The International Comparative Legal Guide to Environment & Climate Change Law 2016 Edition
1 Environmental Policy and its Enforcement
1.1 What is the basis of environmental policy in your jurisdiction and which agencies/bodies administer and enforce environmental law?
Since May 2004, Poland has been a Member State of the European Union (“EU”). Since the early 1990s Poland undertook great efforts to harmonise its environmental law with the EU law. In most cases the transitory periods, established by the EU Accession Treaty of 2003 regarding the implementation of EU environmental legislation, have expired, thus Polish environmental law and policy are determined to the same extent by EU law as environmental law and policy in other EU Member States.
The Polish Constitution of 1997 dedicates a relatively broad space to environmental issues. The Constitution defines protection of the environment guided by the principle of sustainable development as a task of the Polish state, acknowledges environmental protection as a valid reason for warranted limitation of constitutional rights and freedoms, and obligates the public authorities to prevent negative effects of environmental degradation on human life and health. The Constitution also calls upon public authorities to support citizens’ activities dedicated to the protection and improvement of the environment, and obligates everyone to safeguard the environment. The structure of Polish environmental law is traditionally based on a “moderate holistic” approach. In 1949, the Act on the protection of nature, which determined the basic principles of the environmental policy, identified the authorities responsible for its implementation
and established corresponding mechanisms. In 1980, the Act on the protection and development of the environment followed, which was finally replaced by the Act of 27th April 2001 on Environmental Protection Law (“EPL-Act”). In principle, the EPL-Act determines the general rules and establishes certain general institutions of environmental protection and, in addition, it contains the entire regulation of air pollution control, including the protection against noise and electromagnetic fields. At the same time, specific matters like waste management, water protection and water management, protection and management of natural resources, protection of nature and animals, ecological product safety, nuclear power, ecological farming, trade in emission rights and greenhouse gas emissions management are regulated in separate acts. In recent years, a tendency, probably determined by certain pragmatic considerations, to deviate from this traditional structure can be observed. Matters of general character, e.g. access to environment-related information, public participation in environment matters, environmental impact assessment, eco-management and audit, are regulated in separate acts.
Polish environmental law establishes a number of principles of environmental policy. These include the principle that the environment should be protected in a comprehensive manner, the precautionary principle, the principle of preventive action, the “polluter pays” principle, and the principle of integration of environmental policy into other policies. Polish law does not explicitly establish the principle of a high level of protection or the principle that environmental damage should be rectified at source.
Polish environmental law assigns the task of administration and enforcement of environmental law to general profile agencies and bodies at the local and regional levels, such as mayors of towns and cities, heads of districts (starosta), the national government’s representatives to regions (wojewoda), to heads of regional self-governments (marszałek województwa), and to regional assemblies (sejmik województwa). Beneath these general agencies and bodies, environmental law establishes – as bodies with a specific profile – the Minister of Environment, the General Director for Environmental Protection, and the regional directors for environmental protection.
The Act of 1980 on protection and development of the environment had already created the Environmental Protection Inspectorate, charged with the specific task of monitoring compliance with environmental protection laws. Institutions with a more advisory or supporting character include the National Environmental Protection Council, the commissions for environmental impact assessments, and the environmental protection and water management funds.
1.2 What approach do such agencies/bodies take to the enforcement of environmental law?
Before 1990, a great gap between the ambitions of environmental policy expressed in the environmental laws and the practical ability to implement and enforce these goals persisted. Since 1990, this situation has significantly improved, and a lot has been done to not only adopt EU-compatible standards, but also to effectively implement them. Nevertheless, the agencies and bodies empowered to enforce environmental law do not always have sufficient capabilities; in recent years, however, the funds dedicated for these agencies and bodies have been continuously increased.
1.3 To what extent are public authorities required to provide environment-related information to interested persons (including members of the public)?
Access to environment-related information is regulated in the separate Act of 3rd October 2008 on disclosing information about the environment and its protection, participation of society in environmental protection, and environmental impact assessments (“Environment Information Act”). The Environment Information Act implements, inter alia, Directive 2003/4/EC of the European Parliament and of the Council of 28th January 2003 on public access to environmental information and the Aarhus Convention on Access to Information, Public Participation in Decision-making and Access to Justice in Environmental Matters. The Environment Information Act supplants corresponding provisions of the Environmental Law which did not entirely comply with the requirements of Directive 2003/4/EC.
Art. 74.3 of the Polish Constitution stipulates a constitutional right of everyone to information on the state and protection of the environment; according to art. 81 of the Constitution, this right may be exercised only within the limits established by applicable laws. In addition, art. 61 of the Constitution institutes the citizens’ right to receive information on activities of public government bodies and of persons fulfilling public functions. This right is regulated in further detail by the Act of 6th September 2001 on access to public information, which extends this right to everyone.
Both sets of regulations may overlap. In most cases, through the operation of the lex posterior and lex specialis rules, the provisions of the Environment Information Act will have priority.
According to the Environment Information Act, every citizen is entitled to information without demonstrating a legal or factual interest. The Act obligates any “administrative bodies” to grant access to environment-relevant information, thus defining the group of obligated entities in a slightly narrower scope than Directive 2003/4/EC (as it does not include the President of the Polish Republic, the courts, or advisory and auxiliary bodies). The amendment of 9th October 2015 to the Environment Information Act, which extends the group of obligated entities to both chambers of parliament, the President, the courts as well as bodies of governmental control and protection of law, shall enter into force on 1st January 2017.
Administrative bodies are obligated to provide access to such information as is in their possession or which is dedicated to them. The Act covers similar categories of information as Directive 2003/4/EC: environment-related information, i.e. information which relates to the state of the elements of the environment, emissions, measures, reports, cost-benefit and other economic analyses, state of human health and safety. The Act – as opposed to the Directive – does not expressively mention contamination of the food chain.
