Singapore proposes stronger investigative powers, stiffer penalties in expedited review of transboundary haze law
Status quo is no longer tenable, Grace Fu tells Parliament, as she moves to pass the changes in a single sitting
[SINGAPORE] A planned tightening of Singapore’s transboundary haze law could enhance the city-state’s ability to gather relevant information from companies suspected of responsibility for haze, as well as its capacity to investigate commercial links and impose restrictions on these entities.
Giving the government more powers to direct suspected entities to appoint assessors to gather information, and restricting their supply chains and financiers from dealing with them are among the proposed changes.
Minister for Sustainability and the Environment Grace Fu announced a slate of proposed amendments in Parliament on Wednesday (Nov 4) during the debate on the Transboundary Haze Pollution Act (THPA), which received an emergency expedite so that the proposed changes could be passed in a single sitting.
Over the last two months, Singapore had experienced its worst air quality since 2015, with the 24-hour Pollutant Standards Index (PSI) reading crossing 200 at one point, which is considered within the “very unhealthy” range.
When THPA was first enacted in 2014, Fu said that the legislation sought to balance the need to have effective powers to hold errant entities – whose business activities often take place overseas – accountable, while respecting the sovereignty of other countries and avoiding extraterritorial reach.
“Following the recent haze episode, it is clear that the status quo is no longer tenable. Many Singaporeans want to see more effective action to prevent haze and hold those responsible accountable. The government shares these concerns,” Fu told the House.
“We need better ways to obtain and verify information, trace complex corporate relationships, and impose meaningful consequences on errant entities, even where criminal prosecution proves difficult. We also need to be able to intervene earlier, before haze pollution reaches Singapore. We therefore have to strengthen our laws. And we must act quickly,” she added.
New enforcement tools
To give legislative backing to a specialist panel tasked with investigating firms linked to the transboundary haze, one of the proposed changes is to empower the director-general of environmental protection to require entities with suspected links to haze pollution in Singapore to appoint expert private sector assessors.
The director-general will specify the assessors and terms of the assessment in the direction to an entity. The entity receiving a direction must then engage the assessors at their own expense.
The assessors will submit evaluation reports directly to the National Environment Agency to help establish the relevant facts.
The government had previously announced that it was forming a specialist panel made up of seven investigation and law firms as well as one individual to investigate firms linked to the transboundary haze.
The four law firms and legal advisers are Dentons Rodyk & Davidson, TSMP Law Corporation, WongPartnership and arbitrator Toby Landau KC of Duxton Hill Chambers. The three investigation firms are Control Risks Group, FTI Consulting (Singapore) and Kroll Singapore. They would be advised by Davinder Singh Chambers, which has been appointed to coordinate the work of this new panel.
Fu said that a direction by the director-general to appoint an assessor is meant to establish the relevant facts, and does not necessarily mean that the entity has committed or is suspected of having committed an offence.
“The assessors do not determine guilt; decisions on enforcement remain with the relevant authorities, and our courts will determine liability,” she added.
The minister noted that these changes will not remove all the challenges of tracing overseas activities. But it provides the government another avenue to obtain information, understand complex business relationships and hold responsible entities accountable.
In addition to broadening its scope in fact-finding missions, two other proposed amendments would expand the government’s powers to hold companies accountable, extending its reach beyond immediate concessionaires to include their supply chains, related corporates and financiers.
The minister for sustainability and the environment could have the power to designate errant entities or individuals who have failed to comply with relevant directions or notices, or who have got an adverse assessment report. These entities or individuals could either be convicted of an offence under the haze law or are suspected of committing one.
Once they are designated, the government would be able to to impose orders restricting business dealings with these entities or individuals.
This may include the supply or purchase of goods and services, as well as provision of loans and other financial support.
Those found to still have business dealings with designated entities or individuals could be fined a maximum of S$1 million for each contravention, and an additional fine of up to S$100,000 for each day the breach continues.
“The power to designate and impose restrictions is meant to impose economic consequences on those responsible for irresponsible burning or with established links to irresponsible burning. At the same time, the prohibitions ensure that others do not deal with such designated entities, including through complex business arrangements or corporate structures,” said Fu.
The amendments also seek to introduce a power to direct certain entities not to deal with parties that cause or contribute to fires that pose a risk of haze pollution in Singapore.
This would apply to entities with links to activities associated with burning, including large corporations in the forestry and agricultural sectors.
Entities put on notice will be required to take appropriate steps to ensure that their supply chains and business arrangements do not involve entities that cause or contribute to such fires. Failure to comply without reasonable excuse will be an offence.
“These obligations are intended to strengthen due diligence and responsible business conduct across the supply chain. Companies will be expected to take reasonable steps to identify and address the risks within their business arrangements,” said the minister.
She added: “The objective is not to impose an impossible guarantee that no risk will ever arise, but to ensure that companies do not turn a blind eye to irresponsible forestry and agriculture practices.”
