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Brief Counsel

EEZ Bill changes - for better or for worse?

22 May 2012

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​The Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill will be changed as a result of the select committee process – but whether it will be stronger (and for whom) or clearer is debatable.

The most significant change is the removal of the specific requirement that marine consents can be granted only where the activity’s contribution to New Zealand’s economic development outweighs the adverse environmental effects. 

What that might mean in practice is, however, difficult to gauge and may become clear only through legal challenge to the High Court on marine consents.

Bill’s purpose

The purpose of the Bill is to “achieve a balance between the protection of the environment and economic development in relation to activities in the exclusive economic zone and in or on the continental shelf”.

The purpose has remained unchanged although a number of submitters, and the Opposition parties, sought amendments to align it with the Resource Management Act’s purpose of sustainable management.

But how the EPA is guided in making decisions on marine consent applications has changed.

Consents criteria

The first draft of the Bill provided that consent could be granted only where the economic development benefits from the proposed activity outweighed the adverse environmental effects.  Where this criterion was not met, consent would be declined. 

But this threshold has now been removed.  The explanation offered by the select committee for the decision is that it was not the policy intent of the Bill to create an overriding economy-versus environmental test or a cost benefit analysis of the economic and environmental implications of an application. 

Decision makers are now simply guided by the overall purpose in clause 10, and an amended list of principles in clause 59 (formerly in clause 12).  Clause 59 states that the Environmental Protection Authority (EPA) must take into account:

  • effects on the environment and existing interests
  • effects on human health that may arise from effects on the environment
  • the importance of protecting the biological diversity and integrity of marine species, ecosystems, and processes
  • the importance of protecting rare and vulnerable ecosystems and the habitats of threatened species
  • economic benefit to New Zealand 
  • efficient use and development of natural resources
  • the nature and effect of other marine management regimes
  • best practice in relation to an industry or activity
  • the extent to which imposing conditions would avoid, remedy or mitigate adverse effects.

This list is broader than the threshold test in the original version of the Bill and fails to provide the EPA with any direction on how these principles should be balanced when conflict arises. 

Other provisions

The Bill establishes a consenting regime similar to the Resource Management Act but administered by the EPA rather than local authorities (whose jurisdiction does not extend to the EEZ).   

The regime requires the Minister to put in place regulations to determine the status of activities and whether a marine consent is required.  Activities could be classed as permitted (meaning no consent is required), discretionary (meaning consent is required) or prohibited (meaning consent cannot be sought).

Further detail on how the proposed system will work is available in Chapman Tripp’s earlier commentary on the Bill.

The consents process

An application for a marine consent will be publicly notified, a hearing will be held by the EPA, and decisions will be subject only to appeals on points of law. 

The only significant change made by the select committee is to allow the possibility of cross examination of witnesses during the hearing.  The committee recognised the importance of robust testing of evidence, when the process is inquisitorial rather than adversarial.

Chapman Tripp comments

Although the select committee says the policy intent of the Bill was not to create an overriding economy versus environment test, this is still the likely practical outcome. 

Applications in the EEZ will likely have both adverse environmental effects and economic benefits that will need to be balanced by the EPA. 

The Bill as now amended provides limited guidance on how these conflicts should be resolved.  For applicants the potential outcome of an application is less clear and it will be wait and see as to how the EPA exercises its broad discretion.

The select committee was divided on the Bill with the vote being tied on some decisions, resulting in no amendments being made.  Overall the committee was unable to agree that the bill be passed.  In our view, the inconclusive nature of the select committee’s commentary and the few substantial changes made reflect this deadlock. 

But there is still potential for further amendments to the Bill via Supplementary Order Paper in the committal stages in the House.  Watch this space.

Our thanks to Jill Gregory for writing this Brief Counsel. For further information, please contact the lawyers featured.

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