The request for information has to be made in writing; the information may be released in oral, written, visual, acoustic, electronic or other form. The information has to be delivered without delay, but as a rule not later than within one month after receipt of the request. The authorities may refuse the request under certain conditions, e.g. if the information concerns statistical data protected by statistical secrecy, is relevant to a pending court case, or constitutes intellectual property or a business secret.
2 Environmental Permits
2.1 When is an environmental permit required, and may environmental permits be transferred from one person to another?
Environmental permits in Polish law can be divided into two categories. The first are environmental permits in the strict sense of the term, including permits for release of gases or particles into the air, permits for generation of waste, permits for noise emission, and water law permits. These permits constitute a specific environmental protection mechanism necessary for legal use of the environment within the scope, and by the means, specified therein. These permits were introduced to the Polish legal system with a view to controlling the intensity of environmental impact by entities using the environment.
The second category consists of environmental permits in the broader sense, comprising of – among others – permits for pursuing business activity in the area of recycling or neutralisation of waste and gathering and transport of waste or permits for removal, utilisation, and neutralisation of municipal waste. The essential purpose of such permits lies in controlling the operation of market mechanisms with respect to activities centring on recycling, neutralisation, and utilisation of wastes.
The next (statutory) subdivision applicable with respect to environmental permits is that of unitary permits, issued for specific areas of use (e.g. noise emission permits), and integrated permits, with a scope encompassing many different environmental uses. As a general rule, an integrated permit is required for operation of an installation which, given the type and scale of activities involved, may lead to contamination of individual natural elements or of the environment as a whole.
Whatever the category, each environmental permit is issued in the form of an administrative decision at the request of the party concerned. The legal basis for issuing environmental permits is comprised in the EPL-Act and in specific statutes. Environmental permits are issued to specific entities and, as a rule, extend only to the addressee party named in the permit itself.
According to art. 189 of the EPL-Act, however, an entity which becomes the legal operator of an installation or its determined part, takes over the rights and obligations following from the permits concerning such installation or its determined part. Thus, the transfer of the legal title to an installation being subject of a permit results automatically in the transfer of the permit. Art. 189 of the EPL-Act also establishes an obligation of the new operator to apply immediately for a change of the specification of the operator in the permit, but it does not have any specific legal consequences, if thenew operator fails to submit such application.
2.2 What rights are there to appeal against the decision of an environmental regulator not to grant an environmental permit or in respect of the conditions contained in an environmental permit?
The party interested in the issue of an environmental permit by a competent public administrative body, i.e. the applying party, has the right to appeal the decision of that body subject to the general administrative procedure rules; in other words, a first-instance decision concerning an environmental permit may be appealed to a higher body of the public administration (through the body issuing the decision thus challenged). As a general rule, appeals must be lodged within 14 days following service of the decision on the applying party. The body considering the appeal analyses the decision from the perspective of its legality as well as of its viability, i.e. the substantive grounds on which the first-instance body issued it.
Where the applying party is of the opinion that the body issuing the decision did so in contravention of applicable laws, and the appeals body does not rectify this state of affairs, the decision may be challenged before the regional administrative court and then, as a final avenue of recourse, before the Supreme Administrative Court.
It merits mentioning here that the administrative courts – as opposed to the public administration bodies – do not consider the decision on its merits but, rather, limit their analysis to the decision’s legality.
2.3 Is it necessary to conduct environmental audits or environmental impact assessments for particularly polluting industries or other installations/projects?
The Polish legal system regulates the legal duty of carrying out the environmental impact assessment procedure first and foremost in the Environmental Information Act. The Environmental Information Act provides for two different types of environmental impact assessment procedures – a strategic environmental impact assessment required in the process of developing e.g. zoning and regional development plans, politics, strategies, plans or programmes in the fields of industries, energy, transport, telecommunication, water management, waste management, forestry, fishery, tourism, etc. and on the other hand an environmental impact assessment related to specific projects which always have or may have a significant impact on the environment. An Ordinance adopted by the Council of Ministers determines numerous categories of industrial and other installations and projects which are considered as potentially having a significant impact on the environment. Art. 72 of the Environmental Information Act enumerates permits, licensing and similar decisions (e.g. construction permits, mining concessions, water use permits, decisions permitting execution of road works), which the interested party may obtain only after a decision on environmental conditions has been issued.
The environmental impact assessment comprises, first and foremost, analysis and evaluation of the proposed project’s direct and indirect influence on the environment, on human health and living conditions, on physical assets, on the historical heritage, and on accessibility of fossil resources. Means of preventing or limiting negative impact of the project upon the environment are also considered. Analysis is conducted in reference to data presented by the applying party and to other information on the project and its parameters. The environmental impact assessment procedure furthermore requires involvement of the community; in practice, this means that all the documentation and descriptions of the legal status are disclosed to the general public, whose members then have 21 days to submit applications or comments to the planned project.
Polish law does not mandate performance of environmental due diligence, yet the EPL-Act imposes numerous emission monitoring and control duties upon entities utilising installations which are a source of emissions. So, while environmental due diligence is not compulsory, it is often resorted to by the business itself or by its prospective purchaser as a useful tool for assessing the operation’s compliance with environmental protection laws. The Act of 15th July 2011 on the national eco-management and audit system (“EMAS”) regulates the national EMAS. Participation in the EMAS is voluntary.
2.4 What enforcement powers do environmental regulators have in connection with the violation of permits?
The institution charged with verifying abidance by environmental protection laws and by the conditions of permits and decisions issued by appropriate bodies is the Environmental Protection Inspectorate, whose scope of authority, tasks, and character are regulated first and foremost by the Act of 20th July 1991 on the Environmental Protection Inspectorate. Under this Act, the Environmental Protection Inspectorate operates through its officers, namely the Environmental Protection Inspectorate Director and the regional environmental protection inspectors. Within their ambit, the Environmental Protection Inspectorate bodies may perform controlling measures, issue post-audit injunctions, issue administrative decisions, and initiate enforcement (where a duty to that effect arises from applicable laws or from an administrative decision). In environmental offence cases, the Environmental Protection Inspectorate enjoys public prosecution powers; also, where it is found that the commissions or omissions of an organisational unit head, an employee, or of another natural person amount to an environmental offence, the Environmental Protection Inspectorate bodies must address a notice of commission of a crime to the public prosecution authorities, enclosing with it evidence substantiating their suspicions.
