HAZARDOUS SUBSTANCES AND NEW ORGANISMS ACT – STATE OF PLAY

The Hazardous Substances and New Organisms Act (HSNO) Amendment Bill has had its second reading in Parliament last week and has now been referred to the Transport and Environment Select Committee for further consideration.

The HSNO Act, a comprehensive piece of legislation, was passed by Parliament in 1996. It is already in force for new organisms. The commencement of the hazardous substances part of the Act was delayed until the completion of the necessary technical regulations.

"The complexity of these regulations has required a rather lengthy and involved consultative process," said Hon. Simon Upton, Minister for the Environment.

"The regulations are extremely complex as they cover explosives, flammables, corrosives and oxidising substances and those which are toxic to people and the environment. We needed to deal with tracking, packaging, emergency management and disposals well as introducing new substances to New Zealand," said Mr Upton.

"Following concerns expressed by industry, I prompted a further review of the regulations technical documents by a panel of local experts. Areas were identified where simple legislative changes could improve the application of the Act,"

Within the overall objective of improving the operability and efficiency of the Act, the Amendment Bill can be divided into three main areas:

* Those amendments that are essential for the practical operation of the Act

* Those amendments intended to reduce compliance costs and the time involved in gaining approvals

* Those amendments intended to reduce the Environmental Risk Management Authority's administration costs or provide it with more flexibility to effectively achieve the purposes of the Act.

"The amendments are necessary to ensure that the HSNO Act works as was originally intended. The HSNO Act provides a highly advanced environmental risk management regime, tailored to New Zealand's circumstances. These changes ensure that we can deliver the environmental goals at the lowest possible cost to all New Zealanders," said Hon Simon Upton.

"When the new Government has been formed following the election, the appropriate Select Committee will further consider the HSNO Amendment Bill. Interested individuals and organisations will have the opportunity to comment on these proposed amendments at that time," the Minister said.

"Following from the review by the panel of local experts, the technical regulations needed for the hazardous substances part of the Act are close to being finalised by officials. I intend to work with the responsible Ministers to ensure that the Government can agree this month to the technical details for these regulations. This will allow legal drafting to proceed," the Minister added.

"There will not be time to promulgate the large package of regulations before the election. Accordingly, I plan to have the regulations completed and available to enable the incoming Government to take an early decision on the date for bringing the Act into force for hazardous substances."

ENDS

Contact: Paul Goldsmith 04 471 9794

Background information

Amendments to the HSNO Act
The amendments proposed to the HSNO Act are designed to address industry concerns about the actual operation of the Act and the costs associated with compliance. The amendments, however, will not alter the fundamental objectives and principles of the Act.

The changes will also ensure that the operation of the Act is closer to the original intention.
The amendments to the Act can be grouped into four categories:

* Amendments that are considered essential for the practical operation of the Act;
* Amendments intended to reduce compliance costs and delays;
* Amendments intended to reduce ERMA NZ's administration costs; and
* Technical amendments to correct earlier errors.

1. Amendments Needed for the Practical Operation of the Act These matters are largely to do with the transition to the new hazardous substances regime and the possibility of unintended consequences if some other sections are not amended. The amendments proposed include:

* Extension of the Transitional Period
Extend the transition period to three years from the commencement date of the Act with a discretion to extend it by 2 years if required.

* Single approval for a hazardous substance
This removes the current anomaly in the Act which requires every person that intends to import or manufacture a hazardous substance to apply for approval. The amendment ensures that the Act implements the policy on this matter introduced by the Government and agreed to by the bipartisan special Select committee which considered the original HSNO Bill.

* Amending the definition of 'premises' to include dwellings for enforcement purposes.

* The ability to delegate transitional approvals to other agencies

* Amend the Act so that stationery containers (bulk tanks) for hazardous substances will not be treated as buildings under the Building Act 1991.

2. Amendments Intended to Reduce Compliance Costs and Time Delays While implementing the Act, ERMA NZ has also received concerns about the costs of complying with the Act. Following discussions with industry groups, ERMA NZ has put forward a number of proposals that provide greater flexibility so that environmental and public health goals can be achieved at the least cost. These proposals are intended to reduce the costs of approvals and reduce barriers to innovation. The amendments overcome these concerns by:

* Allowing for the rapid assessment of hazardous substances where risks do not warrant the use of the Act's full public assessment procedure.
Rapid assessment gives the ERMA the flexibility to avoid full public notification, or limit notification to those directly affected. The use of this procedure is subject to clearly defined criteria.

* Ensuring that all small scale research and development work with hazardous substances are exempt from the Act's assessment procedure provided the complete system meets prescribed requirements that ensure that it is fully contained.

* Extending the delegation of authority for certain 'low risk' decision making functions involving approvals and reassessments of hazardous substances.

* Allowing minor variation of controls on existing approvals without the need for full assessment.

* Allowing ERMA NZ to provide a statutory determination as to whether a substance is new or whether it is covered by an existing approval.

* Extending the rapid assessment of new organisms that are released, and that are not genetically modified, to also include those that are imported into containment.

3. Amendments Intended to Reduce Administration Costs or Provide More Flexibility to Effectively Achieve the Purposes and Principles of the Act.

These amendments include:
Changing the transfer of enforcement provisions so as to remove potential barriers that might discourage such transfers between different enforcement agencies

Removing the requirement that forms be prescribed so that they can be changed without the use of regulations

Rationalising some time limits to allow more time for the preparation of the ERMA's assessment evaluation reports and give the ERMA discretion to reduce other time limits where it can be shown that no party is adversely affected

Extending the matters to be addressed in the containment controls for hazardous substances and new organisms in the Third Schedule.

4. Technical Amendments
Finally there are a number of technical amendments proposed:

* Extending Codes of Practice to include controls on hazardous substances.

* Correcting the Seventh Schedule to include Part D class 6 ammunition in the explosives covered by the transition.

* Amending test certificate provisions to increase the period of appointment to up to 5 years.