Polluter pays principle

IMPLEMENTATION OF POLLUTER PAYS PRINCIPLE IN

PAKISTAN’S CORPORATE LEGAL REGIME: A COMPARATIVE

ANALYSIS WITH USA AND INDIA.

LLM (CORPORATE LAW)

Supervised By

Dr. MUHAMMAD MUNIR

Submitted By

ADNAN

218-FSL/LLMCL/F09

A thesis submitted in partial fulfillment of the requirement for the degree of LLM

CORPORATE LAW (Faculty of Shariah and Law) in the International Islamic

University Islamabad, November 12,2012.

Department of Law Faculty of Shariah and Law

International Islamic University, Islamabad.

i

Table of Contents

DECLARATION…………………………………………………………………v

DEDICATION …………………... ………………………………………...…...vi

ACKNOWLEDGEMENT ……………………………………………..………vii

LIST OF ABBRIVIATIONS …………………………………………………...ix

ABSTRACT ……………………………………………………………………...x

PREFACE ……………………………………………………………………….xi

CHAPTER # 1: ................................................................................................................... 1

1. INTRODUCTION .......................................................................................................... 1

1.1 BACKGROUNG AND HISTORY OF PPP IN PERSPECTIVE OF OECD ...... 2

1.2 WHAT IS PPP? .................................................................................................... 6

1.3 WHAT IS INTERNALIZATION? ...................................................................... 8

1.3.1 External Environmental Costs through Internalization………….………….9

1.4 EVOLUTION of PPP ......................................................................................... 10

1.4.1 International Environmental Law .................................................................... 10

1.4.2 PPP As Principle Of Law ................................................................................. 10

1.4.3 Adoption of PPP .............................................................................................. 11

1.4.4 Implementation of PPP in Environmental law................................................. 11

1.4.5 Economic Perspective of PPP .......................................................................... 12

1.5 PARAMETER OF THE PRINCIPLE: ................................................................... 13

1.5.1 Corporate Environmental Responsibility Of MNC’S ...................................... 13

1.5.2 OECD Guidelines Regarding Corporate Liability of Environment ................. 15

1.5.3 Tradable Discharge Permit’s (TDP’S) ............................................................. 16

1.5.4 Fees And Taxes- Market Mechnisms .............................................................. 17

1.5.5 Externalities ..................................................................................................... 18

1.6 PRINCIPLE IN INTERNATIONAL ENVIRONMENT LAW: ............................ 19

1.6.1 United Nation ................................................................................................... 21

1.6.2 International Agreements and PPP .................................................................. 21

ii

1.6.2.1 Rio Declaration ............................................................................................. 22

1.6.2.2 Agenda – 21 .................................................................................................. 23

1.6.2.3 Lugano Convention:...................................................................................... 24

1.6.2.4 OSPAR Convention ...................................................................................... 25

CONCLUSION ................................................................................................................. 26

CHAPTER # 2 .................................................................................................................. 27

ANALYSIS OF PAKISTANI ENVIRONMENTAL LAWS IN PPP PERSPECTIVE ... 27

2. INTRODUCTION .................................................................................................... 27

2.1 REVIEW OF PAKISTANI LAWS CONCERNING ENVIRONMENT ............... 29

2.1.1 Relevant Articles of Pakistan’s Constitution concerning Environment .......... 29

2.2.2 Environmental Provision of Pakistan Penal Code (PPC) ................................ 32

2.2.3 Criminal Procedure Coder (CrPC) ................................................................... 33

2.2.4 Environment And 18th Amendment ................................................................ 34

2.3 COMPREHENSIVE ANALYSIS OF PEPA, 1997 ............................................... 35

2.3.1 The Status of PEPA regarding PPP ................................................................. 37

2.3.2 PPP And PEPA Regulation .............................................................................. 38

2.3.4Command and Control under PEPA…………….………………………….…40

2.4 PPP AND ENVIRONMENTAL BYE-LAWS………………………………….....41

2.4.1 Motor Vehicles Rules, 1969…………………………………………...…..41

2.4.2 Pollution Charge for Industry (Calculation and Collection) Rules, 2001….42

2.4.3 Provincial Sustainable Development Fund (Utilization), Rules, 2003.........43

2.4.4 Hazardous Substances Rules, 2003………………………………………..44

2.4.5 Pakistan Bio-safety Rules, 2005…………………………………………...45

2.4.6 PPP and National Environmental Policy, 2005…………………………....45

2.4.7 The Capital Development Authority (Environmental Protection) Regulation,

2008……………………………………………………………………………....47

2.4.8 Some other Byelaws of Electricity and Export……………………….……48

2.5 NATIONAL POLICY OF ENVIRONMENT ........................................................ 48

2.5.1 Existing Policies............................................................................................... 49

2.5.1.1 National Forest Policy of Pakistan 2001 (NFPP) ......................................... 49

iii

2.5.1.2 Forestry Sector Master Plan (FSMP) ............................................................ 50

2.6 CASES .................................................................................................................... 51

CONCLUSION ................................................................................................................. 52

CHAPTER # 3 .................................................................................................................. 53

STATUS OF POLLUTER PAYS PRINCIPLE (PPP) IN PAKISTAN ........................... 53

3. INTRODUCTION .................................................................................................... 53

3.1 THE CONSEQUENCES FOR PAKISTAN TO EQUIVOCATE PPP .................. 53

3.2 PPP CONCEPTUAL STRUCTURE/ AGENDA ................................................... 55

3.3 ENVIRONMENTAL PRIORITIES FOR CLEANER PRODUCTION IN

PAKISTANI INDUSTRY ............................................................................................ 56

3.4 INDUSTRIAL RESTRUCTURING IN PAKISTAN ............................................ 57

3.4.1 Corporate Responsibility in Pakistan ............................................................... 58

3.5 THE CONSEQUENCES OF NOT APPLYING PPP IN PERSPECTIVE OF ETP’s

AND CETP’s .................................................................................................................... 60

3.5.1 Pessimistic Effects of not Applying PPP ......................................................... 60

3.5.2 Inadequate Construction of Effluent Plants ..................................................... 60

3.5.3 The International Benefactor and Government Fiscal Support for Required

CETP’s ...................................................................................................................... 61

3.5.4 Operational Queries at Kasur and Korangi CETP’s ........................................ 61

3.5.5 Neglected Opportunities to erect CETP’s ........................................................ 62

CONCLUSION ................................................................................................................. 64

CHAPTER # 4 .................................................................................................................. 65

4 PRACTICES OF PPP IN USA & INDIA...................................................................... 65

4.1 APPLICATION OF PPP IN US ENVIRONMENTAL LAWS ............................. 65

4.2 USA AND PPP RELATED STATUTES ............................................................... 66

4.2.1 The United States And CERCLA Regulation .................................................. 67

4.2.2 Superfund: The Granddaddy Of PPP Policies ................................................. 68

4.2.3 Making The Violator Pay; An Economic View ............................................... 69

4.3 CORPORATE ENVIRONMENT LIABILITY ...................................................... 70

4.3.1 EPA’s Enforcement Policies On Environmental Auditing .............................. 71

iv

4.3.2 Case Studies ..................................................................................................... 72

4.3.2.1 Civil Cases .................................................................................................... 73

4.3.2.2 Cases of Criminal Nature .............................................................................. 74

4.3.3 USA Cases ....................................................................................................... 75

4.4 PPP IN INDIA ........................................................................................................ 75

4.4.1 Polluter Pays Principle And National Application .......................................... 76

4.4.2 Environment Protection In India ...................................................................... 77

4.4.3 Bhopal Gas Tragedy ........................................................................................ 78

4.5 ENVIRONMENT AND THE PUBLIC INTEREST LITIGATION ...................... 79

4.5.1 Indian Constitution........................................................................................... 81

4.5.2 Indian Supreme Court ...................................................................................... 81

4.5.3 PPP And Absolute Liability In India ............................................................... 82

4.6 PPP & ENVIRONMENTAL JURISPRUDENCE IN INDIA THROUGH CASE

LAWS ........................................................................................................................... 84

4.6.1 Corporate liability via Indian Supreme Court Judgments................................ 87

CONCLUSION ................................................................................................................. 90

CHAPTER # 5 .................................................................................................................. 91

CONCLUSION AND RECOMMENDATIONS FOR PAKISTAN ................................ 91

RECOMMENDATIONS FOR PAKISTAN ................................................................ 94

BIBLIOGRAPHY ............................................................................................................. 99

RELATED BOOKS ...................................................................................................... 99

RELATED ARTICLES .............................................................................................. 101

REPORTS AND PAPERS:......................................................................................... 105

RELEVANT STATUTES: ......................................................................................... 106

RELATED CASES ..................................................................................................... 108

WEBLIOGRAPHY..................................................................................................... 111

v

DECLARATION

I HEREBY, declare that this dissertation is original and has never been

presented in any other university or institute of learning. I also declare that

this thesis has never been copied and any secondary information used has

been duly acknowledged in this dissertation.

ADNAN

218-FSL/LLMCL/F09

(NOVEMBER, 2012)

vi

DEDICATION

This thesis is dedicated to ALMIGHTY ALLAH who is the most merciful and

helpful and my precious and beloved parenets, my mother, brothers and aunti

who grooms me and teaches me the way of life, for this unconditional love,

moral and financial support and also for their care and prayers. May Allah

always showered his blessing upon them.

vii

ACKNOWLEDGEMENT

Firstly, I would like to gratefully acknowledge Allah Almighty, who is

most merciful and helpful to complete this work successfully by this

countless blessing. Allah almighty always supported to me through out of

my life in a number of ways and now also because of his blessing, I have

been able to complete this thesis.

The most earnest acknowledgement must go to my supervisor Dr.

Muahammad Munir for his patient guidance, encouragement, invaluable

advice and many fruitful discussion throughout this study. His critical eyes

and enlightened thoughts were instrumental and inspiring.

I am grateful to my worthy teacher and mentor Sir Ahmad Khalid Hatam

who defined my direction in journey of this work, without whom I would

not have been able to achieve this success and special thanks and prays to

my friend Muhammad Akbar Khan whose company and guidance brought

me to this level.

After that, I owe my deepest gratitude to my parents, brothers and aunti

for supporting me throughout all my studies. They helped me in

difficulties throughout the course of this thesis and also encouraged me

with patience in my stressed mood. I would like to thnaks my whole

family for providing a loving environment for me.

viii

I will extend my thanks to my teacher and mentors Syed Asghar Hussain

Sabzwari and Sheikh Muhammad Khizar-ur-Rahsid their appreciations to

my work as well as their encouragemet and motivations. It is an honor for

me to thanks them for all their best wishes for me.

It will be injustice if I don’t acknowledge and thanks my best friends and

colleagues who have encouraged and support me. I am specially grateful

to my friends Shoiab Ali Khan, Waqar Bangash, Sami Ullah, Dr.Adil

Nawaz and Hafiz Ahmad Waqas . I sincerely thankful to them for

providing me the envrionment fo fun and joy and for everything they

brings me as a friend.

Lastly, I would like to thanks Allah Almighty and also to all praying and

helping hands for me.

ADNAN

(NOVEMBER)

2012

ix

LIST OF ABBRIVIATIONS

CERCLA Comprehensive Environmental Response, Compensation and

Liability Act of 1980

CrPC Criminal Procedure Code

CSR Corporate Social Responsibility

CETP Common Effluent Treatment Plant

CFCs Chlorofluorocarbons.

EPA Environmental Protection Agencies

EPO Environmental Protection Order

EIA Environmental Impact Assessment

EUAD Environment and Urban Affairs Division

ESCO’s Pakistan is Energy Service Companies

ETP’s Effluent Treatment Plants

EMS Environmental Management System

EU European Union

FSMP Forestry Sector Master Plan

IEL International Environmental Law

IUCN International Union for Conservation of Nature

IEE Initial Environmental Examination

ICJ International Court of Justice

IEC International Environmental Courts

ISO International Standards Organization

MEA’s Multilateral Environmental Agreements

MNC’s Multinational Corporations.

NAFTA North American Free Trade Agreement

NAAEC North American Agreement for Environmental Cooperation.

NEERI National Environmental Engineering Research Institute

NCS National Conservation Strategy

NEQS National Environmental Quality Standards

NFPP National Forest Policy of Pakistan 2001

NEAMA National Environmental Assessment and Monitoring Authority

NEAP National Environmental Action Plan

OECD Organization of Economic Cooperation and Development

PEPA Pakistan Environmental Protection Act

PPC Pakistan Penal Code

PEPO Pakistan Environmental Protection Ordinance

PILs Public Interest Litigations.

PRP Potentially Responsible Parties”

PPP Polluter Pays Principle

SME Small and Medium Enterprises

TDP’s Tradable Discharge Permit’s

UN United Nations

UNCED Unite Nations Conference on Environment and Development ()

USA United States of America.

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ABSTRACT

Since its inception from economic to legal principle, the PPP is one of important notion

of International Environmental Law (IEL). This principle is adopted at international,

regional and national level. This thesis offer a detailed examination of how the PPP is

adoptioning and funtioning in the IEL, talking the historical development, its application

and adoption in IEL. This research work provides the PPP implementation in Paksitan

after comparative analysis with USA and India. Both the countries have best legal

practices in implementation of PPP, because the former is developed while the later is

developing practice, which can be helpful to betterly derieved appropriate legal measure

for Pakistan. The dissertation expose off that the existing IEL regarding PPP, which is

limited in implementation in Pakistan.

The dissertation identifies first the definition, history and parameter in the legal

perspective, which was adopted in Rio Declaration. This research has been undertaken

with the sole objective of introduction and implementing PPP in Pakistan. This is

relatively a new concept in the ever-growing world of MNC’s environmental degradation

and implementation of PPP in Pakistani perspective. The concept is special in the sense

that besides being a means to check to unruly the MNC’s and other public bodies, who

degrade the environment, so the the PPP is the effective norm of law to protect the

environment as well as compenste the victims. It provides a platform to the victims and

society to raise their voice and safegaurds their interests from the polluter assult on their

rights.

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PREFACE

This disserttions describes the implementation od polluter pays principle (PPP) in

Pakistani corporate legal regime. The priniciple is part of envrionmental economics,

policies and law. Though in our research work, we mainly focuses on legal aspects of this

principle. A debate is undergoing in the world about the implementation of PPP in

internationl, regional and domestic level. The world is divided in to two main approaches

of legal and ecomomic aspects of this principle. So the implementation of this principle

in developing states are dire specifically in Pakistan concerning industrial pollution. At

one side developing states are facing tough challenges for PPP implementation, and on

the other front they cant met the global criteria specially developed states. Following

research will aspire to enable the reader to aware oneself about the PPP, its regulatory

mechanism and its impacts regarding environmental protection.

The goal of this dissertation is to introduce PPP implementation in corporate legal

regime, specifically industrial pollutions and tanneries. For this purpose command and

control mechanism and tradable discharge permits are used to allocated charges and taxes

and licencing respectively. The purpose of this principle to make the polluter liable for

environmetnal degradation, and for the internalization of external environmetnal costs.

Every corporations are permitted to occur pollution to authorized limits, and if they

violates, they will be stringently liable for it. There are numerous kinds of liabilites upon

polluters according to nature and intensity of pollution.

The polluter pays principle is most significant principle on environmenal

protection which is not implemented in Pakistan nor interpreted in any environmental

litigation. The basic theme of this thesis to review Pakistani environmental laws, and

xii

whether there is any clause which directly or directly or indirectly interpret this principle

or any glimpse for PPP. The ultimate result of such exploration are the economic

develompent, environmental protection, public health, compensation to victims and well

being of the community of state or it just makes the corporations responsible for their

pollution and the state treasury more packed.

The first chapter presents an introduction and historical perspective of PPP in

perspective of international environmental law. In the first part, it highlightes

international treaties regarding PPP, which provides basic concept in economic and legal

perspective, its nature and corporate environmental responsibility. Chapter two deals with

environemtal laws and its history in Pakistan. In this chapter we discusses various statutes

concerning environmental pollution and forums available to the complainant if there is

any grave violations of environment or public nuisance.

Chapter three based on detailed discussion about the status of non-implementation

of PPP and its consequences for Pakistani environment. It also provides conceptual

framework, corporate responsibility at Pakistani level, ETP and CETP’s for tanneries in

Pakistan. Chapter four deals with the comparative study of this principle under the

different laws with specil focus on USA and Indian environmental protection measures

regarding PPP. First part of this chpter deals with USA practices while the second part of

chapter deals Indian judicial practices of implementing PPP. This chapter also give a

broad range of practical aspects of PPP and comparative analysis in courts by case law.

Fifth and last chapter related to conclusion of the whole thesis and some

recommendations for implemention of this principle in corporate legal regime in

Pakistan.

