giving real currency to the
obligations found within international law.
This in Botswana has been seen particular-
ly in the realm of human rights.both with
respect to international and regional
treaties. Botswana as mentioned earlier
has no provision in its constitution for envi-
ronmental protection.
One again, due to education and
capacity constraints both in the public serv-
ice, local government and the judiciary a
lack of training in environmental law has
also hindered the strengthening of environ-
mental law in Botswana with respect to
these MEA's. The office of the Attorney
General, which deals with all legal matters
for government, has for instance no spe-
cialist environmental lawyers.
Specialist lawyers are required to
draft the laws and advise government on
the implications of environmental agree-
ments such as those earlier mentioned of
which Botswana is a signatory to. The need
for scientific and technological data bases
to enable the government to establish
appropriate pollution control standards,
waste management standards, soil conser-
vation rules etc to inform the legislation is
also at infancy.12 The difficulty in establish-
ing a mechanism for environmental impact
analysis of development projects, water
apportionment, and air pollution is also a
source of concern due to manpower con-
straints.
4 CONCLUSION AND
RECOMMENDATIONS
All being said there is a need for
national capacity building with respect to all
role players dealing with these MEAs,
which would include:
— Policy makers and senior government
officers at both national and local levels
—Legal officers and legal draftsmen
—Authorities and agencies and their staff
—Grassroots organisations especially
—those representing local communities
— Non-governmental organisations
— Private sector
— Universities
— Members of judicial bodies at all levels
— Parliamentarians
— Law enforcement agencies
5 REFERENCES
1 Botswana: Towards National Prosperity,
Common Country Assessment 2001, the
UN System in Botswana.
2 Environmental Law Institute, Constitu-
tional Environmental Law: Giving Force
to Fundamental Principles in Africa, May
2000.
3 Ibid. p.86.
4 Fuggle, R.F and Rabie, M.A (eds.), Envi-
ronmental Management in South Africa,
Juta & Co Ltd (2003).
5 Environmental Law Institute, Constitu-
tional Environmental Law: Giving Force
-------
RUBIDIRI 243
to Fundamental Principles in Africa, May 8 Botswana: Towards National Prosperity.
2000. P.90-91.
6 Maluwa, T., Botswana National Conser- 9 lbid.p.91.
vation Strategy Action Plan Consultancy, 10 ihiri D 9-1
January 1998, UCT. » ,^ nn'
11 Ibid. p.92.
7 Weiss, Edith Brown and Jacobson,
Harold K, Partnerships for Global Development of Environmental Legisla-
Ecosystem Management: Science, Eco- tion in ECA Region, Joint ECA/UNEP
nomics and Law (1999). Project (1980).
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244 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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KLINGENBERG 245
ENFORCEMENT OF CHLOROFLUOROCARBONS
REGULATIONS ON MARITIME VESSELS
KLINGENBERG, ALBERT
VROM INSPECTORATE, SOUTH-WESTERN REGION; Weena 723; P.O. Box 29036;
3001 GA Rotterdam; Tel: +31 (0)10 224 4444; albert.klingenberg@minvrom.nl
SUMMARY
Inspections conducted by the VROM Inspectorate between 1996 and 2001
revealed that refrigeration installations on board both merchant vessels and trawlers have
an average annual leakage of hydrochlorofluorocarbons (refrigerants) in the order of 50%.
Among smaller fishing vessels ('cutters'), this figure rose to 80%. The policy of the Nether-
lands Ministry of Housing, Spatial Planning and the Environment (VROM) is that refriger-
ant leakage should not exceed 0.1-1% per annum. Refrigeration equipment on board ves-
sels operating under the Dutch flag accounts for only 5% of the total quantity of refrigerants
in use in the Netherlands, but is responsible for 35% of the total emissions of these sub-
stances. Clearly, the shipping industry makes a disproportionately large contribution to the
emission of substances which deplete the ozone layer and exacerbate the greenhouse
effect. The high leakage rate is due to a number of causes. The Dutch government has
called upon the shipping industry to take corrective measures. In the past year, the VROM
Inspectorate has conducted further inspections of maritime vessels and will continue to do
so in 2005 as a matter of increased priority. The objective of these inspections is to ensure
that operators comply with all legislation covering the use of hydrochlorofluorocarbons, and
that refrigerant leakage is drastically reduced.
1 INTRODUCTION
Since the 1990s, the VROM
Inspectorate has been responsible for reg-
ulating compliance with legislation covering
the use of hydrochlorofluorocarbons in
refrigeration equipment on land. If released
into the atmosphere, these refrigerants
deplete the ozone layer and have an
adverse effect on the climate. In the late
1990s, it became increasingly clear that
refrigeration equipment on board maritime
vessels was a hitherto under-recognized
source of hydrochlorofluorocarbon leak-
age. Fishing vessels with installations for
refrigerating the catch were identified as a
particular problem, although merchant ves-
sels also account for disproportionately
high leakage.
In April 2000, the Netherlands Min-
istry of Housing, Spatial Planning, and the
Environment (VROM) Inspectorate pub-
lished a report further to the inspections
conducted the previous year.1 This publica-
tion describes the leakage rate of refrigera-
tion installations on board vessels operat-
ing under the Dutch flag. It concludes that
the leakage rate of the fishing fleet during
the period 1996 to 1998 was some 80%,
while that of merchant vessels was in the
order of 50%. The policy of VROM states
that refrigerant leakage should not exceed
0.1-1% per annum.
2 TARGET GROUP
The Dutch fishing industry has four
large operators with a combined fleet of
approximately sixteen trawlers sailing
under the Dutch flag. Trawlers are fitted
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
with several large refrigeration installations,
the refrigerant capacity varying from a few
tens of kilograms (kg) to several thousand
kilograms. There are also approximately
420 smaller 'cutters' sailing under the
Dutch flag. These vessels usually carry one
or more refrigeration installations contain-
ing some 10 kg of refrigerant, as well as an
interior climate control installation contain-
ing approximately 25 kg of refrigerant. The
Dutch merchant fleet comprises approxi-
mately 1000 vessels carrying refrigeration
equipment.
3 INSPECTIONS IN 2002 AND 2003
The inspections were carried out
again in 2002 and 2003, resulting in a fur-
ther report published in June 2003.2 The
conclusions are that in the period 1996 to
2001 (the earlier results from 1996-1998
were also analysed), the refrigeration
equipment on board both merchant vessels
and trawlers showed an average annual
refrigerant leakage of 50%. Among the cut-
ters, the figure was 80%.
To place the extent of hydrochloro-
fluorocarbon emissions into perspective,
we may state that the trawlers accounted
for emissions of almost 182,000 kg, from a
total refrigerant content of over 307,000 kg
in 45 refrigeration installations on board 15
trawlers, resulting in a leakage rate of
approximately 59%.
The study also sought to determine
whether there are any vessels with refriger-
ation equipment which does not account for
any hydrochlorofluorocarbon emissions.
This proved not to be the case. Only a very
few vessels can claim a refrigerant leakage
of less than 10%. In 2003, the VROM
Inspectorate instigated legal proceedings
against two trawler operators responsible
for excessive leakages. The case has yet
to be heard.
4 COMPARISON WITH OTHER
REFRIGERATION EQUIPMENT
In the case of refrigeration equip-
ment on land, legislation, enforcement, and
the efforts of the relevant industries have
served to reduce the annual leakage from a
double-figure percentage to approximately
4.5%. Because the shipping industry has
yet to achieve a similar reduction, it now
accounts for a disproportionately large
share of refrigerant emissions. Refrigera-
tion installations on board vessels operat-
ing under the Dutch flag contain only 5% of
the total quantity of refrigerants in use in
the Netherlands, but contribute 35% of the
total emissions. It will be clear that the ship-
ping industry makes an unacceptably large
contribution to the release of substances
that deplete the ozone layer and exacer-
bate the greenhouse effect.
5 CAUSES
It may be assumed that the high
leakage rate is partly attributable to the
refrigeration equipment's inability to with-
stand the specific conditions at sea, such
as a corrosive salt-laden atmosphere,
vibrations and torsion. The causes may
also include poor maintenance, the failure
to detect leaks, the age of the equipment in
use, the technology employed, and the
manner in which legislation has been
enforced to date. The sheer complexity of
the equipment is also an important factor.
6 MEASURES
The Dutch government has
instructed the shipping industry to take
appropriate measures as a matter of
urgency. Such measures relate to the oper-
ation and maintenance of the equipment in
use, the introduction of formal maintenance
systems, increased awareness on the part
of crew members, and the improvement of
leakage detection systems. Alongside
these measures, further action can be
taken in the case of newly constructed ves-
sels, which can be required to install indi-
rect rather than direct refrigeration sys-
tems, to replace synthetic refrigerants with
natural alternatives, and to apply the princi-
ples of Life Cycle Engineering within the
design of refrigeration installations.
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KLINGENBERG 247
7 INSPECTIONS IN 2005
The VROM Inspectorate has con-
ducted further inspections on board sea-
going vessels during the past year and will
continue to do so in 2005 as a matter of
increased priority. The objective is to
ensure that the operators concerned com-
ply with the legislation covering the use of
hydrochlorofluorocarbons, and that refrig-
erant leakages are drastically reduced.
8 REFERENCES
1 'Hoe de scheepvaart het lek boven water
houdt' ('How the shipping industry keeps
on top of things'), VROM Inspectorate,
2000.
2 'Koudemiddelen het schip in' (The trou-
ble with refrigerants'), VROM Inspec-
torate, 2003.
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248 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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ISARIN 249
IMPEL-TFS SEAPORT PROJECT: EUROPEAN ENFORCEMENT
INITIATIVE TO DETECT ILLEGAL WASTE SHIPMENTS
ISARIN, NANCY
Adjunct Inspector, Inspectorate of Housing, Spatial Planning and the Environment, 723,
Weena, P.O. Box 29036, 3001 GA Rotterdam, The Netherlands,
nancy.isarin@minvrom.nl
SUMMARY
Most transfrontier shipments of waste from or through Europe to overseas areas
take place via main seaports. To improve the enforcement of European waste shipment
regulations and stimulate national and international cooperation, a Seaport project was ini-
tiated. This enforcement project was carried out under the umbrella of the Implementation
and Enforcement of Environmental Law — Transfrontier Shipment network (IMPEL-TFS)1
and was focused on inspections of waste shipments through European seaports to non-
OECD countries. Many violations of the waste shipment regulation were discovered during
the inspections and about 20% of the inspected waste shipments were illegal. The project
also showed the need for a follow up and an expansion of the project and recommended
a European enforcement strategy. This paper describes the Seaport project and the neces-
sity for enforcement and more international cooperation on transfrontier shipments of waste
in order to prevent shipments of environmentally harmful waste take place to countries that
do not have the provisions to cope with these wastes.
1 BACKGROUND
In 1994 the Council Regulation on
the supervision and control of shipments of
waste within, into and out of the European
Community (hereafter referred to as the
waste shipment regulation 259/93), came
into force. One of the main purposes of the
waste shipment regulation 259/93 is to pre-
vent shipments of environmentally harmful
waste to countries that do not have the
proper facilities to handle these wastes.
Examples are shipments of hazardous
electronic scrap to Asian countries and
shipments of dangerous chemical waste to
Africa. Even if they fully comply with exist-
ing regulations, the companies that are
involved in these shipments have proven to
be very sensitive to enforcement activities.
For example if the enforcement pressure in
one port increases, companies quickly
move their export activities to an adjacent
port in another European country (also
called port shopping). Differences in
enforcement structures and enforcement
between member states will not lead to a
European level playing field. So, if a real
influence of enforcement on the destina-
tions of these waste streams is desired,
enforcement authorities in the European
seaports have to cooperate in order to align
their enforcement activities. During the
IMPEL-TFS conference in Vienna in June
2002, a proposal was accepted for a joint
enforcement project in large seaports. In
March 2003 this first Seaport project start-
ed and ended in June 2004. Belgium, Ger-
many, United Kingdom, Poland, Latvia, and
the Netherlands participated in this project.
2 GOAL OF THE SEAPORT PROJECT
Main goal of the project was to
improve the (joint) enforcement of the
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
Council Regulation 259/93 in the participat-
ing ports by aligning the enforcement activ-
ities. To reach this goal the enforcement
structures in concerned ports needed to be
described, cooperation between national
and international involved authorities was
necessary and (joint) inspections had to be
carried out in participating seaports. Ulti-
mately, the project aims to create a more
level playing field within the EU.
3 PROJECT SET-UP
After a short preparation phase,
where countries were invited to join the
project, a start meeting for the international
project team was organized in June 2003.
During this meeting, representatives of 6
countries made concrete agreements con-
cerning the project planning, inspection
methods, number of inspections, priorities
for inspections, enforcement structures,
reporting the results and communication.
Important for this kind of executive
enforcement projects is the involvement of
actual inspectors in the project team
instead of managers. Experience and
knowledge of carrying out inspections, con-
trols and the use of legal powers in case of
non-compliances, is essential for the quali-
ty of the enforcement project. Especially
with international projects, is it difficult to
get the right persons on involved. Of course
the support of the managers is needed to
arrange the required resources.
4 RESULTS
The results of the project are
included in a final project report,2 which
was published in June 2004. The results
are structured amongst the main goals of
the project and will be discussed separate-
ly in this paragraph.
4.1
Enforcement structures
Despite that fact that the waste
shipment regulation is directly applicable in
all EU member states, every state itself is
responsible for the enforcement. Because
the member states have regulated the
enforcement under their own national laws,
the enforcement structures vary enormous-
ly. Within the scope of the project, a survey
was held to describe the enforcement
structures in participating seaports. The
results showed many differences in legal
powers, capacity, knowledge, available
means, cooperation with other authorities,
prosecution, and amount of fines or punish-
ments between countries. This does not
lead to a uniform enforcement within the
EU. Also it creates undesired possibilities
for companies to choose the line of least
resistance for waste streams to be dis-
posed.
4.2 Inspections
Participating countries agreed to
focus the inspections on waste shipments
with non-OECD countries (mainly Africa
and Asia) destination and special attention
would be paid to non-declared or green list-
ed waste.3 For example waste streams
such as refrigerators or wrecked cars,
which are declared as second hand goods
or household waste is declared as the
green listed waste (paper waste), but in fact
is amber listed waste.
Further to harmonize and stan-
dardize the way of inspecting and reporting
the results, a manual was developed. This
manual describes the phases and types of
inspections and provides standard forms to
report the inspection results. Every inspec-
tion exists of three phases:
— Preparation phase. During this phase
agreements are made concerning
date and location of the inspection,
necessary cooperation with other
authorities (such as customs or police),
responsibilities during the inspection,
safety measures, sampling facilities,
required means, selection criteria for
the shipments and communication.
—Operational phase. In this phase the
actual inspection is performed. An
inspection exists of an administrative
check and a physical check. The
main aim is to determine if the waste
shipment is permitted or not. The
administrative check is to see if all the
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ISARIN 251
required documents are accompanying
the waste shipment. The physical check
is necessary to verify the actual load
and the composition of the waste with
the information given on the documents.
— Reporting phase. During this phase the
results of the actual inspection are
reported and if necessary follow up
actions are taken such as sending back
the illegal shipment or making a final
report against the violator in case of
non-compliance.
The three types of inspections as
described in the manual are:
— Inspection of custom documents.
Custom documents (for example the
declarations) can be a starting point to
investigate containers that may contain
waste. Cooperation with customs is
indispensable for this kind of inspection.
—Inspection of storage locations and
warehouses. On a port site, many lots
and goods are stored, waiting for further
shipments. This implies that waste can
also be stored in these kinds of storage
locations, awaiting further transfrontier
shipping.
—Traffic inspections. Inspections of
vehicles near roads that lead to port
terminals enlarge the chance of hitting
waste shipments.
Note that more inspection types
are possible. Using a combination of
inspection types increases the chance of
finding illegal waste shipments.
4.3
Enforcement Results
In total, 47 inspections in 6 sea-
ports (Hamburg, Antwerp, Riga, Gdansk,
Felixstowe and Rotterdam) were per-
formed during the operational phase of the
project. During these inspections 1230
shipments were checked, of which 508
were carrying waste. After investigation,
103 shipments turned out to be illegal
(approximately 20%) and in 47 cases
infractions were determined.
Examples of illegal shipments are
exports of:
—cable waste from The Netherlands, via
Belgium to China;
—car wrecks and electronic waste from
Belgium to West-Africa;
— household waste, declared as paper
waste, from the United Kingdom to
India;
—used 'single-use' cameras from
Germany to Hong Kong;
—computer waste and monitors from the
United Kingdom to Pakistan.
Each of the above mentioned ille-
gal shipments took place without the
required notification to and permission of
the involved competent authorities. In
some cases the export BAN applied. The
export BAN means that the export of haz-
ardous waste streams to specific countries
is always prohibited.
4.4 Cooperation and Exchange
of Knowledge
Because of the international char-
acter of the waste shipments, cooperation
between countries is essential for a good
enforcement. Also, the involvement of other
national authorities, such as police and
customs, is necessary to carry out inspec-
tions. In most cases the involved environ-
mental authorities are facing a lack of
capacity and legal powers. Officers from
other authorities can therefore act as the
eyes and ears in the field. The survey of the
enforcement structures showed that each
country may have many organizations and
authorities that play a role in the execution
and enforcement of the regulation.
To stimulate the national and inter-
national cooperation and exchange of infor-
mation, the project management provided:
—a protected project website, where
project participants can exchange
information and signals about cases;
—the exchange of inspectors during the
actual inspections;
— project meetings;
—examples of how to arrange cooperation
with other involved authorities with
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
Memorandums of Understanding.
5 GENERAL CONCLUSION AND
RECOMMENDATIONS
The outcomes of the project
emphasized that cooperation in enforce-
ment of international waste shipments reg-
ulations is needed to protect the environ-
ment. Many illegal waste shipments were
detected; controls of this kind of legislation
are therefore absolutely essential.
Based on the results and the con-
clusions of the project, the following recom-
mendations were given. The first is to
develop a European enforcement strategy
for the waste shipment regulation, if possi-
ble combined with a multi-annual program.
This strategy should contain items like the
minimum principles for adequate enforce-
ment, capacity and means, priorities, proj-
ects and training and exchange programs.
The second recommendation is to create a
website which contains extensive informa-
tion about the waste shipment regulation,
contact persons, a digital reference book of
waste streams and the classification of
wastes, and an alert system of illegal or
suspected waste shipments. Thirdly
enforcement organizations on national
level should take the lead in intensifying
and formalizing cooperation with other
authorities, provide training for their inspec-
tors and give more priority to the enforce-
ment of the international waste shipments
regulations. Finally, it was recommended to
continue and expand the Seaport project
with more countries and seaports.
6 SECOND PHASE SEAPORT PROJECT
Because of the surplus value and
the good results of this joint international
enforcement project, a follow-up project
has already started. During a start meeting
in September 2004 in Riga (Latvia), 12 EU
member states agreed to joint inspections
of the waste shipment regulation from
October 2004 to February 2006. The final
report will be published in June 2006.
7 JOINING THE PROJECT
To improve the quality and efficien-
cy of the seaport project, involvement of
countries outside the European Union is
desirable. For example, countries where
much waste is transported to could verify
the final destination of the waste or
exchange information and signals about
illegal waste shipments. Countries or
organizations which are interested in join-
ing the Seaport project, can contact the
INECE secretariat or the project manager
of the seaport project.
8 REFERENCES
1 The Implementation and Enforcement of
Environmental Law network: http://
europa.eu.int/comm/environment/impel
2IMPEL-TFS Seaport project report, 'Illegal
waste shipments to developing countries,
common practice' http://europa.eu.int/
comm/environment/impel/pdf/impeLtfs_s
eaportprojectjune2004.pdf
3 The Regulation 259/93 contains three
lists of waste streams mentioned for
recovery (green list annex II, amber list
annex III and red list annex IV). The ship-
ment of amber and red listed waste (haz-
ardous waste) always requires a prior
notification. The shipment of green listed
waste (non-hazardous waste) within the
European Union is free of notification.
Shipment of green listed out of or through
the EU is or free of notification or needs a
prior notification depending on the desti-
nation.
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BANKOBEZA 253
STRENGTHENING THE IMPLEMENTATION OF
MULTILATERAL ENVIRONMENTAL AGREEMENTS
BANKOBEZA, DR. GILBERT
Senior Legal Officer, United Nations Environment Programme Ozone Secretariat,
P.O. Box30552, Nairobi, 00100, Kenya, Gilbert.Bankobeza@unep.org
SUMMARY
This article summarizes tools for compliance with obligations imposed by environ-
mental agreements. The author looks to the development and successful implementation
of compliance incentives under the Montreal Protocol to provide an example to Parties of
other multilateral environmental agreements, while they are developing their own mecha-
nisms for implementation.
1 INTRODUCTION
The normative element of compli-
ance with treaty obligations derives from
the duty and obligations contained in the
customary principle, pacta sunt servanda,
as enshrined in the Vienna Convention on
the Law of Treaties. The principle, however,
does not provide the mechanism upon
which compliance with treaty obligations
must be observed, a function that is fulfilled
by developing the compliance mecha-
nisms.
1.1 Implementation as a Tool
For Compliance
The implementation of obligations
contained in environmental agreements
encompasses all the actions required to
carry out the commitments in those agree-
ments. This requires the development of
strategies for such implementation. One
important element for such a strategy is the
identification of obligations to be imple-
mented along with other elements of com-
pliance strategy. Elements of compliance
strategies include data collection and
reporting, identification of potential non-
compliance trends, regular review and
assessment of implementation of obliga-
tions, and peer pressure.
The implementation of these obli-
gations requires a phased approach
whereby at the national level, each state
party is required to agree on national imple-
mentation measures and to ensure its
national compliance. Unless there is a well-
laid down strategy for national implementa-
tion of treaty obligations, it may be difficult
to comply with them.
Important prerequisites in the
implementation of multilateral environmen-
tal agreements include the linkage between
the extent to which developing countries
meet their treaty obligations and the provi-
sion to them of financial and technical
assistance
1.2 Reporting of Data as a
Monitoring Measure
Most environmental agreements
contain a requirement that national compli-
ance with environmental obligations be
reported by providing specific information
to the designated international organiza-
tions. The Montreal Protocol on Sub-
stances that Deplete the Ozone Layer pro-
vides for each party to report to the Secre-
tariat statistical data on its annual produc-
tion and consumption of ozone-depleting
substances.1 The reduction in production
and consumption of ozone-depleting sub-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
stances is measured against the reported
baseline data. The data is also used to
determine the developing country status of
those countries perceived to be develop-
ing. In addition, each Party to the Protocol
has to report to the Secretariat the estab-
lishment and operation of a system for
licensing the import and export of con-
trolled substances.2
1.3 Monitoring as a Supervision
Technique By International
Institutions
The obligation to report information
on national implementation of environmen-
tal agreements provides the necessary evi-
dence for monitoring compliance at the
international level. Monitoring by interna-
tional institutions is a supervisory tool for
the Parties to assess the effective imple-
mentation of their treaty obligations. Thus,
effective monitoring of compliance with
environmental agreements depends on the
establishment of international institutions
that are empowered to take measures to
ensure compliance with the established
standards. In order for these institutions to
have a balanced assessment and easy
comparability of compliance information,
they develop guidelines and formats for
uniform data reporting.
Under the Montreal Protocol, for
example, the institutional structure com-
prised of the Secretariat, the Implementa-
tion Committee and the Meeting of the Par-
ties is responsible for assessing compli-
ance and providing guidelines to Parties on
matters related to data reporting. Under
this arrangement, the Secretariat has
designed formats for reporting data on pro-
duction and consumption of ozone-deplet-
ing substances by Parties and submitted
them to the Implementation Committee for
review after which they are approved by the
Meeting of the Parties for use in monitoring
compliance.
Non-governmental organizations
(NGOs), too, are part of this institutional
framework as they play important roles in
fostering compliance with environmental
agreements. Since their main task is to
inform public and raise concern, they can
provide relevant information to the appro-
priate treaty bodies and put pressure on
governments and other actors to comply.
