February 11, 2010

1. Soil and Groundwater Pollution Remediation Fund Management Board, Environmental Protection Administration, Executive Yuan Soil and Groundwater Pollution Remediation Act Amendment Report February 11, 2010

2. 1. History of Amendment • After the draft of the Soil and Groundwater Pollution Remediation Act (the Act) was approved in the 3068th meeting of the Executive Yuan in 2007, it was sent to the Legislative Yuan for review and approval on February 4, 2008. • On April 28, 2008 and June 16, 2008, every article of the Act was discussed and reviewed in the meetings of the Legislative Yuan. On January 8, 2010, a full meeting of the Legislative Yuan completed the third reading of the Act. On February 3, the Act was officially promulgated by the President. • During the review, the opinions of legislators were considered, such as adding the monitoring and pollution control of sediment, holding hearings before approving the remediation plan, publicizing the names of land polluters and requiring them to attend environmental education lectures, and claiming compensation from the main policymakers of companies, organizations, etc.

3. 2. Main Amendments • After the Act was amended, the articles were increased from 51 to 57. Eleven new articles were added. The content of 43 articles were amended (2 articles were merged). The sequence of 3 articles was changed. One article remained the same. Four articles were deleted. • After the amendment, the main revision includes the subject and scope of control, regular monitoring of pollution prevention, the identification and extent of liability of the liable entity, the submission of industrial inspections.

4. 2. Main Amendments • The sediment in environmental media is now included in the control scope of the Act • The monitoring and control mechanism of sediments is covered, including: setting the quality index for sediments, the categories for management and use limits, and asking the competent authorities of water bodies to monitor the sediment quality and publicize the sediment quality regularly.(§2、§6) • As for the polluted sediments, the polluters, potential parties liable for pollution or the administrator of water bodies must assess the environmental impacts, health risks, technical and economic benefits, etc. If required, remediation must be conducted.(§12)

5. 2. Main Amendments • Add the main liable body of potential party liable for pollution • Concerning polluter liability, the principle of faultless liability adopted by other countries has been studied to re-define which parties may have potential liability for pollution. Regardless of whether a party is defined as a polluter under existing environmental legislation, that party will be liable for soil pollution and remediation thereof.(§2) • In the future, the competent authority may ask the potential parties liable for pollution to take the liability for submitting and executing the control or remediation plans of pollution sites, in order to accelerate the execution of remediation work. But the cleanup liability is limited to half of the total fee, to differentiate it from the violation of a law.(§43) • Also clarified was a regulation governing those with potential liability for pollution, who request compensation from other polluters for remediation related expenses.(§43)

6. 2. Main Amendments • Increaseliability of interested parties of polluted land • As for interested parties of polluted land who show gross negligence or failure to exercise the duty of care as a good administrator of such land, they must share relevant expenses with the polluter, and the potential parties liable for pollution.(§31) • Establish land management principles for interested parties of the land, which will be used to determine whether the obligations of interested parties of the land has been achieved or not.(§31) • The administration units have to regularly inspect the condition of soil and groundwater in areas with high pollution potential, such as industrial parks and science parks, and results must be submitted to the competent authority for review, in order to strengthen pollution prevention of industrial land.(§6)

7. 2. Main Amendments • Site management becomes more flexible through adding regulations on time limits for execution of required response measures and removing from the list of declared sites.(§7) • Upon investigating, if it is found that the soil, sediment or groundwater is polluted so that the health of people, the production of agriculture, the fishing sector or the source of drinking water is influenced, the competent authority may take the required response measures in accordance with Article 15(1). • The time limit for executing required response measures is 12 months. If required, it may be extended once, and the extension should not exceed 6 months. • After the required response measuresare taken, if the pollution condition of soil/ groundwater is reduced, and the concentration of pollutants is lower than the control standard, the site will not be declared as a pollution control site.

8. 2. Main Amendments • Rules were amended for submitting soil pollution assessment and inspection information by enterprises designated by the central competent authority, and to authorize establishment of regulations for the assessment of information. • When land is transferred, assessment and inspection information must be submitted for reference. Also, penalties for violations were specified.(§8) • When enterprises are founded, changed, suspended, etc. assessment and inspection information must be submitted for review.(§9) • Strengthen access to information about polluted land • Register land declared as a pollution control site or a pollution remediation site in a land registration book, in order to satisfy land users’ right to know.(§12) • Publicize the names or title of polluters of pollution control sites or pollution remediation sites.(§40、§41)

9. 2. Main Amendments • Professional engineer certification system added (§11) • To assure the quality of relevant assessment and remediation documents, and ensure a high standard of accuracy and implementation, the relevant documents for control plans, remediation plans and assessment data have to be certified by an environmental, applied geological or other professional engineer. • The professional engineer certification system will be enforced one year after the promulgation of the amended Act. • Add the treatment rule for the pollution site: due to natural environment and background factors, some sites must take required measures. If the local competent authority considers a site needs remediation, the plan must be submitted to the central competent authority for final approval before implementation.(§12)

10. 2. Main Amendments • Risk assessment mechanism (§24) • Although the Act already covered health risk assessments, there were no relevant coordination mechanisms between the regulations and statutory orders. Now the regulations for hazard identification, dose response assessment, exposure assessment, risk characteristics, etc. are specified. • Previously, only polluters responsible for groundwater pollution remediation sites could use the risk assessment method to propose remediation goals. The amendment now allows this method to be used for soil remediation also. • To strengthen public participation and access to information, competent authorities will be requested to hold hearings with experts, scholars, environmental organizations and representatives of adjacent residents before approval of remediation plans.