1

CHAPTER # 1

INTRODUCTION OF POLLUTER PAYS PRINCIPLE (PPP) IN

INTERNATIONAL ENVIRONMENTAL LAW

“The difference between animals and humans is that animals change themselves for the

environment, but humans change the environment for themselves”. 1

Ayn Rand

1. INTRODUCTION

Polluter Pays Principle (PPP) is one of basic notion of modern International

Environmental Law (IEL) and incorporated in many policies for sustainable development

at various levels. It was incorporated in several international legal instruments and

European Union (EU) incorporated this principle in their national laws. It simply states,

that polluter should bear the cost of pollution and not the state. This principle introduces

as an economic instrument for allocation of environmental cost of pollution.

PPP became legal principle from economic instrument; it was firstly incorporated

in 1968, in Article 6 of Draft Declaration of Principles on Air Pollution Control. In 1972,

it was adopted by Organization of Economic Cooperation and Development (OECD).

Though, in several international legal agreements the principle was discussed to

incorporate PPP as legal principle. For the first time, it was implemented through civil

remedy in perspective of curative approach. In 1990, PPP is considered as principle of

international environmental law. Consequently, several agreements approved this

1 ―Ayn Rand: Her Life and Thought,” was a Russian-American novelist, philosopher, playwright, and

screenwriter, accessed September 11, 2012, http://www.aristos.org/aynrand.htm.

http://www.objectivistcenter.org/psource/products.asp?PSID=PSP-OA004W&CartID=8414551200137320

http://en.wikipedia.org/wiki/Russian-American

2

principle, for instance, Rio Declaration, OSPAR convention, Lugano, Barcelona and

many more.

There was divergence of opinions regarding the applicability of PPP. This chapter

will deal with various aspects of PPP. The second part scrutinizes historical

developments through economic and legal perspectives. Thirdly, it will discuss

international environmental law and implementation of PPP in EU. Lastly, it will discuss

corporate environmental responsibility under ambit of United Nations (UN) norms and

OECD guidelines.

1.1 BACKGROUND AND HISTORY OF PPP IN PERSPECTIVE OF

OECD

While the precautionary principle developed from national law, the Polluter Pays

Principle (PPP) is also emerged from international law.2 The PPP is glowing in 1972

from OECD recommendations regarding environmental policies and environmental

economics. In its recommendation, OECD refers,

“Public measures are thus necessary to reduce pollution and to reach a better

allocation of resources by ensuring that prices of goods depending on the quality

and/or quantity of environmental resources reflect more closely their relative

scarcity and economic agents concerned react accordingly”.3

2 Eric Larson, “Why Environmental Liability Regimes in the United States, the European Community, and

Japan Have Grown Synonymous with the Polluter Pays Principle,” 38 Vand. J. Transnat‘l l. 541, (2005):

http://www.jstor.org/stable/1228596, accessed Feburary 12, 2012. 3 Ole W. Pedersen, “Environmental Principles and Environmental Justice,” Environmental Law Review 12,

no. 1 (2010), accessed May 16, 2012, http://ssrn.com/abstract=907456.

http://www.jstor.org/stable/1228596

3

PPP was used for control measures its balance utilization prevention of pollution and

officially put some cost, to shun distortions in investment and trade. This principle

emerged as an economic principle to shun unreasonable economic distortion from

market, sooner than to restrict environmental harm. The OECD further pointed out PPP,

that it will not put subsidies which distort international trade and investment.4

When OECD recommended PPP, then it was incorporated in various significant

international documents to overcome environmental hazards. The first Environmental

Action Programme of European Community (EC) incorporated PPP in 1973, which

discuss in their subsequent programme, like ECSC, EEC in March, 1975. This principle

found application in TEFU under provision of 191(2) and many directives of EC. The

PPP has application in international level, such as OSPAR convention5, principle of Rio

Declaration and Baltic Sea Convention.6

PPP is not only a principle of cost allocation, but it has been used as principle of

liability, tort, modification and violation of environmental laws.7 The OECD council

adopted PPP in 1989 through a recommendation and applied this principle, “In matters of

accidental pollution risks, the Polluter-Pays Principle implies that the operator of

hazardous installations should bear the cost.” In recent times many directives and

4 Though, numerous tribulations are exists to interpretation of PPP. These tribulations create difficulties to

understand the concept of environmental justice. First of all, main problem with the PPP is the

identification of actual polluter. Even though, this question is related to ethical norms, social justice who is

inbuilt in the concept of environmental justice. This principle efficiently works, where some pollution costs

passed on to consumer to participate in incentive during shopping. This led certain goods or products which

pollute environment become costly, in the end. On the other hand, environmental friendly products are

costly in producing and buying. See also, Ole W. Pedersen, “Environmental Principles and Environmental

Justice,” Environmental Law Review 12, no. 1 (2010), accessed May 16, (2012),

http://ssrn.com/abstract=1156979. 5 OSPAR Convention above n. 70 Art. 2(2), (as quoted by, Ole W. Pedersen, “Environmental Principles

and Environmental Justice,” Environmental Law Review 12, no. 1 (2010), accessed May 16, 2012,

http://ssrn.com/abstract=907456.) 6 Baltic Sea Convention Art. 3(4).

7 Alan Griffiths and Stuart Wall, The move towards environmental taxes is in line with the ‗polluter pays‘

principle; Applied Economic, ed 11th

(New York: Jstor, 2007), accessed March 12, 2012.

4

legislations on national and international level draw attention toward implementing PPP

concerning environmental liability.8

The mechanism to implement PPP can led to altercation to environmental justice.

De Sadeleer provides measures to implement the PPP through regularly principle barring

damage or in the course of taxation. Regulatory principles comparatively planned to work

effectively than tax because the later harms the environment. Example of Carbon tax

upon rich and poor households in which rich are least affected than poor, because the

later pay considerably. It seems odd about environmental justice because the poor get

some unjust burden related to environment.9

On the other hand, there were some differences between environmental justice

and PPP, but both have some common grounds.10

Most evident is the utility of PPP as

principle of liability. The followers of environmental justice used this principle for

reasonable allocation of damages of polluting activities. This indicates distributive

function of the principle, which is foundation of environmental justice. The polluter not

only pay the protection and prevention cost, but to cover social cost.11

8 Recommendation of the Council concerning the Application of the Polluter-Pays Principle to Accidental

Pollution, C (89) 88 of 7 July 1989. 9 H. C. Bugge, “The Polluter Pays Principle: Dilemmas of Justice in National and International Contexts,”

Environmental Law and Justice in Context, (2009): www.cambridge.org 10

In addition to above, the focal point of the PPP is investment and trade. The foremost, followers of

environmental justice attacks on “free market”, main theme of which are environmental injustice.

Additionally, governmental actions seems fundamental, to take measures for environment justice issues.

Secondly, the main objection to aid and subsidies can be seen at odds with environmental justice. In these

circumstances the opinions about environmental justice are applied in international settings. Here, measures

for transfer of technology and abatement are acceptable on environmental justice ground, but PPP

apparently disagree governmental abetment subsidies. The recommendations forwarded by OECD & EU

permit exceptions, means it is not a supreme principle and deviation from PP on economic, social and

environmental grounds are acceptable. See, however, U. Kettlewell, “The Answer to Global Pollution? A

Critical Examination of Problems and Potential of the Polluter-Pays Principle” 3 Colo. J. Int‘l Envtl. &

Pol‘y 429 (1992). 11

Ole W. Pedersen, “Environmental Principles and Environmental Justice,” 12.

5

The PPP elevate disagreement and settlement with the concept of environmental

justice same like preventive and precautionary principle. Former environmental justice

point of view, ideal of free market is query of PPP, which is against environmental justice

and taxable liability, which is an impediment for lower class. This principle mainly

incorporated to attain allocation of costs and tribulation as liability rule to attain goal of

environmental justice. It is used for rational application for corroboration of new liability

schemes about environment.12

Numerous functions which this principle can serves.

Damages for soothing or remediation, this is also called restorative or

curative.

Damages to recompense or redistributive (distributive again or

differently).

With internalization of external cost of polluting activities. It is preventive.

As a penal principle- penalizing or punitive measure.

In Article 6 of Draft Declaration of Principles on Air Pollution Control in 1968,13

Committee of Ministers in European Council of State that, “The cost incurred in

preventing or abating pollution should be borne by whoever causes pollution.”14

12

Ibid. 13

In August 1971, OECD held a seminar in Paris regarding environmental economies, where PPP was

main topic of discussion. Envoys of developed and polluting states debated for the first time on the query of

PPP. Many intellectuals in this seminar fvours to imposed charges for environmental costs on polluters.

Prof Murare, talking about favors on efficient basis of the principle that “polluter must pay” while talking

about “Anti pollution and cost allocation”. UN Stockholm conference in 1972 on environment also

discussed PPP, just after 9 days of adoption of OECD, but was not incorporated. Muhammad Munir, The

Polluter Pays Principle in International Environmental Policy and Law: Economic and Legal Analysis

(Islamabad: Institute of Legal Studies, 1996). 14

Muhammad Munir, The Polluter Pays Principle in International Environmental Policy and Law:

Economic and Legal Analysis (Islamabad: Institute of Legal Studies, 1996).

6

1.2 WHAT IS PPP?

PPP have different interpretations in specific context due to idea extensiveness.15

In

municipal law, the principle focuses on polluting industries and their financial and legal

responsibility concerning pollution and their damaging activities.16

In international law,

the application of PPP prescribed by OECD in shape of environmental taxation which is

quasi-regulatory.17

The OECD further explains that companies are taxed according to

their level of pollution they occur.18

In hypothetical terms, this principle having commonalty, like a model which

allocate pollution costs and lessen environmental damage, which require responsible

firm, state and individual to bear pollution cost.19

If there is no existence of PPP, the

environmental responsibility upon the society is in the shape of lower quality standard of

environment and taxation. In legal perspective, it is impartial rule that polluting industries

should pay for their pollution, and this is theme of PPP.20

As a result, the principle

becomes part of conventional economies and shapeless part of environmental economics.

Not amazingly, there is debate concerning the scope of this principle and its justification

as a principle of economic.21

15

Eric Larson, “Why Environmental Liability Regimes in the United States, the European Community, and

Japan Have Grown Synonymous with the Polluter Pays Principle,” 38 Vand. J. Transnat‘l l. 541, (2005):

http://www.jstor.org/stable/1228596, accessed June 19, 2012. 16

Stefanie Sommers, “The Brownfield Problem: Liability For Lenders, Owners, and Developers in Canada

and the United States,” 19 Colo. J. Int‘l Envtl. L. & Pol‘y 259, no. 266- 67, 277-91 (2008):

http://www.jstor.org/stable/3312323, accessed Jaunary 28, 2012. 17

OECD, Polluter-Pays Principle, at 234-35. 18

Mamlyuk, Boris N., “Analyzing the Polluter Pays Principle through Law and Economics,” Southeastern

Environmental Law Journal Vol. 18, no. 1 (2010) : http://www.jstor.org/stable/1228596, accessed April 2,

2012, 19

Sumudu A. Atapattu, Emerging Principles Of International Environmental Law (Transnational:

Publishers, 2006), 470, accessed December 25, 2011. 20

OECD, Polluter-Pays Principle, at 234-35: http://www.oecd.org/ccnm/sustdev, accessed June 6, 2012. 21

Alan Griffiths and Stuart Wall, The move towards environmental taxes is in line with the ‗polluter pays‘

principle; Applied Economic, ed 11th

(New York: Jstor, 2007), accessed June 3, 2012.




http://www.oecd.org/ccnm/sustdev

7

In 1972, OECD formally referred the PPP as guiding principle regarding the

“International Economics Aspects of Environmental Policies”. Following is the main

heading of OECD recommendation;

“The principle to be used for allocating costs of pollution prevention and control

measures to encourage rationale use of scarce environmental resources and to

avoid distortions in international trade and investment is the so-called PPP. This

principle means that the polluter should bear the expenses of the above-

mentioned measures (that is pollution prevention and control measures) decided

by the public authorities to ensure that the environment is in an acceptable

state.”22

The PPP has the efficacy to put environmental damaging cost on polluter.23

It also

elaborated the duty of concerned authorities to recompense the victims as well as make

the environment in acceptable condition. This principle declared the polluters legally

responsible for the pollution they occurs and bound him to pay for pollution control and

other curative measures.24

22

“OECD, Guiding Principles Concerning International Economic Aspects of Environmental Polices”

accessed April 14, 2012, www.elaw.org/search/node/polluter+pays+principle. 23

The focal point regarding human activities is apparent in the concept of pollution which clears as the

prologue of injurious substances or energy into the environment. These changes are seeks to dealt with

international environment.23

A definition from EC environmental measure also includes these elements,

“Pollution‟ shall mean the direct or indirect introduction as a result of human activity, of substances,

vibrations, heat or noise into the air, water or land which may be harmful to human health or the quality of

the environment, result in damage to material property, or impair or interfere with amenities and other

legitimate uses of the environment”. See, Daniel Bodansky, The Art and Craft of International

Environmental law(Harvard University Press Cambridge, Massachusetts, London – England, 2010), 10, . 24

In certain cases, polluters have been identified, especially in cases of waste generator or pollution from

perilous installations. But on the other side, with airport , the originator of noise or authority which are

participated in noise pollution, but its lack clarity identify the real polluter.24

In legal sense, PPP cannot

allocate the pollution cost till the polluter is to be identified. When polluter recognized he should pay

environmental cost and compensate the fatalities, polluter may pass liability to actual party if he is

guarantor of compensation. He polluter can protect his financial safeguard or insurance, in case of non-

payment f liable party. State surety is to pay victims, in case of failure of costs by polluter or liable party.

Potential polluter can finance compensation. "Pollution Insurance and Compensation Funds, Environment

Monograph No. 42,” Environment Directorate, OECD, 1992 (OCDE/GD(92)18), accessed April 14, 2012,

www.elaw.org/search/node/polluter+pays+principle.

8

1.3 WHAT IS INTERNALIZATION?

Internalization is a broad concept, which policy-makers used as interference for putting

social costs of products in the original cost. The Policy-makers enforced the external

costs and adopted numerous diverse methods to implement internalization,25

but the

significant is intervention which depend price mechanism. For instance, Pigovian levied

taxes, which is considered to be tool of internalization.26

In economic point of view, the concept of internalization is taken as cost endures

by financial mediator and polluter is liable to internalize pollution cost with all other

costs, which the polluter should pay.27

Full and partial internalization are restricted to

many categories and certain categories costs are limited for cost internalization.

Practically, full category internalization is not possible, because polluter compensate only

those victims who are damaged.28

25

The tendency which forwarded the PPP steadily, because it is no so far final, and recognized with

external costs of pollution in category of full internalization. In the end, the polluter must bear a portion or

most of the costs of pollution which he pollutes. For implementation of PPP there are some economic tools

compensatory instruments, economic measures and charges. These economic tools make stronger the

environmental and supplementary policies of government through revenue. “OECD, Analysis and

Recommendation :The Polluter-Pays Principle, Paris 1992,” accessed June 10, 2012,

http://www.oecd.org/ccnm/sustdev. 26

Prof. Dr. Dieter Schmidtchen and Dr. Christian Koboldt and Dr. Jenny Monheim, The Internalisation of

External Costs in Transport: From the Polluter Pays to the Cheapest Cost Avoider Principle (December

2007), 45, http://www.cambridge.org. 27

While, under PPP, is mandatory that polluter merely the person, who firstly to pay. He can share

pollution costs with other potential polluter under insurance scheme or pass prices in case of cost of

pollution. This mechanism can also pass to actual liable person who causes pollution. Finally, the person

who pays in actual sense generally will be user or consumer. In certain circumstances, through, the

pollution control mechanism through competition from passing the costs because of owner of polluting

activity. “OECD, Analysis and Recommendation :The Polluter-Pays Principle, Paris 1992,” accessed June

10, 2012, http://www.oecd.org/ccnm/sustdev. 28

Ibid.

9

1.3.1 External Environmental Costs through Internalization

The internalization of external environmental costs based on sustainable development,

and the policy-makers for economic strategies, projects and programmes for development

which possibly influence environment. This rule oblige long-standing and temporary

external environmental costs measures, which can described in numeral ways as follows;

Adoption of PPP.

Assessment of resources and services for environmental issues.

User or consumer pays principle for utilizing, to utilize resources, natural reserves

and vital discarding of waste.

The objectives regarding environment has been defined. To overcome

environmental tribulations, to adopt market mechanism, incentives and other

efficient solutions.29

The logic behind the internalization30

of environmental external cost is environment

to be utilized and administered properly and not exploited carelessly.31

29

See s 6(2)(d) of the Protection of the Environment Administration Act 1991 (Cth); s 10(2) of the

Contaminated Land Management Act 1997 (NSW) and s 3.5.4 of the Intergovernmental Agreement on the

Environment 1992. 30

The scope of PPP has been defined that, the polluter should pay if he has been recognized as polluter.

