April 28, 2021
Environmental Code: an overview of innovations
On January 2, 2021, a new Environmental Code of the Republic of Kazakhstan was adopted, which will enter into force on July 1, 2021. The adoption of the new code is due to the low efficiency of environmental impact assessment, the irrelevance of legislative regulation in the field of waste, limited public participation in environmental control, inappropriate procedure for the economic assessment of environmental damage by the current code. It should be noted that the new environmental code was developed based on the best international experience of the OECD countries.
Let us dwell on the most significant innovations, which especially affect the largest enterprises of the oil and gas, mining and metallurgical, chemical and electric power industries, which account for the largest percentage of pollution.
The code contains a number of principles, among which the polluter pay principle, the principle of correction, deserves attention.
The point is to eliminate environmental damage in full by restoring the environment to its original state. If it is impossible to completely eliminate the caused environmental damage, its consequences should be minimized. To the extent that the consequences of the caused environmental damage have not been eliminated or minimized, their replacement is ensured through alternative remediation.
Subject classification and integrated environmental permitting
Depending on the level and risk of negative impact on the environment, facilities (enterprise, production) are classified into 4 categories, where the most hazardous (polluting) activities are classified in the first category, which also implies stricter regulation. So, for objects of the first category, a mandatory transition to integrated environmental permits (IEP) is provided with the condition of introducing the best available techniques.
An application for an IEP is submitted electronically to the authorized body in the field of environmental protection and must contain a comparative description of the equipment used or intended to be used with the best available techniques, given in the conclusions on the best available techniques for the respective areas of their application.
Integrated environmental permits issued before July 1, 2021 in accordance with the Environmental Code of the Republic of Kazakhstan dated January 9, 2007, including the technological specific standards specified in them, remain in force until January 1, 2031, provided they comply with the conclusions on the best available techniques for their respective areas of application.
Within six months from the date of the issuance by the authorized body in the field of environmental protection of the conclusion on the inconsistency of the integrated environmental permit with the conclusions on the best available techniques for the respective areas of their application, the operator of the category I facility shall agree with the authorized body in the field of environmental protection changes in the program to such an integrated environmental permission, the period of which cannot exceed six years.
Best Available Techniques (BAT)
Technicians mean both the technologies used and the methods, methods, processes, practices, approaches and solutions applied to the design, construction, maintenance, operation, management and decommissioning of the facility;
Techniques are considered affordable if the level of their development allows the introduction of such techniques in the relevant production sector on economically and technically feasible conditions, taking into account the costs and benefits, regardless of whether such techniques are used or produced in the Republic of Kazakhstan, and only in that the extent to which they are reasonably available to the facility operator;
The best are understood as those available techniques that are most effective in achieving a high overall level of environmental protection as a whole.
The areas of application of the best available techniques are defined in Annex 3 to the Code.
Conclusions on NTD are approved by the Government of the Republic of Kazakhstan on the basis of reference books on NTD.
Prior to the approval by the Government of the Republic of Kazakhstan of conclusions on NTD, natural resource users have the right, upon receipt of IEP and justification of technological standards, to refer to reference books on NTD for the relevant areas of their application, developed within the framework of the European Bureau for Integrated Control and Prevention of Environmental Pollution, as well as on decisions of the European Commission on approving opinions on the best available techniques for their respective areas of application.
Environmental Impact Assessment (EIA)
If earlier the environmental impact assessment and assessment of transboundary impacts were envisaged, then the new code, depending on the subject of the assessment, divides the environmental assessment into the following types:
1) strategic environmental assessment;
2) assessment of the impact on the environment;
3) assessment of transboundary impacts;
4) environmental assessment according to a simplified procedure.
The innovations affected the process of passing the EIA: according to the code, the types of activities that have a significant impact on the environment are subject to mandatory EIA. They are listed in section 1 of annex 1 to the code and relate to enterprises of the first category. The activities listed in Section 2 of Annex 1 to the Code may have significant impacts on the environment depending on the results of the screening of the intended activity.
It is prohibited to implement the planned activity, including the issuance of an environmental permit for the implementation of the planned activity, without a preliminary assessment of the impact on the environment, if such an assessment is mandatory for the planned activity.
The intended activity in the Code means the planned activity of individuals and legal entities related to the construction and further operation of production and other facilities, with any other kind of interference in the environment, including through subsoil use operations, as well as the introduction of significant changes in such activities.