3.1 How is waste defined and do certain categories of waste involve additional duties or controls?
The Waste Act of 14th December 2012 defines waste as any item or substance disposed of by its possessor, intended by the possessor to be disposed of or in respect of which the possessor is obliged to dispose of it. A number of items and substances are specifically excluded from the Waste Act’s scope (e.g. explosives, sewage, animal carcasses, etc.), as the further processing of such items and substances is governed by more specific regulations. In addition, the Waste Act itself and the Waste Catalogue Regulation issued thereunder establishes a system of waste classification involving a number of items and subitems, some of which qualify as hazardous waste. Hazardous waste in general and waste belonging to a number of specific categories (e.g. tars, quicksilver-contaminated waste, non-vitrified solid phases, etc.) are subject to additional duties and controls.
3.2 To what extent is a producer of waste allowed to store and/or dispose of it on the site where it was produced?
Pursuant to art. 20 of the Waste Act, on-site processing of waste – i.e. its recovery or disposal – is one of the fundamental waste management principles. While the Waste Act establishes a “reduce – reuse – recycle – retrieve – dispose” hierarchy of preferred means of waste processing, waste not suitable for processing on-site should be transferred to the nearest processing plant accommodating required facilities and not stored as a rule. On-site storing of waste is only allowed if its holder holds a legal title to the property in question. Moreover, the duration of permissible storage of waste under the Waste Act is strictly limited and tied to a justified purpose: there is a time cap of one year in place on storing justified by having to build up the amount of waste suitable for final transfer and ultimate disposal, and of three years total on storing justified on technical or organisational grounds. The Waste Act provides for an optional, more specific regulation on duration and requirements for storage to be issued under art. 25 of the Act.
3.3 Do producers of waste retain any residual liability in respect of the waste where they have transferred it to another person for disposal/treatment off-site (e.g. if the transferee/ultimate disposer goes bankrupt/disappears)?
According to art. 27 of the Waste Act, related liability is transferred along with the waste, provided that the transferee is duly certified and authorised for the relevant activity for waste management purposes. Any gap in the chain of recipients, in respect of authorisations and permits required, prevents liability from being transferred from the transferor – the originator of waste in question or its next legitimate successor in line of transferring entities respectively. Thus, the producer of waste remains liable until released by the first recipient in line proving to be suitable. A later trigger for such release may be established by sterner rules which apply to some specific categories of waste under the Act (e.g. contagious medical waste).
3.4 To what extent do waste producers have obligations regarding the take-back and recovery of their waste?
Manufacturers and importers of certain products (e.g. various packaging, batteries, oils or tyres) have the obligation to ensure a certain level of recycling for such products, as specified in Appendices to the Act of 11th May 2001 on certain waste management obligations of entrepreneurs and on payment of product fees. This obligation can be fulfilled individually by manufacturers or importers, or by special recycling operations.
Similar obligations are laid down in the Act of 20th January 2005 on recycling of end-of-life vehicles, the Act of 11th September 2015 on waste electrical and electronic equipment and the Act of 24th April 2009 on batteries and accumulators. For example, importers of electrical and electronic equipment designed for households are obligated to arrange and to finance receipt from a collection points of discarded equipment as well as conversion, recycling and neutralisation of discarded equipment from households. The Act on batteries and accumulators imposes similar obligations on those who place batteries or accumulators on the market for the first time.
4.1 What types of liabilities can arise where there is a breach of environmental laws and/or permits, and what defences are typically available?
Breach of the environmental protection laws or of the terms of permits/administrative decisions may give rise to three types of liability: civil; administrative; and criminal. Civil liability for breach of environmental protection laws is regulated first and foremost by the Polish Civil Code and, on a more detailed level, by statutes such as the EPL-Act or the Act of 16th April 2004 on protection of nature (“Nature Protection Act”). The most important provision of the Civil Code from the perspective of environmental protection is art. 435, paragraph 1, which institutes liability of entities operating in their own name a business enterprise or facility powered by natural forces (including steam, gas, electricity, liquid fuels). It merits pointing out that this provision institutes strict liability, with no need to prove culpability of the entity operating the business.
The scope of this general rule’s application has been expanded by more specific laws to where it applies also to enterprises which do not rely on natural power, but are classified as “increased risk” or “high risk” (art. 324 of the EPL-Act). Administrative liability for breach of environmental protection laws is regulated by the EPL-Act, the Waste Act, the Water Law Act, and by a number of other statutes. In general, administrative liability does not depend upon deliberate fault of the party concerned – the fact that a situation described in the statute arose constitutes sufficient grounds for liability. Administrative proceedings may result in financial sanctions (e.g. fines, increased charges) for the party in breach of environmental protection laws, in an injunction ordering cessation of activities, or in revocation of the permit for the activity in question (or in delimiting its scope). The regional environmental protection inspector may also proscribe production, importation, or introduction to trade of products which do not comply with environmental protection rules (art. 370 of the EPL- Act). As the criteria for such intervention is not described very precisely the application of this provision is difficult. Art. 362 of the EPL-Act provides for enjoining an entity using the natural environment to reduce its impact on the environment or to restore the environment to its appropriate condition. An injunction to this effect may be issued for an entity which exerts a negative impact on the environment – there is no need to prove that such negative impact is culpable or illegal. The Act of 13th April 2007 on prevention of environmental damage and its remediation provides for additional measures which may be imposed on entities actually or potentially damaging the environment.