11. 2. Main Amendments • To rectify the disproportionate focus of imposing fees on petrochemical products for remediation funds, and to expand the funding base for the pollution remediation funds, the number of entities responsible for paying the fees has been expanded. Fee payment is no longer limited to “chemical substances.” Products or other polluting substances are also included for the funding base.(§28) • The cease auction procedure for the land of pollution remediation site was added. The enforced auction procedure should be stopped.(§21) • To preserve the compensation mechanism for payment into the land pollution fund, the competent authority has the right to notify the relevant authority to freeze the assets of polluters or interested parties of the polluted land within a payment range suited to the party’s assets.(§45)

12. 2. Main Amendments • Strengthen penalties for polluters • If the liable party does not fulfill its obligations, resulting in polluted land, as well as risks to people’s health and the environment, the concerned site will be declared as a pollution control site or a pollution remediation site, and the polluter will be fined.(§40、§41) • Penalties for intentional pollution added. Those who pollute soil or groundwater intentionally, causing declaration of a pollution control site or pollution remediation site, shall be punished by one to five years imprisonment.(§33) • The basis for determining penalties was changed from “number of consecutive days” to “number of occurrences.”

13. 2. Main Amendments • Increase the liabilities of polluters • To strengthen the awareness of environmental protection for polluters, if the land is declared as a pollution remediation site or a pollution control site, the polluter’s name or title will also be publicized . • A four-hour lecture on relevant regulations of the Act and other environmental education should be taken. (§40-3、§41-4) • The attached resolution by the Legislative Yuan upon revising the Act at the fourth session of the seventh meeting - • Pertaining to Article 28(1), with respect to the usage of funds, the Environmental Protection Administration (EPA) will be asked to provide a certain ratio of funds as the budget to deliver environmental education lessons; the content of lessons should be limited to ecological education and to soil and groundwater pollution control regulations. Three months after the amendment of the Act, the EPA must invite the relevant departments, experts, scholars, and civil organizations for a discussion.

14. 2. Main Amendments • Rule added that the competent authority can exact compensation from the responsible persons and main stakeholders of a company (§43) • Before the amendment, if the polluter was a company, the competent authority had difficulty exacting compensation from the responsible persons, controlling companies or main stakeholders of the company. For concern that the responsible persons, controlling companies or main stakeholders of the company wrongly benefit by their polluting behavior, a rule was added to prevent them from abusing corporate legal personality to neglect (or avoid) the responsibility of remediation. If the polluter or the potential party liable for pollution is a company, the local competent authority can exact compensation from the responsible persons, controlling companies or main stakeholders of the company, in order to enforce the principle of polluter liability. • When a company pollutes, or is potentially liable for pollution, it may involve a particular policymaker, controlling companies, or main stakeholders of the company. Who is ultimately responsible for the pollution? Regulations were revised to allow ‘end-of-pipe’ polluters to seek compensation from policymakers who are ultimately responsible for polluting behaviors.

15. 3. Major System Reforms and Benefits • Expands the scope for environmental monitoring and control, including sediments, under control of the Act. This reinforces the prevention, control and pollution remediation tasks for soil, groundwater and sediment in our country, and updates environmental protection laws. • Strengthens the monitoring of potential high pollution areas, to include the prevention of soil and groundwater pollution, and to supervise competent authorities and ensure they pay attention to environmental quality. • Expands the parties liable for pollution sites, adding the identification of potential parties liable for pollution, and cautions land users to be more aware of proper land use and pollution control, in order to conserve limited environmental resources. • Strengthens the system of professional environmental engineeringthrough the enforcement of a professional engineer certification system. • Enables compensation to be demanded from responsible persons, as well as from controlling entities or main shareholders of the company, in order to prevent actual policymakers of companies from avoiding pollution liability.

16. 4. Major Tasks in the Future • EPA • Complete the ecological lecture content within 3 months after the amendment. • Complete the announcement of execution rules for the transition period. • Complete the enforcement rules of the Act within a half year after the amendment. • Complete the rules and regulations for the Act within a year after the amendment. • Introduce the major amended points to relevant departments and local environmental protection authorities, and brief the execution rules for the transition period. • Relevant Departments • Deal with regular monitoring of soil, groundwater and sediment by the competent authorities of industrial parks, and the competent authorities of water bodies. • The industrial and business registration authority must remind enterprises to submit soil inspection data for transferring land owners or changing the usage of the land. • Cooperate with the Ministry of the Interior for the registration of declared pollution control sites and pollution remediation sites, and serve as the liaison for the “assessment and inspection information” submitted upon transfer to the declared land.

17. 4. Major Tasks in the Future • Local Environmental Protection Authority • Review information on soil and groundwater quality submitted by industrial parks, export processing zones, science parks, environmental protection technology parks, agricultural technology parks, etc. • When enterprises, designated by the central competent authority, are changed, it will also be necessary to submit “assessment and inspection information” on soil pollution to the Department of Environmental Protection for review. • If a control site is declared after the promulgation of the Act, the local competent authority must report it to the EPA for review. • When sediments or polluted substances detected in the natural environment exceed control standards, requiring remediation measures to be taken, it will also be necessary to report to the EPA to determine the treatment level and the sequence for the utilization of remediation funds.

18. Thank You!!