The suitable option is to differentiate between the principle in strict and wider. In strict sense, the pollution

to accepted level is matter of partial internalization, while in wider sense to put social damages to

pollution.30

This bridged the economic and legal aspects of principle. The theme of the principle to brings

changes in investment and international trade in shape of limited internalization. They also support absolute

internalization. According to environmental justice point of view absolute internalization is suitable. Ole

W. Pedersen, “Environmental Principles and Environmental Justice,” Environmental Law Review 12, no. 1

(2010), accessed May 16, 2012, http://ssrn.com/abstract=1156979. 31

The Hon. Justice J PRESTON Brian, “Sustainable Development Law in the Courts: The Polluter Pays

Principle,” The 16th Commonwealth Law Conference (2009), Hong Kong, http://www.lead-

journal.org/content/08001.pdf, accessed June 12, 2012.

http://www.lead-journal.org/content/08001.pdf


10

1.4 Evolution of PPP

1.4.1 International Environmental Law

In international law, the concept of environmental responsibility and protection has a

very vague place; that various environmental issues are unrecognized which must

addressed by international law.32

Whereas, scope of environmental regulation increasing

due to environmental problems like intimidation to health and security, but the main

problem is the implementation of environmental laws in international level, which

remains indefinite and uncertain. The additional complexity, that international

environmental law is mostly adopted from human rights or economic laws, yet it lacking

evident reference to environmental safety or rights. Thus international environmental law

has adopted complete theme of public or private international law, applicable to

environmental damages and problems. Relatively than suggesting a complete new branch

of International law, which include the applicability of existing law to environmental

problems besides international law directed at environment.33

1.4.2 PPP as Principle of Law

PPP has been incorporated as general principle of international environmental law in

1990. Before this, PPP was recognized by Single European Act in 1987 and in the Treaty

of Maastricht in 1992, which is in confirmation of its global recognition. The principle

had formerly directed the EC directives and national legislation. It will be directed to

32

Aurelie Lopez, “The Protection of Environmentally-displaced Persons in International Law,”

Environmental Law 37 (2007): 365-409, http://ssrn.com/abstract=1124804.accessed May 6, 2012. 33

Patricia Birnie and Alan Boyle, International Law and the Environment. (Oxford: Oxford University

Press, 2002) 2nd ed, 1-2:

http://ssrn.com/abstract=1124804.accessed

11

numerous conventions, local and global governmental declarations. This tendency gave

huge support to the principle all over the world, which influenced market economy and it

also have application related to environmental matters.34

1.4.3 Adoption of PPP

PPP has been adopted at international, regional and national levels. The National Reports

and various others about PPP has been point out that, this principle has implied as well as

explicit approaches towards liability for pollution and rationale for environmental

regulation. That‟s why in a number of international environmental laws incorporated this

principle, or possibly this concept impliedly or expressly. While others set up rules that

polluter should pay environmental damages which are necessitated. 35

1.4.4 Implementation of PPP in Environmental law

In numerous states, PPP implementation and acceptance in international environmental

law has been debated and mentioned in their environmental reports. Certain states

legislative measures for PPP indicate their approval regarding this principle. The PPP is

incorporated in national laws of many states in numerous ways under the adoption theory.

There are two approaches regarding PPP‟s implementation, which are preventive and

curative approach. The preventive approach imposes charges, prohibitions, limitations

and permits, while curative approach favors civil liability for environmental damage. The

34

“International Convention on Oil Pollution Preparedness, Response and Co-operation,” IMO, London,

November 1990, accessed April 20, 2012, http://www.oecd.org/ccnm/sustdev, accessed March 3, 2012. 35

H. Ch. Bugge, The Principles of ―Polluter-Pays‖ in Economics and Law, eds E. Eide & R. van den

Bergh , (Law and Economics of the Environment, 1996) 53, 73-74.


12

two approaches, liability and prevention may be expressed in identical legislative

measure. Furthermore, pollution victims can claim compensation through civil liability

remedy or under tort law.36

1.4.5 Economic Perspective of PPP

PPP is also a principle of environmental economics, which is adopted for allocation of

cost for restoring the environment and clean-up the pollution. The foundation of rule is

concerning externalities, which is economic speculation. This principle apportions costs

on the polluter, the one who causes pollution and is under responsibility to compensate it.

They allocate costs to internalizes, and these costs are economic tools for conducting

business. When the pollutions costs completely bear by polluter, then it is called absolute

internalization, and internalization become imperfect when the cost entirely shifted to

society.37

According to Moffet and Bregha explain;

“Under the polluter pays principle, the community effectively “owns” the

environment, and forces users to pay for the damage they impose. By contrast, if

the community must pay the polluter, the implicit message is that the polluter

owns the environment and can use and pollute it with impunity. This message is

inconsistent with the principles of sustainable development”38

36

Margaret Rosso Grossman, “Agriculture And The Polluter Pays Principle,” Netherland Comparative Law

Association, Vol. 11.3 Electronic Journal of Comparative Law, (2007), http://www.ejcl.org/113/article113-

15.pdf. 37

de Sadeleer N, Environmental Principles, From Political Slogans to Legal Rules (Oxford University

Press, 2002), 21, www.bsr.org/CSRResources/LeadingPerspectives/2007/_Winter.pdf. 38

Moffett J and Bregha F, “The Role of Law in the Promotion of Sustainable Development” Journal of

Environmental Law and Practice 3 no. 6 (1996): http://www.jstor.org/stable/4414525.

13

When pollution takes place, PPP has dual role of remediation and pollution

prevention, if pollution take place. This principle has compulsion of responsibility for

control and prevention of pollution. In addition to, polluter is liable for containment,

abatement and avoidance. The above were so expensive, because it surpasses the costs of

preventive measures. So, the reasonable option is to take preventive measures instead of

curative measures.39

1.5 PARAMETER OF THE PRINCIPLE

1.5.1 Corporate Environmental Responsibility of MNC’s

In recent years, the supremacy and influence of Multi-national Corporations (MNC‟s)

strengthened to an unprecedented level and there is effort required for the regulation of

these companies. In twenty first century major foreign investments are made by MNCs

and not the states.40

For instance, environmental legislation regarding corporate

responsibility is flawless at center and local level in numerous states, while

environmental governance in other states are considerably different. Corporate bodies in

developing states are enjoying extensive liberty in doing their business and are involved

in environmental abuses massively. Strict measures shall be taken for the implementation

of corporate environmental responsibility in the regulations of the developing states.41

39

The Hon. Justice J PRESTON Brian, “Sustainable Development Law in the Courts: The Polluter Pays

Principle,” The 16th Commonwealth Law Conference (2009), Hong Kong, http://www.lead-

journal.org/content/08001.pdf. 40

John H. Dunning and Sarianna M. Lundan, Multinational Enterprises and the Global Economy

(Cheltenham, UK: Edward Elger Publishing Limited, 2008), 17, www.cambridge.org. 41

“Transnational corporations and other business enterprises shall carry out their activities in accordance

with national laws, regulations, administrative practices and policies relating to the preservation of the

environment of the countries in which they operate, as well as in accordance with relevant international

agreements, principles, objectives, responsibilities and standards with regard to the environment as well as

14

MNC‟s destruction to environment has brutal and long-lasting effects on life of

the people in that particular area. Such devastation requires years to get back to its natural

and clean state. For instance, disaster of Union Carbide in Bhopal, India, which is well-

known case for developing states.42

There are certain other examples of “Corporate

Environmental abuse” which are frequently found and carelessly ignored. Numerous

instances43

of companies‟ transgression exist worldwide, but there shall be a proper

mechanism to penalize such companies in form of monetary compensation for pollution

caused by them. We shall have an idea that these frequent violations by the MNCs are the

result of soft laws and it is the main reason for weak accountability of the corporations. 44

First, the immense power of MNC‟s can weaken the power of environmental

responsibility, because they have to follow only the soft law agreements. While

certain immunities available, but a small diversion from soft law initiative can

harshly affect leading corporations.

human rights, public health and safety, bioethics and the precautionary principle, and shall generally

conduct their activities in a manner contributing to the wider goal of sustainable development”. UN Norms,

2003, Para. b of Commentary to G(14). 42

The disaster of Bhopal is a great lesson of corporate environmental responsibility, which is still

remembered. With growing promptness in related accidents are to be played out worldwide. Environmental

catastrophes, due to reckless corporate practices are repeating of persistent and direct nature. International

companies must require minimizing damage, and must hold responsible the subsidy company avoid civil or

criminal liability to evade distortions. Greenpeace international, “Corporate crimes: the need for an

international instrument on corporate accountability and liability,” last modified, June 2002, accessed

March 13, 2012, http://www.greenpeaceweb.org/shipbreak/. 43

”Following comparable reasoning, the Supreme Court of India held a company legally responsible for the

diversion of a stream and ordered payment of compensation to return damages to the environment,

invoking the Polluter Pays Principle. (1 M.C. Mehta V. Kamal Nath and others, Supreme Court of India,

(1997)1 Supreme Court Cases 388.”

”This principle has been recognized as part of Customary International law with the parallel use with the

precautionary principle within the Indian Supreme Court jurisdiction for the polluters makes responsible.

(Vellore Citizens Welfare Forum V. Union of India, Supreme Court of India, Air 1996 Sc 2715) ”. Arpita

Saha, “Judicial Activism in Curbing the Problem of Public Nuisance on Environment (July – November

2009),” (LLM diss. National Law University, Jodhpur, 2009) http://ssrn.com/abstract=1156979. 44

Ratte, Stephaine, “Enforcing Corporate Environmental Responsibility: Seeking Relief for Environmental

Damage under the alien tort statute,” Brown University, Center of Environmental Studies (2010):

www.bsr.org/CSRResources/LeadingPerspectives/2006.

http://www.greenpeaceweb.org/shipbreak/

15

Second, the instrument of soft laws is Corporate Social Responsibility (CSR)

which is reliant upon the ratification of corporate enterprises and their

agreements.

Third, these soft laws cannot offer compensation to the victims for any violation

of law.45

1.5.2 OECD Guidelines Regarding Corporate Liability of Environment

The guidelines of OECD regarding corporations are overall clear and guide about

financial assistance to the environment, in shape of corporate environmental

responsibility.46

They stressed on sound environmental supervision which is an

opportunity for business and business reliability. These guidelines scrutinize high-quality

environmental standards which can protect a blend of social,47

legal,48

economic49

and

environmental50

benefits.51

Environmental damages are costly and can cause loss of

foreign investment and adversely affect the trade.52

“The Commentary accompanying the OECD Guidelines emphasizes that they

consciously „draw upon, but do not completely mirror, any existing instrument.

The text of the Environment Chapter broadly reflects the principles and

45

“Nolan 2009, 434,” accessed June 5, 2012, http://ec.europa.eu/environment/waste/index.htm. 46

PPP is not exclusively stated in the manuscript of the UN rules, though it implicit in following words,

“Furthermore, the Commentary relating specifically to the environmental provisions notes that businesses

„shall be responsible for the environmental and human health impact of all of their activities, including any

products or services they introduce into commerce”. UN Norms, 2003, Para. b of Commentary to G(14). 47

Improved community and Public Relation. 48

Liability Charges and Reduced compliance. 49

Greater access to Capital and Customer Satisfaction, Lower Operating and Insurance Costs. 50

Improved Energy and Resource Conservation. 51

OECD, 2000, Commentary para. 31, accessed March 13, 2012, http://www.oecd.org/ccnm/sustdev. 52

Ratte, Stephaine, “Enforcing Corporate Environmental Responsibility: Seeking Relief for Environmental

Damage under the alien tort statute,” Brown University, Center of Environmental Studies (2010):

www.bsr.org/CSRResources/LeadingPerspectives/2006, accessed January 25, 2011.

http://www.bsr.org/CSRResources/LeadingPerspectives/2006

16

objectives contained in the Rio Declaration on Environment and Development, in

Agenda 21 (within the Rio Declaration). It also takes into account the (Aarhus)

Convention on Access to Information, Public Participation in Decision-making,

and Access to Justice in Environmental Matters and reflects standards contained

in such instruments as the ISO Standard on Environmental Management

Systems”.53

There are numerous ways due to which corporations can alleviate environmental

damages which are taking place due to their negligence about the harmful emissions.54

This quotation has mentioned various points which are in consonance to OECD

standards. It stated that corporations should, “Maintain contingency plans for preventing,

mitigating, and controlling serious environmental damage from their operations; and

mechanisms for immediate reporting to the competent authorities”.55

1.5.3 Tradable Discharge Permit’s (TDP’S)

TDP‟s was first put forward by Dales, in 1968 and elaborated by Montgomery in 1972. It

is an economic tool used for pollution reduction in USA and Europe. It is operated

through an authority which identifies the permissible degree of emission and

environmental quality standard of the surrounding area. It is mandatory to acquire

53

OECD, 2000, Commentary para. 30. Original emphasis 54

According to liability regime, the development of PPP has been possible at three levels. First and

foremost is “implementation of civil liability, this level individualistic formulation which is executed

through civil law liability. Secondly, “liability regime specification development” in which operator is

responsible for compensation and environmental liability. Thirdly, “partnership regime specification

development” in which operator is partner in case of compensation victims. This can be exemplify form

Greek submission of agriculture and PPP, in which they impose statutory liability, and let victim to claim

damage, and pay damages to farmer for environmental protection. See also, OECD, 2000, Commentary

para. 30. Original emphasis. 55

OECD, 2000, Commentary para. 31, accessed March 13, 2012, http://www.oecd.org/ccnm/sustdev.

17

license, which mark a limit of emission. The concerned authority provides required

number of licenses for authorized emission and not more than it.56

Grandfathering and auctions are two better methods for the apportioning of

TDP‟s. In earlier method, the licenses are awarded on some balance and precedential

pollution which is in compliance with trading polluter.57

This technique approves the old

method rather than the new. The method of auctioning TDP‟s comprises governmental

costs of TDP‟s to polluter. This technique works out for effective assigning of permits.

The third method of assigning TDP‟s is based on the business turnout, vicinity and

according to the community strength. There permits are subject to relocation of emissions

and are to be apportioned in a balanced technique.58

1.5.4 Fee and Taxes- Market Mechanisms

The polluter in a number of states is required to presume liability of wastes through taxes

or fee at local as well as national level. Taxes may possibly be levied to make certain that

PPP regulation will be implemented at any cost through environmental directives. For

instance, US in Clean Air Act has managed to allow authorized emissions under permit

and any excess to this limit may lead to criminal and civil punishments.59

OECD point

out that;

56


Economic and Legal Analysis (Islamabad: Institute of Legal Studies, 1996). 57

Case C-1/03, Paul Van de Walle and Others v Texaco Belgium SA, (Van de Walle) ECR [2004] I-07613

Case C-254/08, Futura Immobiliare srl Hotel Futura, and others v Comune di Casoria.

Case C-188/07, Commune de Mesquer v Total France SA and Total International Ltd, (Total) ECR [2008]

I-04501”.57

Greenpeace international, “Corporate crimes: the need for an international instrument on

corporate accountability and liability,” last modified, June 2002, accessed March 13, 2012,

http://www.greenpeaceweb.org/shipbreak/. 58

Ibid. 59

V. P. Nanda, Agriculture and the Polluter Pays Principle (54 Am. J. Comp, 2006), 317-339,


18

“Pollution charges and taxes on polluters are payments in connection with the use

of the environment, or damage to the environment and the community, as a result

of the pollution emitted. They encourage polluters to protect the environment,

although the revenue from these taxes is not necessarily earmarked for

environmental protection”.60

For instance, in Germany on petroleum products eco-tax is imposed for the protection of

environment, but for agriculture they put reduced tax. In Hungry, environmental load

taxes are apportioned according to the level of emission to water, air and land on the

basis of amount of emitted substances. These taxes are proposed for internalization, for

encouragement of potential polluter and to implement “user pay” approach. Polluter pays

as result apply during local regulation instead of nationwide directives.61

1.5.5 Externalities

The polluter external activities which affect the environment are the release of harmful

gases or emissions. These externalities effects impose social costs rather than private

cost, which will be paid entirely by the community and not by the polluter. It is easy for

polluter to give money as a compensation for the pollution caused by him rather than

taking safety measures and reduces his productions capability and that is external

manufacturing cost.62

According to economists, the word pollution means inappropriate

http://www.jstor.org/stable/1228596. accessed June 25, 2012. 60

“OECD recommendations,” accessed May 26, 2012, http://www.oecd.org/ccnm/sustdev. 61

U. Magnus, The Polluter Pays Principle in Germany (International Congress of Comparative

Law, 2006), 4, XVIIth, www.cambridge.org. 62


Economic and Legal Analysis (Islamabad: Institute of Legal Studies, 1996).

http://www.jstor.org/stable/1228596.%20accessed%20June%2025

19

allocation of costs. The protection cost for fuel and un-refined stuff are charged and on

the other hand water and air are used unpaid.63

The occurrence of externalities is valuable for polluter: lesser cost production or

more income, better salary for workers and low-priced stuff for user. It‟s alarming for

community in perspective of social damage. Now, the duty of law-makers is to

implement the internalization of external costs and let polluter pay for environmental

hazards. Therefore, PPP is the probable measure for externality issue and that is the

foundation of pollution control and prevention. There should be possible solutions for

polluter to put “real cost” and develop technologies. The issue of externalities is used in

long-term for future generation‟s environment.64

1.6 PRINCIPLE IN INTERNATIONAL ENVIRONMENT LAW

Many environmental agreements have been forwarded the model of an international court

for environment, which mainly focuses on states which would fill the loophole in

international legal system. The International Court of Justice (ICJ) is competent court to

entertain disputes concerning environmental claims but private parties cannot access to

the court. There must be an International Environmental Courts (IEC) comprise the

capacity to settle disputes between public as well as private parties, the following

proposals can be followed.65

63

See H. C. Bugge, “The Polluter Pays Principle: Dilemmas of Justice in National and International

Contexts,” quoted in J. Ebbesson and P. Okowa (eds.), Environmental Law and Justice in Context

(Cambridge: Cambridge University Press, 2009). 64


Economic and Legal Analysis (Islamabad: Institute of Legal Studies, 1996). 65

Stephen Hockman, “An International Court for the Environment,” Environmental Law Review 11, no. 2

(2009): http://ssrn.com/abstract=1679245, accessed August 19, 2012.

http://ssrn.com/abstract=1679245

20

To adjudicate environmental disputes, in which members of international

community having responsibility.