1.4 Compliance Incentives
The incentives for implementation
and compliance with environmental agree-
ments are built within the agreements
themselves. For developed countries, but
also applicable to developing countries,
compliance incentives include full imple-
mentation of treaty obligations to avoid
trade sanctions, suspension of the opera-
tion of a treaty or of specific rights and priv-
ileges, whether or not subject to specific
time limits. Cooperation strategy among
Parties to remove obstacles, clarify issues,
and convince themselves to change their
behavior is yet another incentive for imple-
mentation of multilateral environmental
agreements.
In the case of developing coun-
tries, compliance incentives include capac-
ity building for developing countries
through establishment of financial mecha-
nisms, application of the principle of com-
mon but different responsibility in environ-
mental protection, and the transfer of tech-
nology to developing countries to enable
their compliance with treaty obligations.3
The incentives, some of which have been
extended to countries with economies in
transition, are conditional for developing
countries' compliance with their treaty obli-
gations. For example, a linkage has been
created between the implementation and
compliance with the Montreal Protocol by
developing countries and provision of
financial assistance and transfer of technol-
ogy to them under the Protocol.4
1.4.1 Financial Assistance
The financial mechanism of the
Montreal Protocol was the first of its kind to
be created among the multilateral environ-
mental agreements to provide the type of
assistance required for building the capaci-
ty of developing countries to comply with
their treaty obligations. The mechanism
provides for the creation of the Multilateral
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BANKOBEZA 255
Fund for providing financial and technical
co-operation, including the transfer of tech-
nologies to developing countries to enable
their compliance with the control measures.
However, the financial transfers from the
Fund are not open-ended as they are
meant to meet "agreed incremental costs"
for a transition period.5 Of particular inter-
est is the use of financial "incentives" as a
tool for compliance with Protocol obliga-
tions. It is more effective if coupled with
monitoring to ensure that the obligations
are complied with than resorting to classi-
cal means of treaty enforcement, which
includes punitive measures.
The Global Environment Facility
(GEF) is another source of funding. In order
to avoid duplication of effort and not substi-
tuting for other sources of funds, the GEF
provides only complementary assistance
outside the Montreal Protocol financial
mechanism. This assistance goes to other-
wise eligible recipient countries with
economies in transition (CEITs), whose
activities, while consistent with the objec-
tives of the Montreal Protocol, is of a type
not covered by the Multilateral Fund.6
In the event that any Party is found
to be in non-compliance with Protocol obli-
gations, any funding is subject to the Non-
Compliance Procedure of the Montreal
Protocol, including notification of causes of
non-compliance, assessment of expected
delays in the implementation of control
measures, and a revised schedule of com-
mitments. Assistance is provided under
both the Multilateral Fund and GEF consis-
tent with the indicative list of measures that
might be taken by a Meeting of the Parties
in respect of non-compliance with the Mon-
treal Protocol to enable Parties in non-com-
pliance to comply with their Protocol obliga-
tions.
1.4.2 Common But Differentiated
Responsibilities
A common but differentiated
responsibility is one of the principles under-
lying the Montreal Protocol regime. In the
Montreal Protocol context, one aspect of
this principle is to allow developing coun-
tries to delay the implementation of control
measures to phase out ozone-depleting
substances for ten years. This measure is
also linked to the building of capacity of
developing countries by providing them
with technical and financial assistance from
the Multilateral Fund. It is also consistent
with the fact that states are unlikely to
adopt or obey agreements requiring them
to bear greater economic costs for the com-
mon good. The ozone layer, for example, is
a common good that is of concern to many
Parties and therefore unless the economic
burden of developing countries to comply
with the obligations for its protection is
shared by those Parties that are more eco-
nomically endowed, the former left on their
own will not be able to do so.
The principle of common but differ-
entiated responsibilities is also manifested
in other forms. Compliance assistance by
developed countries to developing coun-
tries under multilateral environmental
agreements is one of those forms whereby
the obligation of some state Parties to
assist others through capacity building is
part of their commitment to comply with the
objectives of the agreements. Assistance in
the form of experts and technicians by
developed countries to developing coun-
tries is part of the collective but differentiat-
ed responsibility under the Montreal Proto-
col.
The principle of common but differ-
entiated responsibilities is also relevant
when assessing compliance with environ-
mental obligations by "major Parties" which
are crucial in realizing the objectives of
some environmental. This aspect is valid in
a situation where a group of key Parties
would have a major impact on the success
of the environmental agreement. The Mon-
treal Protocol belongs to that category of
environmental agreements whose success
depends on the co-operation of major Par-
ties that are the largest producers and con-
sumers of ozone-depleting substances
although compliance by all Parties to the
Protocol is also important.
It would have been difficult for the
Parties to the Montreal Protocol to achieve
the current phase out of over ninety per
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
cent of the total global production and con-
sumption of ozone-depleting substances
by 2002 had it not been for the full imple-
mentation and compliance with the control
measures of the Protocol by key Parties.
These include Australia, Canada, China,
France, Germany, India, Italy, Japan,
Netherlands, Russian Federation, Spain,
United Kingdom and United States of
America which were major producers and
consumers of the controlled substances at
the time of the conclusion of the Montreal
Protocol in 1987.7 They collectively com-
manded the near total global supply of
ozone-depleting substances. They were,
and still are, indispensable in the success
of the Montreal Protocol because the
majority of them, as opposed to developing
countries, are generally endowed with
more resources, both technical and finan-
cial, than is the case for the rest of the Par-
ties and therefore able to promote compli-
ance.
The application of the principle of
common but differentiated responsibility in
relation to compliance with environmental
obligations involves a process that
changes over time when the country's
capacity to comply improves. It is an incen-
tive to join in the co-operative effort to pro-
tect the environment and without such co-
operation it would be difficult to realize the
objectives of the environmental agree-
ments. The transfer of technology to devel-
oping countries for the purpose of fostering
compliance with the environmental obliga-
tions also reflects the principle of common
but differentiated responsibility.
1.4.3 Transfer of Technology
The transfer of relevant technology
is one of the compliance incentives to
assist developing countries in the imple-
mentation of their environmental obliga-
tions under multilateral environmental
agreements. The Montreal Protocol com-
mits Parties to transfer the best available
environmentally safe substitutes and relat-
ed technologies to developing countries at
fair and most favorable conditions.8
The key elements of this provision
are the "best available technologies" to be
transferred to developing countries and
such transfers to "occur under fair and most
favorable conditions." The technology
transfer under these conditions serves as a
mechanism for achieving the objectives of
the Montreal Protocol and at the same time
brings developing countries to the same
level as their counterparts, in terms of
accessing the up-to-date technology to
phase out controlled substances. The
required technology builds the capacity of
developing countries to comply with the
objectives of the Protocol because it is
offered under fair and most favorable con-
ditions.9
The implementation of the provi-
sion for technology transfer under the Mon-
treal Protocol has been a subject of some
important decisions of the Parties, which
emphasizes the need for effective imple-
mentation of financial co-operation and
technology transfer to developing countries
in complying with the control measures of
the Montreal Protocol. The significance of
the transfer of technology to developing
countries in the Protocol implementation
process is highlighted by its being tied up
with the adoption of new control measures
under the Protocol. In this connection, the
Parties decided in 1995 that additional
funding and technology transfer "to be
reflected in the replenishment of the Multi-
lateral Fund" must accompany any new
control measures.
1.4.4 Cooperation
There can be no effective imple-
mentation of transboundary environmental
problems such as those addressed by mul-
tilateral environmental agreements without
effective means of cooperation between
states. Cooperation plays an important and
effective role in information gathering and
provision of resources required to meet the
objectives contained in the agreements. In
addition, protection of the environment
requires very high levels of coordination
and cooperation between states on com-
plex activities, without which no single state
can, by unilateral action, succeed in the
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BANKOBEZA 257
protection of transboundary environmental
problems unless it is a sole source of envi-
ronmental pollution.
2 CONCLUSION
The development and successful
implementation of compliance incentives
under the Montreal Protocol has had a pos-
itive effect to Parties to other multilateral
environmental agreements while develop-
ing their own mechanisms for implementa-
tion of those agreements. In this way, the
Montreal Protocol has made a significant
contribution to influencing the strengthen-
ing of implementation of multilateral envi-
ronmental agreements, which is its legacy.
3 REFERENCES
1 Article 7 of the Protocol. Other multilateral
environmental agreements with require-
ment for data reporting include the Persis-
tent Organic Pollutants (POPS) (Article 15
- production, imports, exports); Climate
Change Convention (Article 12 - inter
alia, national inventory of anthropogenic
emissions by sources and removals by
sinks of greenhouse gases); Kyoto Proto-
col to the Climate Change Convention
(Article 7(1) - information on emissions or
discharges); Basel Convention on
Hazardous Wastes and their Disposal
(Article 13(2) and (3)), Biosafety Protocol
to the Convention on Biological Diversity
(Article 23), - information on agreed
implementation measures).
2 Article 4B (3) of the Montreal Protocol.
3 See for example the Montreal Protocol's
Article 5 (common but differentiated
responsibility), Article 10 (financial mech-
anism), and Article 10A (technology trans-
fer).
4 For example Article 5(5) of the Montreal
Protocol which provides that "Developing
the capacity to fulfil the obligations of the
Parties operating under paragraph 1 of
this Article to comply with the control
measures set out in Articles 2A to 2E and
21, and any control measures in Article 2F
to 2H that are decided pursuant to para-
graph Ibis of this Article, and their imple-
mentation by those same Parties will
depend upon the effective implementation
of the financial co-operation as provided
by Article 10 and the transfer of technolo-
gy as provided by Article 10A." See also
Article 20(4) of the Biodiversity Conven-
tion and Article 11(3) of the Climate
Change Convention.
5 The Indicative List of Categories of Incre-
mental Costs that was agreed by the Par-
ties to the Montreal Protocol in 1992
include: Supply of substitutes such as
cost of conversion of existing facilities,
cost of patents and designs and incre-
mental cost of royalties; cost arising from
premature retirement or enforced idleness
of facilities, cost of establishing new pro-
duction facilities for substitutes, net oper-
ational cost including cost of raw materi-
als, cost of import of substitutes, use in
manufacturing as an intermediate good
such as cost of conversion of existing
equipment and product manufacturing
facilities, cost of patents and designs and
incremental cost of royalties, capital cost,
cost of retraining, cost of research and
development, operational costs including
raw materials, end use such as cost of
premature modification or replacement of
user equipment, cost of collection, man-
agement, recycling, and if cost effective,
destruction of ozone-depleting sub-
stances; and cost of providing technical
assistance to reduce consumption and
unintended emission of ozone-depleting
substances. (Annex XII, Indicative List of
Categories of Incremental Costs, and
Report of the Fourth Meeting of the Par-
ties to the Montreal Protocol, document
UNEP/OzL.Pro.4/15 (1992)).
6 Global Environment Facility, Operational
Strategy 64 (February 1996). Many coun-
tries with economies in transition (CEITs),
but not all, are outside the financial mech-
anism of the Montreal Protocol. Article 5
of the Protocol defines eligibility in terms
of per capita consumption of ozone-
depleting substances and some CEITs
such as Romania, Georgia, Bosnia and
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
Herzegovina, Croatia, The Former
Yugoslav Republic of Macedonia, Alba-
nia, Serbia, and Montenegro, Kyrgyzstan,
Turkmenistan and Armenia are eligible
under the Multilateral Fund.
7 For example in 1986 which is the refer-
ence year for calculation of global produc-
tion of ozone-depleting substances, the
total global production of chlorofluorocar-
bons (CFCs) stood at 1,124,000 tons. Out
of this amount the production of each indi-
vidual country was as follows: USA
(311,000 tons); Germany (123, 000 tons);
Japan (120,000 tons); Russian Federa-
tion (105, 000 tons); United Kingdom
(102, 000 tons); France (71, 000 tons);
Italy (56, 000 tons); China (47,000 tons);
Netherlands (42,000 tons); Spain (33,000
tons); India (22,000 tons); Canada
(19,000 tons); Australia (15, 000 tons),
Report of the Secretariat on information
provided by the Parties in accordance
with Article 7 of the Montreal Protocol on
Substances that Deplete the Ozone
Layer, document UNEP/OzL.Pro.14/3
(2002).
8 Article 10A of the Protocol provides that
"Each Party shall take every practicable
step, consistent with the programmes
supported by the financial mechanism, to
ensure: (a) that the best available, envi-
ronmentally safe substitutes and related
technologies are expeditiously transferred
to Parties operating under paragraph 1 of
Article 5; and (b) that the transfers
referred to in sub-paragraph (a) occur
under fair and most favourable condi-
tions."
9 See similar provision in the United
Nations Convention on the Law of the Sea
(Article 266 (1)); Climate Change Con-
vention (Article 4(7)); and Biodiversity
Convention (Article 16(1))-
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DAVIES 259
THE ROLE OF COMPLIANCE AND ENFORCEMENT OF
EMISSIONS TRADING SCHEMES
DAVIES, DR. NEIL
Policy Manager, Environment Agency (England & Wales), Rio House, Waterside Drive,
Aztec West, Almondsbury, Bristol, BS32 4UD, UK,
neil.davies@environment-agency.gov.uk
SUMMARY
This paper discusses the use of emissions trading schemes to deliver environmen-
tal goals. It specifically deals with the approach to compliance and enforcement and draws
on some of the lessons learned from implementing the European Union's Greenhouse Gas
Emissions Trading Scheme.1
1 INTRODUCTION
1.1 Background
Emissions trading offers a flexible,
least-cost approach to achieving emission
reductions. It is being increasingly used in
environmental policy. Under a trading
scheme, the choice of which plants make
emission reductions would be the outcome
of market transactions, rather than a deci-
sion of the regulator. Trading provides a
price incentive for the full range of emis-
sion-reduction options, in the same way as
pollution taxes. Unlike taxes, however, it
caps the total level of emissions, giving
greater certainty to the environmental out-
comes. The European Union (EU) has just
introduced an emissions trading scheme to
limit emissions of carbon dioxide from all
Member States. This is Europe's key policy
instrument for meeting its target under the
Kyoto Protocol. The EU Emissions Trading
Scheme is a "cap and trade" scheme, in
which the total emissions are limited (or
capped) and distributed to each participant
who can then trade their quota (or
allowances). Cap and trade systems have
also been used:
— For SO2 emissions in the USA;2
— In the UK for greenhouse gas emission
controls;3
— In a modified form, for the Renewables
Obligation4 and biodegradable municipal
waste5 in the UK.
2 HOW DOES EMISSIONS
ALLOWANCE TRADING WORK?
Traditionally, environmental regula-
tion works through establishing limits on
emission rates of individual units, plants or
companies. This may be to meet some
required level of ambient pollution concen-
tration or to limit deposition in the environ-
ment.
Emissions allowance trading takes
a different approach, and comes in two
basic forms:
—Cap and trade, as used in the EU
Emissions Trading Scheme and USA
sulfur dioxide market; and
—Credit-based systems, such as the
nitrogen oxides scheme being proposed
in the Netherlands.
National emissions ceilings and
plant-level emission permits provide rights
to emit up to permitted levels. Under cap
and trade, these rights are turned into indi-
vidual property rights, which can be owned
by emitters and bought or sold. The aggre-
gate emissions limit or cap is converted into
many individual rights to emit a smaller
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
amount. Thus, a cap of 100,000 tonnes of
emissions of a pollutant might be converted
into 100,000 individual allowances to emit a
single tonne of that pollutant.
Under a cap and trade system,
individual plants must hold allowances to
cover all of their emissions. Where there
are fewer allowances available than aggre-
gate emissions would be under business
as usual, allowances will have a monetary
value to plants. A plant would be willing to
pay an allowance price below or equal to
the costs to the firm of limiting its own emis-
sions. However, because allowances are
tradeable, firms have the option of buying
them. Depending on the approach to initial
allocation, plants that reduce their emis-
sions may free up allowances that they can
sell themselves, or reduce overall demand
for allowances sold by the regulator.
Plants that have different costs of
controlling emissions can be expected to
hold different numbers of allowances.
Those plants with high costs of control
would be expected to purchase allowances
and to emit more than plants with low costs
of control. Plants with low control costs
would reduce emissions and hold fewer
allowances.
2.1 Design of Trading Schemes
The basic elements of a cap and
trade system are a:
— Binding cap on total emissions for a
number of plants;
—Defined unit of trade (e.g. a right to emit
1 tonne of carbon dioxide);
—System for initial allowance distribution;
— Penalty system for non-compliance;
—Compliance period.
A credit-based system does not
distribute allowances initially. Rather, they
are created when emissions are reduced
below a baseline. In the UK greenhouse
gas emissions trading scheme, firms that
have targets established as a result of a
negotiated agreement with the Govern-
ment can create allowances if they perform
better than required. Certified reductions in
emissions are used to generate credits,
which are then tradeable. These can be
sold to other firms that do not meet their
targets. Similarly, the UK's Renewables
Obligation Certificate market requires elec-
tricity suppliers to hold Renewables Obliga-
tion Certificates equal to 10% of their total
supplies of electricity.1 Renewables Obliga-
tion Certificates are created when a kWh is
generated from defined renewable
sources.
For a credit-based approach,
plants might be required either to achieve
emissions limit values (ELVs) which limit
the rate of emissions, or to hold allowances
to cover the difference between their actual
emissions and what their emissions would
be, had they met the ELV. Plants that find it
expensive to reduce emissions could con-
tinue emitting above their ELVs by buying
allowances from other plants that would
generate allowances if their emission rate
were less than the ELV. This approach
gives less certainty of outcome because
ELVs only control the emissions rate in
mg/Nm3 and not total emissions; if activity
levels increase, so would emissions.
3 REGULATION OF
TRADING SCHEMES
Once a cap has been set and the
allocations made to individual companies it
is important that the scheme is regulated
effectively. What is meant by effective reg-
ulation is an important question. Trading
schemes are very different to conventional
regulation. Few of the benefits of a trading
scheme will be realised if its regulation is
delivered through traditional "command
and control" approaches. For the market to
be effective in delivering the required envi-
ronmental outcome the regulatory
approach must be right. For this reason, it
is important that success criteria for the
scheme are established early on. Key fac-
tors include:
—There must be many buyers and
sellers in the market;
—The "commodity" being traded must
be well characterised;
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DAVIES 261
—There should be a large number of
transactions; and
—The variation in price between individual
transactions should be small.
Often, a trading scheme that is
simple is also most effective as it is more
easily regulated and is more transparent
both to participants and the public. Howev-
er, simplicity is often difficult to achieve
because of the influence of other political
objectives.
The key elements of a regulatory
approach for trading schemes are dis-
cussed below.
3.1 Monitoring and Reporting
An effective monitoring system is
an essential element of a trading scheme.
Good quality monitoring provides both con-
fidence among the wider public about the
effectiveness of the policy and confidence
among companies that they are being
treated fairly.
One of the key features of the EU
Emissions Trading Scheme is the approach
to emissions monitoring. The European
Commission produced guidelines setting
the monitoring standards required to be
met by operators. Although this was guid-
ance, compliance with it was mandatory.
Operators were required to specify how
they would comply with these require-
ments, which had to be approved by the
regulator. Once approved, the emissions
data reported annually have to be verified
before submission to the regulator. A third
party must undertake the process of verifi-
cation. The standard of verification is cru-
cial to ensure that the monitoring is under-
taken in accordance with the Commission's
guidelines. Inconsistencies in approach
and quality between verifiers and countries
will lead to distortions in the trading market
as 1 tonne of carbon dioxide may not be
the same throughout all Member States.
Various initiatives are underway to
try to address this. The European Accredi-
tation Co-operation is producing guidelines
for bodies responsible for setting standards
for the verifiers. Accreditation bodies who
are members of the Accreditation Co-oper-
ation must comply with these guidelines.
Also, the International Emissions Trading
Association is producing a framework for
harmonisation of verification. This will com-
prise a Verification Protocol and a training
programme for verifiers operating under
the scheme.
The costs associated with adminis-
tering and complying with a scheme's mon-
itoring requirements is an important consid-
eration. There is a key question as to how
these costs should be shared equitably
across all operators. In any scheme, there
is usually a significant variation in the quan-
tity of emissions from participants. Further-
more, there will also be a large difference in
turnover and profitability between partici-
pants. There are several approaches to
address this, including:
—Overall management costs are
apportioned depending on an
installation's turnover;
—Costs could be paid depending
on a company's emissions; and
— Bands could be used to categorise
companies based on their
environmental risk - those posing
the highest risk pay the most.
3.2 Compliance Assessment
and Enforcement
Effective compliance penalties are
an essential component of the trading sys-
tem. The compliance penalty creates the
value of the allowance. It therefore needs
to be sufficiently high to deter non-compli-
ance and certainly in excess of any expect-
ed allowance price.
In the economics literature, non-
compliance is viewed as a rational act that
weighs the costs and benefits of compli-
ance and non-compliance - a firm will com-
ply if the probability of being caught times
the fine is greater than the value of non-
compliance.6 The implications are that the
penalty for non-compliance must be at
least as great as the marginal costs of com-
pliance, but must also reflect an additional
amount because of the possibility of not
being caught. The EU Emissions Trading
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
Scheme sets a financial penalty of 40
Euros per tonne of carbon dioxide emitted
above a company's allocation. This will rise
to 100 Euros per tonne for the second
phase of the scheme (2008 - 2012). This
poses a significant deterrent to operators to
over emit. The EU Emissions Trading
Scheme also allows a range of enforce-
ment to be taken against operators. For
example, other offences include failure to
hold a valid permit whilst operating and fail-
ure to comply with monitoring and reporting
conditions. These offences are subject to
enforcement action similar to that used in
traditional regulation.
A number of other elements of the
compliance system improve its effective-
ness, including certainty of the size of the
penalty and "automaticity" (i.e. firms know
that if they do not comply they will face the
penalty).
The penalty to deal with operators
who emit more than the number of
allowances they hold should involve the fol-
lowing two elements:
—A financial penalty per tonne of excess
emissions, set at a value several times
the expected allowance price;
— Deductions of allowances from the
next year's allocation to make up the
difference.
The use of a trading scheme as a
regulatory tool will often require a review,
and possibly, a change in emphasis, of the
amount and nature of regulatory activity.
For instance, the focus may change from a
"hands on" approach, typified by traditional
regulation, to delivery of environmental
results. Hence, there could be less time
spent addressing how reductions are made
and more (and perhaps only) on whether
they have been made.
Inspection and enforcement needs
a balance to be set between frequent
inspection (and hence cost) and significant
penalties for non-compliance.
The role of the verification process
in assessing compliance is an interesting
area of debate in the EU Emissions Trading
Scheme.
Use of third-party verifiers to audit
and verify that an operator is compliant with
its approved monitoring and reporting plan
is an important contribution to compliance
assessment. This raises the question of the
extent to which further inspections and
checks are needed. It is likely that some
form of inspection needs to be undertaken
by the regulator. This is because the oper-
ator contracts the verifier to undertake the
verification process - this calls into ques-
tion the independence of the verification
process. However, for the sake of minimis-
ing compliance costs, whilst maintaining
robust standards, the interaction between
the verifiers and the regulators is an impor-
tant issue that needs to be considered.
3.3 Institutional Arrangements and
Market Development
The adoption of trading schemes
requires a different range of skills com-
pared with traditional "command and con-
trol" regulation. The establishment of a cap
and the allocation process often has signif-
icant implications on the economic viability
of the industry sectors concerned as well
as the general economy of a country. For
the EU Emissions Trading Scheme, nation-
al Governments have usually undertaken
this process. Compliance and enforcement
has then been the responsibility of different
bodies e.g. existing regulatory authorities
(as in the UK) or newly created Emissions
Authorities (as in the Netherlands).
This is not always the case. For the
US sulfur dioxide scheme the U.S. Environ-
mental Protection Agency undertakes the
allocation process. However, it is still done
centrally. This is in contrast to most tradi-
tional regulation where limits and reduction
targets for installations are set at site level.
Another important feature that
must be considered when deciding roles is
the credibility those organisations have
with the public and market participants. An
authority that is responsible for compliance
and enforcement that is viewed as weak
will have a detrimental effect on the credi-
bility of the scheme and the development of
the market. Funding and resource levels for
regulatory bodies must be sufficient to
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DAVIES 263
ensure confidence in the management of
the scheme. Any lack of confidence in the
scheme by investors and operators will
depress the market. A prerequisite for
investor confidence in markets that are cre-
ated by Government policy is that compli-
ance and enforcement approaches are
simple, transparent and robust. Also, it is
important that the rules of the scheme
remain fixed for a reasonable period of time
in order to give certainty to investors.