Criminal liability for crimes against the environment is rooted first and foremost in Chapter XXII of the Polish Criminal Code, and also in a variety of statutes – the Nature Protection Act, the Water Law, the Act of 21st August 1997 on protection of animals, and many others. Please note that according to the Act of 28th October 2002 on liability of collective entities for penalised forbidden acts, companies can be subject to criminal liability.
4.2 Can an operator be liable for environmental damage notwithstanding that the polluting activity is operated within permit limits?
Under art. 325 of the EPL-Act, an entity pursuing operations on the basis of an administrative decision and within such decision’s bounds is still liable for damage occasioned through its impact on the environment. In other words, operation on the basis of an administrative decision or permit does not exempt a party from liability for attendant damage.
4.3 Can directors and officers of corporations attract personal liabilities for environmental wrongdoing, and to what extent may they get insurance or rely on other indemnity protection in respect of such liabilities?
The EPL-Act does not provide for direct, personal (civil) liability of directors or management board members for environmental damage occurring due to a business enterprise’s activities. For members of a company’s management board working on the basis of employment contracts, personal liability is essentially ruled out in that, in accordance with the Polish Labour Code, liability for damages will attach to the employing enterprise, and any claim for indemnification extending to the enterprise (employer) vis-à-vis the employee will be limited, unless caused by deliberate action or omission. The Commercial Companies Code, meanwhile, provides for liability of management board members for damage caused to the company. A business enterprise may take out third party liability insurance including directors and officers insurance, which also covers violation of environmental protection laws; insurance against criminal liability for environmental law offences, meanwhile, is impossible.
4.4 What are the different implications from an environmental liability perspective of a share sale on the one hand and an asset purchase on the other?
Neither Polish legal doctrine nor judicial practice provides for holding a shareholder in a company personally responsible for that company’s liabilities. Polish judicial practice does not provide for “piercing the corporate veil”, as practised in certain other European jurisdictions. Therefore, in case of a share deal, the purchaser does not enter into the liabilities of the company being sold. This rule applies also to eventual environmental liabilities of the company.
In case of an asset deal, however, the purchaser of the enterprise also enters into eventual environmental liabilities connected with historic activities of the enterprise. Art. 554 of the Polish Civil Code provides that in case of a sale of a business enterprise the purchaser of the business is jointly and severally liable with the seller for liabilities associated with management of the enterprise unless, at the time of purchase, the purchaser was not aware of such liabilities even though it exercised due care and skill. The liability of the purchaser is limited to the value of the enterprise as at the day of its purchase. The regime of eventual claims of the purchaser against the seller is also different in case of defects of the enterprise related to environmental issues including environmental liabilities of the enterprise. In a share deal, the seller’s statutory liability is limited to legal defects of the shares. The seller is not liable for physical defects of the respective enterprise, unless such liabilities have been explicitly established in the share purchase agreement. In case of an asset deal, the seller is liable for physical defects of the sold enterprise including defects related to environmental matters.
4.5 To what extent may lenders be liable for environmental wrongdoing and/or remediation costs?
Polish law does not apply any specific mechanism for holding a lender or financing entity liable for damage occasioned by the borrower. In like spirit, the entity financing any given project is under no obligation to ensure that the project does not cause environmental pollution.
5 Contaminated Land
5.1 What is the approach to liability for contamination (including historic contamination) of soil or groundwater?
Liability for contamination of soil or groundwater is regulated by the Act of 13th April 2007 on the prevention of environmental damage and its remediation, which implements Directive 2004/35/CE of the European Parliament and of the Council of 21st April 2004 on environmental liability with regard to the prevention and remedying of environmental damage.
The Act on prevention of environmental damage and its remediation defines damage to water as changes which have a significant negative impact on the ecological or chemical state of water or its quantity, and for damage to soil – its pollution, in particular if it endangers human health. Contamination of soil or groundwater will constitute damage to the environment within the meaning of the Act, in particular, if the quality standards established by the Minister of Environmental Protection are not met.
The Act determines three different categories of potentially liable persons: (1) users of the environment conducting activities which create a risk of damage to the environment (activities defined in the Act and requiring, in most cases, a specific permit); (2) users of the environment whose activity relates to protected species or protected habitats; and (3) land owners (or persons having a perpetual usufruct right in the land). The liability of the first category is strict, i.e. does not require an element of fault. Liability of the second category does require fault. Land owners are responsible under the condition that the damage occurred with their consent or with their knowledge, unless they have notified the risk or the damage to the environment immediately after becoming aware of it.
The Act does not apply to “historic contaminations”, i.e. contaminations which existed before 30th April 2007 or which result from activity terminated before 30th April 2007 or which have been caused immediately by emissions or events that occurred more than 30 years ago. In such cases, the previous rules established by the Environmental Protection Law Act will apply. According to these rules, the owner (or perpetual usufruct holder) of the contaminated land is generally obligated to carry out clean-up measures, regardless of whether the owner had caused the contamination or not. The landowner, however, is not liable if it can prove that the contamination was caused by an identified third party after the landowner had taken over the land. According to these rules, in certain cases the regional director for environmental protection conducts the clean-up measures while the landowner or the third party is obliged to cover the cost of these measures.
5.2 How is liability allocated where more than one person is responsible for the contamination?
The Act on prevention of environmental damage and its remediation establishes the principle of joint and several liability in cases where more than one person is responsible for the contamination. If the contamination was caused with the landowner’s consent or knowledge, the landowner is jointly and severally liable together with the environment user causing the damage. In the case of “historic contaminations”, the landowner is jointly and severally liable with the polluter, provided the pollution happened with the landowner’s consent or knowledge.
5.3 If a programme of environmental remediation is ‘agreed’ with an environmental regulator can the regulator come back and require additional works or can a third party challenge the agreement?