The dispute amid public and private parties to be adjudicated with considerable

enormity or magnitude.

The President of Court can order for preventive, emergency and injunctive

measures when obligatory.

Arbitration and mediation for environmental disputes.

When necessary, conduct investigation in environmental tribulation of

international importance.66

Whereas, the fact is MNC‟s caused environmental damages. The aggrieved parties

have access to courts but they are unable to bear the cost of legal proceedings.

Environmental organizations shall come forward and take such steps which give the

victims relief through environmental organization would help out to address those

tribulations. But it is in doubts that this sort of courts will be established in near future.

Environmental rights are accepted as part of customary international law. The US courts

create obstruction in the establishment of separate court, because plaintiffs bring their

claims for environmental damages to these courts. So, all the states have to answer this

question.67

66

Hockman, “An International Court for the Environment.” 2 67

Ibid.

21

1.7.1 United Nation

United Nations Conference on Environment and Development (UNCED) given

consensus on Rio Declaration on Environment and Development,68

which states that,

“Instrument of international jurisprudence [that] articulates policies and prescriptions

directed at the achievement of worldwide sustainable development”69

Principle 16 of Rio Declaration provide that,

“National authorities should endeavor to promote the internalization of

environmental costs and the use of economic instruments, taking into account the

approach that the polluter should, in principle, bear the cost of pollution, with due

regard to the public interest and without distorting international trade and

investment ”70

The manifestation of this principle is one of the fundamental principles of international

environmental laws which demonstrate the importance of environmental liability around

the world. This further elaborated the interest of regional and national authorities to

implement it through various instruments without deforming investment or international

trade for the sake of public interest.

68

“Rio Declaration on Environment and Development” United Nations Conference on Environment and

Development, accessed May 14, 2012, www.elsevier.com/locate/jenvman. 69

John Batt and David C. Short, “The Jurisprudence of the 1992 Rio Declaration on Environment and

Development: A Law, Science, and Policy Explication of Certain Aspects of the United Nations

Conference on Environment and Development,” 8 j. Nat. Resources: Envtl. L. no. 8 (1993):

http://ssrn.com/abstract=1679245, accessed September 5, 2012. 70

“Rio Declaration” at 879.


22

1.7.2 International Agreements and PPP

Although several international agreements mentioned that PPP is rarely debated and

seldom recognized in international legal documents other than OECD. The principle have

the status of “binding” and “non binding” nature.71

The PPP mentioned in binding form

as “operational proviso” while in form of non-binding, the principle is mentioned only in

the preface. “Rio Declaration on Environment and Development in 1992,” and council of

Europe‟s Convention72

on Civil Liability for Damage Resulting from Activities

Dangerous to Environment in 1993, both of these international instruments developed

and applied this principle.73

1.7.2.1 Rio Declaration

The significant Rio Declaration on Environment and Development adopts the PPP

overtly in Principle 16,

“National authorities should endeavor to promote the internalization of

environmental costs and the use of economic instruments, taking into account the

approach that the polluter should, in principle, bear the cost of pollution, with due

71

N. de Sadeleer, “Environmental Principles: From Political Slogans to Legal Rules 21,” (2002):

http://ssrn.com/abstract=1987809, accessed March 25, 2012. 72

In the European Union (EU) components states, PPP is included in the gist of European Commission

Treaty‟s implementation of community policies and agriculture sector. Therefore, EU states having

approaches regarding environmental norms their interpretation and application specifically considering the

significance of PPP. To shun transgression regarding treaty proviso, component states have need to fulfill

EC law strictly. Furthermore, numerous environmental issues are governed by EC, and they put effective

steps for enhancing the legal system in member states, and guide them in proper direction. “EC Treaty arts.

6, 174” accessed June 10, 2012, http://www.defra.gov.uk/corporate/consult/env-liability. 73

“Council of Europe, Convention on Civil Liability for Damage Resulting from Activities Dangerous to

the Environment (Lugano, 1993),” accessed April 24, 2012, www.elsevier.com/locate/jenvman.


http://www.defra.gov.uk/corporate/consult/env-liability

23

regard to the public interest and without distorting international trade and

investment.” 74

Furthermore, Principle 13 of Rio Declaration stated that states should expand and

enhance their national laws concerning compensation and liability for the environmental

damage and victims of pollution. Some commentators differ with the impact of principle

16 of Rio Declaration.75

They argue that Rio Declaration regarding PPP is effective than

OECD, they put forward the reason that directs governments for declaration of

internalization of environmental costs through economic instruments and not through

subsidization obtain for the use of pollution control apparatus. On the other hand, another

commentator views that Rio Declaration is less progressive than OECD and EC because

of its dependence on economic necessities for application and “aspirational language”.76

1.7.2.2 Agenda – 21

According to this agenda, Programme of Action for Sustainable Development in

numerous provisos recognized PPP impliedly. This Agenda includes a segment on

strengthening the responsibility of main organization. Chapter 32, of agenda 21

77“focusing on farmers‟s role, and aim of which covers internalization of environmental

costs and price mechanisms”.78

74

Rio Declaration, Prin. 16, 31 ILM at 879. The Rio Declaration may be the “main reference” for definition

of the principle in its “broad sense.” 75

The debate of Rio Declaration concerning PPP favors full internalization of environmental damage costs,

as well as compensation for preventive measures and pollution control. However, this declaration was not

first byword of PPP which mentions internalization for costs of damage, and this is comparatively a new

concept. 76

Rio Declaration, Prin. 13, 31 ILM at 878. Principle 7 of the Rio Declaration. 77

Helsinki convention on Protection and Use of Trans-boundary Watercourse and International Lakes

(1992), under those contracting states is guided about the application of Principle. Spanish law

24

1.7.2.3 Lugano Convention

This convention is planned to make certain the compensation for environmental damages

to victims, which cause danger to the environment. The preface of Lugano convention

introduces PPP.

“Lugano Convention favors, to impose strict liability regarding PPP. This

convention defines both environment and damage broadly, which put strict

liability for damage caused by hazardous substances and activities. This

convention focuses hazardous activities to contribute monetary security in shape

of insurance, but there is no expectation of compensation fund. The Lugano

Convention is the only accessible scheme for broad coordination regarding

environmental liability in Europe, or somewhere else. The only environmental

system in which responsibility is not limited in same, that‟s why PPP more

strongly than other treaties due to which loss is extended”.79

However, Lugano Convention would favor the applicability of stringent liability

framework. Only nine states are signatory to this convention in twelve years and none has

adopted it. This convention provides insurance rather than compensation to victims but

this paved a way for introduction of liability for environment in EU.80

Consequently, the

acknowledged significance of PPP and adopt it, through inclusion in Rio Declaration and Agenda 21. There

are supplementary global measures specially the “Cartagena Bio-safety Protocol (2000)” and “Biological

Diversity Convention (1992)" put forward a connection to the PPP. The Canada adopted environmental

agreements as global environmental measures in application of PPP; they used it as interpretative

instrument. E. Raftopoulos, The Polluter Pays Principle and Agriculture in Greece (Greece: Revue

Hellenique de Droit International, 2006), 59, www.cambridge.org. 78

“United Nations Conference on Environment and Development, Agenda 21: Programme of Action for

Sustainable Development,” accessed May 10, 2012, www.eoearth.org/article/Polluter_pays_principle. 79

“Lugano Convention, supra note 154, 32 ILM 1228. The Convention refers to Principle 13 of the Rio

Declaration, which directs States to develop national law to compensate victims of pollution,” accessed

April 20, 2012, www.eoearth.org/article/Polluter_pays_principle. 80

International Environmental treaties comprise the mechanism of PPP. Those states which adopted

multilateral environmental agreements are bound to know extensively by principle. For instance, Barcelona

Convention for the Protection of Marine Environment and Coastal Region Mediterranean, which put

responsibility for application of PPP, and for public interest, the polluter should bear costs for pollution

25

Convention has not legal applicability. One jurist submits that certain states are uncertain

to contribute in strict liability system, because they bring amendments in their national

tort law.81

1.7.2.4 OSPAR Convention

At this point, in OSPAR Convention PPP is articulated in 2.2 (b) as, “The contracting

parties shall apply, (b) the polluter-pays principle, by virtue of which the cost of pollution

prevention, control and reduction measures shall be borne by the polluter”82

The phraseology of OSPAR Convention is stronger than wording of Rio

Declaration. This convention enhanced responsibility of signing state for application of

PPP. They also provide proper mechanism for PPP application, while Rio Declaration

just mentioned “an attempt to promote internalization of external environmental costs and

polluter should pay as matter of principle.83

prevention, reduction and control measures. See also,Barcelona Convention, art. 4(3)(b), cited by

Raftopoulos. 81

Ibid. 82

OSPAR Convention above n. 70 Art. 2(2), (as quoted by Ole W. Pedersen, “Environmental Principles

and Environmental Justice,” Environmental Law Review 12, no. 1 (2010), accessed May 16, (2012),

http://ssrn.com/abstract=907456. p-18) 83

“Convention for the Protection of the Marine Environment of the North-East Atlantic, 1992, (OSPAR

Convention,” accessed by May 20, 2012, www.elsevier.com/locate/ecolecon.

26

CONCLUSION

Initially PPP was an economic principle used as tax, at the development of environmental

economics. After that, PPP is incorporated in numerous international documents as legal

principle. The PPP is not a codified law and its utilization is altering time to time. The

major tendency to put extra responsibility on the polluters to mitigate the financial burden

on the authorities, to takes measures for pollution alleviation.

PPP is not intended to penalize the polluter, nor is it principle of equity. This

principle is an environmental friendly to attain sustainable development. This principle

opted sustainable development indication to put in our economic as well as our legal

system to internalize the environmental costs. This would be possible if we incorporate

PPP in our legislative policy and decision-making process. The purpose of the principle

to shun the wasting natural reserves and to finish the cost-free utilization of the

environment. The PPP will decrease fabrication in investment and international trade, to

protect economic competence.

Corporate Environmental Responsibility can be implemented on corporation

through this principle. Although it was coded in the OECD guidelines, but still MNC‟s

are influential and powerful, that they adopted the soft laws rather than hard law to cost

the environmental degradation. International environmental law must put some obligation

so that their practices are subject to adoption for national and domestic level.

27

CHAPTER # 2

ANALYSIS OF PAKISTANI ENVIRONMENTAL LAWS IN PPP

PERSPECTIVE

2. INTRODUCTION

The first environmental regulation of Pakistan was Pakistan Environmental Protection

Ordinance, 1983, which was the outcome of 1972 Rio Declaration. Before that

environment related issues were to be dealt under public interest litigations. Constitution

of Pakistan (hereinafter called Constitution) and Pakistan Penal Code were main statutes

for environmental regulations. Several constitutional articles were interpreted for

proceedings in the High Courts and Supreme Court of Pakistan for environmental issues.

But still there were no specific laws for pollution abatement costs or environmental costs.

The implementation of PPP in Pakistani Environmental laws and industrial sector

is the need of time. Moreover, it was mentioned in National Environmental Policy, 2005

but it was not fully elaborated nor there were any future expectations to implement it in

industrial sector, though the PPP is provided in various environmental laws. However,

this principle was adopted and implemented in various European Union (EU) member

states, 84

as well as, Indian judiciary apply this principle in various industrial pollution

cases. To avoid Bhopal disaster like situation, South Asian region must consider this

principle not only in their corporations but many Small and Medium Enterprises

84

Margaret Rosso Grossman, “Agriculture And The Polluter Pays Principle,” Netherland Comparative Law

Association, Vol. 11.3 Electronic Journal of Comparative Law, (2007), 12,

http://www.ejcl.org/113/article113-15.pdf, accessed April 14, 2012.

http://www.ejcl.org/113/article113-15.pdf

28

(SME),85

which caused pollution, like tanneries, bricks, cement and numerous other

pollution sources. Shortly, Pakistani environmental laws and judiciary must follow this

principle as followed by Indian judiciary.86

The Pakistan Environmental Protection Act (PEPA), 1997 is the current

implementable environmental statute in Pakistan. The Act provides environmental

enhancement, preservation, protection and rehabilitation. In addition to this, it promotes

sustainable development, pollution prevention and control measures. This provides

various measures for sustainable environment, for establishment of environmental

tribunals and Magisterial Courts. PEPA and provincial Environmental Protection

Agencies (EPA) have been given powers of Environmental Protection Order (EPO) for

grave environmental hazards. But provisions of pollution abatement costs are missing in

this Act due to which it was not fully operationalized.

The scheme of this 1997 Act was not fully operational. For this, there must be

additional rules and regulations to be described under this Act. This Act was not fully

enforced because main Rules and Regulations are pending to notification. So, the

mechanisms of Initial Environmental Examination (IEE) and Environmental Impact

Assessment (EIA)87

have been notified with five additional Rules of environmental

concerns. Finally, environmental laws in Pakistan are not fully enforced or made it

85

Waheed, Ambreen, “Evaluation of the State of Corporate Social Responsibility in Pakistan and a

Strategy for Implementation,” For Securities & Exchange Commission of Pakistan and United Nations

Development Program. UNDP, 2005. www.RBIpk.org. Accessed March 29, 2012.

86Saha Arpita, “Judicial Activism in Curbing the Problem of Public Nuisance on Environment (July –

November 2009),” (LLM diss. National Law University, Jodhpur, 2009):

http://www.legalserviceindia.com, accessed May 18, 2012.

87 “Pakistan National Wetlands Policy,” Ministry of Environment Pakistan Wetland‟s Programme. Last

modified Final Draft, December 2009, accessed April 13, 2012, www.pakistanwetlands.org.

http://www.rbipk.org/

http://www.legalserviceindia.com/

http://www.pakistanwetlands.org/

29

effective and PPP must be adopted and implemented in Pakistani environmental laws as

well as in corporate legal regime.

2.1 REVIEW OF PAKISTANI LAWS CONCERNING

ENVIRONMENT

Though, pollution has been discussed in numerous Pakistani laws and environment

related cases had been filed under public interest litigations of constitutional provision.

The famous case of Shehla Zia vs WAPDA88

was the main example for environment.

Following are the main Statues concerning to environment related issues.

2.1.1 Relevant Articles of Pakistan’s Constitution concerning Environment

In democracies where modification or amendments in constitution or agree to new

constitutional provision for better environmental supremacy or encourage constitutional

reforms about environmental protection. Regrettably, there is no straight stipulation

regarding sustainable development or protection of environment which make possible

judicial declarations of environmental concern.89

But actually the 1972 Stockholm

Conference” on environment was at same time which did not obtain constitutional

draftsmen attention. The closest indication was mentioned in concurrent list in Article 42,

with name of “ecology” which indicates that under Article 143 of constitution, provinces

can make legislation under federal dominancy. 90

88

PLD 1994 SC 693. 89

Dr. Parvez Hassan, “Capacity Building for Environmental Law in the Asian and Pacific Region:

Approaches and Resources,” Pakistan Law Journal Magazine 2, (2002): 252,

http://www.environment.gov.pk/nep/policy.pdf, accessed May 15, 2012. 90

Article, 142 of Constitution of Pakistan.

http://www.environment.gov.pk/nep/policy.pdf

30

Constitution‟s Chapter 1, describes fundamental rights from Article 8 to 28,

which are permissible in Supreme Court and High Courts of Pakistan.91

Constitution

articles no 9 and 14 endow with “Right to Life” and “Right to dignity”. Constitutional

articles 184 (3) in perspective of public interest litigation defined Supreme Court

jurisdiction.