4 CONCLUSIONS
This paper highlights the important
role that compliance and enforcement
plays in the operation of a successful trad-
ing scheme. Monitoring requirements,
compliance strategies, financial penalties
and the overall management of the scheme
have important consequences on the trad-
ing market and investor confidence.
Many trading schemes are now
being implemented and it is important that
the lessons learned from each scheme are
captured and shared. This is especially
important for schemes that have the poten-
tial for international trading e.g. carbon
trading. Although Europe has introduced a
Europe-wide scheme many other countries
are developing their own. For trading to
take place between different schemes it is
important that they share some common
principles. Of paramount importance is the
need to be confident that the commodity
being traded is equal across all schemes.
Having robust compliance and enforce-
ment strategies in-place will go a long way
towards achieving this.
5 REFERENCES
1 European Commission Directive 2003/
87/EC EU Emissions Trading Scheme,
Establishing a Scheme for Greenhouse
Gas Emission Allowance Trading within
the Community.
2 Carlson C., Burtraw, D., Cropper, M. and
Palmer, K.L. (2000), 'Sulfur Dioxide Con-
trol by Electric Utilities: What Are the
Gains from Trade?' Journal of Political
Economy, 108:6, 1292-326.
sDefra (2001), 'Framework for the UK
Emissions Trading Scheme'. Department
of Trade and Industry (2001).
4 Department of Trade and Energy, 'New
and Renewable Energy: Prospects for the
21st Century. The Renewables Obligation
Statutory Consultation' (August 2001)
available at http://www.dti.gov.uk/energy/
renewables/publications/pdfs/energymas-
ter.pdf.
5 Defra, Landfill Allowance Trading Scheme
(14 March 2005) available at http://
www.defra.gov.uk/environment/waste/loc
alauth/lats/.
6 Margrave, T, Kerr, S., Helme, N. and
Denne, T. (2000) "Treaty Compliance as
Background for an Effective Trading Pro-
gram", in S. Kerr(ed) Global Emissions
Trading. Key Issues for Industrialized
Countries, Edward Elgar, pp. 43-83.
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264 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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STONE, ZAELKE 265
THE ESSENTIAL ROLE OF COMPLIANCE IN
EMISSIONS TRADING SCHEMES
STONE, SCOTT J.1 and ZAELKE, DURWOOD2
1 Staff Attorney, INECE Secretariat
2 Director, INECE Secretariat; President, Institute for Governance & Sustainable
Development; and Co-Director, Program on Governance for Sustainable Development,
University of California, Santa Barbara's Bren School of Environmental Science &
Management
2141 Wisconsin Ave. NW, Suite D2, Washington, DC 20007, United States,
sstone@inece.org; dzaelke@inece.org
SUMMARY
Emissions trading schemes represent a promising strategy to pursue economical-
ly efficient solutions to environmental problems, especially in regard to climate change. But
high compliance rates are essential to realizing the benefits of emissions trading schemes,
which can require continuous monitoring of both participating firms' emissions and permit
trading activity. Low or even mediocre compliance levels can undermine the markets that
drive the incentives for new technologies and other benefits. As market-based incentives
continue to proliferate, regulators should consider what resources are required to ensure
full compliance.
1 INTRODUCTION
Emissions trading is a market-
based mechanism designed to allow firms
to choose the least expensive strategy to
meet environmental standards. The suc-
cess of emissions trading schemes -
notably in Europe and the United States in
reducing the sulfur dioxide emissions that
cause acid rain - makes them a promising
tool to achieve the large-scale cuts in
greenhouse gases necessary to stave off
some of the worst effects of climate change
in the 21st century.1
As more and more countries
accept the need to address climate change
on a priority basis, emissions trading will
play an increasingly significant role as an
approach that not only creates incentives
for firms to cut greenhouse gases emis-
sions but also spurs technological innova-
tion that ensures that this is done at the
lowest cost. In this way, emissions trading
capitalizes on the "Porter Hypothesis"
advanced by Michael Porter and Claas van
der Linde - where the application of strict
but flexible environmental standards fos-
ters innovations in technology whose value
meets or exceeds the costs of compliance.2
But the development of these "innovation
offsets" hinges on regulations that specify
performance standards, such as an emis-
sions trading scheme, rather than regula-
tions that impose technology standards or
otherwise limit flexibility.3
For example, early efforts by the
United States to cut acid rain-causing emis-
sions by mandating specific technologies
cost approximately $7 billion per year.
Once the regulations were amended to
include an emissions trading scheme in
1990, the costs of compliance fell drastical-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
ly, and nearly one-fourth of the firms were
able to comply with the standard at a prof-
it.4 The European Union Emissions Trad-
ing Scheme (ETS)5 - the world's first
mandatory international scheme, which
commenced operations in January 2005 -
is expected to allow the ED to achieve its
target under the Kyoto Protocol6 at a cost
of between €2.9 and €3.7 billion annually.7
This is less than 0.1% of the EU's GDP.
Without the scheme, compliance costs
could reach up to €6.8 billion a year.8
But it is important to note that emis-
sions trading schemes are not appropriate
for toxic emissions that can be hazardous
to public health in the area surrounding a
facility. The U.S. EPA cautions against trad-
ing schemes for toxics, where "[allowing
such a facility to buy allowances ... may
make a situation worse by causing a
'hotspot' if the cap does not require suffi-
cient reductions to minimize or prevent
local impacts."9
2 BASIC DESIGN AND BENEFITS OF
EMISSIONS TRADING SCHEMES
Emissions trading schemes begin
with a hard "cap" or ceiling on total emis-
sions and the allocation of permits that enti-
tle participating firms to produce a specified
amount of emissions. Permits may be allo-
cated by auction, by predetermined criteria,
or by historic levels of emissions, although
the latter is generally the most common.10
Firms then use their allocated permits to
cover their existing emissions, and firms
whose emissions exceed their allocated
amount will seek to buy additional permits
from firms who have succeeded in reducing
their emissions. If the scheme involves
enough firms, and if there are no serious
institutional barriers to buying and selling
permits, then a market will emerge that
determines the cost of the permits. At this
point, firms are free to choose between cut-
ting emissions and selling excess permits
or maintaining (or even increasing) emis-
sions through the purchase of additional
permits on the market.
In a competitive market, the per-
mits will flow toward their highest valued
use.11 Firms that would receive lower value
from their permits (due to higher costs, for
example), have an incentive to sell them to
firms that would value them more.12 As
Tom Tietenberg points out, this basic logic
is true irrespective of how the permits are
initially allocated. "Whatever the initial allo-
cation, the transferability of the permits
allows them to ultimately flow to their high-
est valued uses. Since those uses do not
depend on the initial allocation, all initial
allocations result in the same outcome and
that outcome is cost effective."13 Signifi-
cantly, regulators are thus free to use the
original allocation to address other issues,
including political or feasibility concerns,
without undermining the value of the
scheme.14 Emissions trading schemes,
consistent with the polluter pays principle,
help pass some of the cost of pollution con-
trol to the consumer of pollution-intensive
products by imposing the costs of environ-
mental harm on those who cause it and
those who benefit from it.15
In addition to their ability to pro-
voke ingenuity and invention, emissions
trading schemes have also spurred the
development of entirely new subsector of
the economy. For example, the mandatory
monitoring and reporting requirements
under the ETS have forced companies to
establish CO2 budgets and carbon man-
agement systems for the first time, employ-
ing scores of specialists and consultants.16
The carbon market has spawned a new
industry comprised of carbon traders, car-
bon finance specialists, carbon manage-
ment specialists, carbon auditors, and oth-
ers.17 New businesses such as Climate
Change Capital in the U.K., and the Chica-
go Climate Exchange in the U.S., are
poised to benefit from emissions trading
schemes by providing consulting services
that facilitate trading.18 But the benefits of
any emissions trading scheme hinge on its
rates of compliance.
3 COMPLIANCE: THE MAINSTAY OF
EMISSIONS TRADING
High compliance is essential to
emissions trading schemes, and under-
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STONE, ZAELKE 267
standing how to strengthen compliance
with these kinds of market-based mecha-
nisms must be a priority for many policy-
makers in both developed and developing
countries. As with any commodity traded in
a market, compliance is a "prerequisite of
investor confidence."19 Low or even moder-
ate levels of compliance can destroy mar-
kets and undermine the financial incentives
that drive the benefits of emissions trading.
A recent article by John K. Stran-
lund, Carlos A. Chavez, and Barry C. Field
discusses compliance and enforcement
issues arising in emissions trading
schemes.20 The authors note that environ-
mental agencies have often calibrated their
enforcement mechanisms to traditional
command-and-control regimes, which gen-
erally operate by setting environmental
standards and then sanctioning those firms
that fail to meet them.
Emissions trading schemes, by
comparison, provide firms with a choice: to
reduce emissions or purchase permits. It is
this choice that complicates the regulators'
job. Under an emissions trading scheme,
regulators must monitor both emissions
levels and a firm's participation in the trad-
ing scheme - in order to know the number
of permits each firm possesses at a given
time and to be able to sanction firms whose
emissions exceed their permit holdings. As
many schemes involve self-reported data
from firms, the regulator must consider
penalties for firms that falsify information.
From the firm's perspective, they
must decide how much to emit, how much
to report, and how many permits to hold.
Generally, firms will do so according to the
lowest cost, which is why the cost of the
permits must, obviously, be lower than the
cost of the fines.21
Stranlund, et. al., argued that since
the permit price is the firm's marginal cost
of acquiring enough permits to cover its
emissions, there is a greater incentive to be
non-compliant when permit prices are high.
Conversely, when permit prices are low
(and especially when fines are high) there
is a greater incentive to comply. They drew
particular attention to the extremely high
costs of fines in the U.S. Sulfur Dioxide
Allowance Trading Program as evidence
that high fines engenders high compliance.
Practice may bear them out: emis-
sions trading schemes have achieved high
compliance rates where monitoring, and
thus the threat of sanction, was high.
National level programs in the Europe and
the U.S have benefited from sophisticated
monitoring technology that allows regula-
tors to track the emissions of participating
firms. The U.S. EPA has experienced near-
ly 100 percent compliance with its SO2 pro-
gram in part due to its use of continuous
emissions monitoring technology (CEM).22
Participating facilities are required to install
continuous emissions monitoring systems,
which allows the EPA to maintain an accu-
rate tally of SOa emissions. The EPA has
described the continuous emissions moni-
toring data as "the gold standard to back up
the paper currency of emissions
allowances" by "verifying the existence and
value of the traded allowance."23
The near perfect compliance in the
SO2 program presumably is the result of
the continuous monitoring, which makes it
easy for EPA to detect any violations. Van-
denberg, however, suggests that there may
be another reason contributing to the high
compliance rate, specifically the activation
of the "autonomy norm."24 The SO2 pro-
gram allows firms more autonomy to
choose strategies, including methods of
compliance, compared with other programs
under the U.S. Clean Air Act. "Firms are
required to hold emissions allowances for
all relevant emissions, but they can (with
some limits) control many variables in the
compliance calculus, including the number
of emissions allowances purchased and
the means of achieving emissions equal to
those allowances. The means of achieving
emissions totals may include end-of-pipe
controls, switching to cleaner-burning fuels
and reducing plant operations."25 Because
market-based regulatory approaches allow
more flexibility, they presumably elicit a
stronger and more favorable perception of
autonomy. This may contribute to
increased compliance rates compared to
more traditional command-and-control
approaches with less autonomy.
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
4 THE FEASIBILITY OF
EMISSIONS TRADING SCHEMES
IN DEVELOPING AND
TRANSITION COUNTRIES
Skeptics point out that the benefits
of emissions trading schemes will only be
realized by the countries with the resources
and technological expertise necessary to
administer them. Emissions trading
schemes in developing countries have
been derided as a waste of valuable
resources that could be more effectively
applied to command-and-control programs,
which remain the backbone of any serious
environmental regime. But Joe Kruger,
Katherine Graver, and Jeremy Schreifels
have commented that there is little empiri-
cal evidence to suggest that the resources
or expertise necessary to implement emis-
sions trading schemes are greater than for
other types of regulation.26 And this has not
stopped programs from going forward in
China, Chile, and the Philippines, which
have all pioneered their own emissions
trading programs. One of the biggest draw-
backs is the cost of implementing continu-
ous emmissions monitoring technology. But
some emissions may be tracked using
engineering calculations - such as by mon-
itoring fuel composition and consumption
data to calculate total emissions.27 Regula-
tors can also review supplemental informa-
tion such as fuel purchases and product
output to estimate emissions levels.28
5 CONCLUSION
High rates of compliance are
essential for emission trading schemes to
succeed. Investors will not participate and
the market will fail unless there is sufficient
assurance that the contracts that support
the trades will be fulfilled, and that violators
will be punished. Because trading schemes
promote efficiency and technology innova-
tion, they are essential for any regulatory
effort to address climate change. Sufficient
resources to ensure full compliance must
be provided, along with sufficient training
for the new cadre of compliance officials
who will require a new skill set.
6 REFERENCES
1A 1999 OECD survey identified more
than 100 permit- or credit-based systems
worldwide, which not only included nine
emissions trading programs but also 75
permit trading schemes to protect fish-
eries, three schemes to manage water
resources, five schemes to control water
pollution, and five applications in land use
management. OECD, Economic Instru-
ments for Pollution Control and Natural
Resources Management in OECD Coun-
tries: A Survey. 1999. See also Henrik
Hasselknippe, Systems for carbon trad-
ing: an overview, Climate Policy Special
Supplement on Defining and Trading
Emission Targets, 3 suppl. 2, 43-57
(2003) (describing the increasing number
of regional, national, and international
systems for trading and transfer of GHG
emission allowances, focusing on the
International Emissions Trading Associa-
tion (IETA) Trading Schemes Database,
developed by Point Carbon.).
2 Porter, Michael E. & van der Linde,
Claas, Toward a New Conception of the
Environment-Competitiveness Relation-
ship, Journal of Economic Perspectives,
vol. 9, no. 4, 97-118. (1995); M.N. Murty,
S. Kumar, Win-win opportunities and
environmental regulation: testing of
porter hypothesis for Indian manufactur-
ing industries, Journal of Environmental
Management 67 pp. 139-144. (2003);
Glen Dowell, Stuart Hart, Bernard
Yeung.Do Corporate Global Environmen-
tal Standards Create or Destroy Market
Value? Management Science, vol. 46,
no. 8, pp. 1059-1074 (2000) in Making
Law Work: Environmental Compliance &
Sustainable Development (Durwood
Zaelke, Donald Kaniaru & Eva Kru?fkova
eds.) 2005. See also Stephen O. Ander-
sen & Durwood Zaelke, Industry Genius:
Inventions and People Protecting the Cli-
mate and Fragile Ozone Layer (Green-
leaf 2003).
3 For a discussion of reasons inflexible
standards severely limit innovation, see
Environmental Law Institute, Innovation,
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STONE, ZAELKE 269
Cost and Environmental Regulation: Per-
spectives on Business, Policy and Legal
Factors Affecting the Cost of Compliance
(1999).
4 Id.
5 The scheme is based on Directive
2003/87/EC. The first phase, from 2005
to 2007, covers only selected industries
and emissions, but will likely expand in
its coverage in later phases (such as to
transportation), as well as possibly link
with other emissions trading schemes
that may arise under Kyoto or other
agreements. In its first phase, the ETS
will involve more than 12,000 installa-
tions in the 25 Member States and
account for approximately 45 percent of
the EU's total COa emissions. The ETS
aims to reduce GHG emissions to 8 per-
cent of 1990 levels by 2012.
6 The Kyoto Protocol's programs include:
the national systems to estimate GHG
emissions and removals (Article 5(1));
the reporting of GHG emissions (Article
7(1)); and the rules for the Protocol's
three market-based mechanisms — joint
implementation (Jl), the clean develop-
ment mechanism (COM), and interna-
tional emissions trading (Articles 6, 12,
and 17). See also Terje Berntsen, Jan
Fuglestvedt & Frode Stordal, Reporting
and Verification of Emissions and
Removals of Greenhouse Gases, in
Implementing the Climate Regime: Inter-
national Compliance (Olav Schram
Stokke, Jon Hovi & Geir Ulfstein eds.,
2005).
7 European Commission, EU Emissions
Trading: An Open Scheme Promoting
Global Innovation To Combat Climate
Change (2004), available at http://
europa.eu.int/comm/environment/cli-
mat/pdf/emission_trading2_en.pdf (The
EU scheme allows companies to use
credits from Kyoto mechanisms, which
provides cost-effective means for EU
firms to cut emissions and creates addi-
tional incentives for firms to invest in
emission-reduction projects abroad,
such as in developing countries). Similar-
ly, a report by the Natural Resources
Defense Council on the impacts on
employment in the U.S. as a result of the
proposed McCain-Lieberman Climate
Stewardship Act indicated that the "jobs
created outweigh jobs lost by a factor of
five by 2015, rising nearly to seven to
one by 2025." James Barrett et al., Jobs
and the Climate Stewardship Act: How
Curbing Global Warming Can Increase
Employment (2005), available at
http://www.nrdc.org/globalWarming/csa/
CSAjobs.pdf.
s Id.
9 U.S. Environmental Protection Agency,
Tools of the Trade: Designing and Oper-
ating a Cap and Trade Program, EPA430-
B-03-002. But see Barringer, Felicity,
Bush to Permit Trading of Credits to Limit
Mercury, N.Y. Times, Mar. 14, 2005.
10Boemare, Catherine and Quirion,
Philippe, Implementing Greenhouse Gas
Trading in Europe: Lessons from Eco-
nomic Literature and International Expe-
riences, Centre International de
Recherche sur I'Environnement et le
Developpement, 2002.
11 Tietenberg, Tom, The Tradable Permits
Approach to Protecting the Commons:
What Have We Learned? Fondazione
Eni Enrico Mattei, 2002.
13 Id.
1«ld.
15Costanza, Robert, et al., An Introduction
to Ecological Economics 205 (St. Lucie
Press, 1997).
16 Id.
17 Id.
18 Climate Change Capital is an independ-
ent merchant bank in the UK offering
financial consulting to clients affected by
climate change and energy policies,
developing risk management and other
financial markets that help develop new
markets, and conduct a variety of
research and transactional services
related to carbon markets. See
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
http://www.climatechangecapital.com.
Chicago Climate Exchange is a multi-
national and multi-sector market for
reducing and trading GHG emissions.
See http://www.chicagoclimatex.com/.
19 Edwards, Rupert, Effective Enforcement
and Compliance in the EU ETS: A View
from the Financial Sector, available at
http://inece.org/emissions/edwards.pdf
("[T]he rules must be credible or the
investor community will not play or will
heavily discount the price, thus under-
mining the policy goals."). See generally,
the workshop website, available at
http://inece.org/emissions.
2°Stranlund, John K., Chavez, Carlos A. &
Field, Barry C., Enforcing Emissions
trading programs: Theory, practice, and
performance, Policy Studies Journal
30(3), 343-361 (2002).
21 See Becker, Gary S., Crime and Punish-
ment: An Economic Approach, 76(2) J.
Political Econ., 169 (1968) (discussing
how potential offenders respond to both
the probability of detection and the
severity of punishment if detected and
convicted. Compliance may be
enhanced either by raising the penalty,
by increasing monitoring activities to
raise the likelihood that the offender will
be caught, or by changing legal rules to
increase the probability of conviction.).
22 Part of the Acid Rain Program in Title IV
of the 1990 Clean Air Act Amendments,
the trading scheme has succeeded in
reducing emissions in 2003 by 38 per-
cent of 1980 levels. See U.S. EPA's Acid
Rain Program 2003 Progress Report,
available at http://www.epa.gov/airmar-
kets/cmprpt/arp03/summary.html. This is
in contrast to the 61% compliance rate
identified by EPA's annual inspections of
fossil fuel electric utilities under relevant
EPA statutes. (EPA Office of Enforce-
ment & Compliance Assurance, EPA/
310-R-97-007, Profile of the Fossil Fuel
Electric Power Generation Industry 125
(1997) available at http://www.epa.gov/
compliance/resources/publications/assis
tance/sectors/notebooks/f ossi I. htm I.
23 U.S. EPA, "Continuous Emissions Moni-
toring Fact Sheet," http://www.epa.gov/
airmarkets/monitoring/factsheet.html.
24 Vandenbergh, Michael P., Beyond Ele-
gance: A Testable Typology of Social
Norms in Corporate Environmental Com-
pliance, 22 Stan. Envtl. L.J. 55 (2003), at
99, n. 142, citing Marco Verweij, Why is
the River Rhine Cleaner than the Great
Lakes (Despite Looser Regulation)?, 34
Law & Soc'y Rev. 1007,1029-30 (2000)).
The autonomy norm is described as: "An
individual should be left alone unless
events suggest that the individual has
done or will do something morally blame-
worthy. Examples of the norm in the envi-
ronmental compliance area include the
common expectation in the business
world that in the absence of blameworthy
activity an individual or firm should be
free from government intervention.
Violation of the norm of autonomy may
diminish one's attachment to the norm of
law compliance." Id.
25 Id. at n. 152.
26Kruger, Joe, Grover, Katherine &
Schreifels, Jeremy, Building Institutions
to Address Air Pollution in Developing
Countries: The Cap and Trade Approach,
OECD Global Forum on Sustainable
Development: Emissions Trading, 2003.
27 Id., citing Jahnke, James, Continuous
Emission Monitoring, 2nd Ed. (John
Wiley and Sons 2000).
28 Id.
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DEKKERS, ALLESSIE 271
THE INFRASTRUCTURE FOR PERMITTING, INSPECTION
AND ENFORCEMENT OF NITROGEN OXIDES AND
CARBON DIOXIDE EMISSIONS TRADING IN THE NETHERLANDS
DEKKERS, CHRIS PA1 and ALLESSIE, MARC M.J.2
1 Co-ordinator of Nitrogen Oxides and Carbon Dioxide Emission Allowance Trading,
Ministry of Housing, Spatial Planning, and the Environment, P.O. Box 30945,
2500 GX The Hague, The Netherlands, chris.dekkers@minvrom.nl
2 Director, Netherlands Emission Authority (NEa), Ministry of Housing, Spatial Planning
and the Environment, P.O. Box 30945, 2500 GX The Hague, The Netherlands,
marc.allessie@minvrom.nl
SUMMARY
Since the end of 1997, the government and the industry in the Netherlands have
been engaged in the development of a nitrogen oxides emissions trading programme. The
trading programme is to start by mid 2005. In a parallel European development a European
Directive to enable and facilitate the trading in greenhouse gas emission allowances was
enacted in October 2003. The carbon dioxide emissions trading started on 1 January 2005.
The very ambitious timetable with respect to the implementation of the carbon dioxide
emissions trading programme and the integration in the Netherlands with nitrogen oxides
emissions trading proved a tremendous challenge for the policy development and the two
ministries most closely involved. The complex legislation on carbon dioxide emissions trad-
ing was passed in Dutch Parliament in September 2004. The nitrogen oxides bill passed
Lower House in December 2004, and is expected to be passed by the Senate during
February 2005. The paper discusses in relevant detail the various aspects of the two emis-
sion trading programmes, what elements they have in common and where they differ, the
legislative aspects and considerations of national and international law, the structure of
monitoring, reporting, verification, inspection and enforcement, and finally the lessons
learned during the process. It focuses specifically on the "implementation" elements of
emissions trading.
1 OVERVIEW AND ANALYSIS:
INTRODUCTION OF EMISSION
TRADING IN THE NETHERLANDS
1.1
Introduction
Flexible approaches to achieve
environmental targets have been a recur-
ring topic in environmental policy discus-
sions in the Netherlands since the early
1980's. Although these target-oriented
approaches seemed attractive, most of
these concepts, including emissions trad-
ing between different facilities, were at that
time not regarded as desirable or applica-
ble in the Netherlands' environmental and
legislative setting. However, the idea of
more flexible regulatory systems and cost
effective solutions continued to attract
attention throughout the late eighties and
early nineties.
