On 3 December 2024, the Environment Agency (“EA”) published its final guidance on the regulatory appeals process which operators of regulated facilities and activities may follow if they wish to challenge a ‘regulatory decision’ (or an action which is considered to deviate from the Regulators’ Code). The publication of this guidance comes in the wake of the case of R (Suez Recycling and Recovery UK Ltd) v Environment Agency [2023] (the “Suez case”), which we reported on in January and which saw the Administrative Court rule that the EA had failed to comply with the Regulators’ Code in not considering whether to provide a proper appeal mechanism for challenging Compliance Assessment Reports, which the court determined were ‘regulatory decisions’. The new guidance is intended to address the identified deficiencies in the regulatory appeals process.

The EA previously consulted on updates to its regulatory complaints and appeals processes in July, which we considered in our article ‘Environment Agency consults on changes to its regulatory appeal process’. In that article, we outlined the proposals being put forward, which centred on a two-stage regulatory appeal process involving an initial pre-regulatory appeal discussion and a subsequent Stage 2 appeal (where issues cannot be resolved at stage 1). The consultation also included a draft set of internal instructions to assist the EA in dealing with regulatory appeals, which has not yet been published in final version (and no indicative timeframes for such publication have been forthcoming). 

Guidance changes

The majority of the proposals in the consultation, which are covered in our article, have been taken forward into the final guidance. However, we have listed below the key distinctions between the proposals and the final appeals process:

• the timeframe for submitting a Stage 2 regulatory appeal has been extended from 21 to 28 calendar days of the date of receipt of the EA’s Stage 1 response. This period begins on the day the EA emails, delivers or hands the Stage 1 response to the dissatisfied regulated entity, or leaves the Stage 1 response at the entity’s address. If the Stage 1 response is communicated by post then, unless specified otherwise, the EA will treat this as having been received 3 working days after it was posted;
• the proposal for Stage 2 regulatory appeals to be submitted via a specific form has been replaced with a requirement to submit the appeal by email to enquiries@environment-agency.gov.uk, with the following specific details:
  • details of the decision or action (for example any reference numbers, such as permit numbers and report form reference);
  • the name of the EA officer or team who was contacted during Stage 1; and
  • why the regulatory decision is considered to be wrong, or how the action failed to meet the Regulators’ Code;
• the final published guidance specifically states that the impartial person selected to consider the Stage 2 appeal may, where they consider it appropriate, take account of new information and considerations since the original decision was made. This indicates that the impartial person is able to make a decision on the appeal based on information not previously known or in existence when the initial decision or action was made/taken;
• the timeframe for communication of the regulatory appeal outcome to the appealing regulated entity has been increased from 21 to 28 calendar days of the regulatory appeal (if possible); and
• importantly, the guidance clarifies that requesting a regulatory appeal does not suspend the regulatory decision or action unless the EA has written to the regulated entity to confirm that it does.

The guidance also affirms that a request for a regulatory appeal received from someone other than the regulated person will be treated as a complaint (which is dealt with under a separate process).

Enforcement undertakings

The guidance confirms that the decision to reject an enforcement undertaking offer is a regulatory decision – meaning that an operator has a route to a merits-based re-examination in the event their offer is not accepted by the EA. An enforcement undertaking is a voluntary offer by an offender to the environmental regulator (which, if accepted, results in a legally binding agreement between the parties) to put right the effects of their offending and its impact (if applicable) on third parties. Enforcement undertakings are increasingly favoured by environmental regulators in circumstances where they have reasonable grounds to suspect that the offender has committed a specified offence but consider the offered actions (which usually encompass a financial contribution towards environmental improvement) are an appropriate and proportionate alternative to prosecution. Whilst the right to an independent internal review of a decision to reject an enforcement undertaking offer already exists, it is significant that the guidance expressly provides that enforcement undertakings will fall within the EA’s revised appeals process.

Key takeaways

These changes will be welcomed by regulated entities who were previously denied an appropriate appeals process with regard to challenging a regulatory decision, although a question remains as to how far the process goes in achieving a truly impartial procedure and whether appellants will receive a full merits-evaluation of a decision as envisaged. We anticipate that the answer to these questions may become clearer once the process is put into practice. In addition, there are already a number of matters which may cause potential issues for appellants: whilst the timeframe within which an entity must submit a Stage 2 regulatory appeal has been marginally increased, there remains a question as to whether this is sufficient where issues of expert evidence (for example) is involved. The ability of the impartial person to consider ‘new’ information and considerations when reaching a decision may also see complaints of a regulatory shift of goalposts.

Ultimately, it is encouraging to see that the EA has taken action following the decision in the Suez case to ensure that there is (in theory) a clear route of appeal of a regulatory decision under which the impartial reviewer should reconsider the merits of that decision. The requirement to provide the appellant with copies of documents made available to the impartial reviewer also offers a degree of mitigation against accusations of a lack of transparency and bias within the process; however, so long as the EA remains the body which undertakes a review of the decision, it could be observed that the process still falls short of achieving a fully independent reassessment.

If you have any questions or concerns arising from the new regulatory appeals process, please get in touch with a member of the Environment Team.

This article was written by Philippa Shepherd and Victoria Barnes