The Constitution of the Republic of South Africa, 1996 is the supreme law of South Africa. It entrenches the right to an environment not harmful to health or well-being and obliges the state to take reasonable legislative and other measures to ensure that the right is promoted and fulfilled, and that the environment is protected for the benefit of both present and future generations.
Flowing from this duty, a number of statutes have been enacted to give effect to the environmental right. The National Environmental Management Act, 1998 (NEMA), is the framework statute. It contains principles that apply to the actions of all organs of state that may significantly affect the environment. There are many principles including sustainable development, the precautionary principle, the polluter pays principle and equitable access to resources. It also creates a network of compliance and enforcement officers and sets out their mandate, powers and duties.
Following from NEMA, a number of specific environmental management Acts (SEMAs) have been promulgated, each to regulate a distinct area of environmental law, including air quality, biodiversity, coastal management, protected areas, waste, heritage and water. This is the suite of national environmental legislation.
South Africa is divided into nine provinces which are further divided into a number of district and local authorities (or municipalities). The Constitution determines which level of government – national or provincial – has legislative authority in terms of specific functional areas. According to this regime, national and provincial authorities share competence over the environment, meaning that both national and provincial legislatures may pass legislation to regulate environmental issues, while local authorities are primarily responsible for the implementation of matters affecting air pollution.
This is not a hard rule. The Constitution recognises that there are certain instances where national legislation must prevail – for example, where the matter requires national uniformity. Furthermore, in practice, provincial government tends to legislate their own environmental laws (eg, biodiversity laws) which often overlap or differ from national legislation.
It is worth noting that there are a number of policies and guidance documents which operate alongside the environmental legislation. It is incumbent upon decision-makers to take such policies into account in the decision-making process, albeit that these policies do not require complete compliance.
Bodies responsible for environmental policy differ from those responsible for enforcement of environmental legislation.
The environment is a competence shared between national and provincial authorities. Policy is largely developed by the National Department of Environment, Forestry and Fisheries department (DEFF), which also drafts the legislation to give effect to that policy. In the mining industry, although the legislation has been drafted by the DEFF, the Department of Mineral Resources and Energy (DMRE) is responsible for enforcing and implementing that environmental legislation related to mining.
Where there are significant questions around policy, the DEFF may establish an expert panel to provide input into the policy. An example of this is the Minister of Environment, Forestry and Fisheries recently establishing a panel to review existing policy and practice related to, inter alia, management, breeding, hunting, trade and handling of elephant, lion, leopard and rhinoceros.
In respect of compliance monitoring and enforcement, NEMA establishes an Environmental Management Inspectorate. The Inspectorate comprises of enforcement officials known as environmental management inspectors (EMIs) who operate at a national, provincial and local government level and who enforce NEMA and the SEMAs. In respect of regulating the mining industry, NEMA enables the designation of environmental mineral resource inspectors (EMRIs), whose powers are restricted to compliance monitoring and enforcement activities connected with mining.
At present, EMIs are only empowered to enforce national legislation. However, in an attempt to streamline the compliance monitoring and enforcement process, an amendment contained in the National Environmental Management Laws Amendment Bill, 2014 aims to enable EMIs to enforce provincial environmental legislation as well.
South African law distinguishes between incidents and other breaches of environmental law and/or permit conditions.
An incident is defined in NEMA as an unexpected, sudden and uncontrolled release of a hazardous substance, including from a major emission, fire or explosion that causes, has caused or may cause, significant harm to the environment, human life or property. Although such incidents would be covered under NEMA, the National Water Act, 1998 (NWA) includes a similar provision which relates specifically to incidents that affect water resources.
When an incident occurs, there is a duty on the responsible person to immediately alert the responsible authority. “Responsible authority" is defined in the section to mean a municipality, provincial head of department or relevant director general. Delegation of such authority is possible.
The responsible authority may then provide a verbal directive instructing the responsible person to take specified measures to contain the incident and remedy any negative impacts. This verbal directive must be confirmed in writing within seven days.
The relevant authority also has the power, in certain circumstances (for example, if the responsible person fails to comply or if there is uncertainty as to who is indeed responsible), to take the required action and claim reimbursement from the responsible person at a later stage.
With the exception of an incident defined above, EMIs are responsible for monitoring compliance with, and enforcing, environmental laws and the conditions of any authorisations granted under this suite of law.
EMIs have a broad range of powers which are contained in Chapter 7 of NEMA. The extent to which these powers are conferred on an individual EMI depends on what the designation letter states, as this will specify the precise scope of that EMI’s mandate.