In the Netherlands, the interest in
more flexible approaches came to the fore
again in 1995 when various parties
involved in national environmental policy
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
discussion became more and more aware
of the major challenges presented by the
sulphur dioxide and nitrogen oxides emis-
sio reduction targets in the first (1989) and
the second (1994) National Environmental
Policy Plan. Key players in the debate
realised that achieving the government's
targets for the 2000 and 2010 nitrogen
oxides emission reductions from industrial
installations had to be considered as over-
ly ambitious. Moreover, industry began to
openly question the long-term nitrogen
oxides emission reduction targets while the
regional authorities in charge of permitting
of industrial installations also voiced their
doubts. The start of emission trading pro-
grammes such as Acid Rain and Reclaim in
the United States, and their early success-
es inspired supporters in the Netherlands
to initiate discussions on the introduction of
emission trading schemes. Various
studies1 were carried out to assess the
applicability of emission trading in the
Netherlands and to demonstrate the
advantages of trading as a more cost effec-
tive approach in the abatement strategies
of nitrogen oxides emissions in industry.
Although these studies were most useful, it
took another two years before opinions
slowly began to shift towards emissions
trading.
Parallel to the national discussion
on nitrogen oxides emissions in the Nether-
lands a much larger, more political and
global discussion on "policies and meas-
ures" to curb greenhouse gas emissions
took place during the running up to the
Kyoto conference. In this discussion the
United States took the lead in opposing the
various "command and control" options that
were suggested and pressed for the alter-
native of worldwide trading of greenhouse
gases. In 1999 the United Kingdom and
Denmark made an early start with concrete
experiments on carbon dioxide emissions
trading in a national context. Recognising
the danger of a proliferation of various,
mutually incompatible systems of emis-
sions trading within the European Union,
the European Commission commenced at
the end of 1999 with the development of a
European scheme for emission allowance
trading. In a relatively short time and on the
basis of very extensive work within DG
Environment and a wide range of studies
the European Commission published its
legislative proposal2 for a European
scheme for trading in greenhouse gas
emissions. In a remarkable short time polit-
ical agreement between the Commission
and the Member States was reached in the
Council meeting of December 2002, and
following agreement in July 2003 with the
European Parliament the Directive
2003/87/EC3 on the European Emissions
Trading Scheme (EU-ETS) was enacted in
October 2003.
Although most member states
struggled during 2004 with varying success
with the implementation and the precise
interpretation of the definitions and articles
of the EU-ETS directive, actual trading of
carbon dioxide emissions within the frame-
work of the directive has started on 1 Jan-
uary 2005. Perhaps not all elements of the
directive, i.e. reporting, verification, inspec-
tion and enforcement, though most crucial
for the success of the trading scheme, are
yet fully resolved. In the Netherlands all
systems and elements to enable full trading
of carbon dioxide emissions are in opera-
tion and in June 2005 nitrogen oxides emis-
sions trading is to start. This paper will out-
line the policy background of nitrogen
oxides emissions trading and relate that to
carbon dioxide emissions trading, discuss
the similarities and differences of the two
trading systems and outline the structure
that has been set up for the implementation
and actual start of emissions trading, i.e.
the permitting, monitoring, verification,
inspection and enforcement of emissions
trading.
1.2 Background of the Dutch
Nitrogen Oxides Emissions
Trading Scheme
The Dutch nitrogen oxides emis-
sion reduction targets that form the heart
and rationale for the trading programme
are part of a broader set of targets to com-
ply with the European Union directive on
National Emission Ceilings, the so called
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DEKKERS, ALLESSIE 273
NEC Directive.4 According to the directive
the Netherlands are obliged to reduce over-
all nitrogen oxides emissions from 490 kilo-
tons in 1995 to 260 kilotons in 2010. Nego-
tiations with the major industry sectors
involved resulted in a 2010 emission target
for the industry of 55 kilotons relative to a
1995 baseline level of 120 kilotons. This
target would be connected to the introduc-
tion of nitrogen oxides emissions trading in
order to limit the total annual costs of indus-
try. Various studies5 had revealed that the
costs of nitrogen oxides abatement could
vary between installations from a low
€ 0.40 per kilo up to costs in the range of
€ 5 and even up to € 10 per kilo or more in
some cases. By a system of emissions
trading the costs per unit of nitrogen oxides
total annual abatement costs for the indus-
try could be reduced to a range of € 100 to
€ 200 million per year. The rationale for
introducing nitrogen oxides emissions trad-
ing was therefore the consideration that
with a system of trading the emission target
of 55 kilotons could be realised in a cost-
effective way.
2 INTEGRATION OF NITROGEN
OXIDES AND CARBON DIOXIDE
EMISSIONS TRADING
2.1 Design Elements of the
Nitrogen Oxides Trading Scheme
The Dutch emissions trading pro-
gramme differs markedly from other Cap &
Trade programmes, such as the pro-
grammes in the United States (Acid Rain,
Reclaim), and also the European trading
programme on carbon dioxide emissions,
as it is based on 'relative caps' directly
related to the 'activity level' of the facility. In
the case of regular combustion sources,
which are responsible for about 85% of
total nitrogen oxides emissions under the
scheme, the allowed cap for an installation
is based on a performance standard rate
(PSR) defined as grams of nitrogen oxides
per unit of energy (GJ) used in the facility.
The PSR for 2010 is derived from convert-
ing the 2010 national emission target of 55
kilotons for the industry into a uniform per-
formance standard of nitrogen oxides emis-
sion per unit of fossil fuel used: the 55 kilo-
ton target for the industry is divided by the
total projected fossil fuel consumption by
the facilities involved, resulting in a PSR of
40 grams nitrogen oxides per GJ in 2010.
This should be compared with an 'average'
emission performance of 95 g nitrogen
oxides in 1995. It implies a reduction of
more than 50%. At the start in 2005, the
PSR has been set at 68 grams nitrogen
oxides per GJ of energy, and every year
this PSR will be tightened by 5 to 6 g/GJ to
reach 40 g/GJ in 2010. The total emission
allowed for a facility in a particular year will
be calculated by multiplying the facility's
total use of fossil energy input in that year
by the PSR for that year. Specific process
PSR's will be applied to industrial process-
es such as glass manufacturing, steel pro-
duction, nitrogen acid production etc. which
account in total for about 15% of industrial
nitrogen oxides emissions.
The main rationale for the choice of
performance standard rates (PSR) as a
basis for emission allowances is that it pro-
vides individual companies with more flexi-
bility to increase production in response to
market opportunities, and is therefore more
responsive to the needs of the industry.
Moreover, a uniform PSR favours the more
pro-active companies that have taken early
action, and does not, as in most cap-and-
trade systems, favour companies that have
delayed their reductions measures. In this
way the PSR encourages the industry to a
more environmental responsive attitude
and behaviour.
2.2 The EU Carbon Dioxide
Emission Trading System
EU-ETS Directive 2003/87/EC
instructs Member States to implement leg-
islation to introduce a European wide sys-
tem of carbon dioxide emission allowance
trading between industrial installations. The
directive provides for an initial three-year
period from 2005 to 2008 that will limit trad-
ing to carbon dioxide emissions from major
stationary sources within the Community.
This initial period will be followed by budg-
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et periods of 5 years in which a further
extension of emission trading to non-car-
bon dioxide greenhouse gas emissions
might become possible as well as an
expansion of trade with non-EU countries
that have established national or regional
schemes of greenhouse gas emission
allowance trading. The EU-ETS directive
aims to balance the benefits of a Commu-
nity-wide cap-and-trade system with the
principle of subsidiarity. Therefore the
Member States will be the principal agents
to implement the emission trading scheme
on the basis of a set of guidelines and cri-
teria laid down in the EU-ETS directive and
its annexes. Especially important are the
monitoring guidelines which were pub-
lished in January 2004,6 and the regulation
on national registries, published in Decem-
ber 20047
The EU-ETS directive requires
Member States to develop a national allo-
cation plan and to indicate how it intends to
allocate the allowances to the individual
installations. The plan and the allocation
must be based on objective and transpar-
ent criteria, including the criteria listed in
Annex III of the directive. Nearly all mem-
ber states have struggled with varying suc-
cess with the principles and rules govern-
ing the allocation process, the criteria and
providing the proper amount of allowances
to the individual installations. Member
States had to submit their national alloca-
tion plans before 31 March 2004 to enable
the European Commission to approve the
plans within a period of three months. Only
few Member States were in the end suc-
cessful in getting approval of the European
Commission within those three months.
Some were even as late as the end of
December 2004 and for these Member
States approval may take another few
months. The allocation of allowances
proved to be highly political. An issue that
raised much debate was the total number
of allowances that Member States pro-
posed to allocate to their industry, and
whether the allocation was acceptable pur-
suant to State Aid conditions. Other ques-
tions and issues were the cost-effective-
ness of including small installations in the
trading programme, the correction after-
wards if economic growth would be higher
than anticipated, and the number of
allowances for "new entrants." Another
issue of major political importance involved
the question whether the combustion
installations of the chemical industry should
be included or be left out of the emissions
trading scheme. A good overview of the
challenges and difficulties involved with the
introduction of GHG emissions trading is
provided in a recent article in Environ-
ment.8 Undoubtedly in 2006 when the next
round of national allocation plans that
Member States will be submitted to the
European Commissions all these issues
will be revisited. It would be most useful if
by that time, the Member States and the
Commission have resolved some of the
issues and developed an unambiguous
defined set of rules on the basis of which
the allocation can be carried out in a more
coherent and uniform manner.
2.3 Allocation of Nitrogen
Oxides Emission Allowances
Unlike the EU emission trading
scheme (EU-ETS) the nitrogen oxides
emission trading system does not require
an initial allocation of emission rights to
individual facilities. Allowances are auto-
matically determined by the multiplication
of the PSR for a particular year with the
total fuel input or product output of the facil-
ity. Compliance check will take place after
the annual budget period has ended by
comparing the nitrogen oxides emitted by
the facility with the emission that is allowed
on the basis of the use of energy and the
PSR for that year, after correction for
allowances bought or sold during the year.
In a similar way as in the EU-ETS compa-
nies will be given a four month period after
the budget year to balance any difference
between actual and allowed emission lev-
els by buying and selling additional credits.
This enables companies to accommodate
for fluctuations in their production. The
company that exceeds its own "automatic"
allowance by buying too little or selling too
many allowances will have to compensate
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DEKKEHS, ALLESSIE 275
any shortage in the next year in addition to
a penalty for not obeying the regulations
governing the emission trading scheme.
2.4 Similarities Between the Two
Emission Trading Schemes
A major consideration to integrate
nitrogen oxides and carbon dioxide emis-
sions trading is the similarity of the two
trading schemes on a number of elements.
First of all, about 90% or more of all nitro-
gen oxides emissions and a similar high
percentage of the carbon dioxide emis-
sions are directly related to the use and
combustion of fossil energy. In that respect
the two types of emissions are directly
linked to our ways of consumption and
industrial production. Nitrogen oxides and
carbon dioxide have also in common the
very ambitious reduction targets that are
necessary to achieve ultimately sustain-
able emission levels. By virtue of the NEC
directive, nitrogen oxides emission reduc-
tions to be achieved by 2010 in most Euro-
pean countries range from 40 to 60%. The
CAFE programme (Clean Air for Europe)
aims at achieving Europe wide sustainable
emission reductions by 2020, implying fur-
ther emission reductions after 2010. Simi-
larly, long-term sustainable emission levels
for carbon dioxide require by 2050 reduc-
tions in Europe in the range from 50 to
70%. So, both carbon dioxide and nitrogen
oxides have ambitious improvements in the
emission "efficiency" in common with which
the energy is "processed" in industrial pro-
duction.
A second reason for integrating
both emission trading schemes is based on
the consideration that both systems have
also a number of legislative concepts and
requirements in common. This relates for
instance to the way allowances are defined
in law, the way allowances are acquired
and transferred, the legal status of an
allowance and the way the allowances can
be used to comply with the legal require-
ments. Emissions trading means a depar-
ture from traditional type of environmental
legislation in the sense that it is based on
the principle that the private sector is "free"
to choose among themselves how to com-
ply with the required emission reductions,
provided that the emissions target is met.
Emissions trading requires therefore a
redefinition and rethinking of the means
and the legal instruments by which the pub-
lic domain is to be safeguarded and the pri-
vate domain is to be organised in order to
make emissions trading a success.
Another, more pragmatic consider-
ation was that both systems would require
similar provisions and facilities for the
implementation and enforcement, i.e. mon-
itoring, permitting, verification and inspec-
tion. The legislative framework that by now
has been set up provides for one emission
permit for nitrogen oxides and carbon diox-
ide. The monitoring protocol that is an inte-
gral part of the emissions permit must
cover both emissions. The same applies for
the procedures to acquire the permit and
the approval of the monitoring protocol.
Similarly, the operator is to prepare just one
emission report and to have it verified and
hand it in according to the same proce-
dures. Furthermore, to facilitate the imple-
mentation and enforcement of both trading
schemes one competent authority will be in
charge and supervise the various legal
requirements, the permitting, the inspection
and the enforcement of the new legislative
requirements. This new organisation, the
Netherlands' Emission Authority (NEa),
whose tasks and responsibilities will be
outlined in the sections below, has been set
up as an independent, autonomous gov-
ernmental organisation with independent
enforcement and sanctioning powers.
2.5 Differences Between The Two
Emission Trading Schemes
There are also clear differences
between the two trading schemes. Basical-
ly these differences have their origin in the
way emission allowances are being allocat-
ed or generated. The EU-ETS directive
requires that Member States issue yearly
the carbon dioxide allowances to the instal-
lations before the end of February of that
year. The allowances once issued retain
their 'Value" for compliance during the 3-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
year or 5-year period they refer to. The car-
bon dioxide allowances are internationally
transferable and individually traceable.
Through the internationally standardised
and secured logging system required by
the European Union registry regulation a
large number of safeguards have been
build into the national registries developed
and operated by the individual Member
States.
In the nitrogen oxides trading sys-
tem emission allowances are automatically
generated by the use of energy or produc-
tion, and this implies that allowances need
not to be issued at the beginning of the
year. Allowances are not internationally
tradable or transferable, and can only be
used by the installations participating in the
national nitrogen oxides trading scheme.
As a result there is no need to trace each
allowance individually, but rather to ensure
that at any time a transfer is taking place
each number of allowances bought is "cov-
ered" or counterbalanced by an equal num-
ber of allowances sold. Furthermore, only
transfers from one operator or installation
to the other are legally recognised and
allowable for compliance under the condi-
tion that the transfers in question have
been properly registered and administered.
A number of lessons learned from the
development of the carbon dioxide registry
will be taken on board for the development
of the nitrogen oxides registry, though spe-
cial rules and electronic modelling will need
to be developed as the transfer of
allowances in the nitrogen oxides trading
scheme differ from those in the carbon
dioxide trading scheme.
3 LEGISLATIVE STRUCTURE FOR
NITROGEN OXIDES AND CARBON
DIOXIDE EMISSIONS TRADING
3.1 Legislation
In the Netherlands' legislative
structure a new chapter 16 in the Environ-
ment Management Act (EMA)9 is to provide
for the framework of emissions trading of
both nitrogen oxides and carbon dioxide.
Actual implementation will take place by
means of a general decree10 detailing the
operations of the two trading schemes. A
ministerial regulation11 has been issued
prescribing in detail the requirements on
the monitoring and reporting of emissions.
The decision to integrate carbon dioxide
and nitrogen oxides emissions trading
implied that all legal requirements and pro-
cedures had to be aligned. For some time
this seemed a disadvantage as each time a
close look had to be taken to all aspects of
the two schemes in order to reveal a possi-
ble conflict in operation, procedure or defi-
nition. This had however the advantage
that the design of the legislative framework
for both schemes was thoroughly dis-
cussed between the legislative experts
involved.
The combined nitrogen oxides and
carbon dioxide permits will be granted only
if the monitoring protocol that is part of the
permit is shown to be in full accordance
with the national monitoring regulation. The
national monitoring regulation is the nation-
al implementation of the monitoring guide-
lines of the European Commission while for
nitrogen oxides reference is made to the
monitoring requirements of the Large Com-
bustion Plant directive (2001/80/EC).12The
operator is obliged to include in his monitor-
ing protocol precise information on how, on
the basis of the fuel consumption, emis-
sions measurements and the use of raw
materials, the annual carbon dioxide and
nitrogen oxides load will be determined.
3.2 Monitoring
The monitoring protocol must con-
tain detailed descriptions of how all the
information concerning carbon dioxide and
nitrogen oxides emissions that is relevant
to nitrogen oxides and carbon dioxide
emission allowance trading will be
obtained, processed, recorded, internally
validated and reported in an establishment.
To make it as clear as possible to the oper-
ators and installations concerned how the
requirements must be met, the monitoring
regulation contains substantive and proce-
dural requirements. On the basis of these
requirements, the operator must achieve
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DEKKERS, ALLESSIE 277
the required accuracy in the monitoring of
the carbon dioxide and nitrogen oxides
emissions and the reporting on the emis-
sion data.
The guiding principle of the moni-
toring regulation is that the determination of
carbon dioxide emissions is systematically
neither over nor under the actual values of
the carbon dioxide emissions, and that the
uncertainty with which the carbon dioxide
emissions are monitored must be kept to a
minimum. The minimum accuracy with
which the activity data must be monitored is
related to the annual carbon dioxide emis-
sion of the installation. Three classes have
been distinguished, i.e. Class A of installa-
tions emitting not more 50 Mtons of carbon
dioxide, Class B emitting more than 50 but
less than 500 Mtons, and Class C emitting
more than 500 Mtons annually, whereby
the highest accuracy level is attached to
Class C, i.e. the installations with the high-
est annual emissions.
In order to asses the accuracy
level (tier) with which at present and with
existing equipment carbon dioxide emis-
sions are being monitored in installations in
the Netherlands and other Member States,
the Ministry of Environment (VROM)
instructed KEMA Netherlands to carry out
an international study13 on the practicability
of the tier approach. With assistance of
several national authorities across Europe
some 20 installations cooperated in the
project. The study revealed that many of
the major sources for the installations do
not obtain the required uncertainty in the
individual activity data. However, when the
major sources for an installation are com-
bined to calculate the total carbon dioxide
emission, the combined uncertainty in the
activity data is considerably lower. The
study shows that if the overall uncertainty in
the total carbon dioxide emission is calcu-
lated, the results are generally within the
'typical uncertainties' as provided in the
monitoring guidelines of the European
Commission.
A similar requirement of accuracy
levels has been attached to the monitoring
of nitrogen oxides emissions. However, the
monitoring of carbon dioxide involves other
procedures, methodologies and technolo-
gies than the monitoring of nitrogen oxides
emissions. While there is a direct relation-
ship between the carbon dioxide emissions
of a fuel and its composition or conversion
characteristics, and the annual carbon
dioxide emission therefore can be calculat-
ed accurately on the basis of a calculation
formula,, this is not the case for nitrogen
oxides. To measure the nitrogen oxides
emission it will always be necessary to
measure the nitrogen oxides concentration
in the flue gases of the combustion or
process unit. In a similar way as for carbon
dioxide, also for nitrogen oxides a cost-
effective approach for the monitoring of the
emissions has been selected whereby 4
categories of emissions sources are distin-
guished. Category I entails combustion
plants > 100 MWth or other sources with
combustion emissions or process units
emitting more than 150 tons nitrogen
oxides annually. Emission sources in this
category have to be monitored continuous-
ly according to EN 14181. Emissions in
Category II sources, i.e. combustion plants
>50 MWth or process units emitting more
than 75 tons nitrogen oxides annually shall
be monitored through discontinuous meas-
urements which have to be repeated once
every six months. Sources in Category III
and IV, each emitting in total not more than
4% of the total industrial nitrogen oxides
emissions, must be measured every two or
every four years. Similar to the KEMA study
for carbon dioxide, various studies have
been carried to assess the practicability of
the accuracy levels for nitrogen oxides
monitoring. These reports can be found on
the website of the ministry of Environment.
(www.minvrom.nl/international/environ-
ment).
4 IMPLEMENTING, INSPECTION
AND ENFORCEMENT OF
NITROGEN OXIDES AND CARBON
DIOXIDE EMISSIONS TRADING
4.1 NEa as the Competent
Authority for nitrogen Oxides
and Carbon Dioxide Emissions
Trading Schemes
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
The Netherlands consider the per-
mitting process, the inspection and
enforcement as the most crucial elements
of any emissions trading programme, and
the ministry of Environment (VROM) has
therefore invested heavily in setting up a
proper structure and set of requirements to
ensure the successful introduction and
implementation of both trading schemes.
The early development of nitrogen oxides
emissions trading proved to be a major
advantage. It meant that the importance of
a proper structure of the monitoring,
inspection and enforcement requirements
was recognised early on, and also that
these aspects required far more attention
than in more traditional types of regulation.
This was the main rationale for setting up
the NEa as a new semi-autonomous gov-
ernmental organisation that would be legal-
ly charged with the tasks and responsibili-
ties of permitting, inspection and enforce-
ment. The Environment Management Act
empowers the NEa to act as the competent
authority for both emission trading
schemes and provides the Governing
Board of the NEa with the clear instructions
and the competence to sanction and
penalise operators not abiding with the
requirements of the law.
4.2 Nitrogen Oxides Emissions
Trading In Relation To The
Requirements Of The EU
IPPC Directive
The Integrated Pollution Preven-
tion and Control (IPPC) directive requires
that each plant/installation has a permit and
operates under conditions in accordance
with the principles and requirements of the
directive. The permit must contain emission
limit values that are based on an assess-
ment by the Competent Authority of the
emission values achievable through the
application of Best Available Techniques
(BAT) in the installation considered. There
is a conflict of "management" between the
IPPC permitting structure and an emissions
trading structure whereby the operator
decides for himself what is the most cost-
effective action to take in his particular situ-
ation. This conflict of management
approaches has been well recognised, and
the nitrogen oxides emissions trading has
been designed such that in its present form
it does not conflict with the IPPC approach.
It means that for now the enforcement of
BAT will also be maintained when the sys-
tem of nitrogen oxides emissions trading
comes into force.
It is however the clear intention of
the Netherlands to press for changes to the
IPPC directive in order to incorporate and
integrate emissions trading of nitrogen
oxides and other substances fully in a
future revised IPPC. In 2002 the Nether-
lands initiated the ENAP project aimed at a
European dialogue to explore new
approaches for regulating industrial instal-
lations. Within this project four workshops
were organised, the first of which explored
the possibilities and constraints of nitrogen
oxides and SO2 emissions trading within
present EU legislation. The proceedings of
this workshop together with the proceed-
ings of the other three workshops and the
concluding high-level conference on the
ENAP project can be found on the website
of the Netherlands Ministry of Environment
(www.minvrom.nl/international/environ-
ment/enap). The aim is that a revised IPPC
would resolve the present situation of two
conflicting principles of environmental man-
agement, i.e. emission trading on the one
hand and the concept of enforcing reduc-
tions and BAT through emissions limit val-
ues in the permit on the other.
4.3 Responsibilities in the
Emissions Trading Environment
In the Netherlands' situation a clear
distinction has been made between the
precise responsibilities of the two authori-
ties in relation to nitrogen oxides, i.e. a
regional authority which is competent to
issue the IPPC permit, and an emission
authority (NEa) at a national level which is
the competent body to provide the emis-
sion permit for carbon dioxide and for nitro-
gen oxides in a structure of emissions trad-
ing. The IPPC authority is responsible for
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DEKKERS, ALLESSIE 279
maintaining the emission limit values as
contained in the permit or prescribed by the
national legislation implementing the LCP
directive or other EU legislation relevant for
nitrogen oxides. The NEa is responsible for
the proper structure and procedures of the
monitoring and reporting of the annual
nitrogen oxidese missions. Especially with
regard to the continuous monitoring of the
larger installations specific arrangements
have been made between both authorities
to ensure that the monitoring equipment
and procedures in each particular situation
are in line with other monitoring aspects of
the IPPC permit, and to ensure that the
monitoring equipment is regularly inspect-
ed and visited by one of the competent
authorities. Both authorities have made
specific arrangements to cooperate and to
fully inform each other on the permitting,
inspection and enforcement actions with
regard to nitrogen oxides emissions. These
arrangements must ensure that operators
won't be confronted with two authorities
dealing with the same issue and taking
opposite positions in a particular situation.