The Act on the prevention of damages to the environment provides for a specific procedure for the setting of an agreement regarding the remediation of an environmental damage, e.g. the clean-up of a soil contamination. Following an application of the person obliged to carry out remediation measures, this person and the regulator agree on the terms of such measures (state, to which the damaged environment shall be returned; scope and manner of the measures; and time frame for the start and for the completion of the measures). The regulator shall fix the agreed programme in the form of an administrative decision. The regulator may require additional works and a third party may challenge such administrative decision according to the general rules of administrative law. Additional works may be demanded in case of extraordinary circumstances, e.g. if the decision was based on wrong information or the “programme” was not fulfilled, etc. Third parties may challenge such decision under the condition that their legal interests are affected.
5.4 Does a person have a private right of action to seek contribution from a previous owner or occupier of contaminated land when that owner caused, in whole or in part, contamination; and to what extent is it possible for a polluter to transfer the risk of contaminated land liability to a purchaser?
Eventual regress or contribution claims against previous owners or occupiers who caused the pollution are subject to general civil law, in particular torts law. Direct contractual claims of the present owner against the seller, as a rule, are excluded, if the purchaser was aware of the condition of the land. In practice, quite often purchase contracts exclude or limit the seller’s liability for soil contaminations.
It is not possible to transfer the administrative liability for land contaminations by contract between polluter and purchaser to the purchaser. The polluter and the purchaser, however, can agree about a transfer of the economic risk, e.g. by establishing a contractual obligation of the purchaser to indemnify the seller for the cost of clean-up measures which the seller has to perform due to administrative law.
5.5 Does the government have authority to obtain from a polluter, monetary damages for aesthetic harms to public assets, e.g. rivers?
The EPL-Act entitles the state treasury, entities of local self-administration and environmental organisations to claim compensation for damages to the environment as a public asset. In this context the law does not differentiate between aesthetic harm and other damages. Thus, these provisions theoretically apply also in situations where the harm is of purely aesthetic character. In
principle, the polluter is obliged to return the damaged item to its previous condition. If a third party, e.g. a governmental agency, has remedied the damage to the environment, it can demand the return of the justified cost. Thus, the law does not entitle the government to obtain monetary damages, unless in the form of reimbursement of the appropriate cost of eventual restoration measures.
The possibility of monetary damages, regardless of the cost of eventual restoration measures, exists under the Nature Protection Act. In case of certain violations of protected objects, the court, in addition to a penalty or fine, can impose an obligation on the “polluter” to pay compensation of up to 10,000 PLN to a nature protection organisation or to the regional environment protection and water management fund, if the restitution of the damaged item is impossible.
6 Powers of Regulators
6.1 What powers do environmental regulators have to require production of documents, take samples, conduct site inspections, interview employees, etc.?
Issues relating to control and enforcement are regulated by the Act on the Environmental Protection Inspectorate and by the EPL- Act. The Environmental Protection Inspectorate, acting through the Chief Environmental Protection Inspector and the Voivodship Environmental Protection Inspectors, are charged with controlling compliance with the environmental protection laws. In addition, the wójt (local self-government officials), the mayor or the city president, the starosta, the head of the regional assembly, the voivode, the minister in charge of environmental matters, the General Director for Environment Protection and regional environment protection directors are listed as bodies of administration in the field of environment protection. Control and verification powers include the right of round-the-clock access to properties where business activity is conducted and access between 06:00 and 22:00 hours to other properties, requesting oral or written information, summoning and questioning individuals insofar as necessary to establish the factual circumstances, requesting documents and any data relevant to the issues controlled, conducting studies/research, and other necessary control and verification work. The Chief Environmental Protection Inspector, the regional environmental protection inspectors and their authorised employees may access vehicles on a round-the-clock basis, collect samples, assess the technologies and installation and equipment utilisation methods employed by the audited entities, and request production of documents necessary for the levying of a fine.
7 Reporting / Disclosure Obligations
7.1 If pollution is found on a site, or discovered to be migrating off-site, must it be disclosed to an environmental regulator or potentially affected third parties?
Under the EPL-Act, any person noticing a malfunction or an event which may give rise to a threat to life and limb or to the environment, either forthwith or with delayed effect, must promptly alert any persons present within the threatened area as well as one of the following three bodies: the national fire brigade; the national police force; or the mayor. For these purposes, the threatened area will comprise the zone which may be affected by the adverse effects produced by a serious malfunction.
Upon receiving notice of such an event, the relevant authorities shall take measures geared at rectifying the malfunction and its effects. In the event of an industrial accident, entities operating installations classified as “increased risk” or “high risk” must furthermore promptly notify the appropriate unit of the national fire brigade and the regional environmental protection inspector as well as providing information about the event and the rescue/clean-up measures taken.
The Act on prevention of environmental damage and its remediation institutes another reporting duty: where there arises a direct threat of environmental damage, any person using the environment must promptly embark upon preventive measures and, if such measures produce no effect, notify an environmental protection body and the regional environmental protection inspector.
7.2 When and under what circumstances does a person have an affirmative obligation to investigate land for contamination?
Polish law does not establish any general rule imposing upon owners/users of real property an obligation to analyse the quality of topsoil or ground. That said, the law does lay down certain rules for specific parties. Under the EPL-Act, assessment of topsoil and land quality and observation of changes is conducted as part of the environmental monitoring activities pursued by the state, and the starosta (local self-government official) is charged with periodic topsoil and land analysis. State environmental monitoring includes gathering of data from environmental measurements which certain entities must carry out pursuant to applicable laws or to decisions issued with respect to them. A party maintaining an installation as well as using the installation must conduct periodic checks of emission levels; where these installations release large quantities of substances or energy into the environment, releases must be monitored on an ongoing basis. The entity managing a road, railway line, light railway line, airport, or port must conduct periodic measurements of the substance and/or energy levels released into the environment in association with use of such facilities; again, in the case of large releases, measurement must proceed on a constant basis. In both cases, the environmental protection authorities may obligate specific entities (by way of a decision) to conduct measurements of a scope greater than that defined in the statute within a set deadline. Such a decision may be issued, in the first case, if the emission standards were exceeded and, in the second, if environmental quality standards were not complied with. As it issues permission for release of substances or energy into the environment, the environmental protection body may define the scope of emission measurements.