Broadly speaking, EMIs whose powers are limited to compliance monitoring, would have, among others, the power to question suspected contraveners, to inspect (and make copies of) relevant documents, to require information to be produced, to take photographs or recordings, to dig or bore soil, to remove waste or other matter unlawfully deposited, to stop, enter and search vehicles and to conduct routine inspections.
EMIs with enforcement powers, over and above the powers of their compliance monitoring counterparts, are deemed "peace officers" and have all the powers given to peace officers or police officials in terms of certain chapters of the Criminal Procedure Act, 1977 (CPA). The Inspectorate has also entered into a standard operating procedure with the South African Police Services which enables EMIs to carry their own dockets until such time as they are handed over to the prosecuting authority.
In South Africa there are various different circumstances where an environmental authorisation (EA), licence or permit is required. Typically, this is where the proposed actions have, may have or will have, a detrimental environmental impact or where they are otherwise regulated in terms of international laws to which South Africa is a party. The following are a few examples of South Africa's complex permitting system.
In terms of NEMA, the Minister of Environment or a provincial member of the Executive Council (MEC) may identify activities that may not commence without an EA. Where an activity is so listed, an applicant must comply with the prescribed environmental impact assessment (EIA) process and obtain an EA, either from the Minister of Environment or MEC (or person to whom this authority has been delegated), prior to commencing.
Similarly, and in terms of the National Environmental Management: Waste Act, 2008 (NEM:WA), the Minister of Environment may publish a list of waste management activities which have, may have, or are likely to have, a detrimental effect on the environment. A waste management licence is required to conduct such activities.
Prior to the introduction of the One Environmental System (OES), a mining company was required to obtain an EA under the NEMA and a waste management licence from the environmental authorities as well as a mining right and associated Environmental Management Programme (EMPr) from the mineral authorities. This duplication paved the way for the OES which became operational in December 2014.
Under the OES, the minister responsible for Mineral Resources and Energy (Minister of Minerals) is tasked with issuing EAs and waste management licences in terms of the NEMA and NEM:WA, respectively, for both mining and related activities. The Minister of Environment is, however, now the appeal authority for such decisions relating to these authorisations.
Put differently, instead of a mining company having to apply to the mining authorities for a mining right (which included following an assessment process to get an EMPr) and to the environmental authorities for an EA for listed activities related to mining as well as for a waste management licence in respect of listed waste management activities, the company can now apply to DMRE for approval in respect of all of these activities.
The environmental aspects have been excised from the minerals legislation and instead the Minister of Minerals is expected to consider these impacts under the more holistic environmental impact assessment process under NEMA.
In terms of the National Environmental Management: Air Quality Act, 2004 (NEM:AQA) the Minister of Environment is obliged, and a MEC at a provincial level may, publish a list of activities that may have a detrimental effect on the environment, including health, social conditions, economic conditions, ecological conditions or cultural heritage. To undertake such activities, an atmospheric emission licence is required. Such licences are generally granted by officials at local authority level.
The NWA specifies various water uses for which a water use licence is required. These are issued by the minister responsible for water.
The National Environmental Management: Biodiversity Act, 2004, restricts certain activities and requires a person who intends to carry out those listed activities to obtain a permit. Such permits are issued either by the national or provincial authority.
The National Environmental Management: Integrated Coastal Management Act, 2008, also contains a permitting system to regulate, among others, boat-based whale-watching or driving in the coastal area.
Each statute mentioned above, together with its accompanying regulations, lays down a discrete procedure for obtaining the relevant authorisation. This generally incorporates some form of impact assessment.
NEMA contains an appeal provision. This enables a person aggrieved by an administrative decision to appeal to the Minister of Environment or MEC, as the case may be, where a decision was taken under delegated authority. In circumstances where the Minister of Minerals, or a delegated official, took a decision in respect of EAs for mining activities, that decision may be appealed to the Minister of Environment. Regulations have been promulgated to regulate this appeal process.
South African law contains avenues for both administrative and criminal enforcement.
NEMA contains a duty of care provision in which every person who causes, has caused or may cause significant pollution or degradation of the environment, must take reasonable measures to prevent it from occurring or, where the harm is authorised by law or cannot reasonably be avoided, to minimise and rectify such pollution or degradation. The ambit of persons upon whom this duty falls is wide and includes owners of land, persons in control thereof and those who have the right to use such land.
In such circumstances where a person on whom the duty falls fails to take the reasonable steps required, the relevant authority may issue a directive instructing the responsible person to take such necessary action, failing which the authority may itself take the action required and thereafter approach the court to recover the costs from the responsible parties.