4.4 The Validation Of
Monitoring Protocols
As early as 2002 a total of ten oper-
ators started experimenting with drafting
monitoring protocols for their installation.
The first results showed a wide variety in
the structure, monitoring procedures and
details, and other elements to such an
extent that it was hardly possible to com-
pare the scope and content of one protocol
with that of the other. In order to safeguard
a level playing field between the installa-
tions involved, a well defined set of uniform
requirements on the structure of the moni-
toring protocols, the monitoring rules and
conditions, the data processing, quality
assurance, internal control systems and
reporting requirements was therefore nec-
essary. Early in 2003 this assessment
based on the aforementioned experiments
was conveyed also to the team of consult-
ants that advised the European Commis-
sion on the guidelines for the monitoring
and reporting of greenhouse gas emissions
pursuant to the EU-ETS directive. More-
over, a next set of experiments by opera-
tors learned that a rigorous, systematic
approach was needed with regard to the
validation of these protocols. It became
also clear that a most stringent and clear
cut division or responsibilities between the
competent authority, the operator and the
verifier was needed in order to safeguard
the interests involved and to distinguish the
responsibilities of the public domain from
those of the private sector in order to
ensure a proper functioning of the emis-
sions trading schemes. As a result of these
experiments a project was started to devel-
op a validation protocol with a clear set of
criteria and procedures to enable the vali-
dation of the monitoring protocols of some
250 installations in a uniform and unbiased
manner. After testing and experimenting
with the various elements of the validation
protocol, the final version of the validation
protocol has clearly demonstrated its use-
fulness in October last year when in the
very short time of altogether 8 weeks some
250 monitoring protocols were validated by
the NEa. As the validation of the monitoring
protocols is the most critical and time con-
suming element of the permitting proce-
dure, this validation protocol and the strict
procedures allowing a very efficient permit-
ting process, proved a most valuable tool.
Technical assistance was provided by four
consultancy firms who independently eval-
uated and processed these 250 protocols
and provided the NEa with their advice
whether to approve the protocol, to request
the operator for additional information or to
return the draft protocol to the operator for
not meeting the minimum standards.
4.5 Verification of Emission Reports
As the introduction of emissions
trading implies the entry of environment
emissions into the financial domain, new
safeguards must be developed to ensure
that emissions are properly monitored and
verified. All participants in the trading
scheme must therefore adhere in the same
way to the uniformly defined rules of the
"game". After some early discussion in
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
2002 KPMG Sustainability was commis-
sioned to draft a verification protocol outlin-
ing the various elements that needed to be
covered in a verification process. Article 14
of the EU-ETS directive requires Member
States to ensure that emission reports are
verified in accordance with Annex V of the
directive before being handed in to the
competent authority. KPMG based their
draft verification protocol on the various
elements contained in Annex V. This draft
verification protocol was then forwarded to
the International Emissions Trading Associ-
ation (IETA). By October 2004 IETA togeth-
er with the Certification Committee of the
European Co-operation for Accreditation
(EA) had developed a draft guidance note
on the basis of which national accreditation
bodies can start the process of accredita-
tion of national verifiers. This guidance note
contains the various verification require-
ments and specific process and compe-
tence aspects needed for carrying out the
verification in accordance with the EU-ETS
directive.
In the Netherlands, some 25 oper-
ators participated from May to August 2004
in a large-scale demonstration project to
test all main elements of the two emission
trading systems. One of the elements in the
test concerned the verification of emission
reports. One outcome and major lesson
from this verification testing exercise was
that without proper preparatory actions the
verification of the emission reports in
February-March 2006 may prove to be very
difficult. Most monitoring protocols, even
after having been validated, still contain
elements that are too vague or too open
formulated to enable a proper verification
by the verifier. Before the actual verification
of the emission reports starts early next
year, most operators in the Netherlands will
be advised to take more time and seek the
advice of the verifier in order to implement
and adjust the various elements of monitor-
ing protocols and to bring operational pro-
cedures in line with the requirements of the
permit and the monitoring protocol. One of
the recommendations of the demonstration
test was that all operators should be invited
and stimulated to have their monitoring
systems and reporting procedures verified
as early as mid 2005 through a systematic
and thorough pre-verification exercise. The
aim of this pre-verification is to reveal which
elements, aspects or procedures of the
emission monitoring in the installation need
further improvement in order to enable in
February or March 2006 a smooth verifica-
tion process of the emission report in line
with the requirements of the EU-ETS direc-
tive.
4.6 Inspection and Enforcement
The aim of verification is to guaran-
tee that the emissions reported by the oper-
ator are a true representation of the moni-
toring as required by the permit. As such
the verification must ensure the general
truthfulness of the emissions reported by
private sector. The verifier will start his ver-
ification process on condition that the emis-
sions as reported by the company are a
correct representation of the emissions as
monitored according to the monitoring
requirements. Inspection by the competent
authority however is based on a different
assumption. The inspector will look specifi-
cally for elements of non-compliance. So
the verifier and the inspector have a differ-
ent "basic" attitude vis-q-vis the reported
emissions. The inspection and enforce-
ment actions by the NEa as competent
authority must respond to the public and
demonstrate that also in a system of emis-
sions trading the public interests of the
environment are well protected through the
proper functioning of the control mecha-
nisms. The NEa is obliged to ensure that
the emissions reported from the private
sector are in full accordance with the permit
requirements and the monitoring protocols
as approved. Moreover, the NEa will see to
it that the system achieves the environmen-
tal targets set. In order to ensure that the
inspection and enforcement actions by the
NEa are credible in the eyes of the industry
and the public, the NEa has developed an
inspection and enforcement strategy as an
integral part and tail end of its whole imple-
mentation, permitting, inspection and
enforcement structure. As part of that strat-
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DEKKERS, ALLESSIE 281
egy it is the intention of the NEa to make
inspection and enforcement visits to all
installations in a period of three years.
5 LESSONS LEARNED:
CONCLUSIONS
For the last four or five years emis-
sion trading has been a major topic in envi-
ronmental policy discussions in Europe.
Most of these discussions were and are
directly related to emissions trading within
the context of climate change and the
Kyoto protocol. Much less interest went out
to the advantages of emissions trading as
an instrument for achieving cost-effective
reductions of other emissions, such as
nitrogen oxides. Even now, in January
2005, the concept of emissions trading is
still not accepted everywhere in Europe as
a next phase in environmental policy devel-
opment.
This should not have been a sur-
prise. In order to function properly, emis-
sions trading requires a well-defined leg-
islative context. And as legislation itself is
one of the most important cultural aspects
of a modern society, strongly tied to the
norms and values held by its people, the
success or failure of emission trading very
much depends on the full acceptance by
society that future ambitious emissions
reductions require also a cost-effective
approach of reducing emission such as
offered by emissions trading. It calls for a
more proactive attitude of the industry
towards regulation and towards reducing
its own environmental burden. It requires
also the recognition that a command and
control type of regulation does not always
serve the objectives effectively.
Traditional regulatory instruments
have in that respect their own "anomali-
ties". Although by now the idea of carbon
dioxide emissions trading has become
widely accepted in Europe, the interest in
Europe for the trading of other emissions,
such as for sulphur dioxide and nitrogen
oxides, is still very low. The example of the
Netherlands shows that the development of
nitrogen oxides emission trading has been
a major effort in thinking and constructive
debate between the various sectors of soci-
ety. It has taken several years of intense
discussions among all parties involved
before the various aspects of this nitrogen
oxides emissions trading programme were
sufficiently explored and the results could
be agreed upon. The input from industry,
and especially from some very dedicated
people who were prepared to devote much
of their time and energy in the development
of nitrogen oxides emissions trading, has
been instrumental to the successful devel-
opment and launching of the trading
scheme.
One of the lessons learned is that
new complex regulatory solutions require
the talent, energy and cooperation of many
dedicated people from industry and gov-
ernment. Moreover, it may be that the eco-
nomic aspects of emission trading are self-
explanatory, the development of an emis-
sions trading programme is a most difficult
undertaking. Solving the practical prob-
lems, such as the monitoring requirements
and the legal constraints are time-consum-
ing and difficult. In fact "emissions trading"
is a completely new field of environmental
instrumentation, covering new grounds and
new procedures. It involves a rethinking
and redefining of the role of the govern-
ment as the legislator and the arbiter of the
"common goods." This has been a real
challenge all along during carbon dioxide
emissions trading. If one looks back over
the full period from 1997 till now one con-
clusion must be that conceptually and from
an economic point of view emissions trad-
ing is a most interesting environmental
instrument, most useful and effective for
achieving ambitious long term reduction
targets for substances such as carbon
dioxide and nitrogen oxides. However,
another conclusion must be that taking the
concept of emissions trading into practice
is most challenging but also very difficult.
6 REFERENCES
1 Choosing to Gain: "a study of the poten-
tial cost advantages of a system of trad-
able permits", issued by the Inter Provin-
cial Council (IPO) under IPO Publication
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
105, The Hague, May 1997
The Exchange Model, "A high-potential
cost sharing option as an instrument to
combat NOx emissions from stationary
sources in the Netherlands", drawn up by
the Chemical Industry Cost Sharing Con-
sultative Group, January 1999.
A system of NOx emission trading for sta-
tionary industrial sources' (October
2000), KPMG
2 COM (581) 2001 Proposal for a directive
of the European Parliament and the
Council establishing a scheme for green-
house gas emission allowance trading
within the Community and amending
Council Directive 96/61/EC (OJ EU C75)
3 Directive 2003/87/EC of the European
Parliament and the Council of 13 Octo-
ber 2003 establishing a scheme for
greenhouse gas emission allowance
trading within the Community and
amending Council Directive 96/61/EC
(OJ EU L275)
4 Directive 2001/81/EC of the European
Parliament and of the Council of 23 Octo-
ber 2001 on national emission ceilings
for certain atmospheric pollutants, (OJ
EU L 309/22}
5 Potential for reduction of NOx emissions
at the industry, refineries and the Power
Industry, and the Costs involved, by
Stork Comprimo Protech, 26 October
1998. (available in Dutch only). Sensitiv-
ity analysis of the cost of NOX reductions
in the Industry, Refineries and the Power
Industry, also by Stork Comprimo
Protech, 28 May 1999. (available in
Dutch only).
6 Commission Decision of 29 January
2004 establishing guidelines for the mon-
itoring and reporting of greenhouse gas
emissions pursuant to Directive
2003/87/EC of the European Parliament
and of the Council (OJ EU L 59)
7 Commission regulation (EC) No
2216/2004 of 21 December 2004 for a
standardised and secured system of reg-
istries pursuant to Directive 2003/87/EC
of the European Parliament and of the
Council and Decision No 280/2004/EC of
the European Parliament and of the
Council (OJ EU L381)
8 Greenhouse Gas Trading in Europe:
"The New Grand Policy Experiment", by
Joseph A. Kruger and William A. Phizer,
published October 2004, Environment,
Volume 46, Number 8.
9 Amendment of the Environmental Man-
agement Act and other Acts in connec-
tion with the implementation of Directive
no. 2003/87/EC of the European Parlia-
ment and of the Council of the European
Union of 13 October 2003 establishing a
scheme for greenhouse gas emission
allowances trading within the Community
and amending Council Directive
96/61/EC (OJ L 275) and the establish-
ment of an emission authority (EC Direc-
tive on Greenhouse Gas Emission
Allowance Trading Implementation Act.
10 Decree containing provisions with regard
to the implementation of implementation
of Directive no. 2003/87/EC of the Euro-
pean Parliament and of the Council of
the European Union of 13 October 2003
establishing a scheme for greenhouse
gas emission allowances trading within
the Community and amending Council
Directive 96/61/EC (OJ L 275) ( Decree
on Emission Allowance Trading).
11 Regulation containing provisions with
regard to the determination and record-
ing of greenhouse gas emissions for the
purpose of the the implementation of
Directive no. 2003/87/EC of the Euro-
pean Parliament and of the Council of the
European Union of 13 October 2003
establishing a scheme for greenhouse
gas emission allowances trading within
the Community and amending Council
Directive 96/61/EC (OJ L 275) and the
implementation of the Commission Deci-
sion of 29 January 2004 establishing
guidelines for the monitoring and report-
ing of greenhouse gas emissions pur-
suant to Directive 2003/87/EC of the
European Parliament and of the Council
(OJ EU L 59)
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DEKKERS, ALLESSIE 283
12 Directive 2001/80/EC of the European 13 Assessment of the accuracy and quality
Parliament and of the Council of 23 Octo- in monitoring for CO2 emissions trade at
ber 2001 on the limitation of emissions of different sectors across Europe "Testing
certain pollutants into the air from large the tier approach in practice", KEMA
combustion plants(OJ EU L 386) Netherlands, February 2005.
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284 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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BRITO, BARRETO, ROTHMAN 285
NEW BRAZILIAN ENVIRONMENTAL CRIMES LAW:
AN ANALYSIS OF ITS EFFECTIVENESS TO PROTECT
THE FORESTS OF AMAZONIA1
BRITO, BRENDA,1 BARRETO, PAULO2 and ROTHMAN, JOHN3
1 Lawyer, Vice Executive Director and Research Assistant at Imazon, Pel Mario Covas
Kmol, Pass Pan, brendabrito@imazon.org.br
2 MSc Forest Science (Yale/USA), Senior Researcher at Imazon, D'arco, Conj Village
Pan D'arco, n 09 Ananindena, Para, Brazil, pbarreto@imazon.org.br
3 Senior Attorney, U.S. Environmental Protection Agency, Region 9, 811 York Street,
#307, Oakland, California, 94610, rothman.john@epa.gov.
SUMMARY
In order to evaluate the effectiveness of the new Brazilian environmental crimes
law, we analyzed 55 judicial actions involving forestry crimes in the federal courts of Belem,
the capital of Para. Para is the Brazilian state that currently accounts for 40% of Amazon-
ian logging. We identified the kinds of crimes committed, and the kind of penalties
assessed and collected. We then identified the main obstacles to effective enforcement
against environmental violators and propose some solutions to these problems. We con-
clude that the two principle obstacles to effective enforcement arise from 1) the ineffective
communication among the agencies responsible for applying the law and 2) inability to
apply penalties resulting from environmental crimes to environmental projects. In order to
resolve these problems we propose: 1) adaptation for Para of models of communication
that have already been used successfully in another part of Brazil; and 2) use of environ-
mental funds to enable penalties for environmental projects to be used for environmental
purposes.
1 INTRODUCTION
The Amazon occupies 59% of
Brazil's territory, holding one fifth of the
world's biodiversity.2 It is the largest tropical
forest in the world, but increasing defor-
estation has adversely affected the region-
al biodiversity and may well be leading to
climate change both locally and globally.
The principal causes of deforestation are
cattle ranching and predatory logging. The
ranchers and loggers disregard labor laws;
lack required licenses; and lack required
management plans. For example, there are
reports that between 50 and 80% of logging
is conducted illegally.3
Given the economic and social
importance of the forest sector for the
region - it generates more than 350 thou-
sand direct and indirect jobs and about
US$2.5 billion of gross income per year4 -
the federal government and some state
governments are promoting sustainable
forest management. The governmental
actions include increased monitoring of for-
est resources and, for legitimate forest
uses, the development of support pro-
grams such as credit, training and settle-
ment of land title problems. The federal
government is also negotiating a loan from
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
the World Bank to invest in sustainable
forestry and one state government (Acre
State) has obtained a loan from the Inter-
American Development Bank for infrastruc-
ture and forestry development.
At the same time, the Brazilian leg-
islature has written new laws to aid environ-
mental enforcement. The most important
innovation was the Environmental Crimes
Law of 1998 and its implementation in
1999. The new law greatly broadens liabili-
ty for environmental violators. The new law
improves the ability of administrative agen-
cies to apply administrative sanctions;
establishes the responsibilities of corpora-
tions for environmental violations and dam-
age; turns more environmental violations,
such as illegal logging, into crimes with
higher penalties (up to US$ 16 millions5);
and provides quicker judicial procedures
for many environmental crimes.
In order to find out if this new law
has been of aid in protecting the forests of
Para, the Brazilian state that currently
accounts for 40% of Amazonian logging,
we analyzed 55 judicial actions involving
forestry crimes in the federal courts of
Belem, the capital of Para. We identified
the kinds of crimes committed, and the kind
of penalties assessed and collected. We
then identified the main obstacles to effec-
tive enforcement against environmental
violators and propose some solutions to
these problems.
In Brazil, enforcement of forestry
laws uses criminal law and procedure.
Criminal liability for environmental crimes is
enforced exclusively by the Ministerio
Publico6 which bases its prosecutions on
information and cooperation provided by
the federal environmental agency, IBAMA.
IBAMA has been the main monitor of the
logging activity in Amazonia. Typically, a
prosecution by the Ministerio Publico for a
forestry crime quickly calls for a negotiation
aimed at settlement. This negotiation takes
place under the auspices of the court in the
presence of the judge.
2 DIFFICULTY IN FINDING THE
ALLEGED VIOLATORS AND SERVING
PROCESS
In the 55 cases we analyzed, only
one had already been completed (see fig-
ure 1). The rest were in various procedural
phases. In 62% of the cases the alleged
violators had not been located and served
and in 16% the cases were caught in vari-
ous procedural binds including a jurisdic-
tional problem between the federal and
state judicial systems. In 20% the violators
were complying with the terms of settle-
ments that had been negotiated with the
MP7
The difficulty in serving process
was the main cause for the delay in prose-
cution. The practice of the Federal Court in
Figure 1: Phases of 55 Lawsuits on Forestry Crimes
100%
Violators not
served
Procedural
problems
Complying with
the terms of
the negotiated
agreement
Completed
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BRITO, BARRETO, ROTHMAN 287
Belem has been, for those who do not
reside in Belem, to mail the notification of
violation and the date for settlement confer-
ence. If the defendant does not appear on
the appointed date, then the Federal Court
contacts a court in the municipality of the
defendant's residence to serve process.
Unfortunately, most rural municipalities in
Para lack personnel to serve process.
Moreover, even when the municipality does
send someone to serve process, there is
no guarantee of success. For example, in
one case, the alleged violator lived in Por-
tel, a city 204 miles away from Belem. The
process server could not serve the process
because there was no boat available to get
to the alleged violator's house, which was
on the other side of the river.
In other situations, the communica-
tion between the process servers and the
courts has been deficient, even by tele-
phone. They have failed in serving
processes on time and have not communi-
cated that to the court before the confer-
ence date. They also have had problems in
finding alleged violators who have moved.
All of this causes delay. Delay (and the pos-
sibility that the penalty will never need to be
paid) reduces the deterrent effect of the
prosecutions.
3 PENALTIES FOR ENVIRONMENTAL
CRIMES DO NOT GO TOWARD
ENVIRONMENTAL PROJECTS
We have observed that the terms
of most of the negotiated settlements in
Para have provided for social assistance -
particularly donation of medicines and food
- but very little for the environment (see fig-
ure 2). Typically the only environmental ele-
ment in the settlements was the provision
of seedlings of valuable tree species. This
is true even though the environmental
crimes law explicitly calls for repair of envi-
ronmental damage.
We noted, from talking with prose-
cutors, that it is hard to know what damage
is caused by a specific crime. Therefore,
the application of penalties to specific envi-
ronmental damage is difficult for logging
crimes in the Amazon. This problem is
aggravated by the lack of information,
resources and clear procedures. For exam-
ple, there is no clear and tested procedure
for directing funds to environmental proj-
ects. As a result, prosecutors aimed penal-
ties at social assistance - a procedure that
has been for long used for judicial settle-
ments of non-environmental violations.
This is a problem not only in Para, but cer-
tainly in other parts of Brazil.
Figure 2: Proportion of amount for social assistance and environment
ino% i
ono/
qno/
70%
60%
cr)%
4O%
ono/
20% —
10%
0% -
•MB
2000
I
•••
2001
u
year
•
2002
^^••i^H
2003
Social assistance
• Environment
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
In Brazil, the Ministerio Publico has
the power to order investigations from the
federal agencies, but not to pay for them.
The requested institutions must pay and
most of the time there are no resources
available. For instance, in two of the cases
that we sampled, the federal court request-
ed information from the federal environ-
mental agency, IBAMA, about the environ-
mental damage caused by the crime.
I BAM A provided the requested information,
but refused to agree to continue this kind of
help due to lack of resources and the high
cost of these assessments.
4 POTENTIAL SOLUTIONS
4.1 Improving Prosecution
Delays in the prosecution of envi-
ronmental matters in Para appear to be
caused by the deficient communication
among institutions. Some experiments in
the municipality of Blumenau - south of
Brazil - suggest a solution to this problem.
In Blumenau, the Environmental
Police8 (the inspectors), MP and Federal
Court agreed to improve their coordination
to enforce the environmental crimes law. To
that end, the federal court reserved two
days per week for environmental negotia-
tions. Therefore, when the environmental
police served process, they also assessed
a fine and scheduled a negotiation because
they knew when the federal court would be
available. The environmental police then
advised, by electronic mail, both the court
and MP of: i. the fine; ii. the date for the
negotiation; and iii. the successful service
of process. As a result, the court and the
MP were prepared on the day of negotia-
tion. About 95% of the violators attended
the negotiations within 30 days of violation,
which compares to only 16% for the 16
cases in Belem.
A system similar to that used in
Blumenau could be adapted to Para and
other states in Amazonia that have experi-
enced difficulty even serving process for
environmental matters. To improve prose-
cution all of these agencies will need more
resources. However, we think that with or
without new resources, a key element will
be better coordination between the agency
responsible for inspections and monitoring.
In the case of Para, this would be IBAMA,
the Ministerio Publico and the courts.
4.2 Strengthening Environmental
Conservation and Recovery
Through Environmental Funds
As we have discussed, the penal-
ties that result from prosecution of environ-
mental crimes are not used to help repair or
protect the environment but are mostly
used instead for social assistance. We sug-
gest sending penalties and other relief to
trust funds aimed at repair of environmen-
tal damages or protection of the environ-
ment. Lacking a clear nexus between the
violation and a particular environmental
harm, which is the norm, the penalty or
other relief could be placed in a fund that
would be devoted to environmental proj-
ects. These trust funds could also support
the work of environmental agencies.
The kind of fund most appropriate
for this purpose would be an endowment
fund, which collects money for investment
using interest and dividends for its projects.
The main advantage of an endowment fund
is the ability to investing in long terms proj-
ects. In Brazil, there is at least one a good
example of such an endowment fund: the
Brazilian Biodiversity Fund (Funbio)9. Fun-
bio has been providing financial support to
public and private projects concerning bio-
diversity conservation and sustainable
development.
Another kind of fund that would be
suitable would be a sinking fund, which col-
lects money to be used for designated pur-
poses. Its goal is to spend all of its money
on projects consistent with those proposes.
The disadvantage of sinking funds is the
difficulty in supporting long term projects
because of the unforeseeable future budg-
ets. In Brazil, sinking funds are more com-
mon than endowment funds. One example
is the Fundo de Defesa de Direitos Difu-
sos,10 a national fund for protection of con-
sumer and environmental matters.
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BRITO, BARRETO, ROTHMAN 289
5 CONCLUSION
Two principle obstacles to the
enforcement of the environmental crimes
law arise from: 1) the lack of effective com-
munication among the agencies responsi-
ble for applying the law; and 2) inability to
apply penalties resulting from environmen-
tal crimes to environmental projects
In order to resolve these problems
we propose: 1) adaptation for Para of mod-
els of communication that have already
been used successfully in another part of
Brazil; and 2) use of environmental funds
by the Ministerio Publico and courts to
enable penalties for environmental projects
to be used for environmental purposes.
6 REFERENCES
1 This article is a partial summary of a larg-
er study that more fully analyzes the
effectiveness of the environmental
crimes law. The full version in Por-
tuguese can be found at
www.imazon.org.br. We hope that an
English version will soon be available on
the INECE website.
2 WWF Brasil available at www.wwf.org.br.
3 See: Embrapa. Relat6rio sobre o diag-
nostico dos projetos de manejo florestal
no estado do Para - Fase Paragominas.