The Act on prevention of environmental damage and its remediation empowers the environmental protection authority to issue decisions obligating entities using the environment and conducting activity which threatens environmental damage which constitutes a direct cause of threatened risk to measure the concentration of specific substances in the topsoil or in the ground.
7.3 To what extent is it necessary to disclose environmental problems, e.g. by a seller to a prospective purchaser in the context of merger and/or takeover transactions?
Polish environmental protection laws do not mandate disclosure of information on non-compliance with environmental protection laws in the context of merger or take-over transactions. The commercial and civil laws (which address specific aspects of such transactions) likewise do not institute a direct duty to this effect. In practice, environmental matters are commonly subject of due diligence exercises conducted before the transaction and corresponding warranties and representations in the contractual documentation. Non-disclosure of existing environmental problems in such cases may result in liabilities of the seller.
8.1 Is it possible to use an environmental indemnity to limit exposure for actual or potential environment-related liabilities, and does making a payment to another person under an indemnity in respect of a matter (e.g. remediation) discharge the indemnifier’s potential liability for that matter?
Under Polish law, environmental indemnities can limit exposure for actual or potential environment-related liabilities only in the relationship between the contractual parties agreeing on such indemnity. They do not affect the liability under administrative law or the liabilities against third parties. The party making a payment under an indemnity is not released from its potential liability against third parties; it may have only a compensation claim against the person to whom it has made the payment under the indemnity.
8.2 Is it possible to shelter environmental liabilities off balance sheet, and can a company be dissolved in order to escape environmental liabilities?
Environmental liabilities, with the exception of “historic” contaminations, normally are based on activities which are connected with risks for the environment or which cause damage to the environment. It is possible to shelter environmental liabilities off balance sheet only by transferring these activities to separate companies and only in so far as the transferor is not obliged to prepare a consolidated group balance sheet reflecting also the situation at the company to which the activities are transferred. As a rule, a company can be dissolved only after the completion of a liquidation procedure. During the liquidation procedure, the liquidator has to call the eventual creditors to notify their claims against the company within a certain period after this call. The company can be dissolved only after all creditors who have notified claims have been satisfied. Thus, the possibilities to escape environmental liabilities by dissolving the company are rather limited. Dissolution of the company without full satisfaction of the company’s creditors may be possible in case of a bankruptcy procedure. Such procedure, however, creates significant risks for the members of the company’s management board. The members of the management board can be held personally liable in relation to creditors of the company, in particular if they have not applied in time for the opening of the bankruptcy procedure.
8.3 Can a person who holds shares in a company be held liable for breaches of environmental law and/or pollution caused by the company, and can a parent company be sued in its national court for pollution caused by a foreign subsidiary/affiliate?
As a general rule, under Polish law the shareholders of a limited liability company or a joint stock company cannot be held liable for breaches of law or damages caused by the company. As mentioned above, Polish judicial practice does not provide for “piercing the corporate veil”. This applies also in environmental matters. According to Polish civil procedure law Polish courts, as a rule, have international jurisdiction in matters in which a company who has its registered seat in Poland is the defendant. According to this rule, a Polish parent company could be sued in Polish courts for pollution caused by a foreign subsidiary or affiliate. Whether the foreign parent company of a Polish entity can be sued in its national court is determined by the law of that court.
8.4 Are there any laws to protect “whistle-blowers” who report environmental violations/matters?
There are no specific provisions concerning “whistle-blower” protection under Polish law. However, “whistle-blowing” may be subject to protection established by general provisions of law, in particular under employment law. While the Polish employment law obliges the employee to confidentiality, and while there are no specific provisions releasing the employee from such confidentiality obligation in case of environmental matters or violations, dismissal or otherwise unequal treatment of the employee on grounds of having notified the authorities or the general public of environmental violations or matters may be in theory regarded under the Polish Labour Code as discrimination or unlawful dismissal respectively. “Whistle-blowers” may also be subject to exemptions provided in civil and criminal law against slander charges or claims ondefamation grounds, if not without some additional reservations, e.g. further freedom of information and public interest considerations.
8.5 Are group or “class” actions available for pursuing environmental claims, and are penal or exemplary damages available?
The Act of 17th December 2009 on the assertion of claims in group proceedings introduces the instrument of “class” actions into Polish law. The Act allows groups of at least ten persons to bundle their claims against one defendant into one claim. The Act does not explicitly mention environmental claims, but it applies, inter alia, to tort liability claims. In principle, damages are limited to actual loss and lost profit. However, as mentioned above, in case of violations of provisions of nature protection the court can oblige the polluter, as additional sanction, to make payments to a nature protection organisation or to the regional environment protection and water management fund. Poland has a highly developed system of economic instruments of environmental policy and in particular emission and environment use charges. The environment protection and water management funds, which exist on different levels, are partly financed through these charges. A similar function like penal or exemplary damages may have the increased emission charges which have to be paid in case of emissions exceeding the allowed emission limit values.
8.6 Do individuals or public interest groups benefit from any exemption from liability to pay costs when pursuing environmental litigation?
In civil litigation matters, the court may grant an exemption from court fees to non-profit organisations pursuing goals in the field of environment protection. In criminal matters, such organisations are exempted from court fees, if they participate as additional private prosecutor. Non-governmental organisations having the legal status of a public benefit organisation ( organizacja pożytku publicznego) are exempted from court fees in proceedings before the administrative courts when acting in the scope of their tasks and not pursuing commercial interests.
9 Emissions Trading and Climate Change
9.1 What emissions trading schemes are in operation in your jurisdiction and how is the emissions trading market developing there?