Although the duty of care applies equally to water pollution, the NWA contains its own duty of care, very similar to the one explained above, but which may be enforced by a catchment management authority as opposed to the Director-General responsible for environmental affairs, the Director-General responsible for mineral resources and energy or the respective provincial heads who may enforce the NEMA duty of care.
Aside from the general duty of care, where an EMI suspects a person of being in contravention of a relevant law or condition, the EMI may issue a compliance notice in which the official will set out the reason he or she believes that a person is not compliant, as well as the steps that the person must take in order to comply. Non-compliance with a compliance notice is itself a criminal offence.
It is also possible, in terms of the various laws, to have licences and permits suspended or revoked in particular circumstances.
The purpose of administrative enforcement is to provide an opportunity for a contravening party to comply by correcting their offending actions while the purpose of criminal law is primarily to punish the offender and to act as a deterrent. Often the breaches that give rise to the issuing of an administrative enforcement notice are the same offences that attract criminal sanctions. The two processes may run in parallel.
In terms of NEMA, upon successful conviction and in addition to a fine or imprisonment which may be imposed, a court can make certain additional orders. It can enquire into the monetary value of any advantage gained or likely to be gained through the contravention and either award damages or a fine equal to that amount or require that such remedial measures be taken. It can also order the convicted person to pay the reasonable costs incurred by the public prosecutor and organ of state which conducted the investigation. A court can also order the forfeiture of items used for the purpose of, or in connection with, the commission of an offence.
Included in Section 24G of NEMA is a provision imposing quasi-administrative fines. Under this provision, where a person unlawfully commenced with a listed activity for which the person required an EA or waste management licence, the person may apply for ex post facto authorisation in terms of Section 24G of NEMA. After submitting the application, the environmental authority has a discretion to defer a decision on that application until any criminal prosecution in respect of the unlawful commencement has been finalised. The decision-maker must then issue a fine to the Section 24G applicant and, once that fine has been paid, the application for ex post facto authorisation may be adjudicated. There is a similar provision in the air quality legislation.
South African law caters for liability for historic pollution to be imposed on a current or purchasing owner or operator. The duty of care provision discussed above and contained in Section 28(1) of NEMA is retrospective in nature. This section specifies that it applies to significant pollution or degradation that occurred before the commencement of NEMA in 1998, to pollution or degradation that arises or is likely to arise at a different time from the actual activity which caused the harm, as well as in circumstances where, through an act of a person, there is a change to pre-existing contamination.
The duty applies to a broad category of persons and includes: “an owner of land or premises, a person in control of land or premises or a person who has the right to use land or premises on which or in which – (a) an activity or process is or was performed or undertaken; or (b) any other situation exists, which causes, has caused or is likely to cause significant pollution or degradation of the environment”.
Accordingly, in terms of the duty of care, liability for historic pollution or degradation would fall squarely upon a person who purchases property, or someone who simply operates on property, that was previously contaminated. A similar provision is contained in the National Water Act.
In addition to the duty of care under NEMA, and specifically in respect of contaminated land, the NEM:WA provides for remediation orders to be made where land is, after investigation, found to be contaminated. This order may be issued to the owner of the contaminated land, regardless of when or how the contamination occurred. It is for this reason that when land is declared a remediation site, this must be registered against the title deed of the property.
Where an environmental incident has taken place, or damage has otherwise been caused, South African law places a duty on the contravener to remedy the harm caused. An environmental authority would issue an administrative enforcement notice instructing the offender to take these steps to remediate.
At times it may be uncertain as to who caused the harm. This is a defence that the alleged contravener may raise in representations to the proposed administrative enforcement notice. Another possible defence, in respect of an allegation of a breach of the duty of care, would be where the polluter is able to show that all reasonable steps were taken to prevent and/or remediate the pollution or degradation.
It is possible to bring an interdict against a person who is causing environmental harm. In order to succeed, the applicant would have to show that all suitable alternative remedies were exhausted. Furthermore, where the requirements for an interdict are met, it is possible for a private person, group of persons or class of persons to bring such application.
In terms of South Africa's CPA, it is possible to prosecute and secure a conviction against corporate entities. A corporate entity is a legal fiction, it exists only in law and cannot therefore perform criminal acts itself. Accordingly, in order to hold that legal fiction criminally accountable, it is necessary to attribute any acts of persons furthering the interests of that corporate body to the corporate body itself.
South African law, therefore, provides that any act performed, with or without a particular intent, or any act which should have been performed by or on instructions given by a director or officer of that corporate entity in furthering or endeavouring to further the interests of that corporate body shall be considered to be the act or omission of the corporate body itself.