“Without prejudice to the provisions of Article 199, the Supreme Court shall, if it

considers that a question of public importance with reference to the enforcement

of any of the Fundamental Rights, conferred by Chapter-1 of Part-II, is involved,

have the power to make an order of the nature mentioned in the said Article”92

According to Article 189, the Supreme Court established precedents which are

obligatory upon Provincial High Courts. The verdicts of High Courts are obligatory upon

lower judiciary in respective provinces.93

In, Supreme Court and High Courts numerous

environmental writ petitions have been lodged on plea of Shehla Zia vs WAPDA.94

This

precedent has been quoted in various pollution related cases and writs which comprised

water, air, noise and wastes pollution. The petition claims that increasing pollution in

urban areas which are terribly dangerous to human life and is contravention of

fundamental rights prescribed in constitution.95

Following articles of constitution of Pakistan are concerning to environmental

issues with respect to public interest litigation.

91

Chapter 1, Constitution of Pakistan, about fundamental rights from Article 8 to 28. 92

Dr. Parvez Hassan, “Environmental Jurisprudence form Pakistan; A lesson for SAARC Countries,” A

paper presented at the South Asia Conference on Environmental Justice organized by the Supreme Court of

Pakistan, (2012): 5, http://www.environment.gov.pk/nep/policy.pdf, accessed August 28, 2012. 93

Article 201, of Constitution of Pakistan. 94

PLD 1994 SC 693 95

Dr. Parvez Hassan, “Environmental Jurisprudence form Pakistan; A lesson for SAARC Countries,” 7.


31

Part – VII, Article 184 (1, 2, 3)

1. “The Supreme Court shall, to the exclusion of every other court, have original

jurisdiction in any dispute between any two or more Governments.

2. In the exercise of the jurisdiction conferred on it by clause (1), the Supreme

Court shall pronounce declaratory judgment only.

3. Without prejudice to the provisions of Article 199, the Supreme Court shall, if it

considers that a question of public importance with reference to the enforcement

of any of the Fundamental Rights conferred by Chapter I of Part II is involved

have the power to make an order of the nature mentioned in the said Article.

Explanation: In this clause “Government” means the Federal Government and the

provincial governments”.96

The following constitutional article 199 (1) (c) having jurisdiction of Provincial High

Courts.

Article 3 “Elimination of Exploitation: The state shall ensure all forms of

exploitation and the gradual fulfillment of such fundamental principle, for each

according to his ability to each according to his work.”97

The above mentioned constitutional articles are used as basis for environmental

regulations. The right to spend better life in healthy and pollution-free

environment is the fundamental right of every citizen of the state. The Supreme

Court and High Court of state are taking environmental issues under the ambit of

public interests under Article (184) and (199)98

of the said constitution

respectively.

96

Article 184(1, 2, 3), Part-VII of Constitution of Islamic Republic of Pakistan. Philips Electrical

Industries v Pakistan, 2000 YLR 2724 Karachi. 97

Article- 3of Constitution of Islamic Republic of Pakistan. Moulvi Iqbal Haider v. CDA, PLD 2006 SC

394. 98

“On the application of any aggrieved person, make an order giving such directions to any person or

authority, including any government exercising any power or performing any function in, or in relation to,

any territory within the jurisdiction of that Court as may be appropriate for the enforcement of any of the

fundamental rights conferred by chapter 1 part-II.” Article 199(1, (c)), Part-VII of Constitution of Islamic

Republic of Pakistan. Moulvi Iqbal Haider v. CDA, PLD 2006 SC 394.

32

2.2.2 Environmental Provision of Pakistan Penal Code (PPC)

Pakistan Penal Code (PPC), 1860,99

which is common penal law in country which

provides punishments on its contravention. Section 277, of PPC provides punishment for

water pollution.

“Whoever voluntarily corrupts or fouls the water of any public spring or

reservoir, so as to render it less fit for the purpose for which it is ordinary used,

shall be punished with imprisonment of either description for a term which may

extend to three months, or with fine which may extend to five hundred rupees, or

with both”.100

As section 426 of PPC described that.

“Whosoever commits mischief shall be punishable with imprisonment of either

description for a term which may extend to three months, or with fine, or with

both”.101

PPC, Section-278

“Making atmosphere noxious to health: Whoever voluntarily vitiates the

atmosphere in any place so as to make it noxious to the health of persons in

general dwelling of carrying on business in the neighborhood or passing along a

public way shall be punished with fine which may extend to fifteen hundred

rupees”.102

If someone intentionally diverts or trouble waters which causes dangerous effects to flora

so such person is causing water pollution. According to above two sections, it is obvious

99

“PPC is a comprehensive code concerning diverse sorts of crimes. Penalties are available according to

nature and circumstances of offence. Several of these punishments are severe and deterrent and certain are

trifling, which are preserved in this code. It also has certain stipulations concerning environment and

having penalties for transgressors in personal capacity or public at large.” Fahim Ahmad Siddique, The

Scope of Environmental laws in Pakistan (Karachi: Asia law House, 2000). 100

Qadir, Dr. Shoaib “ Environmental Legislation in Pakistan” 101

The Pakistan Penal Code, 1860.S. 277 & 426. 102

The Pakistan Penal Code, 1860.S. 278.

33

that if someone stinking water so law is there to have check and balance and make the

polluter accountable before law and will be punished. Sections 277 and 426 of PPC

provide punishment for such offences. The objectives of these sections are to stop

reduction in water supply for agriculture and for flora and fauna. Very specific above sec

277 of PPC be appropriate for stained water which make ailing for human consumption

and same status for irrigation sector. So whosoever, pollutes water of different sources of

irrigation is accountable under this section.103

2.2.3 Criminal Procedure Coder (CrPC)

Furthermore, a provision of Criminal Procedure Code (CrPC), 1898 in section-144;

“the District Magistrate direct any person to abstain from certain act or take

certain order with certain property in possession, if such Magistrate considers

that such direction is likely to prevent, or tends to prevent, obstruction,

annoyance or injury, or risk of obstruction annoyance or injury or risk of

obstruction to any person lawfully employed, or danger to human life, health or

safety”104

The above mentioned provision of CrPC elaborated the Magisterial powers for the

environmental regulations.105

The Magistrate can cease any public body or authority from

doing any activity which can harm the environment, public nuisance or any irritation to

103

Fahim Ahmad Siddique, The Scope of Environmental laws in Pakistan (Karachi: Asia law House, 2000). 104

Code of Criminal Procedure in Pakistan. Section-144 105

“The precautionary principle has mentioned in EPO‟s and directed by federal and provincial EPA in

section 16 of PEPA with latent or real unpleasant environmental outcome in breach of this Act. Where

there is ambiguity the EPA scrutinizes precautionary and rule of care and issues EPO‟s. When EPA

contended concerning the breach of this Act due to release and emanations of air, waste, effluents, noise or

removal of wastes which puts unpleasant environmental impacts, then precautions are mandatory. EPA

directs liable person to attain precautionary steps within limited time. This precautionary principle is having

different mechanisms for implementation. Whoever not observe EPO‟s, must be penalized under section 17

of fine and EPA taken charges from responsible person. The factory machinery, apparatuses can be

eliminated and be subjects to closure under precautionary principle.” Jawad Hassan, “Environmental laws

of Pakistan,” 165.

34

community. These principles has inclusively discussed in ―Shehla Zia vs WAPDA” and

various other public interest litigations in Pakistan.106

2.2.4 Environment and 18th

Amendment

Pakistan countered the provincial appeal in 2010 to bring certain main amendments in

constitution concerning provincial control and capability in various fields. The provinces

looking for extra autonomy under the federal system after the approval of 18th

amendment in Parliament and their take place decentralization of powers from federal to

provinces.107

Before conceding 18th

amendment, numerous subject matters were inside

under the ambit of concurrent list equally at provincial and federal level. As mentioned in

concurrent list the federal legislative authority has dominancy over provincial legislation

in case of identical subject-matter. The concurrent list eliminated in 18th

amendments

which incorporated “Ecology and Environment”. The outcome of this amendment is the

federal government has no authority to cope with such significant issue at state level and

environment becomes a provincial issue. This indicates incapability of federal

government to cope with environment at state level policies and particularly to ratify

“Multilateral Environmental Agreements (MEA‟s)” with other states.108

106

PLD 1994 SC 693. 107

Dr. Parvez Hassan and Ahmed Rafay Alam, “The Role of Commissions in Public Interest

Environmental Litigation in Pakistan,” All Pakistan Legal Decisions, Journal, 78 (2011): 88-89,

http://www.iucn.org/themes/ceesp/publications/art-mono/pak.doc, accessed March 29, 2012. 108

Article 270AA, introduced by the 18th Amendment, provides:

“Notwithstanding omission of the Concurrent Legislative List by the Constitution (Eighteenth Amendment)

Act, 2010, all laws with respect to any of the matters enumerated in the said List (including Ordinances,

Order, rules, bye-laws, regulations and notifications and other legal instruments having the force of law) in

force in Pakistan or any part thereof, or having, extra-territorial operation, immediately before the

commencement of the Constitution (Eighteenth Amendment) Act, 2010, shall continue to remain in force

until altered, repealed or amended by the competent authority”.

“On the omission of the Concurrent Legislative List, the process of devolution of the matters mentioned in

the said List to the Provinces shall be completed by the thirtieth day of June, two thousand and eleven.”

http://www.iucn.org/themes/ceesp/publications/art-mono/pak.doc

35

There may be a number of dissensions which come out that parliament approved

the 18t amendment in swiftness to block federal responsibility in state environmental

development. There needs sincere efforts to re-examine the verdict, because the result of

this attempt would manipulate main global plane concerning climate change in which

vigorous contribution of Pakistan is mandatory at state level.109

Resting on vivid side the “right to information” likes a fundamental right under

the 18th

amendment.110

This provides assistance to the efficient execution of liberty to

information to regulate and lend a hand to environmental advocates to get suitable details

and statistics so vital to the victorious result of their effort.111

2.3 COMPREHENSIVE ANALYSIS OF PEPA, 1997

In section 2 of PEPA, the terms mentioned in Act have been evidently defined in this

section. According to section 4, PEPC is authorized to endorse national policies

concerning environment within the ambit of NCS which agreed by federal government in

various times. At provincial level their “Sustainable Development Fund” to supply fiscal

aid to appropriate project.112

The violation of NEQS permitted emission and discharges

and new standards which recognized by PEPA have been banned. Sections 11 and 11 (2)

authorized federal government to imposes pollution charges upon transgressors through

NEQS. A bi-phase screening procedure for different projects has been proposed in shape

109

Dr. Parvez Hassan, “Environmental Jurisprudence form Pakistan; A lesson for SAARC Countries,” A

paper presented at the South Asia Conference on Environmental Justice organized by the Supreme Court of

Pakistan, (2012): 5, http://www.environment.gov.pk/nep/policy.pdf, accessed June 10, 2012. 110

Article-19A, Constitution of Pakistan. 111

Dr. Parvez Hassan, “Environmental Jurisprudence form Pakistan; A lesson for SAARC Countries,” 21. 112

Jawad, Hassan, “Country Report for Pakistan, 2001,” Asia Pacific Journal of Environmental Law, 319,

(2001): 324, http://www.epa.gov/air/criteria.html, accessed December 19, 2011.


http://www.epa.gov/air/criteria.html

36

of Initial Environmental Examination (IEE) and for some unpleasant environmental

cases, forwarded EIA.113

There are numerous sections which provide environmental guidelines. According

to section 13, bringing of dangerous wastes has been banned and without permit no one

can manage the banned and dangerous materials.114

To make certain observance with

PEPA, NEQS and provincial EPAs has been authorized to order the automobiles to fix

pollution reduction devices. They desired to used pollution control fuels and endure for

vehicles maintenance. The provincial EPA and PEPA have authorized to appoint

Environmental Protection Officer (EPO) to deal with latent or real worse environmental

impacts in transgression of this Act.115

Under the Act, environmental tribunal was

established to try severe offences with special authority. Environmental Magistrates tried

of ordinary offences concerning littering, removal of wastes, automobiles pollutions and

transgression.116

There are certain causes for the futile execution of PEPA which are lacking public

alertness concerning its survival particularly which lodging a complaint by the aggrieved

community. The main query was the improper working procedures of environmental

113

Sections 2, 4, 9, 11(2) of PEPA, 1997. 114

Section 13 and 14 of PEPA, 1997. 115

“According to sections 5 and 8 of PEPA, the federal and provincial EPA‟s has been recognized. While

there are certain powers and functions mentioned under sections 6 and 7 for administering the federal EPA

and some powers has transferred to provincial environmental agencies. The query is that environmental

agency at federal have the executive supremacies for the execution of PEPA, while the executing authority

haven‟t any specific formulation for regulation. New functions have been dispensed to agency as per new

National environmental policy. In true sense the federal agency powers and functions according to its

formation and sustained resources has been abandoned rather it have extensive list of supremacies to

execute its agenda and policies. According to section 16 the agency concerned with environmental

protection order (EPO). Officially the agency is not well-resourced, though it passed EPO‟s but not a single

case has been lodged against polluter. The process for lodging case against polluter is not translucent.

Mujahida Naureen, “Development of Environmental Institutions and Laws in Pakistan,” Pakistan Journal

of History and Culture XXX, no.1 (2009): 7, http://www.environment.gov.pk/nep/policy.pdf. 116

Jawad Hassan, “Environmental Laws of Pakistan,” Pakistan Law Journal, (2001): 12,

http://www.epa.gov/air/criteria.html, accessed Jaunary 23, 2012.



37

magistrates and environmental tribunals. Certain other ineffectiveness are not issuing of

National Report on Environment, PEPC uneven meetings, strict NEQS, lack of quality

standards for ambient air and short of aggravated and skilled staff in provincial EPA‟s.117

The 1997 Act exemplify that sluggish but detectable environmental awareness

steadily developed in Pakistan. This awareness has happen in the government and

community response to the overlook of Pakistan development planning disregard for

environmental features. This causes environmental dilapidation which virtually affects

Pakistan‟s environment.118

2.3.1 The Status of PEPA regarding PPP

The government of Pakistan endorsed PEPA in 1997 which substitute PEPO, 1983. 119

Following are the main provisions prescribed regarding the status of PEPA.

Complete Environmental Impact Assessment (EIA) legislation.

Environmental Tribunals establishment.

Infliction of pollution taxes and beginning of economic procedures.

Handing over of some powers of supervision and implementation of the Act to

provincial authority.

National Environmental Quality Standards (NEQS) enhancement.

117

Prof. Nicholos Robinson and Jawad Hassan, “Comparative Environmental Law & Regulation,” Oceana

Publications, New York, USA, (1997): http://www.environment.gov.pk/act-

rules/D_National_Drinking_Water_Policy.Pdf, accessed March 12, 2012. 118

Dr. Parvez Hassan, “Environmental Consciousness on Pakistan,” Viewpoint, 21, (1989): 11,

www.elaw.org/search, accessed Febaurary 13, 2012. 119

Government of Pakistan, PEPO,1983 & PEPA 1997.

http://www.environment.gov.pk/act-rules/D_NATIONAL_DRINKING_WATER_POLICY.pdf

http://www.environment.gov.pk/act-rules/D_NATIONAL_DRINKING_WATER_POLICY.pdf

http://www.elaw.org/search

38

2.3.2 PPP and PEPA Regulation

The PPP are not expressly mentioned in the PEPA. The intolerable heights of pollution

are to be lessened through the polluter should pay the fiscal cost of environmental

degradation. It did not evidently mentioned in definite provision for pollution control

actions to allocate fiscal responsibility. Though, to execute the PPP the PEPA approved

customary principles in shape of Pakistan Environmental Protection Agency (Pak-

EPA)120

to locate certain standards of discharge121

and grant permits for discharge.122

So,

other functions like implementation proceeding against permit transgressors, initiations of

taxes, excise duties etc and other levies.123

The PEPA damaged this principle by holding

out opportunity for taxes immunity, depreciation, subsidies and allowances are standard

exception from PPP. 124

Pak-EPA attempted to initiate pollution costs/taxes in the past 1990s and 2000s,

but that was aimless. Primarily there was support amongst stakeholders125

for market-

based mechanism in shape of pollution costs, subsidies and NEQS observance certainty

rather than command and control mechanisms.126

But the debate between industry and

government was fruitless on issue of refunding fee.127

120

The Pak-EPA and Provincial agencies taken measures against polluters to pay for pollution decrease.

Firstly, provincial environmental agencies needs assistance from Pak-EPA to grant discharge permits.