As an EU Member State, Poland participates in the EU emissions trading system (“EU ETS”), which was launched in 2005. The EU ETS provides for two different ways of allocation of emission allowances – allocation for free and allocation through auctioning. During the current third trading period, which began in January 2013 and will span until December 2020, auctioning is the default method of allocating allowances. For the electricity generation sector, the EU ETS Directive (Directive 2003/87/EC) establishes the rule, that operators no longer receive any allowances free of charge. Poland, however, has made use of the derogation option under art. 10c of the EU ETS Directive (Directive 2003/87/EC), which allows it to give a decreasing number of free allowances to existing power plants for a transitional period until 2019. While the EU ETS provides for a common auction platform, Poland, like Germany and the United Kingdom, has made use of the possibility to opt out of the common platform and appoint their ‘own’ auction platform. Poland has contracted the European Energy Exchange (“EEX”) in Leipzig to
auction on its behalf.
The basic legal instrument on the national level regulating emissions trading is the Act of 12th June 2015 on the system of trade in greenhouse gas emission allowances. The Act applies to
emissions of carbon dioxides (“CO2”), nitrous oxides (“N2O”) and perfluorocarbons (“ PFCs”) from stationary installations and to CO2 emissions from aviation operations. The emissions trade system is administered by the National Centre for Emissions Balancing and Management (“KOBiZE”), which is also the national administrator within the meaning of the Registry Regulation of the European Commission (Regulation no. 389/2013). The emission allowances may be traded and transactions may be conducted between parties having an account in the Union Registry. Emission allowances are valid for the entire trading period. Emission allowances registered on an account in the Union Registry and which have not been used up at the end of the trading period are replaced by emission allowances for the following trading period. Emission allowances for stationary installations are allocated free of charge on the basis of a corresponding application made by the operator. The number of emission allowances allocated for free and the respective installation are finally determined in an ordinance issued by the Polish Council of Ministers after having received the opinion of the European Commission. Emission allowances for aviation operations are allocated by the Minister for the Environment after having obtained the opinion of the European Commission. Under the Act, a permit is required for the operation of an installation in the meaning of the Act. Together with the permit the authority issuing the permit approves a plan for monitoring emission amounts and – as far as required by the respective provisions of EU law – a sampling plan. The Act excludes the free allocation of allowances for “new installations” in the energy sector, i.e. installations for which a greenhouse gas emission permit has been issued after 30th June 2011 or where after that date the production capacities have been extended. Thus, the operators of such installations have to acquire the required emission allowances through auctions or on the secondary market.
As far as the market development is concerned, EEX auctions primary market share of Polish emission rights traded on that platform has grown over time – from 2.84% in tCO2 auction volume and 2.82% in total revenue in 2014 (13,335,000 tCO2 and 78,009,750 € respectively) through 3.07% (17,559,000 tCO2) and 3.06% (132,823,705 €) in 2015 to 5.62% (3,526,000 tCO2) and 5.19% (20,098,200 €) in early 2016 (according to EEX data, until 8th February 2016). With the dwindling number of free allowances remaining to be issued under transitional regulations to existing power plants until 2019 (60,030,069 European Emission Allowances in 2016, 52,248,393 in 2017, 43,355,052 in 2018, 32,238,368 in 2019 to nil in 2020) one could reasonably expect the Polish market to become fully aligned with the rest of the EU by 2020 in that sector as well.
9.2 Aside from the emissions trading schemes mentioned in question 9.1 above, is there any other requirement to monitor and report greenhouse gas emissions?
As mentioned above, the operators of installations covered by the emissions trading system when applying for the permit are required to submit monitoring plans and – as far as required by EU law
– sampling plans. In addition, the Act on the system of trade in greenhouse gas emission allowances establishes further monitoring and reporting requirements. Furthermore, the Act of 17th July 2009 on the management of system of emissions of greenhouse gases and other substances establish a comprehensive system of monitoring and reporting of greenhouse gas emissions. This system is not limited to the emission of substances covered by the emissions trading scheme, but much broader. The Act established a National Emissions Balancing and Forecasting System covering emissions of greenhouse gases and other substances. This system includes the National Database, where data on emissions of greenhouse gases and other substances is collected and which is operated by the National Centre for Emissions Balancing and Management (“KOBiZE”), an organisational unit established within the Institute for Environment Protection. The Act obliges entities using the environment by conducting an activity which causes emissions to submit an annual report to the National Database informing, inter alia, about the place of activities causing emissions, equipment causing emissions, installations, sources of emissions, the quantities of emissions, quantities of production, features of the used materials and fuels, relevant permits, cases of exceeding emission limits, investment projects having an impact on the emissions. Physical persons who are not entrepreneurs are obliged to deliver such reports if they use the environment and produce emissions in a manner requiring a respective permit.
9.3 What is the overall policy approach to climate change regulation in your jurisdiction?
Poland is party to the United Nations Framework Convention on Climate Change of 9th May 1992 and to the Kyoto Protocol of 11th December 1997, which may be considered as the international basis of the Polish climate change policy. Poland has accepted additional commitments on an international or supranational level as a Member State of the European Union. Poland, however, so far has not ratified the Doha Amendment of 8th December 2012 establishing the second commitment period of the Kyoto Protocol covering the period from 2012 to 2020. The Polish President vetoed the ratification of the Doha Agreement on 26th October 2015, arguing that when the parliament voted in favour of the ratification on 11th September 2015, the legal and economic effects of this document had not been sufficiently analysed. Also the practical effect of the President’s decision on Poland’s emission reduction obligations may be limited as Poland is bound by the corresponding commitments within the European Union, it can be seen as a sign of a general change of attitude to climate change regulation in Polish policy after the elections of President and Parliament in 2015. The Polish energy production is to a large extent based on the use of coal, originating from coal mines inside the country. Already in the past, the Polish government had been rather reluctant to accept commitments to reduce the share of coal-based energy. The protection of the Polish coal mining industry is a declared goal of the now ruling party. Its programme demands that European law should be made realistic and that the climate policy agreements in the European Union should be renegotiated. It emphasises that the possibilities of Polish forests to absorb carbon emissions should be used as Poland’s contribution to global climate change regulation and proposes broader afforestation. At the same time, restrictions in the use of coal as source of energy production are rejected. While in the field of renewable energies the previous government favoured wind energy, now more emphasis shall be given to biomass, municipal waste, solar power and water power as renewable sources of energy. Time will show how far these intentions will be implemented.