This is mirrored in NEMA which provides that whenever a manager, agent or employee does or omits to do an act which had been his or her task to do or refrain from doing on behalf of the company and which would be an offence for the company to do or omit to do, and it occurred because of the failure of the company (ie, employees acting on behalf of the company) to take all reasonable steps to prevent it, then the company will be guilty of the offence.
Accordingly, there is a duty on the persons mentioned above to cause the corporate body to comply with the law. If they do not, the corporate body may be convicted and sentenced to an appropriate fine, bringing with it reputational damage.
South African law does not provide for shareholder liability or parent company liability.
In South African law it is possible for directors and other company officers to be held personally liable for environmental offences committed by the company. This is set out in NEMA which provides as follows.
In terms of director liability, Section 34(7) of NEMA provides that any any person who is or was a director of a corporate entity at the time of the commission by that corporate entity of an offence shall himself or herself be guilty of the said offence and liable, on conviction, to the penalty specified under the relevant provision if the offence in question resulted from a failure by the director to take all reasonable steps that were necessary in the circumstances to prevent the commission of that offence – this provided that proof that the corporate entity committed the offence shall constitute prima facie evidence that the director is guilty. The section does not impose strict liability on directors but requires a degree of fault.
As far as we are aware, only one successful conviction has been secured under Section 34(7) of NEMA. The state is often reluctant to use it as the proviso may be read to create a reverse onus which could possibly fall foul of the Constitution. As a result of this, before initiating a prosecution, the authority attempts to obtain absolute proof that the director was party to the offence.
While this may be so, the better interpretation is arguably that the proviso creates a shift in the evidentiary burden from the state to the accused so that once the state has proved that the corporate entity committed an offence, the director must show why he or she is not guilty (ie, how he or she took all reasonable steps to prevent it). A director may not simply ignore what the company is doing, allow it to breach relevant laws and thereafter claim ignorance. The South African Companies Act, 2008 codifies directors' duties which include the duty to act in the best interests of the company with the degree of care, skill and diligence that may reasonably be expected of a person carrying out the same functions in relation to the company as those carried out by that director, and having the general knowledge, skill and experience of that particular director. To satisfy these obligations, the Act requires a director to take reasonable and diligent steps to become informed about matters.
Directors who are convicted are subject to the same penalties as would apply to the company for the particular offence; generally, a fine of ZAR10 million or ten years' imprisonment.
Section 34(6) of NEMA includes liability for managers, agents and employees who are not directors. It provides that whenever such an individual carries out or omits to carry out an act that was his or her task on behalf of the company and which would be an offence for the company to carry out or omit to carry out, then he or she may be convicted as if he or she were the company. This section is problematic as employees may commit an offence unwittingly by following instructions of their superior.
Interestingly, NEMA contains a specific provision in respect of director liability for non-compliance with an EMPr which forms part of an EA. Section 24N(8) of NEMA, provides that notwithstanding company law, directors of a company are jointly and severally liable for any negative impact on the environment, whether advertently or inadvertently caused by the company, which they represent, including damage, degradation or pollution.
In terms of the Companies Act, a director cannot indemnify himself or herself against liability arising from the breach of a duty placed on him or her. In addition, if a fine is imposed on a director as a consequence of the director having been convicted of an offence, the company may not pay that fine, either directly or indirectly, on behalf of the director, save for convictions based on strict liability which fall outside of the scope of this discussion.
Regarding insurance, the company could take out directors and officers liability insurance (D&O insurance) to cover the legal costs of the director’s prosecution. Whether the D&O insurance policy will cover the penalties imposed on directors will be dependent on the wording of the policy and whether the fine or penalty is insurable by law.
Under the duty of care discussed above, a lender who secures the loan through a mortgage can, as owner of the land or premises, be held liable for significant pollution or degradation caused by the borrower; as the owner of the land or premises, the lender has a duty of care to take all reasonable steps to avoid significant pollution or degradation on that land.
In respect of other types of loans, it would in all likelihood depend on the extent of control that the lender exercises over the operation as to whether or not that lender may be liable for environmental damage, as this will determine whether or not the lender is caught within the ambit of the duty of care as a person who is in control of the land or premises.
Lenders would ordinarily conduct a due diligence review to determine the extent of liability risk. Where transactions are over a certain threshold (for example, USD10 million in respect of project finance) the "Equator principles" apply. These principles form a risk management framework, adopted by financial institutions, for determining, assessing and managing environmental and social risk in projects and are primarily intended to provide a minimum standard for due diligence and monitoring to support responsible risk decision-making.
