On 15 December 2021 the European Commission published its second set of "Fit for 55" directives – a package aimed at reducing greenhouse gas emissions in the European Union by 55 percent by 2030 compared to the 1990 level.

One of the important drafts from the set is the draft of the directive that relates to criminal liability for environmental offenses, which would replace the current Directive of the European Parliament and of the Council of 19 November 2008 on the protection of the environment through criminal law. The proposed extension of the catalog of sanctions and categories of environmental crimes is another tool securing not only the effective implementation of the Green Deal strategy (i.e. the European Green Deal), but also the economic policy of the European Union.

This project is in line with the latest trends on the market – Green Compliance and ESG, emphasizing the importance of environmental protection in the operations of companies, especially when taking into account the context of the sanctions for environmental offenses described below. The specificity of such crime, based on an extensive supply and production chain, as well as complex export-import schemes related to economic activity, significantly hinders the elimination of the risk of participation in these practices. Even more so, with the planned tightening of liability, companies will have to pay even more attention to the system of selecting suppliers and contractors, especially in terms of waste management by unauthorized entities.

In addition, the draft of the directive provides for the possibility of extensive information on crimes and penalties imposed on enterprises, taking into account the wider context of non-financial reporting and the Taxonomy. Transparency regarding the sanctions imposed and the conducted proceedings is to ensure greater transparency on the market and, consequently, eliminate from it companies that do not meet the strict EU requirements. One of the tools to ensure this is the legal protection of whistleblowers who report irregularities to public authorities and the admission of interested parties to proceedings, in particular non-governmental organizations.

The desire to introduce a new directive on criminal liability for environmental offenses into the EU legal order is dictated by the fact that the provisions that are currently in force in this matter are perceived as ineffective. The new directive aims to close existing regulatory loopholes and ensure wider protection of the environment by updating the scope of the provisions, clarifying or eliminating unclear terms used in definitions, or ensuring effective, dissuasive and proportionate types and levels of sanctions.

The catalog of environmental crimes proposed by the Commission extends it to include such offences as:

• placing on the market products that causes or may cause significant damage to the quality of air, water or soil, or to animals or plants as a result of using the product on a larger scale (especially in the context of the so-called forever chemicals, which we wrote about here),
• discharges of polluting substances from ships,
• uptake of surface or groundwater that causes or may cause significant damage to the ecological status or potential,
• placing on the European Union market illegally harvested timber or timber products that have been made of illegally harvested timber,
• any behavior that causes the deterioration of the natural habitat in the protected area,
• introduction or spread of invasive alien species of interest to the European Union,
• production, placement on the market, import, export, use, emission or release of fluorinated greenhouse gases.

The draft also includes financial sanctions for legal persons, which are to amount to no less than 5 percent of the total turnover in a given Member State in the financial year preceding the decision to impose a fine. These sanctions clearly show that the Commission does not make any compromises with regard to polluters and that each such case is to be treated with the utmost severity in the EU.

Moreover, the new directive – unlike the original one – obliges Member States to threaten environmental crimes with a minimum prison sentence of 4 years, some with a sentence of at least 6 or even 10 years, depending on the degree of harm done. The catalog of sanctions other than imprisonment proposed by the Commission may also turn out to be significant from the point of view of the risk of running a business. Although the draft relates mainly to legal persons, penalties for natural persons may be imposed on each of the persons responsible in a given entity for environmental issues. Thus, the provisions of the directive in the proposed wording will act in two ways, making it possible to impose severe financial sanctions on the bodies of legal persons and to personally punish those responsible, e.g. by imprisonment or additional sanctions, such as:

• deprivation of the right to use public benefits or public aid,
• temporary or permanent exclusion from access to public funding, including tender procedures, grants and concessions,
• revocation of permits and authorizations to conduct the activity that led to the commission of the crime,
• publication of a judicial decision at national or EU level,
• placing under judicial supervision,
• temporary or permanent ban on conducting business activity,
• judicial liquidation.

Upon implementing the directive into the national legal order, one can expect a significant tightening of the criminal provisions related to environmental protection, which in Poland have so far been relatively mild. The draft directive in its present wording is also a clear signal for the market about the increasing importance of environmental and ESG regulations in conducting and planning business activities.

The project will soon be processed by the Council and the European Parliament, and after positive consideration, it will be handed over to the Member States for implementation, which is likely to happen in 2024 at the earliest.