10.1 Is your jurisdiction likely to follow the experience of the US in terms of asbestos litigation?
The Act of 19th June 1997 on prohibition of application of asbestos- containing products prohibits any production of asbestos containing products and entitles the minister in charge of economic affairs to determine by ordinance the means and conditions of safe utilisation and removal of asbestos containing products. The EPL-Act classifies asbestos as a substance creating specific hazard for the environment (the other one being PCB), and prohibits the placing on the market and re-utilisation of such substances. In performance of these statutory provisions, the Council of Ministers adopted a programme for removal of asbestos and of asbestos-containing products on 14th May 2002. This programme is subject to implementation through the year 2032, upon which use of asbestos and asbestos-containing products will be proscribed. The programme obligates owners of property to remove any asbestos-containing products and to employ duly trained and certified entities for this purpose.
In addition, on 14th July 2009, the Council of Ministers adopted a programme for the cleaning of the country of asbestos for the years 2009 to 2032, which was amended by a decision of the Council of Ministers adopted on 15th March 2010. The duties of entities offering asbestos removal services are laid down in the Regulation of 2nd April 2004 concerning means and conditions of safe use and removal of asbestos-containing products. The database kept by the Ministry of Development indicates over 5.4 million tonnes of asbestos-containing products in Poland, of which almost 5 million tonnes still have to be neutralised.
While Polish laws strictly regulate asbestos use, asbestos-related litigation in Poland bears little resemblance to what is observed in the United States. Not many asbestos-related cases are pending.
10.2 What are the duties of owners/occupiers of premises in relation to asbestos on site?
Any entity (other than a natural person) using asbestos must document the type, quantity, and location of the asbestos-containing materials and the means of its elimination; this information must also be passed on to the head of the regional self-government. Natural persons submit similar information, but in simplified form to the executive body of their local community. Under the Regulation of the Minister of the Economy, Labour, and Social Policy of 2nd April 2004 concerning means and conditions of safe utilisation and removal of asbestos-containing products, the owner, user, or administrator of a property upon which asbestos is located must inspect the condition of asbestos-containing products within a timeframe following from assessment of these products’ condition. Such periodic inspections constitute the basis for appraisals of safe use of the asbestos-containing products; one copy of this appraisal is submitted to the construction supervision authorities. Any asbestos-containing products earmarked for replacement due to excessive wear or damage should be duly disposed of by the party in question. The Regulation of the Minister of the Economy and Labour of 14th October 2005 concerning occupational health and safety rules in securing and removing asbestos-containing products and the training programme for safe use of such products defines conditions which must be met by employers whose workers are assigned to securing and/or removal of asbestos-containing products. The Waste Act lays down rules for handling waste so as to ensure protection of the environment. The definition of waste adopted by this statute also includes asbestos. Under the Waste Act, a party administering land is legally in possession of any waste situated on the property and, accordingly, is bound by certain duties under the Act as regards handling the waste in compliance with waste management and environmental protection rules. According to these general rules, waste should, first and foremost, be recycled (not applicable in case of asbestos) or, where this is impossible, should be neutralised. A party in possession of waste should maintain an inventory list of waste (this duty does not apply to natural persons or to organisational units other than businesses which use waste for their own purposes).
11 Environmental Insurance Liabilities
11.1 What types of environmental insurance are available in the market, and how big a role does environmental risks insurance play in your jurisdiction?
Poland has not yet established a system of mandatory third party liability insurance with respect to ecological damage. Also, voluntary insurance dealing with environmental protection is, at best, a niche product in the Polish insurance market. Any ecological insurance is offered as additional insurance. The general terms and conditions of a typical insurance product offered in Poland enumerate among the risks not covered by the insurance contract damage arising from, for instance, effects of asbestos, of nuclear energy, of magnetic and electromagnetic fields, of radioactive contamination, or of delayed operation of chemical, thermal, or biological agents. Polish law still does not include any special regulations concerning ecological insurance. Liability of business enterprises for damage, meanwhile, is regulated by an assortment of legal instruments, including the EPL-Act and the Polish Civil Code.
11.2 What is the environmental insurance claims experience in your jurisdiction?
Seeing as Polish law does not mandate ecological insurance and that voluntary insurance in this area is rare (please see question 11.1), it would be difficult to estimate the number of ecological insurance cases considered by the courts or their nature.
12.1 Please provide, in no more than 300 words, a summary of any new cases, trends and developments in Environment Law in your jurisdiction.
Polish cities suffer from a high level of air pollution, to a large extent caused by heating of houses using fuels of low quality. On 10th September 2015 the Polish Parliament adopted an amendment to the EPL-Act which empowers regional assemblies to enact limitations or bans on the operation of fuel combustion installations. As mentioned before, in the future major changes to the climate change regulation and energy policy of the Polish government may occur. Part of these potential changes is a different approach in the field of renewable energies. Currently, an ongoing state of uncertainty persists to affect this sector. After a prolonged and rather turbulent legislative process of almost five years a comprehensive Renewable Energy Sources Act was adopted on 20th February 2015. Pursuant to a recent amendment, however, full coming into effect of the Act – and specifically, of the revised renewable support scheme as incorporated therein – has been postponed until mid- 2016 in order to provide the government with time to reconsider some of the Act’s assumptions. The explanatory memorandum to the amendment might imply that a shift in policy concerning that sector e.g. to maintain further support of biogas plants might occur.