Section 32 of NEMA deals with legal standing. It allows a person or group of persons to seek appropriate relief for any breach or threatened breach of any statutory provision concerned with environmental protection or the use of natural resources – whether in their own interest, in the public interest, in the interest of a class of persons or in the interest of protecting the environment.
For a damages claim to be successful, the following requirements would have to be proved:
These are separate and distinct components of the same delict, each having its own requirements and test. Problems anticipated in order to claim damages for a breach of environmental legislation concern causation.
As far as we are aware, South African courts have yet to deal with a damages claim in respect of a breach of an environmental law, other than perhaps nuisance cases. However, other remedies have been granted in terms of such breaches.
One example is the 2004 case of Hichange Investments (Pty) Ltd v Cape Produce Co (Pty) Ltd t/a Pelts Products and Others, 2004 (2) SA 393 (E) where the applicant was the neighbour of the first respondent. The applicant’s business involved keeping vehicles on its property prior to delivery thereof, while the first respondent ran a tannery. The tannery produced high levels of hydrogen sulphide and ammonia (particularly from its effluent ponds) which were alleged to have negative impacts on the health and well-being of the applicant’s employees, as well as to corrode the vehicles. The applicant asked the court to shut the tannery down, alternatively to order an investigation and to report on the negative environmental impacts of its business under the duty of care.
In terms of this duty of care a person who causes, has caused or may cause significant pollution or degradation of the environment must take reasonable steps to prevent, mitigate and remedy the effects of this pollution. Although the applicant could not show the precise extent of the pollution, the court held that it was common cause that there was a degree of hydrogen sulphide pollution emanating from the tannery, and that to determine whether or not this was significant required a considerable measure of subjective import.
The court went on to say that in light of the constitutional right a person has to an environment conducive to health and well-being, the threshold level of significance will not be particularly high. The court thus ordered the state to issue a directive to the first respondent to investigate, evaluate and assess the impact of its activities under the duty of care and to report thereon. It did not, however, grant an order shutting down the tannery, as there was insufficient evidence for it to do so, both in terms of a lack of clarity on the severity of the pollution problem and the extent to which it was permanent. This case highlights the difficulty in proving the precise extent of pollution.
Section 32 of NEMA is also used to establish standing to seek interdicts against persons who may cause or are causing significant, irreparable harm to the environment and/or who are acting in breach of an environmental law or term or condition of a permit.
As far as we are aware, this has not yet arisen in the context of South African environmental law. The courts do not generally recognise exemplary or punitive damages – also known as “constitutional damages” – where such damages would serve a purely punitive function, and particularly where the damages are claimed from the state in an environmental law context.
In the 1997 case of Fose v the Minister of Safety and Security (CCT14/96)  ZACC 6; 1997 (7) BCLR 851; 1997 (3) SA 786 (5 June 1997) the court held that it was inappropriate to use the country's scarce resources to pay punitive damages to plaintiffs who had fully been compensated for harm sustained, with no real assurance that such punitive damages would have any deterrent or preventative effect on the state in the future.
In this matter the plaintiff claimed damages for past and future medical expenses, pain and suffering, loss of amenities of life and insult as a result of having allegedly been tortured and seriously assaulted by the police. In addition, the plaintiff claimed “constitutional damages” which included an element of punitive damages. The defendant, who was vicariously responsible in law for the conduct of the police, took exception to the particulars of claim on the ground that an action for constitutional damages of this kind did not exist in law and that an order for the payment of such damages did not qualify as “appropriate relief” in terms of Section 7(4)(a) of the Interim Constitution, 1993 which was then in force.
It is likely that the same position would be taken under the current Constitution read with Section 32 of NEMA when seeking to enforce the environmental right. Section 32 of NEMA similarly contains the proviso “appropriate relief”.
As mentioned above, NEMA gives standing to a group or class of persons. There are many cases wherein community organisations have brought applications to enforce environmental legislation, including applications for interdicts, reviews in respect of decisions to grant EAs, licences and permits. More recently, Constitutional litigation has been launched to request the court to acknowledge that there has been a breach of the environmental right by the state and to ask that the court order the state to promulgate regulations to give effect to its management plan established under the relevant environmental legislation. This is the first time that litigation has been brought directly to enforce the constitutionally entrenched environmental right.
An important judgment in respect of the issue of costs in constitutional litigation (which includes litigation to enforce the environmental right, is the matter of the Trustees for the time being of the Biowatch Trust v the Registrar of Genetic Resources and others 2009 (6) SA 232 (CC). In this matter, the court set aside a costs order granted against a public interest organisation. In so doing it held that the general approach is not to award costs against litigants when they assert constitutional rights, as long as the litigation raised genuine issues of constitutional import and was not frivolous or vexatious. The rationale for this rule is that an award of costs would likely have a chilling effect on the litigants who might wish to vindicate their constitutional rights.
