Sheba Gumis and Yee Xin Qian examine the recent changes to environmental law requirements in Malaysia.
In recent years, Malaysia has seen an increase in environmental awareness, particularly after witnessing the devastating results of uncontrolled development in the country, such as the widespread flooding in the East Coast of West Malaysia and the landslides in Cameron Highlands in 2014.
The Government, acknowledging the need to update existing environmental laws, gazetted the Environmental Quality (Prescribed Activities) (Environmental Impact Assessment) Order 2015 (“2015 Order”). This was part of the Government’s preventive strategy in ensuring that all development projects would take into account environmental factors at all stages of planning, construction and operations.
The 2015 Order supersedes the previous Environmental Quality (Prescribed Activities) (Environmental Impact Assessment) Order 1987 (“1987 Order”) by making changes to the prescribed activities requiring Environmental Impact Assessments (“EIA”).
However, it should be noted that the 1987 Order continues to apply to any environmental impact assessment report (“EIA Report”) approved or received by the Director General of Environmental Quality (“DG”) for any prescribed activity under the 1987 Order before the 2015 Order came into operation on 29 August 2015.
THE REQUIREMENT FOR EIA
The requirement for an EIA is set out in Section 34A of the Environmental Quality Act 1974. A person who intends to carry out a prescribed activity is required to appoint a qualified person to conduct an EIA and to submit an EIA Report to the DG.
The EIA Report must be prepared in accordance with the guidelines prescribed by the Department of Environment (“DOE”) and contain an assessment of the impact that such activity will have, or is likely to have, on the environment. Proposed measures to prevent, reduce or control the adverse impact on the environment are also required to be detailed in the EIA Report.
THE 1987 ORDER
Only activities prescribed by the DG are required to have EIAs conducted on them. Prior to the coming into operation of the 2015 Order, prescribed activities requiring EIAs were set out in the 1987 Order.
The 1987 Order contained one schedule prescribing nineteen categories of activities and included those relating to agriculture, airport, drainage and irrigation, and other activities. Most of the activities prescribed in the 1987 Order were defined in terms of project size (area) and capacity (quantum) while others were not defined by any unit of measure.
While the 1987 Order covered a wide range of prescribed activities, there has since been a need to update the prescribed activities to regulate activities that were not envisaged when the 1987 Order was gazetted nearly 30 years ago.
CHANGES AND UPDATES UNDER THE 2015 ORDER
One of the more notable changes under the 2015 Order is the introduction of a two-tier approach to EIAs.
The 2015 Order contains two schedules, namely the First Schedule and the Second Schedule. The prescribed activities specified in the First Schedule do not require EIAs to be made available for public display and comment unless otherwise instructed by the DG, whereas the EIAs of prescribed activities specified in the Second Schedule must be put up for public display and public comment.
As a general rule, the previous position under the 1987 Order required all EIAs to be made available for public display and comment, although subsequent DOE guidelines only required detailed EIAs (as compared to preliminary EIAs) to be displayed to the public for comment.
Fine tuning the 2015 Order
The 2015 Order attempts to plug the loopholes of and fine tune the 1987 Order by reducing thresholds for certain activities, having more comprehensive provisions, and redrafting certain provisions for greater clarity.
We see certain prescribed activities in the 2015 Order having had their thresholds lowered to increase DOE’s oversight over the same. For example, industrial estate development covering areas of 20 hectares or more is now a prescribed activity. Previously, only industrial estate development for medium and heavy industries exceeding 50 hectares was considered to be a prescribed activity.
The construction of off-shore and on-shore pipelines exceeding of 30 kilometres in length is now a prescribed activity as compared to the previous 50 kilometre threshold.
Land development schemes covering an area of 20 hectares or more but less than 500 hectares now require an EIA Report (without public display and comment), whereas such schemes of 500 hectares or more require an EIA Report (with public display and comment). Previously, only agricultural land development schemes of 500 hectares or more came within the ambit of the 1987 Order.
Item 3(4) of the 2015 Order plugs loopholes in the 1987 Order by deeming certain activities as prescribed activities. These include any prescribed activity which has been divided into a size or quantum smaller than the size or quantum specified in the First Schedule and the Second Schedule or any increase in size or quantum of an activity which results in such activity falling within the specified parameters for prescribed activities under the 2015 Order. There is no corresponding provision in the 1987 Order.
We also see more precise drafting in the 2015 Order, as certain descriptions of prescribed activities are redrafted for greater clarity. Examples include the prescribed activity of “oil and gas fields development” in the 1987 Order which is now divided in the 2015 Order into oil field development, gas field development and oil and gas field development, to capture all three activities.
Another example is the forestry category of prescribed activities, where the expression of “hill forest land” in the 1987 Order is replaced by “forest at 300 metres or more above mean sea level” in the 2015 Order.
Environmentally Sensitive Area
The 2015 Order introduces the concept of an “environmentally sensitive area” and extends the requirement for an EIA to certain activities (such as coastal or land reclamation along river banks, and mining of minerals) adjacent to or near an environmentally sensitive area. This concept was not in the 1987 Order but was discussed in the five-year National Physical Plans published in 2000 and 2005.
An “environmentally sensitive area” refers to any area specified as such in the development plan or national physical plan under the Town and Country Planning Act 1976 or any area specified as an environmental protection area or an environmental conservation area under relevant legislation in Sabah and Sarawak.
New Prescribed Activities
Taking into account developments in today’s modern world, the 2015 Order introduces a number of new prescribed activities to extend the DOE’s oversight to these activities.
Interestingly, development or land clearing in slope areas in certain circumstances, reclamation of land for man-made islands, capital dredging and disposal of waste dredged materials and activities using and generating radioactive materials are all now captured as prescribed activities under the 2015 Order. These activities, which were subject to bad press and garnered public awareness in recent years, now require EIAs under the 2015 Order. There is also a requirement for the EIA Reports relating to some of the aforementioned activities to be displayed for public comment, depending on the manner and circumstances in which the activities are to be carried out.
The 2015 Order updates Malaysia’s environmental laws to provide for more comprehensive coverage and greater clarity with respect to activities that require an EIA. The 2015 Order was presumably drafted to address environmental issues of high concern in recent years due to major development projects carried out around the country involving land reclamation, drainage and irrigation, radioactive materials and radioactive wastes, amongst others.
It is hoped that the 2015 Order will assist the DOE in ensuring that future development projects are carried out in an environmentally sustainable and acceptable manner without causing any serious or irreversible damage to our already fragile environment.