COVID-19 – Compliance with Federal Environmental Requirements

By the McLennan Ross Energy, Environmental & Regulatory Team

In recognition of the compliance challenges many companies are encountering during the COVID-19 pandemic, the federal Minister of Environment and Climate Change Canada (the “ECCC”) has recently announced the ECCC’s intended approach during the crisis. While companies are expected to continue to comply with all applicable laws and regulations, and to operate in a manner that is safe and protects human health and the environment, ECCC will exercise discretion and take into account any challenges that regulated parties are facing when considering enforcement action.

Expectation of Compliance

The announcement is clear that regulated companies are expected to continue to comply with all environmental laws, regulations, operating permits and approvals. This includes compliance with all obligations to notify public authorities of an unauthorized release of pollutants, particularly where such release may cause risk to human health or the environment. At all times, regulated companies are expected to continue operating in a manner that is safe and protective of human health and the environment.

The COVID-19 pandemic and the corresponding self-imposed and regulated quarantine protocols may have a significant impact on the ability of companies to meet existing regulatory requirements. In particular, regulated companies may experience workforce shortages in the form of reduced access to personnel and contractors at a facility. If there are insufficient resources to conduct an operation in full compliance of environmental obligations, companies should consider revising operation plans or reducing production levels, as necessary, to ensure compliance.

Non-Compliance Issues

Where compliance is not possible due to COVID-19, regulated parties are expected “to act responsibly to minimize the effects and duration” of any non-compliance and should, to the extent possible identify and document:

• the nature and dates of any non-compliance;
• how COVID-19 contributed to the non-compliance; and
• the actions taken to prevent or minimize any risk to human health and the environment, including steps taken to come into compliance at the earliest opportunity.

Prior to taking enforcement action, the ECCC will continue to consider any damage to the environment on a case-by-case basis, which includes a consideration of any other aggravating factors and all reasonable measures taken by an individual or company to mitigate and to comply.

Due Diligence Going Forward

The ECCC is signaling its clear expectations that regulated entities continue to maintain environmental compliance to the best of their abilities. It is therefore critically important for companies to plan for what may be a prolonged state of abbreviated operations at their physical work sites, and to implement and exercise the appropriate level of due diligence to prevent incidents.

Provided that the company can demonstrate that certain violations or non-compliance events resulted from the COVID-19 pandemic, and the company took reasonable measures to minimize any risk to human health and environment, there is a low likelihood of sanctions being imposed. However, prevention of those incidents in the first place is, as always, the better approach.