Another landmark case was the matter of Fuel Retailers Association of Southern Africa v Director-General: Environmental Management, Department of Agriculture, Conservation and Environment, Mpumalanga Province and Others, 2007 (6) SA 4 (CC). In this case the court considered the definition of sustainable development. It held that the Constitution recognises the interrelationship between the protection of the environment and socio-economic development. It contemplates the integration of environmental protection and socio-economic development and envisages that the two will be balanced through the ideal of sustainable development. The court went further to say that sustainable development provides a framework for reconciling socio-economic development and environmental protection and thus acts as a mediating principle in reconciling environmental and developmental considerations.
It is not possible for persons to contract out of, or indemnify themselves against or apportion, liability resulting from a breach of an environmental law, and the state may take appropriate enforcement action against the transgressor or any person who is legally liable. However, parties are free to contract between themselves and indemnify each other against liability in respect of costs related to that risk. These contracts will be binding as between the parties and will have no impact on the state’s ability to proceed against a transgressor.
There is nothing in law to prevent a company from taking out insurance to protect it against environmental liability. However, as with the contractual agreements discussed in 10.1 Transferring or Apportioning Liability, the insurance will not absolve the transgressor from its legal duties. The insured will be obliged to pay the remediation costs but may do so through, or claim back from, an insurer.
A policy may cover liability for an unplanned incident which causes harm, such as a spill. In this case a policy might typically cover transporters of hazardous substances or companies that store hazardous substances on-site. There are, however, no limitations, save that it is not possible to escape public liability through a private insurance policy.
Contaminated land is governed by chapter 4, part 8 of the NEM:WA as well as the national norms and standards for the remediation of contaminated land and soil quality published under the NEM:WA.
These laws apply to contaminated land even where the contamination occurred prior to the commencement of the NEM:WA, where contamination originated on land other than the investigation area, where contamination arises or is likely to arise at a different time from the activity that caused it as well as where contamination arises through an act of a person that results in a change to pre-existing contamination.
The Minister of Environment or MEC (in respect of an area which affects the relevant province) may, after consulting with the Minister of Human Settlements, Water and Sanitation (Minister of Water), identify investigation areas. These are areas of land on which high-risk activities are taking place or previously took place or land that the official reasonably believes to be contaminated. There is also a duty on owners of contaminated land and persons who undertake activities that caused land to be contaminated to notify the relevant officials.
Once land is identified as an investigation area, this must be recorded in a national contaminated land register and a site inspection must be conducted; either by the relevant official or by the owner or person who is undertaking, or who undertook, the high-risk activity on that land. The NEM:WA specifies the minimum information to be contained in the site assessment report. The report is then submitted to the Minister of Environment or MEC to decide whether or not the site is contaminated and the level of risk that the contamination presents. In making such assessment, the Minister of Environment is guided by the national norms and standards which contain soil screening values.
If it is decided that the land is contaminated, the land must be declared a remediation site and the Minister of Environment or MEC must make an appropriate remediation order.
Once declared a remediation site, this information must be submitted to the Registrar of Deeds.
The South African Constitution contains the right to an environment not harmful to health or well-being and includes the right to have the environment protected for both present and future generations. NEMA, enacted to give effect to that right, contains important principles when it comes to climate change; some of the most critical in this context are arguably sustainable development, the precautionary approach and the duty to discharge global and international responsibilities in the public interest. Recently, in the matter of Earthlife Africa Johannesburg v Minister of Environmental Affairs and others, 2017 JDR 0492 (GP) the court recognised that when undertaking an environmental impact assessment pursuant to obtaining an EA, a thorough climate change impact assessment must be considered. We would thus argue that it is incumbent on decision-makers, when deciding to grant or refuse authorisations in terms of the suite of environmental laws, to consider the climate change impacts of the project as well as the impacts of climate change on the projects.
The key legislation relating to climate change in respect of atmospheric emissions, is currently NEM:AQA. Regulations published thereunder include: those that set the National Ambient Air Quality Standards, industry-specific Minimum Emission Standards, Regulations Regarding the Phase-Out and Management of Ozone Depleting Substances, National Greenhouse Gas Emissions Reporting Regulations and the Declaration of Greenhouse Gases as Priority Air Pollutants.
More recently, the Carbon Tax Act, 2019 has been promulgated to incentivise a low-carbon economy. Climate Change Bill No 41689 has been proposed to address climate change concerns more specifically.