Secondly, Pak-EPA now provides some assistance to provincial agencies concerning the implementation of

criminal and civil sanction. Lastly, the lack of inclusive examining of pollutant discharge, which is

conducted by provincial agency in reply of public grievances. See also, Ralph A Luken, “Equivocating on

the polluter-pays principle: The consequences for Pakistan,” Journal of Environmental

Management,(2009): 3, www.elsevier.com/locate/jenvman, accessed June 12, 2012. 121

Section 6, PEPA, 1997. 122

Section, 16, PEPA, 1997. 123

Sec 6 & 16 of PEPA, 1997. 124

Ralph A Luken, “Equivocating on the polluter-pays principle: The consequences for Pakistan,” Journal

of Environmental Management,(2009): 3, www.elsevier.com/locate/jenvman. 125

“Representatives of Industry, Government, Environmental NGOs and Academic Researcher,” accessed

in July 11, 2012, http://www.jstor.org/stable/20439029. 126

“Industrial air pollution is area of anxiety for environmental dilapidation. The emissions caused from

such industries are matter of PPP, to control such discharges. There are relatively smaller industrialization

http://www.elsevier.com/locate/jenvman

39

There was failed attempt from Pak-EPA to explain the exception to PPP to buy

pollution control apparatus and to lower custom duty. But this step has no fruitful

outcome, because custom authority asked to draft a list of apparatus that should excused

form tax, but Federation of Pakistan incapable to prepared that particular list.128

Pakistan‟s Chamber of Commerce and Industry have insufficient role.129

PPP is mentioned in PEPA, furthermore; main elements of this principle are discussed in

detail. Section 6, 7, 11, 16 and 33 are specifically focus on different modes of pollution

charges. Section 6, sub-section(1) and (2) parts „r‟, „t‟, „s‟ mention to control disaster and

accidents.130

It also identifies safeguards for disaster‟s prevention and contingency plans

and to support pollution control. Moreover, take appropriate measures for environmental

enhancement, rehabilitation and conservation. This section fulfills the purpose of PPP up-

to the extent of tax, duties and levies.131

Section 7(c) describes Federal EPA powers to fix and realize charges, rates and

fees etc.132

Though section 11 (2) explains that emission or discharge of any pollution is

not allowed, and those who disobey will be charged.133

Section 16, sub-section 2(a & b)

also passes such measures for controlling of emission, shrinking, discharge and other

as compared to develop states, so air quality distresses related with corporation not attained shocking level

in Pakistan. The standards like ambient air value principles are initiated for the examination of

corporation‟s emission and assess their affects. They made standard evaluation obligatory for the industrial

process in case of combustible and toxic chemical substances. These measures are essentials to avoid

disasters in future to shun catastrophes like Bhopal.” Jawad Hassan, “Environmental laws of Pakistan,”,

143. 127

UNIDO, 2000: 41; Hagler Bailly, 2005: A23-24. 128

“Hagler Bailly Report, 2005: A26,” last modified in 2005, accessed in Dec 23, 2011, http://www.lead-

journal.org/content/. 129

Perhaps the Chamber is unwilling to do so as the existence of the duty gives industry one more excuse

for not complying with NEQS. 130


Pakistan Environmental Protection Act, 1997. 132


Section 11, PEPA, 1997.

40

environmental issues.134

It further provides measures to decrease control or abolish on

enduring or provisional bases. Section 33 sub-sections 2(d) also favors the notion to taken

charges, fees and other rates etc.135

“In addition to the fees and charges provided for in PEPA, excise revenues

could be levied specifically to find natural resources conservation, restoration

and rehabilitation. Effective implementation of PEPA‟s pollution control

provisions and compliance with NEQS would contribute significantly to

improving the quality of natural resources. The law does not make it

mandatory for pollution charges levied on industry to be used to mitigate

environmental damage or restore degraded resources. The provisions of PEPA

are primarily reactive, although an environmental protection order (Section

16) may be used proactively.”136

2.3.3 Command and Control under PEPA

According to Section 6(g) (i) of PEPA, the federal EPA enhanced such measures for

different emissions or discharges for air, land and water and to standardize NEQS.137

According to section 7(h) discussed about effluents, emissions or discharges of polluted

air. To take the materials or hazardous substances samples from the polluted to control

it.138

Section 11 sub-section (2) and 16 sub-sections (1) (2) mentions about command and

control mechanism, which is the main tool of PPP.139

Though, the principle was not

134



Ibid. 137

Section 6(g)(i), PEPA, 1997. 138

Section 7(h), PEPA, 1997. 139

Section 11(2) & 16(1)(2), PEPA, 1997.

41

discussed in direct terms. It was also explained in section 6 sub-section (1)(i)(g).140

This

mechanism was further corroborated from section 13 which mentions dangerous

substances prohibition.141

According to section 16, this specially focuses on command and control system

under the ambit of environmental protection order. The section 16 given huge powers to

provincial and federal EPA‟s concerning polluting activities, hazardous substances and

emission etc. It also suggests the installations, actions, mitigating and precautionary

measures for abating pollution.142

Section 18 also imposed legal bars on corporation

concerning environmental degradation.143

Section 27 given powers to federal and

provincial EPA‟s about performance of their function which may be used as command

and control (CnC) against the polluter.144

2.4 PPP AND ENVIRONMENTAL BYELAWS

The following are some environmental byelaw under the PEPA. These laws mention PPP

under different headings, which are main tools of the principle.

2.4.1 Motor Vehicles Rules, 1969

These rules discuss the safeguards provided for the proper control of emissions or

discharges greases, vapor or smoke etc in the atmosphere. In fact, theme of rules is that

vehicles should be sustained and mechanized in a way that it will not emit any ashes,

sparks or other hazardous or polluted substances. Therefore, referred proper measures

140

Section 6(1), PEPA, 1997. 141




Section 27, PEPA, 1997.

42

avoid violation, which leads to the environmental degradation, to control the

environmental hazards.145

In “Mid-Term Development Framework 2005-10” provided to reorganize and

improve environmental quality.146

Furthermore, the framework decide to inspect the

vehicular emission which exemplify C&C and vehicular emission has been provided in

sec-15 of PEPA. The “Motor Vehicle Rules, 1969” provides responsibilities and powers

of “Motor Vehicle Examiners (MVE).147

MVE established an inspection mechanism for

better quality air. These are regulatory measures to manage pollution control substance

appropriately.148

2.4.2 Pollution Charge for Industry (Calculation and Collection) Rules, 2001

According to section 31 of PEPA, the Federal Government revamps the rules to charge

the industries for pollution, and the procedure for their collection and calculation. It

provides rules and procedure for the allocation of charges which is the main part of PPP.

Sections 3, 4 and 5 provide determination of pollution charges, its level, and

responsibility for the payment, reporting and calculation. Calculation and payment

procedure is discussed in detail in section 6 of the rules; therefore, these calculation and

payment procedure is further elaborate in rule 9 and 8. In addition these rules specifically

provide many schedules for legal basis and guidelines which discusses payment of

145

Rule 163(1), Motor Vehicle Rules, 1969. 146

“Establishment of Motor Vehicle Emissions Inspection System,” accessed date November 23, 2012,

www.environment.gov.pk/PRO_PDF/PositionPaper/Establishment%20of%20Motor%20vehicle%20emissi

ons%20Inspection%20system.pdf. 147

“Responsibilities and Powers of Motor Vehicle Examiners (MVE)”, Motor Vehicle Rules, 1969. 148

“Establishment of Motor Vehicle Emissions Inspection System,” accessed date November 23, 2012,

www.environment.gov.pk/PRO_PDF/PositionPaper/Establishment%20of%20Motor%20vehicle%20emissi

ons%20Inspection%20system.pdf.

43

charges which constituted the PPP.149

The following is the calculation procedure of

charges;

“The pollution charge shall be calculated by multiplying the pollution level, with

actual production during the period for which the charge is paid, also provides

per pollution unit for the year in rates and escalation. It shall be paid biannually,

and will be deposit against proper receipt. The industrial unit then submits a copy

of receipt and details of calculation charge.”150

Schedule III and schedule IV of the rules provides details, tables, escalation

rate and details of pollution charges calculation.151

2.4.3 Provincial Sustainable Development Fund (Utilization), Rules, 2003

According to a notification, the “Provincial Sustainable Development Fund (Utilization)

Rules, 2003” has a clue for the PPP. In rule 5, there are certain points which have

indication for monetary assistance for projects concerning environment and sustainable

development. In addition, sub-para of this rule encouraged the projects which decreased

the effects of environment and those who paid charges for pollution.152

Sub-rule 2 of rule

5 also discusses pollution charges of industries.

“As far as possible, the Board shall endeavour to ensure that the total

financial assistance sanctioned industry-wise in a year, is proportional to the

pollution charges paid by each industry: Provided that this criterion shall not

apply to project-specific assistance channelized through the Fund: Provided

further that within each industry, priority will be given to a project which is

149

Pollution Charge for Industry (Calculation and Collection) Rules, 2001. 150

Rule 6, Pollution Charge for Industry (Calculation and Collection) Rules, 2001. 151

Pollution Charge for Industry (Calculation and Collection) Rules, 2001. 152

Rule 5, Provincial Sustainable Development Fund (Utilization), Rules, 2003.

44

more cost-effective in terms of the mitigation it is designed to achieve as

compared to the investment planned.”153

Moreover, Rule 8(2) provides remedial procedures for environmental projects.154

2.4.4 Hazardous Substances Rules, 2003

Rule 5 of these rules put the procedure of licensing of industrial hazardous activities. EIA

of the industrial projects is mandatory for granting of license under the rule for waste

management plan and safety plan.155

According to rule 17, they specifically mention the

C&C156

for the environmental effects which are safety precautions and emergency

measures under the provided bye-law. This rule provides responsibility and liabilities of

persons in case of major industrial accidents.157

In addition, rule 19 provides mechanism

for “Waste Management Plan” under clause (a) and (b) of the said rule.158

This further

elaborated to review159

the plan and export plan under the specified convention.160

.

153

Sub-rule 2 of rule 5, Provincial Sustainable Development Fund (Utilization), Rules, 2003. 154

Rule 8(2), Provincial Sustainable Development Fund (Utilization), Rules, 2003. 155

Rule 5 of Hazardous Substances Rules, 2003. 156

Rule 17 (1) (b) (c), “A description of safety equipments and systems and safety precautions taken, and

an assessment of the nature and scope of the adverse environmental effects likely to be caused major

accidents” & Rule 17 (1)(d), “A description of emergency measures should be taken on and off the

premises of the applicant to control the major accident, and to mitigate its adverse environmental effect.”

Hazardous Substances Rules, 2003. 157



Rule 19(2), “The waste management plan shall be reviewed every three years by the licensee to take into

consideration the management of new technologies and management practices which can better protect

against an adverse environmental effect, and if required so revised waste management plan and fresh EIA

shall be submitted with the application for the renewal of license”. Hazardous Substances Rules, 2003. 160

Article 11 of the Convention on the Control of Transboudary Movements of Hazardous Wastes and

Their Disposal, Basel, 1989.

45

2.4.5 Pakistan Bio-safety Rules, 2005

These rules provide surety of safe application of biotechnology for the environment. In

fact, these rules provide mechanism following the PEPA for environmental hazards for

biosafety. According to rule 4, it provides “National Bio-safety Committee” functions for

the efficient work in the environmental sphere.161

Therefore, this rule provides certain

functions of the committee to command the polluter to control dangerous environmental

activities. Moreover, rule 7 & 9 further elaborates their functions under the umbrella of

“Technical Advisory Committee” and “Institutional Biosafety Committee”. These rules

provide their respective functions for PPP.162

In fact, under these rules environmental

ministry163

notified “National Biosafety Guidelines, 2005”.

2.4.6 PPP and National Environmental Policy, 2005

National environmental policy provides the structure for the degrading issues concerning

the environment. It mentions certain elements which pollute the environment and also

give the directions to address such issues under the control mechanism of PPP. The

policy provides the indication for PPP implementation, discussed under the heading of

“Air Quality and Noise” to control and reduce vehicular and hazardous emissions through

proper legislation. The policy further plans for emission standards, noise control and

161

Rule 5, Pakistan Biosafety Rules, 2005. 162

Rule 7 & 9, Pakistan Biosafety Rules, 2005. 163

“Before conceding 18th

amendment, numerous subject matters were inside under the ambit of concurrent

list equally at provincial and federal level. The concurrent list eliminated in 18th

amendments and the

outcome of this amendment is the federal government has no authority to cope with such significant issue

at state level and environment becomes a provincial issue”. Dr. Parvez Hassan, “Environmental

Jurisprudence form Pakistan; A lesson for SAARC Countries,” A paper presented at the South Asia

Conference on Environmental Justice organized by the Supreme Court of Pakistan, (2012): 5,

http://www.environment.gov.pk/nep/policy.pdf, accessed March 13, 2012.


46

technology which promote cleaner production.164

It discusses the mechanism “discharge

licensing system for industry” and guidelines of risk assessment for corporations.

Furthermore, response to emergency, decrease the effects of calamities, plans for

disasters preventions, fiscal measures and incentives165

for pollution control and

environmental standards which fulfill the requirements of PPP.166

This policy provides legislative mechanism for further rules and regulations at

federal and provincial level. Therefore, the scope for implementing the PPP in Pakistan‟s

corporate legal regime is desired. So, proper enactment and revision167

of environmental

laws are necessary.168

This policy elaborated the “Economic and Market Based

Instrument”. These instruments are fiscal reforms for environment, to avoid trade barriers

for environmental purpose, reduction of taxes, tariffs and incentives for environment. In

addition to the above, introduction of corporate accountability and green business169

should be promoted which have clear mechanism for implementation for PPP.170

164

“Air Quality and Noise”, National Environmental Policy, 2005. 165

“Provide financial and other incentives (reduction/elimination of tariffs, low interest loans, appreciation

certificate and awards) for technology upgradation, adoption of cleaner technology, implementation of

pollution control measures and compliance with environmental standards.” National Environmental Policy,

2005. 166

“Waste Management”, National Environmental Policy, 2005. 167

“Necessary rules, regulations and standards would be operatilization of society of the policy at federal,

provincial and district level. Existing environmental legislations will be revised and new legislation would

be enacted where required and appropriate”. National Environmental Policy, 2005. 168

“Legislation and Regulatory Framework”, National Environmental Policy, 2005. 169

“Opportunity for green business such as environmental engineering mechanism and installations,

environmentally-certified products and business, energy service and conservation companies, ecotourism

will be promoted” National Environmental Policy, 2005. 170

“Economic and Market Based Instrument”, National Environmental Policy, 2005.

47

2.4.7 The Capital Development Authority (Environmental Protection) Regulation,

2008

Here in this regulation of 2008, regulation no.4 describes the powers and functions of

committee to take charges from the polluters. The mechanism is provided in detail under

sub-regulation 1 & 2 of regulation no.4. The CDA committee for the environmental

protection has some binding and discretionary nature of powers and functions.171

Regulation no.5 provides certain prohibitions on the polluters under the command and

control mechanism.172

Indeed, it provides the theme of PPP in effective manner and

provides various prohibitions on those who can cause pollution. Furthermore, regulation

no.6 provides measures how to alleviate the environmental pollution.173

Regulation no.10

mentions the procedure about corporation pollution or any other legal body or body

corporate and regulation no.14 provides measures which compensate the authority like

land revenue arrears.174

“Remedial Measures: where the person to whom directions under sub-

section (1) are given, does not comply therewith, the Authority may, in

addition to the proceeding initiated against him, under these regulations,

itself take or cause to be taken such measures as specified in the order as it

may deem necessary, and may recover the costs of taking such measures

from such person as arrears of Land Revenue.”175

171

Regulations 4(c) The Capital Development Authority (Environmental Protection) Regulation, 2008. 172

Regulation no. 5, The Capital Development Authority (Environmental Protection) Regulation, 2008. 173

Regulation 6, Ibid. 174

Regulation 10, Ibid. 175

Regulation no. 14(2), The Capital Development Authority (Environmental Protection) Regulation, 2008.

48

The most important is regulation no. 7 which provides punishments and penalties for the

violaters and regulations no.16 provides power to give directions.176

“Power to give directions: in the performance of its functions under these

regulations, the committee or any authorized officer may give any

direction for the prevention of any offence under these regulations or to

take any preventive or remedial measures to any person who shall be

bound to comply with the direction.”177

2.4.8 Some other Bye-laws of Electricity and Export

Essentially the Federal legislation is deficient for the protection and preservation of

environment. Various statutes on maritime shipping, electricity and concerning export are

general and vague about the implementation of PPP. It does not provide such clear

restriction on the polluter to avoid environmental hazardous functions or guidelines. So,

the nature of these laws is not mandatory and is discretionary in nature for

implementation of PPP in any manner either to charge or C&C. But the laws which

follow an amendment make the polluter liable for compensation in the harbors for

healthy environment.178

2.5 NATIONAL POLICY OF ENVIRONMENT

In 2005, national environmental policy to present expansive plans to federal, provincial,

local governments and FATA to make certain the efficient management of environmental

176

Regulation 16 of, The Capital Development Authority (Environmental Protection) Regulation, 2008. 177

Ibid. 178

“Environmental Law in Pakistan,” from IUCN, last accessed October 25, 2012,

http://www.iucn.org/places/pakistan/elaws.