Belem: Emprapa/Cpatu PA, 1996. 94 p;
Update Report on Illegal Mahogany Log-
ging and Trade in the Brazilian Amazon.
Preliminary Version. Sco Paulo: Amigos
da Terra, 1995; Lentini et al. Forest Facts
2003. Belem: Imazon, 2004.
4 Lentini et al. Forest Facts, 2004.
5 Equivalent to R$ 50 million.
e The "Ministerio Publico" (or "MP") is a
prosecutor's office that functions almost
like a fourth branch of government. The
MP functions independently of the other
branches and at both the federal and
state levels. According to the Brazilian
Federal Constitution it is in charge of
"...civil investigation and public civil suits
to protect public and social property, the
environment and other diffuse and col-
lective interests" (Article 129, Section III -
emphasis added). It also has exclusive
authority to bring environmental criminal
actions.
7 The negotiations are allowed by law and
they are used in order to avoid the need
for further criminal action, which take a
long time to be completed and have high
costs.
8 In Blumenau and other southern states
the Environmental Police is the main
monitoring agency for environmental
enforcement. Para also has an Environ-
mental Police but it has not been so
active in forestry matters.
9 Fundo Brasileiro Para a Biodiversidade
available at www.funbio.org.br.
10Conselho Federal Gestor do Fundo de
Defesa dos Direitos Difuses available at
http://www.mj.gov.br/cfdd/default.htm.
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290 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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POSTIGLIONE 291
ENVIRONMENTAL DAMAGE IN ITALY IN
RELATION TO DIRECTIVE 2004/35/EC
POSTIGLIONE, AMADEO
Justice, Supreme Court of Cassation, Italy; Director ICEF (International Court
of the Environment Foundation), International Court of the Environment Foundation
via Cardinal Pacca, 19 - 00165 Rome (Italy)
SUMMARY
This paper looks at current Italian legislation and case law on environmental dam-
age in light of the new European Directive (Directive 2004/35/EC), which is dedicated to
the prevention and remedying of environmental damage.
1 INTRODUCTION
Directive 2004/35/EC on Environ-
mental Liability with regard to the Preven-
tion and Remedying of Environmental
Damage is important because:
1) it recognises that the environmental
situation in Europe has accelerated
due to the loss of biodiversity and
the dangerous contamination of
many sites;
2) it recognises - implicitly - that the
principles of "prevention" and
the "polluter pays" have not been
effective, thereby making it necessary
to establish downstream common
legal regulations on environmental
damage to avoid further negative
consequences;
3) for the first time in Europe, a common
framework of regulations has been
introduced within the Member States,
mirroring the preventive model
(EIS, SEA and Integrated Pollution
Prevention and Control), closing
downstream the European legal
system, according to a principle
of integration, proportionality and
subsidiarity;
4) it introduces an element of certainty in
a delicate and complex area, taking
the first positive step, in view of
gradually harmonising the regulations
of the individual Member States;
5) the common sectors involved (water,
land and protected species and
natural habitat) are the sectors most
at risk;
6) special attention is focused on
prevention, on the imminent threat of
concrete environmental damage;
7) the privileged form of remediation is
not the monetary form but that of an
effective natural return to original
conditions, with strict application of the
principle that the polluter pays for the
damage it has caused;
8) proper space has been dedicated to
strict liability in relation to intrinsically
risky activities, whilst accepting,
in other cases, liability for fault or
negligence;
9) individuals and NGOs are given
rights to information, participation
and access in administrative and
legal proceedings with the
resulting possibility of channelling
environmental damage in its personal
and social dimension towards the
institutions;
10) apart from having a "natural"
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
dimension, "environmental damage",
as a legal category, acquires a
"Community" dimension and promotes
the evolution of commonly integrated
legal systems in the sense of also
bringing the objective of humanising
the international dimension closer.
Anti-legal environmental damage
also exists in the "international sphere" and
it appears to be urgent that the Internation-
al Community becomes aware of this by
creating adequate mechanisms for "gover-
nance" and for a global jurisdiction, giving
access to men and women, as individuals,
and not merely to the States.
2 DIRECTIVE 2004/35/EC
2.1 Legal Basis
Directive 2004/35/EC legally
entered into force for the Member States
from its date of publication on 30th April
2004 with the obligation of the Member
States in relation to the common basic
nucleus to implement it by 30th April 2004.
Member States may maintain their national
regulations if they are more comprehensive
or more stringent (before and after 30*n
April 2007). The part of the Directive which
is sufficiently clear, precise, and detailed
enters into force by 30th April 2007, even
without formal reception by the Member
States. It is the European Court of Justice
which is the competent court for deciding
whether Member States have failed, even
partially, to comply with the Directive.
2.2 Environmental Damage -
Main Characteristics
2.2.1 Subject matter
The subject matter covered in the
Directive includes: (1) damage to any
aspect of biodiversity (Habitat Directive
79/409/EEC; Birds Directive 92/43/EEC);
(2) water damage indicated in the Frame-
work Directive 2000/60/EEC; and (3) land
damage.
2.2.2 Definitions
In the Direct^ damage to protect-
ed species and natural habitats is under-
stood as being "any damage that has sig-
nificant adverse effects on reaching or
maintaining the favourable conservation
status of such habitats or species" and on
the return of the natural resources to their
baseline condition.
Likewise, water damage includes
damage that significantly adversely affects
the "ecological status" and the "ecological
potential", as well as the chemical and/or
quantitative status, of the waters involved.
Also, in this case, the measure for remedi-
ation is return to the original conditions.
Land damage is restricted to "con-
tamination" creating a significant risk to
human health.
2.2.3 Scope
In the Directive, the damage must
have some general characteristics. It must
be concrete, measurable (or quantifiable)
and significant.
Preventive measures are also pro-
vided for in the case of imminent threat of
damage, that is, the "sufficient likelihood
that damage will occur", or an actual and
concrete threat of future damage.
2.2.4 Activities Which Can Cause
Environmental Damage
The Directive, under Art. 3, applies
to two kinds of occupational activities: (1)
those listed in Annex III (these are 12 occu-
pational activities deemed to be intrinsical-
ly risky and already regulated by special
directives) and (2) other occupational activ-
ities (that is, those not listed in Annex III),
where damage or a threat of damage to
protected species and natural habitats is
always caused by fault or negligence.
2.2.5 Parties Subject to Liability
Under the Directive, not only pri-
vate persons and public persons but also
multiple parties causing the damage are
subject to liability for causing environmen-
tal damage.
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POSTIGLIONE 293
2.2.6 Criteria for Remedial Action
With regard to remedial action
under the Directive, the two basic rules are
that the operator bears the cost of remedi-
al action and that remediation is under-
stood as material restoration (full or equiv-
alent). Only in exceptional cases is com-
pensation provided for as set out in Annex
III of the Directive.
2.2.7 Prevention and
Remediation Costs
In the Directive, the operator bears
all the costs for the damage. However,
whenever there are multiple parties, nation-
al regulations are applied. Also whenever
there is pollution of a diffuse or general
character, liability is excluded if there is no
causal link to the damage and the identified
polluters.
The cost includes damage to the
environment; damage to related services;
administrative, legal, and enforcement
costs; costs of data collection; and monitor-
ing and supervision costs.
The competent authority has the
right to enforce the measures (including the
right to recovery of the sums spent within 5
years). Whereas, although private persons
have the right to health and the environ-
ment, they do not have the right to compen-
sation for environmental damage.
2.2.8 The Economic Valuation
Of Environmental Damage
The "polluter pays" principle
requires that all the costs for natural pri-
mary restoration or for its equivalent are
considered. No specific economic model
for valuation is provided although the fol-
lowing criteria are indicated:
—priority for primary remediation;
—in cases of impossibility or difficulty,
to guarantee equivalent natural
resources and services_(complementary
remediation) in an alternative location
geographically linked to the damaged
site;
—to compensate (and, therefore, to
include in the costs) interim losses
whilst awaiting natural recovery;
— if it is not possible to use resource-
to-resource or service-to-service
equivalence, then the method of
monetary valuation is adopted;
—the choice of remedial options takes into
account the need to use best available
technologies, considering its cost, its
effect (including in the future), the time
frame for recovery, the specific nature of
the situation of the site, and other social
and cultural factors.
For the remediation of land dam-
age, there are specific procedures for risk
assessment and for the elimination of the
harmful substances. If the use of the land is
changed, land use regulations are resorted
to. There are also provisions for the mar-
ginal case of natural recovery in which
there is no direct human intervention in the
recovery process (where this is possible).
2.2.9 Standing
It is well known that environmental
damage has a three-fold dimension - per-
sonal, social and public. The Directive, in
Art. 12, therefore, recognises that both nat-
ural and legal persons, and NGOs, have a
role in being able to put an administrative
procedure before the competent authori-
ties, consisting in a request for action,
accompanied by relevant information and
data, as well as to take part in the proceed-
ings taken.by the competent authorities on
their own initiative.
Art. 13 enables natural and legal
persons to have access to a review proce-
dure before a judicial or administrative
body. This is, of course, without prejudice
to any provisions of national law which reg-
ulate access to justice.
2.2.10 Civil Liability
It is expressly stated in Art. 3 (b) of
the Directive that there is liability for fault or
negligence for occupational activities (other
than those listed in Annex III) which cause
damage to protected species and natural
habitat. Implicitly, it can therefore be
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argued that there is strict liability for the
activities provided for in Annex III (with the
resulting shifting of the burden of proof).
2.2.11 Cases Of Exceptions To
Civil Liability
The Directive, in Art. 4, sets out
that it will not cover environmental damage
or its imminent threat in cases of: (1) a nat-
ural phenomenon of exceptional, inevitable
and irresistible character; (2) marine trans-
port of nuclear substances; (3) pollution of
a diffuse character; (4) national defence;
and (5) international security and measures
for protection against natural disasters.
2.2.12 Further Cases Of Exceptions
To Civil Liability
Under the Directive, further cases
of exceptions to civil liability relate to the
lack of a causal link, the lack of fault or neg-
ligence, the lack of proof of the damage,
authorised activities (on certain conditions),
and delegated activities.
3 ITALIAN LAW
3.1 Legal Basis
The main rule on environmental
damage, under current Italian law, is to be
found in Article 18 of Law No. 349 of 8 July
1986, which established the Italian Ministry
of the Environment (today known as the
Ministry of the Environment and Territory).
3.2 Environmental Damage -
Main Characteristics
3.2.1 Unitary Nature
Environmental damage is consid-
ered to be any damage to one of the com-
ponents of the environment (air, energy,
flora, fauna, landscape, land set-up,
nature, noise, soil, waste, water, etc.)
3.2.2 Public Nature
It is considered damage to the
State or to other territorial public bodies
(Region, Province, Municipality, Park
Administrations).
3.2.3 Social Nature
Environmental damage is not only
considered as damage to the State, but
also to society and, therefore, to social
groups (NGOs). As a result, standing
(access to justice) is also granted to nation-
al and local environmental protection asso-
ciations. These social groups may request
the administrative courts to declare admin-
istrative acts void as illegal. They can take
action before the civil courts for restoration
(but, in the case of compensation for dam-
ages, only the State and the other public
parties are entitled to this, except for the
right to reimbursement for legal costs).
In the same way, environmental
protection associations may act as an
aggrieved party in criminal proceedings to
recover damages ("parte civile") in pro-
ceedings regarding offences against the
environment, but damages are only paid to
the State, save for the right to reimburse-
ment for legal costs.
3.2.4 Personal Nature
Environmental damage can cause
damage to the health and property of indi-
viduals. These may take action against the
perpetrator of the damage in accordance
with general principles.
Any individual, even when there is
no direct damage to his/her health or prop-
erty, may join a "popular action" which is of
a substitutive and supplementary kind,
directed at reinforcing the autonomous
duties of local bodies (Municipalities and
Provinces).
3.2.5 Patrimonial Nature
Environmental damage has an
economic value. The damage is of both a
patrimonial nature and a fiscal nature, in
the sense that it includes not only the finan-
cial losses of public bodies but also dam-
age to the community, encumbered with
additional economic charges.
3.2.6 "Unjust" Nature
Not all environmental damage is
taken into consideration, but only that
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POSTIGLIONE 295
which is "contra ius", namely, that which is
legally pertinent. It is necessary, case by
case, for the courts to verify which "legal
provisions" or "administrative measures"
adopted on the basis of the law have been
infringed.
3.2.7 Behavioural Nature
"Substantive" and not merely "for-
mal" damage to the environment is
required, that is, an "alteration", a "deterio-
ration", the "total or partial destruction", a
"compromising" in some way that can be
measured and quantified. The courts will
only hear an action when there is an exist-
ing and concrete danger to the environ-
ment.
3.2,8 Perpetrator Of The Damage
This may be "anyone" or, in other
words, a private or also a public party. The
activity exercised by the perpetrator does
not need to be "occupational" in nature,
except in the case of some dangerous
activities.
3.2.9 Liability for Fault or Negligence
In Italy, the principle of "subjective"
liability (for fault and negligence) is in force,
which is to be proven case by case. Strict
or "objective" liability (with the shifting in the
burden of proof) constitutes the exception.
It should, however, be stressed
that liability for negligence is interpreted
very strictly in case law, in the sense that it
not only arises in the case of negligence,
recklessness or inexperience, but also
when there has been a failure to take prop-
er preventive technical and organisational
measures for avoiding the damage.
Except in extreme cases (earth-
quakes, floods), liability is always recog-
nised, with the exception of ordinary cases
of exemptions to liability (fortuitous event,
force majeure, economic grounds due the
excessive nature of the costs of adopting
the best available technology, social
grounds caused by a drop in employment,
etc.).
3.2.10 Priority For The Restoration
Of Places To Their Prior State
This aspect has been underlined in
case law but, in practice, the monetary
quantification of the environmental damage
still prevails, fixed "on equitable grounds"
by the courts on a case by case basis.
There are some cases of the assessment
of damage which consider "the cost
required for restoration" and "the profit
gained by the perpetrator as a result of his
illegal behaviour towards the environment"
more strictly.
3.2.11 Parties Subject To Liability
The principle is in force whereby
each party answers in court within the lim-
its of its own liability.
3.2.12 Contaminated Sites
Regulations have been introduced
ad hoc within the sectors of water (Art. 55
of Law 152/99) and waste (Arts. 17 and 51
bis of Law 22/97). The failure to reclaim
contaminated sites is considered an
offence, as well as a civil wrong, although
liability is not retroactive.
4 IMPORTANT CASES IN ITALY
4.1 Case of Air Pollution from the
Enichem Plant of Marghera
The case took place on 27/12/1998
in Venice. The Court of Venice, in its judg-
ment of 27 November 2002, No.1286 (pub-
lished in www.giuffre.it/riviste/2ga) found
those in charge of the plant to be criminally
responsible for failing to adopt the neces-
sary measures for preventing the occasion-
al emission of toxic gas (ammonia) with
resulting harm to the employees and the
natural resources.
The decision is important due to
the criteria applied in quantifying the civil
damages.
Even if this emission of gas only
lasted two hours, the damages to be
awarded were 225,000 Euro, of which
25,000 Euro were for the cost of restoring
the environment and 200,000 Euro corre-
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sponded to the illegal profit made.
The specific provision on environ-
mental damage (Art. 18 of Law 349/86) was
strictly interpreted, in the sense that the
damage was held to encompass the exact
wealth produced thanks to the failure to act
which caused the environmental damage
(to the air and water).
4.2 The Wreck of the Oil Tanker
Haven in the Ligurian Sea
On 11 April 1991, there was a fire
on board the oil tanker Haven in the Genoa
- Arenzano roadstead. The oil tanker sank
on 14 April. The serious accident resulted
in the death of the captain and some mem-
bers of the crew as well as serious environ-
mental damage.
The Court of Genoa, in its judg-
ment of 21/11/1997 No.945, failed to find
any definite cause for the damage and
therefore the defendants were acquitted.
Under Law 16 July No. 239, a compromise
was reached whereby the State was to be
compensated for damages of 117,6 thou-
sand million Italian lire (recognising in this
way the civil damages of this serious acci-
dent).
4.3 Vicissitude of the Red Mud of
Scarlino, dumped by the
Montedison Company in the
Sea off Corsica
The Court of Bastia, in Corsica, in
its judgment of 4 July 1985, No.422, con-
victed the Italian Montedison company and
ordered it to pay 180,000 French francs to
the Prud'Hommie of the fishermen of Bas-
tia (for damages for the increase in costs of
production due to the fishing boats having
to lengthen their voyages in order to avoid
the polluted zones and for damage due to
the loss of fish) and 250,000 French francs
to the Department of Haute Corse and that
of Corse-du-Sud (damage to their image).
The French judges held that the burden of
proof rests on those who claim they have
suffered harm, according to general princi-
ples, but that in environmental matters, the
particular difficulty with regard to proof
must be taken into consideration. This is a
case of transborder environmental dam-
age, at least partially, resolved with the
rules of judicial collaboration between dif-
ferent countries, according to international
law.
4.4 Dumping Hazardous Waste
Into The Sea (Titanium Dioxide)
The Auditors' Court, in joint ses-
sion, in a decision of 16 June 1984 (in II
Foro Italiano, Rome, 1985, 38) once again
dealt with the so-called red mud of Scarli-
no, that is, the waste of the industrial pro-
cessing of titanium dioxide, dumped by
Montedison in the Tyrrhenian Sea.
The decision upheld the conviction
of the Habour Master of the Port of Leghorn
(for having granted the permit for the dis-
charges) and of the Director of the Central
Hydrobiology Laboratory of the Ministry of
Agriculture and Forests (for having given a
favourable technical opinion), in violation of
their duties.
The decision is very important
because:
—it considers environmental heritage
(including the open sea) as legal
heritage (as legislation protecting
it exists), apart from whom it
"belongs to";
—it considers environmental damage as
public damage which the State must
restore;
—it considers public officials, who
intentionally or negligently, in breach of
their official duties, cause the damage,
responsible for the damage.
Therefore, so-called environmental
damage comes within the attempt to con-
struct a new, wider concept of public dam-
age, through case law (see Paolo Maddale-
na, «Danno ambientale, danno pubblico e
responsabilit^ amministrativa, in II Con-
siglio di Stato, Rome, 1982, The, 1423; on
the red mud of Scarlino: K. Siener,
Protezione dell'ambiente trasfrontaliero:
esperienze europee di un problema mondi-
ale» in II Foro Italiano, Rome,
1981.V.314).
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POSTIGLIONE 297
4.5 Porto Marghera (Venice)
This is one of the most important
cases to have taken place in Italy on the
disposal of toxic and dangerous waste.
Montedison, through three plants (Ferti-
mont, Montefluos and Ausiodet) in
Marghera, dumped (by using special
tankers) about 1 million tons of phospho-
rous-based substances (waste from the
production of phosphoric acid and hydroflu-
oric acid) and other noxious substances
(arsenic, chromium, zinc, iron, radium266,
phosphates) into the sea. However, at the
end of an investigation that lasted three
years, the Public Prosecutor of the Court of
Venice, on 28 July 1980, called for the
acquittal of the 11 managers from Montedi-
son and another company (Alumental), on
the grounds that the industrial discharges
were not dangerous.
4.6
Genoa
The Stoppani company of Cogole-
to (25kms from Genoa) produced dichro-
mat for tanneries and dumped the related
sludge into the sea (70 thousand tons of
chromite per year). Following the damage
claimed by fishermen, to swimming and to
flora, and to marine fauna, the Magistrate
of Sestri Ponente opened an inquiry.
Another inquiry began before the
Magistrate of Genoa, with a complaint
lodged on 3 July 1985 by a group of citi-
zens and by environmental associations
(such as Lega per I'Ambiente). It was
claimed in this complaint that the dumping
of toxic and noxious waste into the sea was
absolutely prohibited because it was illegal
and, as a result, there was no justification
for the Minister for the Merchant Navy to
grant permits to the Stoppani company on
17/6/1983, with subsequent extensions
until 19/7/1984 and 31 /12/1985 and up until
July 1986.
Subsequently, the Ministry for the
Environment prohibited this activity with a
special ordinance that finally closed the
case: no more dumping into the sea.
4.7 Sinking of the Greek cargo ship
Klearchos in Sardinia
On 20 July 1979 the Greek cargo
ship Klearchos sank between the islands of
Molara and Tavolara in Sardinia with a
cargo of toxic substances on board.
The Magistrate of Olbia intervened
on 10 August 1979, instructing an expert to
inspect the holds of the wreck.
4.8 Sinking of the Cavtat off Otranto
The cargo ship Cavtat was carry-
ing 909 drums of tetramethylead, a very
poisonous substance, and it sank on 4 July
1974 off Otranto. With the great commit-
ment of the Magistrate of Otranto, 863
drums were recovered. The captain of the
ship was found guilty on 29 May 1985 by
the Court of Lecce.
4.9 Augusta (Sicily)
On 29 September 1979, the Magis-
trate of Augusta sequestered three large
industrial plants (Esso, Montedison and
Liquichimica) for dangerous industrial dis-
charges into the soil and water (bay of
Augusta) and emissions into the air. The
trade unions had previously called a strike
(on 16 September) to demand the ecologi-
cal protection of the roadstead polluted by
the petrochemical plants. The criminal pro-
ceedings ended on 21 January 1981 with
the sentencing of the managing director of
the Esso refinery to 2 months 10 days in
jail.
4.10 Gela (Sicily)
On 15/11/1979, the Magistrate of
Gela sequestered the Anic petrochemical
plant of Gela.
The proceedings ended on 21
February 1981 with the manager of the
plant being sentenced to 20 days jail.
4.11 Dumping of Toxic Substances
in the Tremiti Islands
In the course of 20 trips between
Manfredonia (Puglia) and the beautiful
Tremiti Islands in front of it, the ship "Irene"
discharged toxic substances without a per-
mit (9 thousand tons). The Tremiti Islands
were used as a place for dumping the
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waste. The Magistrate of Manfredonia took
action and, on 3 April 1981, arrested the
captain and the owner of the ship.
The situation has now changed.
4.12 Seveso
This case is famous at an interna-
tional level. On 10 July 1976, a toxic cloud
containing dioxin was released from the
ICMESA plant in Seveso near Milan, caus-
ing serious harm to persons and things
over a vast territory. The Court of Monza, in
a judgment of 24 September 1983, convict-
ed the technical manager of the ICMESA
plant (to 5 years imprisonment); the techni-
cal director of the Givaudan group, of
which ICMESA was a part (to 5 years
imprisonment); the head of designing and
engineering of the ICMESA plant at the
time of the construction of the reactor (to 4
years imprisonment); the chairman of the
Board of Directors of ICMESA (to 4 years
imprisonment); the head of engineering
and security systems sector (to two and a
half years imprisonment).
The defendants and ICMESA were
ordered to pay damages to the aggrieved
parties acting in criminal proceedings to
recover damages (the mayor and 17
groups of persons).
At Community level, the Seveso
case gave impulse to the Directive
82/501/EEC on the major-accident hazards
of certain industrial activities. Despite the
sad experience it had, Italy was slow to
implement the Directive, thereby deserving
a finding by the European Court of Justice
in Luxembourg that it had failed to fulfil its
obligations under Community law (on 1
March 1983 in Commission v. Italy).
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INECE SECRETARIAT STAFF 299
PENALTIES AND OTHER REMEDIES FOR
ENVIRONMENTAL VIOLATIONS: AN OVERVIEW
INECE SECRETARIAT STAFF
2141 Wisconsin Ave. NW, Suite D2 Washington, DC 20007, inece@inece.org
SUMMARY
This article provides an overview of the functions and unique features of penalties
and other remedies available to legislators, administrators and judges who seek to enforce
existing environmental laws and regulations and/or to deter, both generally and specifical-
ly, future non-compliance.
1 INTRODUCTION
The article begins by surveying
variations on the traditional remedy of
money damages. It then discusses the
appropriateness of alternatives such as
restitution, injunction and declaratory reme-
dies. This discussion is followed by an
overview of the penalty options available to
policy makers for harms to the environment
and/or persons and for non-compliance
with environmental laws and regulations.