Environmental impact assessment includes the following stages:
1) consideration of an application for the planned activity;
2) defining the scope of the environmental impact assessment;
3) preparation of a report on possible impacts;
4) assessing the quality of the report on possible impacts;
5) rendering an opinion on the results of an environmental impact assessment and its accounting;
6) post-project analysis of actual impacts during the implementation of the planned activity, if the need for it is determined in accordance with the Code.
The EIA includes a scoping stage for the EIA to identify the impacts on which the research should be focused. Depending on the nature of the activity, in one case, significant impacts on groundwater are possible, in another – on flora and fauna, in the third – on atmospheric air. The scope of the environmental impact assessment will take into account current knowledge, best research methods, existing technical capabilities in the relevant economic sector and the availability of environmental data.
After submitting an electronic application, it is posted on the Internet resource, where interested government agencies and the public have the right to submit their comments and suggestions within thirty working days from the date the initiator submits the application.
After the completion of the preparation of the report on possible impacts, this report will be submitted to public hearings. If, after the public hearings, there are comments and suggestions that have not been removed by their authors, the initiator of the planned activity will have to organize the revision of the report and its submission to repeated public hearings. If the initiator disagrees with the comments and proposals of the interested state bodies and the public, which were not removed by their authors during the repeated public hearings, the corresponding opinion of the initiator is entered into the minutes of the repeated public hearings, after which the disagreements on controversial issues are resolved by the expert commission.
The compiler of the report on possible impacts bears civil liability to the initiator for the quality of the report on possible impacts and other results of the environmental impact assessment obtained by the compiler in accordance with the agreement concluded between them. In addition, the compiler of the report on possible impacts, the initiator are liable, provided for by the laws of the Republic of Kazakhstan, for concealing the information received about the impact on the environment and for submitting inaccurate information when conducting an environmental impact assessment.
A post-project analysis of the actual impacts during the implementation of the planned activities is carried out by the compiler of the report on possible impacts in order to confirm the compliance of the implemented planned activities with the report on possible impacts and the conclusion based on the results of the environmental impact assessment.
Post-project analysis should be started no earlier than twelve months and completed no later than eighteen months after the start of operation of the relevant facility that has a negative impact on the environment.
Targeted spending and payments for negative environmental impact
In connection with the introduction of the principle of correction and the “polluter pays”, the payments received for the negative impact on the environment to the budget will have targeted expenditures for financing environmental protection measures, which was not previously envisaged.
The norm for allocating funds to environmental protection measures is the share of income received from payments for negative environmental impact directed to environmental protection activities, which is taken in the amount of at least one hundred percent of payments for negative environmental impact. Thus, 100% of the funds received into the budget will be used to finance environmental protection measures.
Payments for emissions into the environment will be called payments for negative impact on the environment. The payers of the fee are operators of objects of I, II and III categories.
In order to stimulate the introduction and application of BAT on the territory of the Republic of Kazakhstan, to prevent or reduce the level of harmful anthropogenic impact on the environment when calculating fees for facilities that have a negative impact on the environment, for which an integrated environmental permit was issued, including until July 1, 2021 , payers apply a zero coefficient to the established rates.
If by a certain date the indicator of a gradual reduction of the negative impact on the environment to the IEP issued for an object of category I by less than 30 percent is not achieved, the coefficient to the established rates will periodically increase.
At the same time, for the 50 largest objects of the first category, such an increase will begin in 2025, and for the rest of the objects for which the IEP is not valid since 2037.
The Code introduces a new classification of waste, corresponding to the European catalog and aimed at the phased and circular waste management: minimization of waste generation, reuse of generated waste, recycling, disposal and disposal at landfills.
Waste management operations include:
1) accumulation of waste at the place of their generation;
2) waste collection;
3) transportation of waste;
4) waste recovery;
5) waste disposal;
6) auxiliary operations;
7) conducting observations of operations for the collection, transportation, recovery and (or) disposal of waste;
8) activities for the maintenance of liquidated waste disposal facilities.
Waste accumulation is understood as the temporary storage of waste in specially designated places during the time periods specified by the Code. Thus, the maximum terms of waste accumulation are: 6 months at the place of generation, 3 months at the place of collection and 6 months at the place of disposal or recovery. For wastes from mining and processing industries, the maximum accumulation period at the place of their generation is 12 months.
Persons carrying out waste collection operations are obliged to ensure the separate collection of waste. Separate collection is carried out for the following fractions:
1) “dry” (paper, cardboard, metal, plastic and glass);
2) “wet” (food waste, organic matter, etc.).
Mixing of waste subjected to separate collection at all further stages of waste management is prohibited.