At an international level, in August 1997, South Africa ratified the United Nations Framework Convention on Climate Change (UNFCC). In July 2002, South Africa acceded to the Kyoto Protocol which came into force in 2006. Thereafter, South Africa became a signatory to the Paris Agreement that builds upon the UNFCC and brings all nations together in common cause to undertake ambitious efforts to combat climate change and adapt to its effects.
In terms of targets to reduce greenhouse gas emissions, the following are relevant. Under the Paris Agreement, South Africa’s Intended Nationally Determined Contribution (INDC) was formulated in the context of, inter alia, the environmental right set out in Section 24 of the Constitution and its National Development Plan, which provided a “2030 vision” to guide the country’s sustainable development trajectory where poverty is eliminated and inequalities are reduced by 2030. The INDC committed to emissions in a range between 398 and 614 Mt CO₂ equivalent between 2025 and 2030 within the peak plateau decline (PPD) trajectory.
In terms of legislation, the Carbon Tax Act requires anyone who conducts activities in South Africa which result in greenhouse gas emissions to pay tax on those emissions and ensure that the emissions do not exceed the thresholds set by the Act.
The Climate Change Bill has been proposed and was published for public comment and stipulates that its purpose is “To build the Republic’s effective climate change response and the long term Just [sic] transition to a climate resilient and lower carbon economy and society in the context of an environmentally sustainable development framework; and to provide for matters connected therewith”. In its current form, the Bill enables the Minister of Environment to set thresholds for determining which persons will be allocated a carbon budget. If a carbon budget is allocated, a person will be required to submit a greenhouse gas mitigation plan demonstrating their commitment to staying within their allocated carbon budget.
In 2008, regulations for the prohibition of the use, manufacturing, import and export of asbestos and asbestos containing materials were published (Asbestos Regulations) under the Environment Conservation Act, 1989 (ECA). Although the ECA is now largely repealed, the Asbestos Regulations continue to be in force as they are now deemed to have been published under the current NEM:WA.
The Asbestos Regulations prohibit: the acquisition, processing, packaging or repackaging of asbestos; the manufacturing of asbestos containing materials, distribution of asbestos or asbestos containing materials; and the import and export of asbestos or asbestos containing material into and from South Africa. They also prohibit the import of asbestos containing waste into South Africa. The Asbestos Regulations make provision for the import of asbestos or asbestos waste from a state, which is a member of the Southern African Development Community, for safe disposal at a disposal site. The Asbestos Regulations require a permit under the ECA which we believe should now be read as requiring a waste management licence under the NEM:WA.
There was a one-year transitional period permitting persons importing asbestos for, or distributing asbestos in, an identified product to register such activity and compile a phase-out plan. The disposal of asbestos is also regulated in that a person who is in possession of asbestos and wishes to dispose of it, would require a waste management licence in order to do so.
Failure to comply with the Asbestos Regulations is an offence, as is disposal of waste without a waste management licence.
The NEM:WA is the primary law governing the management of both general and hazardous waste in South Africa. It does not extend to radioactive waste which is covered separately. It is a SEMA and must be read together with NEMA and interpreted with reference to the NEMA principles.
The NEM:WA contains a general duty of care specifically in respect of waste management (over and above the NEMA duty of care discussed above). This duty falls upon all holders of waste. A holder of waste is defined widely to include any person who imports, generates, stores, accumulates, transports, processes, treats, exports waste or disposes of waste.
In terms of NEM:WA, the Minister of Environment may publish a list of waste management activities that have, or are likely to have, a detrimental effect on the environment and for which a waste management licence must be obtained. Such lists have been published and are updated from time to time.
NEM:WA also obliges the Minister of Environment to publish norms and standards in respect of the classification of waste, the planning for and provision of waste management services, and the storage, treatment and disposal of waste. The Act also enables him or her to publish further norms and standards in respect of: minimisation, reuse, recycling and recovery of waste; extended producer responsibility; recognition of waste management services; and remediation of contaminated land. Many such norms and standards have been published.
Section 18 of the NEM:WA provides for extended producer responsibility. In terms of this section the Minister of Environment may identify a product or class of products in respect of which extended producer responsibility applies, specify the extended producer responsibility measures that must be taken in respect of the identified product or class of products, and identify the person or category of persons who must implement the extended producer responsibility measures. The Minister of Environment may then set norms and standards in this regard.
No such notification or norms and standards have yet been published.
NEM:WA does not require a producer to take back or recover its goods once they become waste. However, a producer is still required to dispose its waste appropriately.
