Fast-track Approvals Bill Presents A Serious Risk To New Zealand Exporters – Environmental Defence Society

On 1 May, New Zealand’s new free trade agreement with the European Union – our fourth largest trading partner – comes into force. The enforceable commitments by the Parties under its Trade and Sustainable Development Chapter have been described as a significant step up in accountability on key sustainability issues.

This is particularly so in relation to the Parties’ commitment to “refrain from any action or omission which materially defeats the object and purpose of the Paris Agreement”, which is subject to dispute settlement provisions and potentially trade sanctions if breached.

“Our exporters should, therefore, be deeply concerned that the Fast-track Approvals Bill was not assessed for consistency with any of our free trade commitments prior to being introduced to the House,” says Gary Taylor, Chief Executive of the Environmental Defence Society (EDS).

“EDS has conducted its own detailed peer-reviewed analysis of the Bill against those commitments. It concludes that, without significant amendment, the Bill could breach several of the legally binding commitments New Zealand has agreed to under free trade agreements with the UK, EU, and the Trans-Pacific Partnership. These include commitments:

• To provide for a high level of environmental protection and continue to improve environmental protections
• Not to weaken, reduce, waive, or otherwise derogate from environmental laws to encourage trade or investment
• To require evidence-based decision-making
• To transparency, including requiring a reasonable opportunity for interested persons, stakeholders and the other Party to review and comment on any proposed measures that might affect the free trade agreement’s environmental provisions or the free trade agreement generally
• To ensuring that all interested persons, including non-governmental organisations, have an early and effective opportunity, and an appropriate time period, to participate in and comment on the environmental impact assessment for activities related to the production (i.e. extraction / mining) of energy goods or raw materials. The definitions of “energy goods” and “raw materials” include coal, oil and gas, and a range of chemicals, minerals and metals
• To effectively implement the multilateral environmental agreements to which New Zealand is a party, including the Paris Agreement and commitments with regard to nationally determined contributions
  • Under New Zealand’s free trade agreement with the EU, that obligation specifically “includes the obligation to refrain from any action or omission that materially defeats the object and purpose of the Paris Agreement” – yet there is no requirement under the Bill for projects to demonstrate how they align with New Zealand’s emissions reduction plan, budgets, climate targets, or otherwise support our country’s transition to a low emissions economy. Indeed, supporting petroleum production can be deemed to be nationally or regionally significant for the purposes of fast-track referral eligibility; and
• To:
  • Fossil fuel subsidy reform
  • Protect and conserve endangered species and promote the conservation and sustainable use of biodiversity
  • Promote sustainable agriculture and reduce agricultural emissions
  • Promote the conservation and sustainable management of forests
  • Implement a precautionary, science and ecosystem-based fisheries management system, consistent with international best practice.

“Therefore when we consider, for example, whether the Bill is consistent with our commitments to ensure that New Zealand’s environmental law provides for and encourages a high level of environmental protection and continues to improve its level of environmental protection, we think that the Bill’s pro-development purpose and relegation of environmental safeguards (among other flaws) are plainly inconsistent with that obligation.

“The Bill clearly represents a significant weakening of existing environmental laws. Ministers have said that is to encourage trade. This constitutes an implicit subsidy for our exporters, a point made clearer by additional intentions to weaken freshwater and biodiversity protections to reduce costs to farmers. Free trade agreements are specifically designed to prevent such subsidies.

“In response to the proposition that New Zealand is a relatively small market and there is little risk that a counter-party would pursue enforcement action for non-compliance, we say that is a very low-integrity position for New Zealand to take, akin to ‘we can get away with it’. And it makes it very hard for us to then bring proceedings against our counterparts for any non-compliance on their part.

“It also overlooks the dynamics playing out in key export markets, where producers in those countries, particularly farmers, are struggling economically, are particularly alive to the prospect of unfair competition from foreign export markets and are looking for any justification to shut out our products. It is naïve to assume New Zealand is too small a player to matter.

“There is also the related, more critical danger of reputational harm from law that downplays environmental considerations, including climate change, excludes public input, enables species extinction, and facilitates executive overreach. These key features of the Bill’s design present a significant risk for exporters, who trade heavily on New Zealand’s ‘clean, green’ credentials.

“We need to be alert not just to legal compliance with free trade agreements, but also the perceptions of our offshore customers.

“We already have existing fast-track law that is issuing resource consent decisions within an average of around 90 days and does not imperil our trade relations or enable harm to our natural world. There is no need to place our exporters at risk,” Gary Taylor concluded.