The article provides a background analysis
of the critical formulation of civil penalties,
with the aim of ensuring that the economic
benefit of non-compliance is outweighed by
the punishment facing regulated entities for
non-compliance. Mitigating and aggravat-
ing factors in individual cases are also con-
sidered. This analysis is followed by a dis-
cussion of the differences between criminal
and civil penalties and the appropriateness
and underlying bases of each form of
penalty. Finally, the article offers a brief dis-
cussion of alternative penalties available to
policy makers, in addition to the traditional
criminal and civil penalties available, by
surveying environmental enforcement
alternatives in use by environmental
administrators in the United States and
Canada.
2 TYPES OF REMEDIES
2.1 Damages
Damages are a financial remedy
administered with the aim of providing the
plaintiff with monetary compensation equiv-
alent to his or her losses resulting from the
actions of the defendant.1 Types of dam-
ages include:
—General Damages: The market value
of the damage to the plaintiff caused by
the defendant (e.g., the difference
between the market value of a property
immediately before a harm and its
market value after the harm2).
—Consequential Damages: Those
damages incurred after the initial loss
as a direct consequence of the initial
harm. These damages are usually used
when the full value of the loss cannot be
calculated by market mechanisms or
when the full value of the loss is not
represented in the calculation of market
loss.3
— Substitution Cost: Used when there
is a large difference between the
replacement value and market value of
a property to the plaintiff (e.g., when a
particular piece of property has an
unquantifiable sentimental value to its
owner4).
— Punitive or Exemplary Damages:
Intended to punish the defendant, in
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addition to compensating the plaintiff,
and deter future wrongs by the
defendant and others.
-Standardized Damages: Damages
generally provided under a statutory
framework, but calculated for the
particular plaintiff.5
-Litigation Costs: These damages allow
a party to recover reasonable attorney's
fees accrued in the course of litigation.
They are frequently provided for under
civil rights, employment discrimination
and environmental statutes.
-Adjustments for Time Differentials:
When interest and present value
are used to calculate compensation
payments made to the plaintiff for
injuries occurring long after the initial
harm has occurred or for future harm.
-Adjustments for Benefits Reaped or
Harms Avoided by the Plaintiff: Plaintiff
usually has a responsibility to take
reasonable measures to avoid
damages.
2.2
Alternative Remedies
2.2.1 Restitutional Remedies
Restitutional remedies are a form
of damages used to prevent unjust enrich-
ment by making defendants give up what
they wrongly obtained from plaintiffs.6
Restitution can take on a punitive element
when the restitution exceeds both the plain-
tiff's losses and the defendant's gains.
— Restitution in Specie: Where restitution
is in-kind rather than money damages.
—Measurement of Defendant's Benefits:
Measures the increased assets in the
hands of the defendant from the receipt
of property.7
— Market Value: Measures the market
value of services provided to defendant
regardless of their value to the
defendant,
—Use Value: Measures the value of any
benefits received by the defendant as
measured by market indicators or actual
gains to the defendant.
—Gains Realized: Measures the actual
gains realized by the defendant upon
the sale or transfer of an asset received
from the plaintiff.
—Savings or Profits: Measures the
value of savings or profits earned by
the defendant in the use of assets
received from the plaintiff. This is an
extraordinary remedy because of the
difficulty in separating the defendant's
efforts from the plaintiff's assets.
2.2.2 Coercive Remedies
Typified by an injunction, this type
of remedy coerces the defendant to act or
not act under threat of being found in con-
tempt, which subsequently results in fines
or imprisonment.8
—Specific Performance: Compels
defendant to perform or not to perform
a specific action ordered by the court.
—Structural Injunction: Used to restore
public institutions such as schools or
prisons and to force compliance with
constitutional or statutory requirements.
— Provisional Injunctions: Temporary
restraining orders and preliminary
injunctions issued before a trial begins
to prevent some irreparable harm or
alleviate the threat of an imminent
emergency.
2.2.3 Declaratory Remedies
An authoritative and reliable state-
ment of the parties' rights with no award of
damages, restitution or injunction. This
remedy is often useful in contract cases
when the parties need to know their rights
and duties under the contract or when a cit-
izen is confronted with regulation that may
be unconstitutional and seeks to clarify the
validity of the regulation without first
breaching that regulation.9
3 PENALTIES
3.1 Civil Penalties
Civil penalties are fines, payable to
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INECE SECRETARIAT STAFF 301
the government, following a breach of the
relevant governing statute. The underlying
policy consideration when applying civil
penalties requires the administrator to cal-
culate the economic benefit of non-compli-
ance and ensure that the penalty burden is
at least as great as the benefit of the viola-
tion, so that there is a compelling motiva-
tion for compliance.10 Considerations
include the benefit that the violator receives
from delayed compliance and other bene-
fits of non-compliance.11 In calculating the
appropriate severity of civil penalties,
administrators should address circum-
stances in which benefits arise in factors
other than cost savings.12 There are very
few circumstances where the economic
benefit of noncompliance will be mitigat-
3.1.1 The Gravity Component:
While the economic benefit compo-
nent ensures that a company cannot profit
from its violations, the gravity component
reflects the seriousness of the violation.
The following components are considered
when calculating the gravity factor:
—Actual or Possible Harm: This factor
contains within it a number of sub-
factors that attempt to determine
the likelihood that the activity of the
defendant actually resulted or was
likely to result in a violation.
— Toxicity of the Pollutant.
—Sensitivity of the Environment.
—Overall Severity of the Environmental
Harm.
— Length of Time of the violation: A
penalty is assessed for each separate
violation as well as the length of time
that the violations occurred.
3.1.2 Adjusting the Gravity Component
Establishing consistency and rea-
sonable expectations with respect to the
treatment of the regulated community is a
policy goal of the civil penalty system. But
there must also be flexibility within the
penalty assessment process to account for
particular circumstances of a given situa-
tion. The following factors promote flexibili-
ty among the regulated community by
adjusting the gravity factor for such circum-
stances as:
— Degree of willfulness or negligence:
This factor can only increase the
severity of the penalty. It considers the
following:
• The degree of control the violator
had over the events constituting the
violation.
• The foreseeability of the events
constituting the violation.
• The level of sophistication within the
industry in dealing with compliance
issues or the accessibility of
appropriate control technology (if
this information is readily available).
This should be balanced against the
technology-forcing nature of the
statute, where applicable.
• The extent to which the violator in
fact knew of the legal requirement
that was violated.
— Degree of Cooperation: This factor
can aggravate or mitigate the penalty
and will be based on the following
sub-factors:
• Prompt reporting of noncompliance.
• Prompt correction of environmental
problems.
• Cooperation during pre-filing
investigation.
— History of noncompliance: This factor
may only be used to raise a penalty. It
considers the following factors:
• Similarity of the violation in question
to prior violations.
• Time elapsed since the prior
violations.
• The number of prior violations.
• Violators' response to prior violations
with regard to correcting the previous
problem and attempts to avoid future
violations.
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• The extent to which the gravity
component has already been
increased due to repeat violations.
— Environmental damage: Used where
the environmental damage is so severe
that it is not sufficiently covered by the
gravity component.
—Ability to Pay: Generally, administrators
will not assess fines that are beyond a
company's means to pay, and may
adjust penalties accordingly. The burden
of proving the inability to pay is on the
violator.
—Strict Liability: For some regulated
pollutants that pose grave threats to the
environment and human populations
(e.g., toxic and hazardous pollutants),
administrators enforce penalties under
a theory of strict liability. Under this
theory, any party who contributes to
a hazardous waste site (generates,
transports, stores or disposes), can be
held liable for the entire cost of the
cleanup, regardless of the magnitude of
that party's contribution. However, in sit-
uations where there are multiple poten-
tially responsible parties, the administra-
tor will attempt to identify
and resolve the liability of the smaller
contributing parties early in the process.
The harshness of the enforcement
scheme can be mitigated by
implementing a de minimis exemption
to the settlement policy, which exempts
the smallest contributors from liability
subject to certain conditions.14
3.2 Criminal Penalties
Punitive by nature, criminal reme-
dies tend to utilize fines or imprisonment
rather than damages or restitution. Criminal
laws focus on immorality and state of mind,
while tort laws focus on compensation. A
further distinction is that criminal remedies
tend to be imbued with moral culpability.
The justifications for tort and criminal law
differ in that tort law focuses on compensat-
ing a victim for damages that have
occurred or likely will occur, while criminal
law focuses on protecting the public from
harm by punishing harmful results that will
or probably will occur from defendant's
conduct.
3.2.1 Appropriateness of Civil or
Criminal Penalties
Criminal law punishes a broad
range of activities. A threshold question in
determining whether criminal or civil penal-
ties are appropriate focuses on which form
of punishment provides the most practical
and effective means of coercing the
desired behavior.
Function of Criminal Penalties:
Criminal penalties can seek retribution,
social condemnation, specific deterrence,
general deterrence, protection of third par-
ties, and payment of compensation or repa-
ration. Thus it serves a much broader
range of functions than civil damages.15
Standard of Proof: Generally at
common law, the burden of proof in civil
cases need only balance the probabilities
in favor of the defendant's guilt. Criminal
cases however, usually require prosecutors
to prove the defendant's guilt beyond a rea-
sonable doubt.
3.2.2 Underlying Bases of
Criminal Punishment
There are two possible routes to a
criminal sanction for environmental viola-
tions. One is through the conventional crim-
inal codes. Another consists of acts that are
specifically made punishable through the
various environmental statutes.16
—Severity of Punishment: The severity
of criminal offenses are not solely
defined by the resulting punishment,
but are frequently classified as
felonies or misdemeanors prior to
the administering of punishment.
— Felonies: Felony offenses usually
require the defendant to "purposely,"
"knowingly," or "recklessly" violate the
law and generally carry more severe
sentences and fines.
—Misdemeanors: Misdemeanor offenses
often require less culpability on the part
of the defendant and can be prosecuted
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INECE SECRETARIAT STAFF 303
when the defendant "negligently"
commits an act or omission.
Alternatively, misdemeanors can
also be prosecuted where a defendant
"purposefully," "knowingly," or
"recklessly" commits an act or omission
which has less deleterious effects
than a felony offense.
3.3 Alternatives to Civil & Criminal
Penalties - U.S. &
Canadian Models
3.3.1 Supplemental Environmental
Projects in the United States
The purpose of Supplemental
Environmental Projects is to encourage
and obtain environmental and public health
protection and improvements that may not
otherwise have occurred without the settle-
ment incentives provided by the policy.17
In evaluating a proposed Supple-
mental Environmental Project, administra-
tors may follow an evaluation process sim-
ilar to that of the U.S. Environmental Pro-
tection Agency (EPA), which follows the fol-
lowing four-step process:18
— Ensure the Project Meets the Basic
Definition of a Supplemental
Environmental Project. This means it
must improve, protect or reduce risks to
public health, or the environment at
large. The primary benefit of the project
must be to the public health or the
environment, rather than benefits
accrued by the regulated violator.
Further, Supplemental Environmental
Projects cannot include actions that
the defendant is likely to be required to
perform as injunctive relief in the instant
case, as injunctive relief in another legal
action that EPA or another regulatory
agency could bring, as part of an
existing settlement or order in another
legal action, or by a state or local
requirement.
— Ensure that All Legal Guidelines are
Satisfied:19 The project cannot be
inconsistent with any provision of the
underlying statutes and must either:
advance an objective of the environ-
mental statutes that form the basis
of the action; by design, reduce the
likelihood of similar violations; reduce
the adverse impact that the violation
contributes to; or reduce overall risk
potentially affected by the violation.
—Other Requirements: A project cannot
use funds to satisfy obligations of a
federal agency, nor spend money
on projects that might circumvent
limitations on federal funding.
—Commitment to perform a Supplemental
Environmental Project may mitigate
the penalty assessed.20 However,
the final penalty should meet some
minimum amount established by the
administrator. In calculating the final
settlement penalty, the administrator,
within its discretion, may mitigate
the penalty in response to the
violator undertaking a Supplemental
Environmental Project. The U.S. EPA
utilizes the following formula:
Final Settlement = Settlement amount -
(Supplemental Environmental Project
Cost x Mitigation Percentage)
The following broad project cate-
gories illustrate some of the aims of a Sup-
plemental Environmental Project:
— Public Health: Providing diagnostic,
preventative or remedial health care
(e.g., community medical treatment,
therapy or studies).
— Pollution Prevention: Reduce the
amount or toxicity of the pollution
produced (e.g., improvements in
recycling, treatment and disposal
techniques).
— Environmental restoration and
protection: Improve the land, air
or water at natural or man-made
environments affected by the violation
(e.g., conservation or remediation of
resources not otherwise mandated
by law).
—Assessments and audits: Examine
internal operations to determine if other
pollution problems exist or if operations
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
could be improved to avoid future
violations (e.g., pollution prevention
assessments, environmental quality
assessments, or environmental
compliance audits with requirements
to correct any discovered violations).
— Environmental compliance promotion:
Help other companies achieve
compliance and reduce pollution
(e.g., seminars, publications, training
or technical support).
— Emergency Planning and Preparedness:
Assist state or local emergency
response or planning agencies to
fulfill their duties under the Emergency
Planning and Community Right to Know
Act (e.g., non-cash assistance such as
training or equipment).
3.3.2 Environmental Protection
Alternative Measures in Canada
Environmental Protection Alterna-
tive Measures, as provided by the Canadi-
an Environmental Protection Act of 1999,
are an alternative to court prosecution.
Environmental Protection Alternative Mea-
sures under the Act divert the accused -
whether a company, individual or govern-
ment agency - away from the court
process after the entity is charged, and into
negotiations between the accused and the
Attorney General of Canada, in consulta-
tion with the Minister of the Environment.
The Environmental Protection Alternative
Measure will contain measures that the
accused must take in order to restore com-
pliance.
Examples of those measures
include:
—Development of pollution prevention
measures to reduce releases of a toxic
substance down to regulated limits;
— Installation of better pollution control
technology or monitoring systems;
—Changes to production to ensure
compliance with regulatory
requirements; and
—Clean-up of environmental damage.
Not every alleged offender is eligi-
ble for an Environmental Protection Alter-
native Measure.
4 REFERENCES
1 Dobbs, Dan B., Dobbs Law of Remedies
3(1993).
2 Id. at 288.
3 Id. at 289.
4 Id.
s Id.
e Id. at 5.
7 Id. at 566.
s Id. at 6.
9 Id. at 10.
10 Riesel, Daniel. Environmental Enforce-
ment: Civil and Criminal § 4.05 (5th ed.
1999).
11 Memorandum from the Kathie A. Stein,
EPA Office of Enforcement and Compli-
ance Assurance, to Regional Division
Directors 5 (July 23, 2002) available at
http://www.epa.gov/compliance/
resources/policies/civil/caa/stationary/
penpol.pdf.
12 Id.
13 Id.
14 Memorandum form Barry Green, Officer
of Site Remediation enforcement, U.S.
EPA and Bruce Gelber, Environmental
Enforcement Section, U.S. Dept. of Jus-
tice, to Regional Directors, Revised Set-
tlement Policy and Contribution Waiver
Language Regarding Exempt De
Micromis and Non-exempt De Micromis
parties (Nov. 6, 2002) available at
http://www.epa.gov/Compliance/resourc
es/policies/cleanup/superfund/wv-
exmpt-dmicro-mem.pdf.
15 Woods, Michael and Richard Macrory,
Environmental Civil Penalties: a More
Proportional Response to Regulatory
Breach, Faculty of Laws, University Col-
lege of London, 11 (Nov. 2003) available
at http://www.ucl.ac.uk/laws/environ-
ment/civil-penalty/index.html.
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INECE SECRETARIAT STAFF 305
16 Riesel, Daniel. Environmental Enforce- Compliance Assurance, to Regional
ment: Civil and Criminal § 6.02 (5th ed. Administrators 1 (May 1,1998) available
1999). at http://www.epa.gov/Compliance/
17 Memorandum from the Steven A. Her- resources/policies/civil/seps/fnlsup-
man, EPA Office of Enforcement and hermn-mem.pdf
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306 SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
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HlMBERG 307
THE NEW ACCOUNTABILITY AND ADVISORY MECHANISM
OF THE OVERSEAS PRIVATE INVESTMENT CORPORATION:
THE APPLICATION OF INTERNATIONAL BEST PRACTICES
OF INTERNATIONAL FINANCIAL INSTITUTIONS
HlMBERG, HARVEY A.
Senior Environmental Specialist, Quality Assurance and Control Unit, Environmentally
and Socially Sustainable Development Network; Former Deputy Vice President for
Investment Policy and Director, Environmental Affairs at the Overseas Private Investment
Corporation, The World Bank, 1818 H Street, N.W., Washington, DC, 20433, U.S.A.,
hhimberg@worldbank.org
SUMMARY
This paper analyzes the options and outcomes by which the U.S. Overseas Private
Investment Corporation (OPIC) recently designed an accountability and advisory mecha-
nism. OPIC's accountability and advisory mechanism although modeled after the "best
practices" of the accountability and advisory mechanisms of several international financial
institutions was also, of necessity, adapted to conform to the expectations of OPIC's stake-
holders and to its identity, structure, and culture as bilateral financial institution and agency
of the U.S. government.
1 BACKGROUND: THE
OVERSEAS PRIVATE
INVESTMENT CORPORATION
The Overseas Private Investment
Corporation is an agency of the U.S. gov-
ernment and, as such, occupies a unique
position among international financial insti-
tutions that support economic and social
development in developing countries and
emerging markets.1 Accordingly, the struc-
ture and functions of OPIC's new account-
ability and advisory mechanism reflect its
identity as an agency of the US govern-
ment and other mandates that flow from
that relationship. Seven executive branch
agencies, including OPIC, are represented
on OPIC's fifteen member Board of Direc-
tors, all appointed by the President of the
United States at the sub-cabinet level.2
By statute, OPIC operates under the "for-
eign policy guidance" of the U.S. Depart-
ment of State and every transaction assist-
ed by OPIC requires separate State
Department approval on foreign policy
grounds. The Overseas Private Investment
Corporation is subject to periodic reautho-
rization requiring affirmative legislative
action by the U.S. Congress and Executive
Branch with terms historically extended to
at most four years and sometimes as little
as one year.3 The Overseas Private Invest-
ment Corporation's budget, although
appropriated from its own funds, must be
approved in annual appropriations legisla-
tion.
Like the International Finance Cor-
poration and the Multilateral Investment
Guaranty Agency - both World Bank affili-
ates - OPIC works exclusively with the pri-
vate sector in support of foreign direct
investment. Like the International Finance
Corporation, OPIC provides medium and
long-term project finance (and to a lesser
extent corporate finance) to enterprises in
developing countries and emerging mar-
kets and supports financial intermediaries
(such as equity funds and on-lending facili-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
ties) that invest in such enterprises and
projects. Unlike the International Finance
Corporation, OPIC's financing is limited to
direct loans (for small business) and loan
guaranties (for medium and large projects)
and does not include equity for OPIC's
account.4 Like the Multilateral Investment
Guaranty Agency, OPIC provides political
risk insurance to mitigate the risks of expro-
priation, currency inconvertibility, and politi-
cal violence. However, unlike both the
International Finance Corporation and the
Multilateral Investment Guaranty Agency,
which can support investment originating
from any member country, projects sup-
ported by OPIC must also have some direct
U.S. business connection, typically in the
form of equity, debt or other long-term
stake in the project.
However, unlike most other bilater-
al institutions that support overseas invest-
ment, OPIC is a development bank and not
an export credit agency, according to the
Organisation of Economic Co-operation
and Development's definition of "export
credit agencies."5. As such, OPIC supports
development through the vehicle of foreign
direct investment rather than trade per se;
unlike the export credit agencies, OPIC
does not finance exports.6 Several other
industrialized countries have government
supported or affiliated development banks
that finance investments in developing
countries; however these tend to be much
smaller than OPIC and the export credit
agencies.7
In voting to reauthorize OPIC for
four years in November 2003, the Interna-
tional Relations Committees of the House
of Representatives and the Senate Foreign
Affairs Committee recommended that
OPIC "follow the best practices of [several
international financial institutions] and work
with all stakeholders to establish an
accountability mechanism."8 Both commit-
tee reports cited, as examples of "good
practice," virtually all of the international
financial institutions known to have adopt-
ed accountability and advisory mecha-
nisms, including the World Bank Group
(consisting of the International Bank for
Reconstruction and Development, the
International Finance Corporation and the
Multilateral Investment Guaranty Agency),
the Asian Development Bank, the Inter-
American Development Bank, the Euro-
pean Bank for Reconstruction and Devel-
opment, the Export Development Corpora-
tion of Canada, and the Japanese Bank for
International Cooperation.
The report also set forth the Com-
mittee's expectations regarding the func-
tions, scope, accessibility and transparen-
cy of the mechanism. Following Congres-
sional guidance, the design of OPIC's
accountability and advisory mechanism
took the form of a multi-stakeholder
process under the leadership of OPIC's
Board of Directors, and senior manage-
ment with active participation by civil socie-
ty, private industry and interested members
of Congress.
2 TERMS OF REFERENCE FOR
OPIC'S ACCOUNTABILITY AND
ADVISORY MECHANISM
The terms of reference for the
accountability and advisory mechanism as
approved by OPIC's Board in September
2004 is a remarkably concise four-page
document. This brevity results from the use
of concepts and terms that derive their
meanings from detailed descriptions pro-
vided by other international financial institu-
tions in the terms of reference set forth for
their own accountability and advisory
mechanisms. It also reflects the expecta-
tion that additional refinements would occur
as the mechanism is staffed and integrated
into OPIC's management structure. The fol-
lowing aspects of Overseas Private Invest-
ment Corporation's accountability and advi-
sory mechanism are clearly defined: its
functions, structure, stakeholder access,
scope of its mandate, lines of authority, and
transparency of its recommendations.
2.1
Functions
Consistent with Congressional rec-
ommendations, OPIC's accountability and
advisory mechanism will perform all three
functions associated with these mecha-
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HlMBERG 309
nisms in other international financial institu-
tions: compliance review, problem-solving,
and advisory. With respect to the "best
practices" mandate, OPIC's choice most
closely resembles the functions assigned
to the International Finance Corporation/
Multilateral Investment Guaranty Agency
Compliance Advisor Ombudsman the only
other accountability and advisory mecha-
nism that appears to perform all three func-
tions.
Compliance review: Evaluate and report
on OPIC compliance with its governing
statutes, rules, policies and procedures
relating to environment, social, labor and
human rights standards in the context of
specific projects;9
Problem solving: Provide a forum for
addressing the concerns of locally affected
communities and review and try to resolve
outstanding complaints of local communi-
ties relating to the impacts of projects sup-
ported by OPIC on such communities,
with or without allegations of non-compli-
ance on the part of OPIC; and
Advisory: provide advice regarding the
adequacy for fulfilling OPIC's public policy
mission, of OPIC's existing policies and
procedures rather than on specific OPIC -
supported projects.
Given OPIC's small size and com-
pliance-oriented culture as a U.S. govern-
ment agency it is OPIC's expectation that
of the three functions, the problem-solving
role will be the most visible consequence of
the establishment of an accountability and
advisory mechanism. Although the adviso-
ry function will be important, to some extent
it will formalize existing relationships that
OPIC has with stakeholders, such as the
quarterly meetings that its President has
had with civil society since 2001.
2.2 Structure
The structure of OPIC's accounta-
bility and advisory mechanism differs from
that of the Compliance Advisor Ombuds-
man in that the advisory function is separat-
ed from the compliance and problem solv-
ing functions. The first two are assigned to
the new Office of Accountability, a senior-
level Director of Accountability reporting
directly to the President and Chief Execu-
tive Officer (See the discussion on authori-
ty, below). Rather than charging the Direc-
tor of Accountability with primary responsi-
bility for advising management on policies
and procedures (as is the case for the
Compliance Advisor Ombudsman), this
responsibility is to be assigned to an Advi-
sory Group organized under OPIC's exist-
ing Office of External Affairs. The Advisory
Group will be open to representatives of a
broad spectrum of OPIC stakeholders
including those from civil society as well as
the business communities and will include
participation by liaisons of the seven U.S.
government agencies represented on
OPIC's Board.