49

anxieties. This policy includes some 107 strategies scheduled sectoral, policy and cross

sectoral mechanisms, but does not decide the vagueness concerning fiscal accountability

for pollution alleviation. In the market-based or economic mechanism, they do not

approve PPP nor do they cite pollution taxes or charges. And also they didn‟t try to take

measures to initiate or execute as explain above. Though, it still proposes the exclusion of

PPP prospects like subsidies, loans of minimum interest and special credits. These

exceptions are recognized by OECD and are not reliant because they depend on particular

exceptions.179

2.5.1 Existing Policies

The following are two main policies concerning the Pakistani environmental protection.

2.5.1.1 National Forest Policy of Pakistan 2001 (NFPP)

The draft of NFPP put forward necessities to develop and preserve the renewal of usual

assets like biodiversity and forests in Pakistan. The essence of the policy looks for to

introduce procedure for eradicating the basic sources of the reduction of renewable usual

assets with the contribution of stakeholders and agencies. Another provision of this

policy to directs the provincial and district rank policy procedures to facilitate the

sustainable development assets in appearance of protecting policy. The main objective of

179


of Environmental Management,(2009): 4, www.elsevier.com/locate/jenvman, accessed July 10. 2012.

http://www.elsevier.com/locate/jenvman,%20accessed%20July%2010

50

this policy to promote sustainable development concerning biodiversity and forests

grazing-manor of Pakistan for rehabilitation and preserve its environment.180

2.5.1.2 Forestry Sector Master Plan (FSMP)

The Pakistan government for a period of twenty five years from 1993-2018 has emerged

FSMP for the progress and improvement of forestry sector. This plan thoroughly

evaluated Pakistan‟s forestry and recommended many plans, approaches, programmes

and policies for the welfare of rural communities, fiscal and societal encouragement and

environmental enhancement. It proposed the following plan;

“It also identified the social, economic and physical causes of forest depletion in

the country, and proposed five (5) areas of development programmes, namely

soil conservation and watershed management, forest management, wood

production and industrial development, ecosystem and biodiversity and

provincial and federal institutional strengthening.”181

The FSMP acknowledged five different areas for the environmental management. It

mainly focuses on management of natural resources of environment in perspective of

forests and makes the federal and provincial authorities capable for forests management.

180

Dr.Parvez Hassan and Jawad Hassan, “From Rio 1992 to Johannesburg 2002: Case Study of

Implementing Sustainable Development in Pakistan,” All Pakistan Legal Decisions, Journal, (2009): 13,

http://www.environment.gov.pk/nep/policy.pdf, accessed June 18, 2012. 181

Ibid.


51

2.6 CASES

1. Shehla zia and others vs. Wapda and others.182

2. General Secretary, West Pakistan Salt Mines Labour Union (CBA) Khewra,

Jhelum vs. The Director, Industries and Mineral Development, Punjab, Lahore.183

3. Ardeshir Cowasjee vs. Sindh Province.184

4. Shaheen Welfare Society vs. Environmental Protection Agency Punjab, Lahore.185

182

PLD 1994 SC 693 183

1994 SCMR 2061 184

2004 CLC 1353 185

2005 CLC 1267

52

CONCLUSION

The chapter can be concluded to the point that “National Policy of Environment,

2005” has provided the PPP but it was not fully elaborated nor any express

implementation measures were put forwarded specifically concerning industrial

pollution. Numerous plans, policies, regulations were operationalized for the effective

implementation of environmental laws in PPP‟s perspective in Pakistan, but in vain.

There are very less registered cases in Pakistan concerning environmental litigations,

though there are two main environmental tribunals in Lahore and Karachi and having

proposals for other environmental courts.

The PEPA, 1997 established federal and provincial agencies, NCS, sustainable

development funds, tribunals, environmental magistrates, EIA, IEE and public awareness

through media. This Act has given powers to adopt international agreements on

environment which Pakistan has ratified. Before the said Act the environmental cases

were contested under the ambit of PPC and public interest litigation of constitutional

provisions of 199(1) a & c and 184(3), for the forums of High Courts and Supreme Court

respectively.

53

CHAPTER # 3

STATUS OF POLLUTER PAYS PRINCIPLE (PPP) IN PAKISTAN

3. INTRODUCTION

PPP was attributed to an important notion in environmental laws for pollution reduction.

This principle has been broadly applied in OECD member states. Though, this principle

has restricted execution in mounting states. The main reasons for non-implementation in

developing states are based on approximation of economic or environmental damages. So

far there are numerous other documental lacunas regarding failure of PPP implementation

in Pakistan. These comprised building of Common Effluent Treatment Plant (CETP)

which was financed by governments and international donors. Though, some are Effluent

Treatment Plants (ETPs) are working but they are not efficient. There are two main issues

regarding PPP implementation in Pakistan, first is operational issue and second is

erecting new plants. But there is issue of ignoring NEQS due to pollution releases, and

environment is degraded due to unrestrained limit.

3.1 THE CONSEQUENCES FOR PAKISTAN TO EQUIVOCATE PPP

This principle was first time devised by OECD member states for pollution control

prevention costs between government and private sector.186

The administration or

community is not responsible to pay the pollution costs, but it‟s only the polluter to bear

the environmental costs with few noticeable exceptions. These exemptions include the

enhancement of technology, advance infrastructure for pollution control and maintenance

186

OECD, 1972.

54

of current industrial installation which are under strict complexities due to environmental

policies.187

Many declaration and charters suggest the implementation of PPP in principle 16

of Rio Declaration, “World Summit on Sustainable Development in 2002”, and Agenda

21 and EU member states.188

The OECD member countries for environmental

betterments, broadly recommended the implementation of PPP in strict liability scope of

un-subsidization in member states.189

This principle is not restricted to a specific law, but

it put impression on the enhancing of pollution control legislation. For instance, in US,

PPP is not expressly confirmed in USA environmental laws. This put impression on

Clean Water Act and Clean Air Act in 1997 to bear environmental costs and these

statutes were mainly imposes on the command and control agenda.190

In developing states like Pakistan the PPP has been implemented through

mechanisms of economic incentive and command and control, though preventive191

or

precautionary192

measures should be taken. Most of the developing states practicing the

187

OECD, 2002. 188

“This principle based on future generations‟ environmental requirements at advancement taking place

in these days. This is recognized as populations‟ principle of intergenerational parity assumption”. 189

UN, 2002 & OECD, 2002: 23 190

J.R.Nash, “Too much market? Conflict between tradable pollution allowances and the „Polluter Pays‟‟

principle,” Harvard Law Review 24, (2000), 465–535, http://ssrn.com/abstract=1156979. 191

This principle has the support of reality, which environmental calamities and hazardous are reduced

cheaply and easily overcome through preventive principle. Prevention principle supports appropriate

measures to reduce and eradicate environmental harms. The preventive measures are used to forbid harmful

actions, for instance, lessen and stop the marine pollution inside and outside of state waters, rather the

pollution impact the marine environment. Geetanjoy Sahu, “Implications of Indian Supreme Court‟s

Innovations for Environmental Jurisprudence,” Law Environment and Development Journal (2008):

http://www.lead-journal.org/content/08001.pdf, accessed July 12, 2012. 192

This principle presumes, that the acceptance of new legislation for preventing of environmental harms,

which can‟t be stopped due to lacking of scientific agreement. The theme of this principle to take

appropriate measures if there is expected danger to environment, though there is lacking of evidence for the

subsistence of coming danger. For instance, policy-makers assign extra funds for lessening of infective

viral ailments, in case of increasing the probable incidence of those particular ailments due to global

warming. See also “Article 194 of the UN Convention on the Law of the Sea (UNCLOS) of 1984. The

prevention principle is the fundamental notion behind laws regulating the generation, transportation,

treatment, storage, and disposal of hazardous waste and laws regulating the use of pesticides.”


55

mechanism of economic incentives for implementing PPP. These states are India, Brazil,

China, Egypt and Malaysia. But doing with certain exemptions, they did not apply

PPP.193

China is better exception, which started pollution tax system bases on PPP. They

pre-determined in their various statutes regarding environment. The levy system

concerning pollution is sources of PPP implementation and financial support for

environmental agencies.194

Though regarding Pakistan, there are limited text concerning approval and

implementation of PPP in strict form, and also monetary responsibility for steps taken

about decreasing pollution. This research work put forwarded certain pessimistic

consequences of the letdown and implement the liability for pollution reduction of

industries in Pakistan.195

As we compare this status with India, the Indian Supreme Court

supporting the latest environmental legislation in 2005, and stresses that industrial sector

pollution alleviation is not the duty of government, but duty of concerned sector.196

3.2 PPP CONCEPTUAL STRUCTURE/ AGENDA

A number of legal authorities are adamant that multi-faced environmental queries are not

considered straight forward human right of environment. Though, the importance of this

opinion is that human rights guideline is not the solution of compound administrative,

political and legal tribulations. The guideline provides moral standards for all public

193

“The transition economies of Eastern European have imposed effluent fees on industrial discharge, but

these experiences are not included in this brief overview as they are not developing countries.” 194

“Wagner and Wheeler,” last modified, 2000, accessed July 10, 2012, http://ssrn.com/abstract=1087548. 195


of Environmental Management,(2009): 3, www.elsevier.com/locate/jenvman, accessed July 12, 2012. 196

“Chodry, 2008, Indian Chief Justice of Supreme Court comments,” last modified 2008, accessed April

23, 2012, www.elsevier.com/locate/jenvman.


56

policy and act to be estimated beside. These assessments approached to compound

environmental queries and policies after the adoption international environmental law

sources. These are rooted in court practices, global public policies and environmental

treaties and declarations. These provide details about international norms as well as

obvious objective concerning legal verdict, policy assessment and other technical

approaches. The brief of main rules are as follows.

3.3 ENVIRONMENTAL PRIORITIES FOR CLEANER

PRODUCTION IN PAKISTANI INDUSTRY

This study forwarded an option for developing the cleaner production of Pakistani

industrial sector which based on environmental prerogatives. First of all appropriate legal

measures for modifying environmental legislations to deal with environmental

prerogatives, secondly for economic development of the industries does not considers

environmental damages which are un-sustainable for future. The execution of this

Programme has close connection with the acceptable observance to environmental

regulations. So it is government‟s duty to make certain the effective observance of law,

modify the current regulations and then implementation for better environment and

advance technologies. Additional study point out that industries are not properly paying

for environmental costs, while NEQS are not properly implemented due to technological,

fiscal and institutional restrictions.197

197

“Environmental right towards a Human rights approach to Environmental Protection” A Brief fro

Parliamentarian and policy-makers arranged by „lead‟,” accessed 12 June, 2012, http://www.lead-

journal.org/content/08001.pdf.



57

The research study point out that PPP is the principle of environmental policy

which needs that polluter should bear the cost of pollution. The execution of SMART

Programme in Pakistan industrial sector was a step, but that could not create expected

outcome. There is meager implementation of law and regulations in Pakistan regarding

infrastructure and industrial territories which notably lacking. There is very less

achievement in export processing zone of industrial sector. The instance of Cleaner

Production of notion in Pakistan is Energy Service Companies (ESCO‟s).198

3.4 INDUSTRIAL RESTRUCTURING IN PAKISTAN

For industrial restructuring in Pakistan, there are certain actions that are other than

scientific alterations and are communal approaches, policy- frameworks, trader

perspective and educational structure.199

In Pakistan, above concept requires

mainstreaming afterwards institutional reforms and its incorporation in industrial

wastes.200

Following are the suggestions to deal this significant subject.

“All industrial sectors through their respective industrial associations should

form co-operations, partnerships or alliances between businesses, government,

NGOs and others to develop the economic, regulatory and political frameworks

within which innovation is stimulated. This will allow the firms to deliver more

198

Ibid. 199

States should make certain the protection of vital societal rights and human rights together with

environment and health, that‟s why companies stuck to maximum standards concerning environment.

According to Principle 14 of Rio Declaration, sovereign states must not authorize to MNC‟s for keeping

inferior environmental standards for protection knowingly in those areas where implementation of

environmental protection regulations are ineffective. See also, Greenpeace international, “Corporate

crimes: the need for an international instrument on corporate accountability and liability,” last modified,

June 2002, accessed March 13, 2012, http://www.greenpeaceweb.org/shipbreak/. 200

Ratte, Stephaine, “Enforcing Corporate Environmental Responsibility: Seeking Relief for

Environmental Damage under the alien tort statute,” Center of Environmental Studies Brown University,

(2010), 12, www.elaw.org/search, accessed July 12, 2012.



58

value and performance with fewer resources and less waste, and result in greater

business efficiency”.201

The above quotation provides only suggestions for industrial sector in Pakistan. It

mentions the role of NGOs for environmental protection and put forward some

recommendations for mutual cooperation for lucrative trade. The following is another

great suggestion regarding from the perspective of Pakistani industrial sector

restructuring.

“While it is industry that implements cleaner production and eco-efficiency,

government should provide the environment to encourage industry to move

ahead by providing cleaner production friendly environment through regulatory

reforms and use of economic instruments”.202

This statement has possible clue for the implementation of PPP. Firstly, that to implement

it through as an economic instrument as practiced in various countries. Secondly, it

provides environment friendly cleaner production and eco-efficiency which impose some

responsibilities on Pakistan‟s industrial sector.

3.4.1 Corporate Responsibility in Pakistan

Along with NGO‟s and government the corporate sector is largely responsible for the

mitigating the effect of climate change. Thus, it has been suggested for changing to a low

Carbon financial system and this financed by corporate and industrial sector.203

201

“Implementable Recommendations for Cleaner Production Programs in Pakistan,” Executive Summary

of The World Bank Final Report 16 May 2011, accessed in May, 26, 2012,

http://www.epa.gov/air/criteria.html. 202

Ibid. 203

The MNC‟s will be firmly responsible for all sorts of environmental harms of their actions like private

injury, property damage and remediation of places the holding, subsidiaries and other allied companies are

accountable for rebating and compensation. Companies must pay liability like “cradle to grave” for their

59

Conversion to low Carbon sustainable financial system can be encouraged through a few

mechanisms such as Principle for Responsible Investment (PRI), Socially Responsible

Investment (SRI) and Corporate Social Responsibility (CSR).204

It has therefore recommended that,

“Harnessing the power of corporations and encouraging their cooperation is one

of the key areas for building environmental security. Both individually and as

cartels and coalitions corporations have the size, influence and financial

resources to wield control internationally. Multinational corporations can play an

influential role in advancing environmental protection by shaping technological

advances and commercialization of products and technologies, participating in

negotiations on global environmental issues thereby contributing to consensus

building, supporting programs for public education and awareness and creating

international institutions to advance sustainable development principles”205

In this provision it has mentioned that MNC‟s can play vital role for environmental

protection through the induction of advance technologies. It is prior declared that

corporations must work for the betterment of environment and societal requirements.

Which will propagate the comfort among consumers and the trade chances will be

increased.206

stuffs. It is duty of state to make directors and other officers accountable in case of corporate blunder in

holding as well as subsidiaries. Ratte, Stephaine, “Enforcing Corporate Environmental Responsibility:

Seeking Relief for Environmental Damage under the alien tort statute,” Center of Environmental Studies

Brown University, (2010), 12, www.elaw.org/search, accessed July 12, 2012. 204

Dr Tariq Hassan, “Climate Change and Corporate Environmental Responsibility,” accessed June 15,

2012, www.environment.gov.pk/Environment%20Policy%20and%20Legal%20Framework.pdf

205 Waheed, Ambreen, “Evaluation of the State of Corporate Social Responsibility in Pakistan and a

Strategy for Implementation,” For Securities & Exchange Commission of Pakistan and United Nations

Development Program. UNDP, 2005. www.RBIpk.org, accessed May 13, 2012.

206 Ibid.



60

3.5 THE CONSEQUENCES OF NOT APPLYING PPP IN

PERSPECTIVE OF ETP’s AND CETP’s

The following are main points regarding PPP and its non-implementation in Pakistani

industrial sector.

3.5.1 Pessimistic Effects of not Applying PPP

This study scrutinizing harmful effects of corporation pollution to level that particular

company is completely or partly accountable for paying pollution mitigation costs. This

study exemplify of not applying PPP with making of Effluent Treatment Plants (ETP‟s)

and Common Effluent Treatment Plants (CETP‟s) of treating industrial waste water. The

construction of these plants having fiscal reliance on government and international

benefactor and also its operational tribulation. For building new CETP‟s for industries,

there are some inadequate environmental assistance in investments for these plants, fiscal

discrepancies and enduring environmental deprivation.207

Following are some harmful impacts of not applying PPP in ETP‟s and CETP‟s

perspective.