The Code provides for the principle of hierarchy, which means that waste generators and owners must apply the following hierarchy of measures to prevent waste generation and waste management in descending order of their preference in order to protect the environment and ensure sustainable development of the Republic of Kazakhstan:
1) prevention of waste generation;
2) preparation of waste for reuse;
3) waste processing;
4) waste disposal;
5) waste disposal.
It should also be noted that for the implementation of activities for the processing, disposal and destruction of hazardous waste, a licensing procedure is being introduced, for transportation, a notification procedure is introduced for companies carrying out these types of activities.
With the adoption of the Code, appropriate changes are made to the Code of Administrative Offenses (CAO), in terms of toughening administrative liability for environmental offenses. Let’s consider some of them.
For illegal use of subsurface resources, with the exception of underground waters, transactions that, in direct or latent form, violate the right of state ownership of subsurface resources, if earlier fines in MCI were envisaged, then the new punishment provides for a fine in the amount of one hundred percent of the amount of damage caused to subsurface resources.
For failure to comply with the conditions of an environmental permit (Article 326 of the Administrative Code), the amount of penalties was increased from 50 to 300 MCI, depending on the business entity. If the offense is committed repeatedly within a year, and by large business entities – within three years after the imposition of an administrative penalty, the amount of the fine is from 150 to 1,000 MCI. If the aforementioned action, associated with the infliction of environmental damage, 700, up to 2,000 mrp, with or without the suspension of the environmental permit. And not the elimination of violations by individuals and legal entities within the prescribed period, for which the environmental permit is suspended, entails the revocation of the environmental permit.
A new article 327-1 of the Code of Administrative Offenses is introduced, according to which for failure to submit, submission of incomplete or untimely submission of mandatory information, submission of inaccurate mandatory information, penalties from 100 to 1000 MCI are provided, depending on the business entity.
A new article 327-2 of the Code of Administrative Offenses is introduced, according to which improper remediation (elimination) of the caused environmental damage is punishable by a fine of 700 to 2000 MCI depending on the business entity, and for failure to remediate (eliminate) the environmental damage caused by a fine of one hundred percent benefit derived from the violation, with the suspension of the relevant environmental permit or activity.
For violation of the terms of waste accumulation (part 8 of Article 328 of the Administrative Code), a fine is provided in the amount of one hundred percent of the rate of payment for waste disposal in relation to the amount of accumulated waste for each day in excess of the period established by the environmental legislation of the Republic of Kazakhstan. Thus, the fine acquires the character of a penalty, the accrual of which will stop only with the removal of waste to the place of collection, disposal or recovery.
If earlier fines calculated in MCI were envisaged for exceeding the standards of emissions into the environment, then for innovations for violating the standards of permissible anthropogenic impact on the environment (Article 328 of the Administrative Code), a fine is imposed on legal entities – in the amount of ten thousand percent of the corresponding rate of payment for negative impact on the environment in relation to the excess amount of pollutants.
Serious administrative liability is also stipulated for violation of the established limits for the accumulation of waste. Thus, for violation of the limits for the accumulation or disposal of waste (part 6 of Article 328 of the Administrative Code), a fine is provided in the amount of 10,000 percent of the rate of payment for waste disposal in relation to the amount of waste accumulated or buried in excess of the established limit.
For violation of environmental requirements for waste management (Article 344 of the Code of Administrative Offenses), a fine is provided in the amount of one hundred percent of the amount of economic benefit received as a result of the violation.
Liability is introduced for individuals, officials and business entities for storing waste outside specially designated places that are not intended for their accumulation or burial, as well as burial of waste without an environmental permit or waste not declared in the declaration on environmental impact in the form of a fine from 50 to 100 MCI, and for medium-sized businesses – in the amount of 100 percent, for large-scale businesses – in the amount of 200 percent of the amount of economic benefit received as a result of the violation.
With regard to subsoil users, administrative liability is provided for violation of environmental requirements during subsoil use operations, violation of the procedure for the liquidation and conservation of subsoil use objects.
Thus, as explained in the Ministry of Ecology, Geology and Natural Resources of the Republic of Kazakhstan, the main reason for the increase in fines for administrative offenses in the field of environmental protection is the incomplete implementation by nature users of measures to prevent environmental pollution and failure to implement the necessary modernization. The current administrative fines cannot be an incentive mechanism. It is much more profitable for users of natural resources to pay fines instead of eliminating violations and omissions. Therefore, it is envisaged to toughen sanctions for environmental violations.
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