EBA urges to take into account critical provisions for business in the draft law №4167

09/ 03/ 2021

On March 10, the Environmental Committee of the Verkhovna Rada will consider the revised version of the draft law №4167 on industrial pollution. The document aims at unifying four environmental permits into an integrated one and introducing the best available techniques (BAT), as provided by Directive 2010/75 / EC on industrial emissions. In February, Parliament returned the document to the Committee for revision, citing that the draft law did not take into account the current economic situation in the country and could deal a significant blow to the domestic industry, including job cuts and GDP. The European Business Association proposed to take into account the rational proposals of the alternative draft law №4167-1 when finalizing the document. Thus, the revised version of the draft Law №4167 contains the following positive decisions: Refusal to issue an integrated permit cannot be based on a negative conclusion of the body concerned (for example, local governments, which often do not have the appropriate competence to make such decisions, etc.). Clarification of the requirements for suspending an integrated permit. It concerns particularly the suspension due to “significant impact”, the interpretation of which had no legal basis. Doubling the deadlines for launching a facility that has obtained an integrated permit before the Ministry of Environment decides to revoke it. The BAT conclusions are put into effect 4 years after their entry into force, which allows companies to assess their own resource needs and capabilities. Extending the terms of non-application of the law to operators of all types of activity by three months (each category has a different term, energy - 18 months, waste management - 42 months, etc., to which three more months have been added). At the same time, the new version of the document has the following provisions to be unchanged: double interpretation and duplication of terms (pollution/emissions); regulation of activities for which there are no European BAT conclusions (underground mining and open-pit mining); insufficient adaptation period for the introduction of a new permitting system; no transition period for energy activities and links to the National Emission Reduction Plan (NAP); the possibility of the permitting body (Ministry of Environment) to independently suspend or revoke the integrated permit without a court decision, which creates favorable conditions for corruption. Besides, the latest version of the document offers the following new changes: The scope of the draft law extends to the stage of commissioning. Amendments to the integrated permit as well as the issuance of the permit are expected to be on a paid basis, although all permits are currently free. The document provides for installing means of automated emission monitoring at incinerators, should which in real-time transmit to the permitting authority information for publication on the Internet. This facility would come at a very high cost, especially for business in the beginning. BAT conclusions should be updated no later than 12 months after the official publication of the relevant acts in the European Union (this means that in Ukraine and the EU the terms of renewal should be approximately the same, however, the pace of technology differs by about 10-15 years). Olga Boiko. EBA Industrial Ecology and Sustainable Development Committee. According to EBA experts, the implementation of the requirements of the draft law №4167 will cost at least 10 billion dollars in the backdrop of a catastrophic lack of investment in Ukraine. At one time, a large number of industrial enterprises in Eastern Europe were unable to adapt to the new requirements and were forced to cease operations despite subsidies and preferential EU tax policies. In 2020, capital investment in the Ukrainian industry decreased by 43% and this negative trend will continue. That is why it will be expedient to provide companies with the opportunity to switch to integrated permits as the current permits expire. Therefore, the business community appeals to the peoples deputies to finalize the draft law №4167 in terms of increasing the period for transition to an integrated permit system to 15 years, introducing the possibility of transition to an integrated permit after the expiration of existing permits, as well as developing incentives for companies that apply eco-modernization measures. Be the first to learn about the latest EBA news with our Telegram-channel – EBAUkraine.

In February, Parliament returned the document to the Committee for revision, citing that the draft law did not take into account the current economic situation in the country and could deal a significant blow to the domestic industry, including job cuts and GDP.

The European Business Association proposed to take into account the rational proposals of the alternative draft law №4167-1 when finalizing the document. Thus, the revised version of the draft Law №4167 contains the following positive decisions:

Refusal to issue an integrated permit cannot be based on a negative conclusion of the body concerned (for example, local governments, which often do not have the appropriate competence to make such decisions, etc.).
Clarification of the requirements for suspending an integrated permit. It concerns particularly the suspension due to “significant impact”, the interpretation of which had no legal basis.
Doubling the deadlines for launching a facility that has obtained an integrated permit before the Ministry of Environment decides to revoke it.
The BAT conclusions are put into effect 4 years after their entry into force, which allows companies to assess their own resource needs and capabilities.
Extending the terms of non-application of the law to operators of all types of activity by three months (each category has a different term, energy – 18 months, waste management – 42 months, etc., to which three more months have been added).

At the same time, the new version of the document has the following provisions to be unchanged: double interpretation and duplication of terms (pollution/emissions); regulation of activities for which there are no European BAT conclusions (underground mining and open-pit mining); insufficient adaptation period for the introduction of a new permitting system; no transition period for energy activities and links to the National Emission Reduction Plan (NAP); the possibility of the permitting body (Ministry of Environment) to independently suspend or revoke the integrated permit without a court decision, which creates favorable conditions for corruption.

Besides, the latest version of the document offers the following new changes:

The scope of the draft law extends to the stage of commissioning.
Amendments to the integrated permit as well as the issuance of the permit are expected to be on a paid basis, although all permits are currently free.
The document provides for installing means of automated emission monitoring at incinerators, should which in real-time transmit to the permitting authority information for publication on the Internet. This facility would come at a very high cost, especially for business in the beginning.
BAT conclusions should be updated no later than 12 months after the official publication of the relevant acts in the European Union (this means that in Ukraine and the EU the terms of renewal should be approximately the same, however, the pace of technology differs by about 10-15 years).

Olga Boiko EBA Industrial Ecology and Sustainable Development Committee

According to EBA experts, the implementation of the requirements of the draft law №4167 will cost at least 10 billion dollars in the backdrop of a catastrophic lack of investment in Ukraine. At one time, a large number of industrial enterprises in Eastern Europe were unable to adapt to the new requirements and were forced to cease operations despite subsidies and preferential EU tax policies. In 2020, capital investment in the Ukrainian industry decreased by 43% and this negative trend will continue. That is why it will be expedient to provide companies with the opportunity to switch to integrated permits as the current permits expire.

Therefore, the business community appeals to the people’s deputies to finalize the draft law №4167 in terms of increasing the period for transition to an integrated permit system to 15 years, introducing the possibility of transition to an integrated permit after the expiration of existing permits, as well as developing incentives for companies that apply eco-modernization measures.

Be the first to learn about the latest EBA news with our Telegram-channel – EBAUkraine.