The decision to open the advisory
process to as broad as possible a range of
internal and external stakeholders seeks to
maximize the transparency of the advisory
process. To some extent this choice also
reflects OPIC's identify as a US govern-
ment agency and the concerns that have
been raised in recent years regarding the
transparency of the advisory process in
agency decision-making.10 The Overseas
Private Investment Corporation was
encouraged to move in this direction by the
example of the external stakeholder advi-
sory committees organized by the Office of
the US Trade Representative on various
economic, environmental and social issues
impacted by trade negotiations.
2.3 Stakeholder Access
In general terms, OPIC's accounta-
bility and advisory mechanism will be
accessible to all stakeholders to the same
extent as other offices that deal directly
with the public, such as the Office of Exter-
nal Affairs. However, with respect to two
functions assigned to the Office of Account-
ability - compliance review and problem
solving - the issue of access was one of
the more contentious issues debated dur-
ing the stakeholder consultations. The
question of which party has "standing" to
initiate a compliance review or problem
solving effort has been controversial in all
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
accountability and advisory mechanism
processes. In this connection, OPIC con-
ducted a detailed review of the practices of
other accountability and advisory mecha-
nisms and discussed the issue at length
with its stakeholders before making a deci-
sion to provide access to the Office of
Accountability as follows:
2.3.1 Compliance Review
For compliance review purposes,
standing to file a complaint with the Office
of Accountability is available to: (1)
"impacted communities in the host country"
(2)" those documented as their authorized
representatives;" and (3) OPIC Manage-
ment and Board.
In this regard, access to OPIC's
accountability and advisory mechanism
appears more liberal than that of the Inter-
national Finance Corporation/Multilateral
Investment Guaranty Agency Compliance
Advisor Ombudsman whose Operational
Guidelines reserve the right to trigger com-
pliance audits to investigations by the Com-
pliance Advisor Ombudsman itself or at the
request of the management of International
Finance Corporation or the Multilateral
Investment Guaranty Agency,11 and at the
same time less liberal than Canada's
Export Development Corporation which
permits virtually any self-identified stake-
holder to access the Corporation's compli-
ance program.
The Overseas Private Investment
Corporation's standing provision on compli-
ance reviews appears to be generally con-
sistent with the practices of the Internation-
al Bank for Reconstruction and Develop-
ment's Independent Inspection Panel; the
European Bank for Reconstruction and
Development's Independent Recourse
Mechanism; the Asian Development Bank's
Special Project Facilitator; the Inter-Ameri-
can Development Bank 's Independent
Investigation Mechanism and Japanese
Bank for International Cooperation's Com-
pliance Mechanism, all of which permit
locally affected persons to request initiation
of a compliance review.12
In any case, although the external
stakeholders defined above may contact
the Office of Accountability to request a
compliance review and the Office of
Accountability can recommend that such a
review be conducted, the final determina-
tion to conduct such a review is to be made
by the President (see discussion of "author-
ity," below).
2.3.2 Problem-Solving
For problem-solving purposes,
standing to file complaints with the Office of
Accountability is available to (1) impacted
communities in the host country, (2) those
documented as their authorized represen-
tatives and (3) project sponsors.
With the inclusion of project spon-
sors, OPIC's problem solving portal pro-
vides broader access to external stake-
holders than either of the two accountabili-
ty and advisory mechanisms that have with
a comparable problem solving mandates:
the International Finance Corporation/Mul-
tilateral Investment Guaranty Agency Com-
pliance Advisor Ombudsman's Ombuds-
man, and the Asian Development Bank's
Special Project Facilitator.
In the latter two cases complaints
may be filed by locally affected people or
their designated representatives but not by
project sponsors (companies borrowing or
receiving investments from the Internation-
al Finance Corporation and companies or
host governments in the case of Asian
Development Bank). OPIC proposed
extending this standing to project sponsors
as way of enhancing the neutral mediation
role that the Office of Accountability is
expected to play in its problem solving
capacity, to reduce the risk that sponsors
would always tend to assume that Office of
Accountability intervention amounted to
advocacy on behalf of locally-impacted
communities and to maximize the opportu-
nities for the Office of Accountability to
interact on the project level where local
communities may lack the information or
resources to initiate a problem-solving
review.
OPIC's decision to so limit standing
is consistent with its primary objective justi-
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HlMBERG 311
fication in establishing an accountability
mechanism: to provide a dedicated portal
through which locally affected communities
could engage OPIC senior management
outside of the decision-making authority for
project approval and routine monitoring.
The same logic applies to the decision to
give sponsors the right to initiate problem
solving reviews: they are direct stakehold-
ers in the project.
With respect the accountability and
advisory mechanism's advisory functions,
broad representation of civil society within
the Advisory Group, the presence in the
Advisory Group of key management and
Board liaisons, and the flexibility afforded
by the informality of a process not restrict-
ed by the Federal Advisory Committee Act
will ensure that NGOs and other external
stakeholders have direct access to OPIC
decision makers with respect to agency's
policies and procedures over a full range of
policy issues.
2.4 Scope
Following Congressional guidance,
the scope of the Office of Accountability's
compliance review and problem solving
activities are focused on OPIC's statutory
mandates and subordinate policies and
procedures relating to environmental and
social concerns, labor and human rights.
This is at once both narrower and broader
than the scope of activity for the accounta-
bility and advisory mechanism of other
international financial institutions.
OPIC's model would in the first
instance appear to be comparable to the
scope of the compliance audit role of the
International Finance Corporation/Multilat-
eral Investment Guaranty Agency Compli-
ance Advisor Ombudsman which is to
determine "whether the International
Finance Corporation or the Multilateral
Investment Guaranty Agency staff, and in
some cases the project sponsor, have com-
plied with the International Finance Corpo-
ration or the Multilateral Investment Guar-
anty Agency social and environmental poli-
cies, guidelines and procedures."13 How-
ever, the scope of OPIC's Office of
Accountability is narrower in that it seeks
only to determine OPIC's compliance with
its own requirements, and does not envis-
age making determinations as to sponsor
compliance. OPIC takes the view that
determinations of sponsor compliance with
the conditions included in its loan agree-
ments and insurance contracts should
remain within the full discretion of OPIC
management, including its Office of Legal
Affairs, and not delegated to an accounta-
bility office. Not only is this a matter of prin-
ciple; as a practical matter, sponsor compli-
ance is technically a matter of compliance
with contract conditions. Absent such con-
ditions, a sponsor cannot be found to be
non-complaint. As finance agreements and
insurance contracts are not publicly dis-
closed documents, there is no practical
basis on which a locally-impacted commu-
nity, or any other external stakeholder for
that matter, can allege that an OPIC-sup-
ported sponsor is in violation of a particular
contractual condition. This difference
between the scope of OPIC and the Inter-
national Finance Corporation compliance
mechanisms may reflect differences in the
transparency policies of these respective
agencies, matter to be discussed more fully
in the section of transparency, below.
With respect to the problem solving
function, the scope of OPIC's accountabili-
ty and advisory mechanism activity is also
narrower than the grounds for complaints
considered under the International Finance
Corporation/Multilateral Investment Guar-
anty Agency Compliance Advisor Ombuds-
man problem-solving or ombudsman roles
which "may relate to any aspect of the
planning, implementation or impact of proj-
ects."14 In practice, the International
Finance Corporation/Multilateral Invest-
ment Guaranty Agency Compliance Advi-
sor Ombudsman has taken complaints on
economic and social matters that are out-
side the scope the International Finance
Corporation or the Multilateral Investment
Guaranty Agency environmental or social
policies.
The scope of the OPIC accounta-
bility and advisory mechanism's advisory
role is similar to that of the International
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
Finance Corporation Compliance Advisor
Ombudsman - the only other accountabili-
ty and advisory mechanism with a defined
advisory role, with its focus on agency poli-
cies and procedures rather than specific
projects. However, in OPIC's case, the
Advisory Group is not limited to environ-
mental, social, labor and human rights mat-
ters, but also includes issues of "trans-
parency" and "the full range of OPIC public
policy mandates, including U.S. economic
effects and the 'cumulative impacts' of
OPIC policies and procedures."
There is one other aspect in which
OPIC's accountability and advisory mecha-
nism has a potentially broader scope than
the AMs of other international financial
institutions and this reflects OPIC's rela-
tively comprehensive and prescriptive
mandate labor rights mandate, compared
to other international financial institutions.
Since 1986, OPIC has been required to
take worker rights conditions into account
in determining country eligibility for its pro-
grams. As a result OPIC programs in sev-
eral countries have been suspended at var-
ious times on worker rights grounds.15
Since 1993 OPIC has also been
statutorily prohibited from supporting any
project that "contributes to violations of
internationally recognized worker rights,"
and has been required to include specific
worker rights compliance language in every
finance agreement and insurance contract
it issues for projects. Along with prohibi-
tions of forced labor and child labor that are
increasingly common to loan conditionality
in IFI-sponsored projects, OPIC's language
references the rights of association, collec-
tive bargaining, minimum wages, hours of
work and occupational health and safety.
OPIC interprets and applies this language
to require sponsor compliance, wherever
feasible, with the applicable conventions of
the International Labor Organization
(whether or not the host country, or for that
matter, the US, is a signatory to the partic-
ular convention). OPIC's interpretation of
"labor rights" is considerably broader than
the current norm among international finan-
cial institutions, where consensus on the
need to guarantee the rights of association
and collective bargaining remain controver-
sial. 1fs
OPIC's worker rights mandate and
its inclusion within the scope of its account-
ability and advisory mechanism, provides a
potential opportunity for the workers in an
OPIC-supported project (whether organ-
ized or not), as locally-impacted communi-
ties, to file complaints with the accountabil-
ity and advisory mechanism that could gen-
erate problem solving activity in the form of
labor-management mediation or compli-
ance reviews regarding the application by
OPIC of its statutory worker rights require-
ments. It is unclear whether this recourse is
available to project workers under any
other IFI accountability mechanism.
To a lesser extent, OPIC's statuto-
ry requirements on human rights distin-
guish the scope of OPIC's accountability
and advisory mechanism activities from
those of its IFI counterparts. Although far
less prescriptive than its worker rights
requirements, OPIC is required to "take
human rights into account in the operation
of its programs" and to refrain from provid-
ing assistance to projects that provide
direct or significant indirect assistance to
governments with a "consistent record of
gross violations of human rights. Although
human rights have barely begun to appear
on the agendas of international financial
institutions it is not yet an actionable policy
on the project level.17
In practice OPIC defers to the guid-
ance of the US State Department's Bureau
for Human Rights, Democracy and Labor in
implementing its human rights statutory
requirement, and once having done that it
is not clear on what basis a complaint could
be filed with OPIC's Office of Accountability
regarding OPIC compliance with its human
rights mandate. However, where compa-
nies are implicated in human rights viola-
tions in connection with OPIC-assisted
projects, there may be an opportunity for
creative problem solving on the part of the
Office of Accountability. Moreover, there
are tools under development by human
rights NGOs could provide international
financial institutions with the means to
impose some form of human rights condi-
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HlMBERG 313
tionality on project sponsors. Once action-
able, such conditions could become the
basis for activity by accountability mecha-
nisms.
In one area OPIC departed from
the recommendation of the Congressional
Committee report. Whereas the report
included "corruption" among the environ-
mental and social concerns to be within the
purview of the accountability and advisory
mechanism, OPIC concluded that existing
statutory requirements in application of the
Foreign Corrupt Practices Act took prece-
dence over Committee report language
and that OPIC should rely on existing pro-
cedures, including referral of credible alle-
gations of corruption to the Department of
Justice and the Securities and Exchange
Commission rather than charge the
accountability and advisory mechanism
with investigating corruption allegations.
Should any information come to the atten-
tion of the Office of Accountability regarding
corruption allegations on the part of OPIC-
supported sponsors, the Office of Account-
ability would treat this information the same
way as any other OPIC employee.
2.5 Authority
The Congressional Committee
reports recommended that OPIC "insure
the independence and integrity of the eval-
uations and advice provided by the
accountability mechanism."
This raised the question of whether
the accountability and advisory mechanism
should report directly to the OPIC Board of
Directors or to the President of OPIC, all
appointees of the President of the United
States. The international financial institu-
tions follow a mixed practice. In some
cases the AM reports to the Board: the
International Bank for Reconstruction and
Development Inspection Panel reports to
the International Bank for Reconstruction
and Development Board of Directors as
does the Asian Development Bank's Com-
pliance Review Panel and the International
Monetary Fund's Independent Evaluation
Office.18 In other instances the accounta-
bility officer reports to the President or
other chief executive officer.19 In some
international financial institutions the chief
accountability officer is an employee of the
organization while in other cases the offi-
cers or officers have the status of inde-
pendent experts who perform their duties
on a project-specific basis.
In OPIC's case, OPIC has made it
clear that the Director of Accountability will
be an employee of OPIC and that the work
and reports of the Director of Accountabili-
ty will be integrated into the overall deci-
sion-making of the agency under gover-
nance of the President and CEO and the
Board of Directors, where agency authority
will continue to reside.20
The decision to have the OPIC
Director of Accountability report directly to
OPIC's President and CEO and not to the
Board was facilitated by the fact that unlike
the international financial institutions which
have resident full-time resident Boards of
Directors who may be require to approve
nearly every agency transaction, OPIC has
a part-time Board that meets quarterly to
approve the agencies budget, major proj-
ects and policy initiatives. Moreover,
OPIC's President and CEO is currently, by
designation of the President of the United
States, also the Chairman of OPIC's Board.
It is OPIC's expectation that the
Office of Accountability would receive and
investigate claims from eligible parties,
draw independent conclusions and make
recommendations to the President regard-
ing OPIC compliance or future steps to
resolve a conflict. Although the findings and
recommendations of the Office of Account-
ability will reviewed in the first instance by
OPIC's President, the Office of Account-
ability will have a regular opportunity to
report its activities to the full Board of Direc-
tors or a subset of the Board membership.
Beyond reporting mechanisms, the
independence of OPIC's Office of Account-
ability will be ensured by its ability to review
all documents relating to a project under its
purview, to interview staff that worked on
the project, to conduct site visits and to
employ consultants and bring in expertise
as need to respond to specific requests,
subject to all of the normal budget con-
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
straints that apply to OPIC as a federal
agency.
2.6 Transparency
The Congressional Committee
report expressed the view that OPIC's
accountability mechanism should "be
transparent in its operations and outputs."
21 OPIC recognizes that maximizing trans-
parency and information disclosure is criti-
cal for the Office of Accountability 's credi-
bility and public confidence in the process.
OPIC has sought to emulate the
best practices of the international financial
institutions with respect to the transparency
of its decision-making process regarding in
particular environmental and social mat-
ters. For example, OPIC has adopted prac-
tices similar to that of the International
Finance Corporation for public disclosure
and consultation regarding Environmental
Impact Assessment for Category A proj-
ects. However, it is more difficult for OPIC
to simply adopt the public disclosure prac-
tices of international financial institutions
than it is to emulate other due diligence and
project monitoring practices because, as a
US government agency, OPIC is subject to
the statutory and regulatory framework of
the U.S. government with respect to infor-
mation disclosure, particularly information
of a business confidential nature. The Free-
dom of Information Act contains a pre-
sumption of disclosure subject to exemp-
tions including the protection of the integri-
ty of the internal government deliberative
process and information that is legitimately
business confidential. The protection of the
latter category of information is reinforced
by criminal provisions of the Trade Secrets
Act that apply to OPIC employees, includ-
ing the Office of Accountability, in an indi-
vidual capacity.
Subject to these applicable laws,
its is expected that the Office of Account-
ability 's reports would be made available to
claimants and to project sponsors and that
wherever possible, Office of Accountability
findings would also be made public in a
timely manner. Wherever necessary,
appropriate measures will be taken to
maintain the confidentiality of communica-
tions where companies request such pro-
tection.
3 CONCLUSION
The application of international
"best practices" to the design of an
accountability mechanism for a bilateral
financial institution can provide a useful
framework for identifying options regarding
access, standing, scope and transparency.
However, to be effective, such a mecha-
nism needs to be responsive to the expec-
tations of the institution's particular stake-
holders as well as reflect the institution's
political and institutional culture. It is to be
expected that OPIC's model will continue to
evolve in
4 REFERENCES
1 OPIC operates its programs in approxi-
mately 150 such countries. A current
OPIC country eligibility list can be found
at www.opic.gov.
2 The agencies include the Departments of
State, Treasury, Commerce, Labor, the
Office of US Trade Representative and
the Agency for International Develop-
ment. The other eight members, also
appointed by the President of the United
States, are from the U.S. private sector
and are required to include at least one
representative each from small business,
organized labor and cooperatives.
3 In 1977 and again in 1996 controversy
over OPIC's very existence resulted in
one year reauthorizations; in 1997 OPIC
was reauthorized for two years. OPIC's
current reauthorization is set to expire in
December 2007.
4 In 1999 OPIC's authorizing statute pro-
vided for a pilot equity program limited to
sub-Saharan Africa and he Caribbean,
but Congress has not appropriated funds
for this program due to its reluctance to
having the US government as an owner
of foreign assets.
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HlMBERG 315
5OECD. Arrangement on Guidelines for
Officially Supported Export Credits.
Paris, 1998.
6 The investments OPIC supports can and
do use OPIC financing to buy goods and
services from the United States as well
as other countries, as well as to export
products, subject to OPIC restrictions on
support of activities that have the poten-
tial to displace US domestic production
and employment.
7 A number of the European development
banks belong to informal association, the
European Development Finance Institu-
tions (EDFI). For a complete list and
description of these institutions, all of
which are somewhat smaller and less
active than OPIC, see
http://www.fmo.nl/en/links/edfi.php.
8 House committee on International Rela-
tions, Overseas Private Investment Cor-
poration Amendments Act of 2003,108th
Congress, 1st Session, Report 108-339,
November 3, 2003.
9 The OPIC accountability and advisory
mechanism compliance review function
is a bit narrower than the IFC/MIGA
Compliance Advisor Ombudsman as the
latter oversees "audit of IFC's and MIGA'
social and environmental performance
both on systemic issues and in relation to
sensitive projects (emphasis added).
See IFC/MIGA, (Revised) Operational
Guidelines for the Office of the IFC/MIGA
Compliance Advisor Ombudsman,
November 2004 at http://www.cao-
ombudsman.org/html-eng lish/about_
opguidelines.htm.
10 Government in the Sunshine Act 5
U.S.C. 552b.
11 "Compliance audits may be triggered by
Ombudsman investigations or undertak-
en on a case-by-case basis at the
request of management or on the Com-
pliance Advisor Ombudsman's own initia-
tive." (Revised) Operational Guidelines
for the Office of the IFC/MIGA Compli-
ance Advisor/Ombudsman, op. cit.
12 International Bank for Reconstruction
and Development/International Develop-
ment Association, The Inspection Panel:
Operating Procedures, 1994; European
Bank for Reconstruction and Develop-
ment, Independent Recourse Mecha-
nism, April 29, 2003; Inter-American
Development Bank, The Independent
Investigation Mechanism, June 30, 2000;
Japan Bank for International Coopera-
tion, JBIC's New Accountability Mecha-
nism to Environmental and Social Guide-
lines, April 2003 (powerpoint).
13 Compliance Advisor Ombudsman, Oper-
ational Guidelines, op cit.
14
op cit.
15 OPIC programs in Chile, Romania,
Nicaragua, Mauritania, and the Central
African Republic have been suspended
on worker rights grounds as a result of
findings by the Office of the U.S. Trade
Representative that these countries
failed to meet the "taking steps" criteria
required for beneficiary status under the
Generalized System of Preferences
(GSP) trade program. GSP and OPIC eli-
gibility have since been restored. Liberia
remains ineligible for GSP OPIC on
worker rights grounds. Other countries -
e.g. El Salvador, Guatemala,
Bangladesh - have been subject to
extensive multi-year reviews of worker
rights conditions. Independent of the
GSP eligibility, OPIC has suspended and
since restored its programs in Ethiopia
and South Korea; OPIC programs
remain suspended in Saudi Arabia,
Qatar and the United Arab Emirates on
worker rights grounds.
16 Most recently, the IFC has moved toward
a more extensive definition of worker
rights by referencing the rights of associ-
ation and collective bargaining in its new
proposed Performance Standard on
Labor and Working Conditions.
17 World Bank President Urges 'radical
shift," Financial Times May 18, 2004;
Exim..., EGCD.
18 It is unclear why the IMF was cited in the
Committee report among the list of IFIs
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
having accountability mechanisms as the
IMF's role is to provide balance of pay-
ment support to countries and it does not
support investment projects as is the
case for development banks and export
credit agencys. The IMF's IEO does not
respond to claims filed by external stake-
holders.
19The IFC/MIGA Compliance Advisor
Ombudsman reports the President of the
World Bank group, and not to IFC's
Executive Vice President, who is the
chief management official at IFC Com-
pliance Advisor Ombudsman, Opera-
tional Guidelines, op cit).;. The Asian
Development Bank's Special Project
Facilitator (who implements the problem
solving function at the Asian Develop-
ment Bank) reports directly to the Presi-
dent and not to the Board. Asian Devel-
opment Bank Accountability Mechanism,
May 2004; JBIC's mechanism reports to
Governor of JBIC, a position comparable
to the President of OPIC. (Japan Bank
for International Cooperation, JBIC's
New Accountability Mechanism to Envi-
ronmental and Social Guidelines, April
2003 (powerpoint)) The Independent
Investigation Mechanism of the IADB
appears to report to both the President
and to the Board of Directors (Inter-
American Development Bank, The Inde-
pendent Investigation Mechanism, June
30, 2000).
20 OPIC has recently filled the DA position
on a three year contractual basis.
21 HIRC report, op. cit.
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SEVENTH INTERNATIONAL CONFERENCE ON ENVIRONMENTAL COMPLIANCE AND ENFORCEMENT
ACKNOWLEDGEMENTS
The Editors would like to provide a
special note of thanks to the conference
speakers, topic experts, moderators,
facilitators, rapporteurs, and those who
volunteered to prepare papers. These
Colleagues are making a special effort to
share their experiences and help facilitate
our exchanges at the Conference. Special
thanks to those contributing materials for
the Conference exhibits.
The Seventh International
Conference on Environmental Compliance
and Enforcement in Marrakech, Morocco,
was made possible by the personal and
financial contributions of many organiza-
tions and individuals. The Executive
Planning Committee of INECE, whose
membership is listed on page 1 of the
Proceedings, provided leadership and
direction in the design of the program,
selection of the speakers and topic experts,
and identification of individuals from a
range of nations who would be in the best
position to share practical experience in
environmental compliance and enforce-
ment to improve or develop domestic com-
pliance and enforcement programs and to
engage in ongoing networking, capacity
building and enforcement cooperation.
Funding of the Conference logis-
tics, planning, and workshop development
was provided by the Conference sponsors:
the United States Environmental Protection
Agency; Ministry of VROM, Inspectorate of
Housing, Spatial Planning and the
Environment, the Netherlands; the
European Commission; Environment
Agency, England and Wales; Environment
Canada; Organisation for Economic Co-
operation and Development; Ministry of the
Territory Planning, Water, and
Environment, Morocco; Minisitry of Justice,
Morocco; International Fund for Animal
Welfare; Institute for Governance and
Sustainable Development; United Nations
Environment Programme; The World Bank
Institute; Ceske Svycarsko (National Park
Bohemian Switzerland of the Czech
Republic) and the Appian Group; Ciments
du Maroc (CIMAR); Centre de
Developpement des Energies Renouvables
(CDER); Deutsche Gesellschaft fiir
Technische Zusammenarbeit (GTZ).
Funding of participants was gra-
ciously offered by the Ministry of VROM,
Department of International Environmental
Affairs, the Netherlands; the United States
Environmental Protection Agency; the
World Bank Institute; the European
Commission; the International Fund for
Animal Welfare; Royal Air Maroc;
Environment Agency, England and Wales;
the United States Department of State; and
the North American Commission on
Environmental Cooperation.
The Editors are particularly grateful
to Meredith Reeves, Dave Grossman,
Scott Stone, Aesah Javier, Steven Potokar,
Sachiko Morita, Peter Grabiel, and Maina
Kaniaru for their invaluable assistance in
the preparation of these Proceedings.
Cover design and graphics,
Earthpace LLC
Layout and design,
The Bluemont Company
Printing, Spectrum Printing
For more information, please visit the
INECE Web site at http://www.inece.org
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319
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