Section 30 of NEMA, which deals with incidents, requires the person responsible for the incident to report the incident to the relevant authorities, including the nature of the incident, risks posed, toxicity of the substances or by-products released and any steps that have been taken to avoid or minimise the effects of the incident.
The NWA likewise requires a person involved in an incident, or someone with knowledge of an incident, to, as soon as reasonably practicable, report that incident to the authorities. In terms of the NEM:WA, an owner of contaminated land, or a person who undertakes an activity that caused the land to be significantly contaminated, must notify the authorities of that contamination as soon as that person becomes aware of it.
The Promotion of Access to Information Act, 2 of 2000 (PAIA), was enacted to give effect to the constitutional right of access to any information held by the state or by another person and which is required for the exercise or protection of any rights. Where a member of the public wishes to obtain such information, a request is filled out and submitted to the relevant public body together with payment of a nominal fee.
A public body is defined widely to include: a department of state or administration in the national or provincial sphere of government or any municipality in the local sphere of government; and any other functionary or institution when either exercising a power or performing a duty in terms of the Constitution; or when exercising a public power or performing a public function in terms of any legislation. Some public bodies are, however, excluded from the ambit of this definition such as the Cabinet, the courts and an individual member of Parliament.
PAIA sets out grounds upon which a public (or private) body may refuse to disclose information. They are numerous and include, for example: protection of commercial information of third parties, documents privileged in legal proceedings and documents which, if produced, could hinder investigations or prosecution. However, PAIA also contains a mandatory override provision in terms of which information must be disclosed regardless of any protection afforded to that class of information under PAIA. This includes: information where the disclosure thereof would reveal either evidence of a substantial contravention of, or failure to comply with, the law; or an imminent and serious public safety or environmental risk. Provided that the public interest in the disclosure of the record clearly outweighs the harm contemplated in the provision in question allowing or obliging the authorities to refuse the information.
Sustainability guidelines, indices and governance codes that support the “sustainability agenda” – such as the King Code on Corporate Governance for South Africa, the Johannesburg Stock Exchange’s (JSE) Socially Responsible Index and the Global Reporting Initiative Guidelines – rely on a company’s own assessment of its performance. What this means is that despite these initiatives, companies often under-report on compliance with environmental laws, if they report at all.
The King Code on Corporate Governance is a document published by the Institute of Directors which sets out the philosophies, principles, practices and outcomes which serve as a benchmark for corporate governance in South Africa. The King IV Report is the current iteration and finally takes heed of environmental concerns. It applies to all organisations, including organisations listed on the JSE, unlisted companies, trusts and non-government organisations. However, because of its complexity, smaller organisations have seldom applied the principles. The latest version has tried to address this by making it simpler and easier to understand.
In terms of the Companies Act, a company’s annual report must provide information on any matter material for the shareholders to appreciate the company’s state of affairs. One would therefore expect that information in respect of climate change or an investigation into non-compliance with environmental laws would be disclosed, but this is not the case and there is, to our knowledge, no specific provision which requires this information.
Environmental due diligence is typically conducted in M&A, finance and property transactions. Environmental concerns, in respect of climate liability, are becoming increasingly important. In the transactions mentioned above, there is also a financial risk to the purchaser in terms of NEMA because, as discussed in 5.1 Liability for Historic Environmental Incidents or Damage, there are provisions in South African law which create retrospective liability as well as residual liability after a transaction has been completed. Therefore, the purchaser needs to be fully aware of all liability that will be transferred upon finalisation of an M&A and property transaction. As discussed in 8.1 Financial Institutions/Lender Liability, in terms of finance, lenders can themselves become liable by lending money, provided certain conditions are met.
An environmental due diligence typically includes an investigation into compliance-related aspects and whether the seller has the correct and approved authorisations, licenses and permits. Furthermore, whether any administrative enforcement notices have been issued by the regulator in order fully to anticipate what type of (and the extent of the) liability which the purchaser may be assuming should a transaction be concluded.
As discussed above, in terms of Section 40(1) of the NEM:WA, a seller must inform a prospective buyer that the land is contaminated. We are not aware of other similar legislated provisions.
Green taxes in South Africa aim to bring about climate change mitigation in South Africa.
In an effort to stabilise greenhouse gases in the atmosphere and to give effect to the polluter pays principle, among others, South Africa recently enacted the Carbon Tax Act, effective from 1 June 2019. This Act imposes taxes on all those who emit greenhouse gasses, with allowances extended to certain industries. Taxes include a carbon levy on fuel and an emissions tax on businesses. These will form part of the environmental taxes that currently exist in South Africa, such as the plastic bag levy, light bulb levy, electricity levy, CO₂ tax on vehicle emissions, and the tyre levy.