3.5.2 Inadequate Construction of Effluent Plants

For an estimated 10,000 main discharges of wastewater from industries and only 50-100

ETP‟s are available and no CETP‟s for eighty main industrial estates. These capture

207


of Environmental Management,(2009): 7, www.elsevier.com/locate/jenvman, accessed July 12, 2012.


61

entirely wastewater of which ten industrial estates are completely operational.208

At

present merely two CETP‟s, one is use for pre-treatment which does not abide by NEQS

while the second given up-flow treatment.209

3.5.3 The International Benefactor and Government Fiscal Support for Required

CETP’s

At present only 2 CETP‟s are working and two more required which demanded

participation of fiscal support from international benefactor which can not be erect

through local support. The industrial sector did not finance any CETP till time due to

which implementation of PPP is inevitable. For this purpose, participation of the UN

institutions in association with government to managed tanneries pollution. For instance,

construction of “Korangi Environmental Management Programme” was completed in

association with government support, international donors, Sind government and Pakistan

Tanners Association/ Southern Zone.210

3.5.4 Operational Queries at Kasur and Korangi CETP’s

There are two main queries concerning the CETP‟s, those are maintenance and operation

costs payment failure of tanneries. In Korangi, numerous tanneries are not paying charges

of CETP‟s operation.211

Though, as confirmed by reality that Pakistan Tanners

Association had complained to Regional (Provincial) Environmental Protection Agency

208

Author interview with the Director General of the Pakistan Environmental Protection Agency,

Islamabad, March 2008. 209

Author interview with the Chief Executive Officer, Cleaner Production Institute, Lahore, March 2008. 210

The Pakistan Tanners Association-Southern Zone has verifiable accounting records about the

contributions of tanners for the capital costs of the CETP. Ninety tanneries have paid their share of the

capital costs and these ninety are responsible for about 95% of the wastewater received by the CETP. 211

Ralph A Luken, “Equivocating on the polluter-pays principle: The consequences for Pakistan,” 17.

62

about decline of non-payment. In total eighty tanneries, only nine are paying less than

35%.212

In case of Korangi, it is subject to be determined that numerous tanners are not

paying to plants and the liability for maintenance and operations are still indefinite. The

fact is usually that plant is running on the mechanism of costs sharing amid voluntary

assistance of Punjab Government, tanneries, district and tehsil governments of Kasur

with percentage of 20%, 50%, 15%, 15% respectively. Though, in reality tanneries are

paying less than 50% as they contracted that they will pay full price till 2008 end.213

3.5.5 Neglected Opportunities to erect CETP’s

This study explains two unsuccessful attempts for other two CETP‟s, one proposed in

Kharianwala, Faisalabad which proposed by Asia Development Bank Environmental

Management and Industrial Efficiency. Though, it flopped due to polluters should pay for

the cost of control of pollution.214

ADB Project for CETP‟s for Industrial Environment.

The proposed Asian Development Bank (ADB) founded support for the scheme

in Pakistan for enhancing Industrial Environmental Management for emission

discharges. They forwarded tow major measures, firstly, to evaluate the

environmental programmes and policies and secondly training for scrutinizing the

CETP‟s at industrial estates.215

They planned six plants but the problem was the

212

Author interview with the Chief Executive Officer, Cleaner Production Institute, Lahore. March 2008. 213

Ralph A Luken, “Equivocating on the polluter-pays principle: The consequences for Pakistan,” 19. 214

Ralph A Luken, “Equivocating on the polluter-pays principle: The consequences for Pakistan,” 21. 215

“Hagler, Bailly, 2005,” last modified 2005, accessed June 27, 2012,

www.eoearth.org/article/Polluter_pays_principle.

63

government consensus upon loan and rate of interest. The government also favors

to charge industrial sector.216

Kharianwala Proposed CETP‟s.

For Kharianwala industrial estate, a CETP‟s investigating survey was conducted

in 1998. In early phase of scrutiny, industrial sector shows interest but later on

mitigated due to consumer compliance with industrial divisions. Some adopted

“see and wait” attitude. Certain industries continued to erect their personal ETP‟s

with the hope to get largest share in market. The prospect of CETP vanished due

to technical, cost-effectiveness, social and business rationales.217

216

“Another loss for the country was a US$ 1.0 million Norwegian-funded technical assistance project to

be managed by the ADB for follow up capacity building for the Ministry of Environment and PAK-EPA.

The Ministry of Environment declined to use the technical assistance project as formulated, all grant

money, and wanted to make extensive changes in the agreed upon technical assistance scope, mainly for

procurement of more equipment. The Norwegians and the ADB then withdrew their offer”. 217

Ralph A Luken, “Equivocating on the polluter-pays principle: The consequences for Pakistan,” 13.

64

CONCLUSION

The non-implementation of PPP from last twenty-five years put numerous pessimistic

impacts on environment and accepted environmental deprivation as a result of obvious

pollution discharge. Through various remarkable exemptions for corporations it is

liability of government to allocate the fiscal liability for the alleviation of pollution. The

Pakistan‟s government situation was lately confirmed by their reluctance to pay a major

share and not a total amount to built plants for dangerous wastes. The conciliation

between industries and government are vague concerning environmental law and policy.

They provide certain exceptions with the hope to develop an agreement but in the end

they did not approve and practiced the proposed plan.

The implementation of PPP is an evident challenge in front of Government of

Pakistan, because majority of developed and several developing states adopted it.

Government requires existing illogical plan of limited payment principle in case of new

CETP‟s. The industrial polluter must pays for pollution alleviation because corporate

sector as whole is lucrative and economically practical. Another advantage of the PPP

implementation is compliance of identical environmental regulations for all corporations.

65

CHAPTER # 4

PRACTICES OF PPP IN USA & INDIA

"The PPP has been exasperatingly associated with Plato‟s assertion that: “If anyone

intentionally spoils the water of another, let him not only pay damages, but purify the

stream or cistern which contains the water.”218

4.1 APPLICATION OF PPP IN US ENVIRONMENTAL LAWS

In this portion of my research I will breifly discuss the environmental enforcement

challenges faced by the United States. US use sound economic approaches to apply the

“polluter pays principle.” Today US-EPA achieves very high compliance rates without

being unduly punitive and usually without closing enterprises or causing unemployment.

We see this linkage of law and economics as a key ingredient for success in the U.S.

In 1970, USA established EPA due to environmental dilapidation and financial

competition. In the top global economy, the EPA role is to control pollution and allow

enterprises to compete in international economy. Similarly, state like USA which is

developed in implementing PPP while India is progressing to put environmental

responsibility on polluters. Installation of modern technology in the industries will

resolve the environmental problems. Proper awareness shall be given about the

environmental laws. Some states have administrative problems to implement laws

regarding environmental protection.219

218

Jowett B, The Dialogues of Plato: The Laws, trans. Jowett G (Oxford: Clarendon Press (4th ed.), 1953)

section 485(e), accessed May 12, 2012, www.egs.edu/library/plato/biography/. 219

Phyllis P. Harris, “Combining Legal Mandates With Economics in the Application of Environmental

Law,” Office of Enforcement and Compliance Assurance United States Environmental Protection Agency,

66

The Indian judiciary and US-EPA are the concerned authorities who took

the responsibility of the incorporation of PPP and its implementation. For better

implementation, these two states have been utilized suitable mechanism to tackle main

problems and to attain better results. Consequently, both these states used the legal

measures as well as economic incentives for better development through efficient

implementation of PPP.220

4.2 USA AND PPP RELATED STATUTES

The PPP up to a great level enhanced the US Environmental laws, but its power should

not be effective and legislators note down that,

“The United States, in contrast to the European nations, does not officially

recognize the [polluter pays principle] as a distinct principle or policy mandate,

but does, by natural political and economic inclination, closely follow its

precepts in practice”.221

Numerous provision of the American environmental legislation like Clean Water

Act, 1977 (CWA, 1977) and Clean Air Act, 1970 (CAA, 1970) need the polluter to

comply with environmental standards at their own responsibility. Another statute,

Comprehensive Environmental Response, Compensation and Liability Act of 1980

(CERCLA, 1980) allocates pollution abatement charges, which is linked up with cleaning

of polluted locations of dangerous substances. PPP is an important land-mark result of

Seventh International Conference On Environmental Compliance And Enforcement, 31,

http://www.jstor.org/stable/3440859, accessed July 19, 2012. 220

Ibid. 221

Sanford E. Gaines, “The Polluter-Pays Principle: From Economic Equity to Environmental Ethos,” Tex.

Int'l l.j. 463, 480, no. 26 (1991): http://ssrn.com/abstract=1987809, accessed March 19, 2012.



67

CERCLA in America and legislators have mentioned that, “the polluter pays principle is

one of the central objectives or goals of CERCLA”.222

4.2.1 The United States and CERCLA Regulation

The official authorized environmentalists have been spoilt by European Union with

parliamentary debate, tactical credentials and materials abundance, which notify

credentials and PPP progress in state. In America, many policy-makers are impressed by

the model of this principle which is extra restricted in referred resources which includes

vital lawful setting. Though, in United States the PPP have such developed mechanism

for its implementation in numerous spheres of environment than any place other around

the globe.223

CERCLA was ratified to give EPA mechanisms to achieve dangerous waste clear

up comprising a stringent accountability system.224

In addition to that, to make stronger

the federal courts which allocate clear up expenditure practically to any landlord, carriers,

disposal machinist and producers of dangerous waste linked with polluted locations.

CERCLA incorporated a legal norm for authorizing EPA to private party order to clear

up and to utilize numerous incentives and conciliation measures to produce assistance of

private party, which considering the exercise of proceedings of Alternate Dispute

222

J. Whitney Pesnell, “The Contribution Bar in CERCLA Settlements and Its Effect on the Liability of

Nonsettlors,” LA. L. REV. 167, 190, no. 58 (1997): http://www.jstor.org/stable/3440859, accessed March

19, 2012. 223

W. Wilkerson and T.W. Church, “The Gorilla in the Closet: Joint and Several Liability and the Cleanup

of Toxic Waste Sites, “ 11 LAW & POL'Y 425 (1989): www.springerlink.com/stable/1228596, accessed

June 29, 2012. 224

EPA dependent upon numeral executive implementation plans of enforcement scheme in Superfund

agenda and polluter pays principle. Primarily, the agency has prudence upto the extent to compel and force

collaboration to lodge prosecution. Subsequently, hard work of environmental agency to improved

dependence on executive powers and efficient legal principles to coerce liable parties to accept the

compensation sum to purify the environment under PPP. See, T. Church and R. Nakamura, Cleaning Up

The Mess: Implementation Strategies In Superfund (The Brookings Institution ed., 1993),

http://www.cambridge.org.


http://www.springerlink.com/stable/1228596

68

Resolution (ADR). EPA may allow various clear up operating costs and allocating

balance shares of responsibility amongst “Potentially Responsible Parties” (PRP) at

multiparty location. The agency compensated and determined dangerous wastes locations

from federal finance which are allocated for clear up, generally identified as “Superfund”

which is a phrase used in “Hazardous Substance Superfund” as well as in CERCLA.225

4.2.2 Superfund: The Granddaddy of PPP Policies

In 1980, “Hazardous Substances Trust Fund” has been approved by Congress as

“Superfund” in the CERCLA. The Agenda of this fund was to remove dangerous wastes

from EPA selected locations. So this indicated that the creation of PPP had included in

heading of above mentioned Act.226

As we argued above that the principle should used to allocate the liability upon

accountable persons who caused damage and to recompense the victims. Though, similar

to other mechanisms for above discussion, superfund has done something very minimum

for vital norms, regardless of heading of Act which introduced it. This fund forces

“polluters” which are marked by EPA for cleaning up of locations which may or may not

be doing damage to anybody. Numerous victims of superfund verdicts have divergent

225

Ibid. 226

Large amount linked with extensive and satellite proceedings, which turns round implementation action

of EPA. The defendants launched claims averse Potentially Responsible Parties (PRP‟s) “deep-pocketed”

as per regime‟s nature. Accordingly, essential charge that society acquires in perspective of lengthy

proceedings and delays remediation locations of Superfund which is supplementary result of Superfund

plan. In spite of, consuming twenty years upon executive disorder and expensive proceedings, though, USA

mainly emphasized on approval of PPP and Superfund plan as remediation instrument doing support for

clear up activities at various main lethal locations. While, EPA has expanded considerable community

funds, various observers argue that accessibility of these funds under polluter pays principle enhances

labors to clear out Superfund location. Additionally, it permits more permanent and defensive remedies are

to be utilized which would be accessible with community resources. See, D. Mazmanian & D. Morell,

“Beyond Superfailure: America's Toxic Policy for the 1990s, Boulder,” (1992):

http://ssrn.com/abstract=1087548, accessed June 29, 2012.


69

link to locations of waste substances. The policy of superfund is not active to indemnify

or recognized victims.227

The important point of superfund is to impose charges on corporations, for

clearing up locations of designated dangerous wastes disposals, not to recompense any

victim from reckless disposal actions.228

The polluters most of the times pay to

bureaucracy, lawyers, clean up and private investigators, while the victims are not

compensated properly.229

4.2.3 Making the Violator Pay; an Economic View

In USA, Congress recognized command and control legal mechanism which determines

prescribed punishments and forbidden acts. For implementation of legislative purpose our

main implementation course has tactically focused on transgressors of environmental

laws and prohibitions. The environmental agency relate these laws to deterrence230

227

Janis D. Bernstein, “Alternative Approaches to Pollution Control and Waste Management; Regulatory

and Economic Instruments,” Published for the Urban Management Programme by The World Bank,

Washington, D.C (1995): http://www.jstor.org/stable/4414525, accessed May 13, 2012.

228 In USA, the wider interpretation of PPP plays important position in conciliation of cases regarding

Superfund. Nakamura and Church have acknowledged three vital tasks for PPP. Primarily, determinations

of Court and CERCLA have recognized numeral secret defendants in Superfund issues. This further

authorized EPA to start proceedings against PRPs, for whom against fortified case, who can pay for

remediation of location due to their vital resource. Subsequently, CERCLA extensiveness of liability

permits to compensate complete/absolute clear up charges and to identify “deep pocket” PRP. Lastly,

virtually indefeasible authorized stance of administration encourages stiffness with defendants in liability

measures approved by CERCLA. See, T. Church and R. Nakamura, Cleaning Up The Mess:

Implementation Strategies In Superfund (The Brookings Institution ed., 1993), http://www.cambridge.org. 229

Ibid. 230

“USA adopted the approach of huge punishments and most of times imprisonments. The detentions are

increasing in current era in states though there is reflection to utilizing economic tools as best to support

environmental conformity. Certain states like a customs of reverence for government, voluntary observance

and better assistance to laws and standards. In most area of the globe there is immense corruption, poverty

and anarchy for which only sturdy effort of administration can put forth any control. Consequently, relied

on practice of USA, so it is vital to command and control implementation of finance based implementation

mechanism.” See also, Roy E. Cordato, “The Polluter Pays Principle: A Proper Guide for Environmental

Policy,” Institute for Research on the Economics of Taxation Studies in Social Cost, Regulation, and the

Environment: No. 6, (2010): http://ssrn.com/abstract=1156979, accessed August 10, 2012.


http://www.cambridge.org/


70

because the authority having cognizance to infringements. Which must chases and detect

violations and enforced sanctions and fines. To make it unbeneficial and fail to obey

instantly, the authority is capable to get timely voluntary conformity and compliance

from major corporations. The remaining companies must be discouraged, fined or

deterred.

The aim of pollution control fiscal policy to reduce unnecessary “externalities”

and corporations must to internalize the external costs for pollution control, in cost of

product. EPA is recognized as efficient enforcer, many regulated ventures decide to pay

for efficient pollution control and attain conformity. Resultantly, EPA deterrence is an

essential motivator for observance of implementation. Whatsoever, to given motivation

for abetment of pollution, administrative expenses on deterrence or discouragement

generate enormous capital for control of pollution. Like this, authorized and acceptable

polluters internalize pollution control charges.231

4.3 CORPORATE ENVIRONMENT LIABILITY

The scrutiny of international environmental liability in perspective of USA transnational

companies trying to answer the question is object of PPP. This work will analyze the

extent of measures taken by USA companies in foreign countries and in domestic and

global authorized tools in context of environmental corporate liability.232

A great deal of

231




http://ssrn.com/abstract=1987809, accessed May 13, 2012. 232

Professor Fisse, analyzed PPP in context of “Sentencing Options Against Corporations” who declare

that unconventional punishments are better to enforce rather than fines. For example, when a business is

concluding down due to some disqualification from execution of specific type of process or probation of a

concerned corporation, are related grounds for assessment of probable pollution. In United States vs Allied


71

scrutiny and research is done on legal method and numerous other expensive habits to

overcome this problem. There are legal scrutiny permits for practical and hypothetical

assessment of accomplishment and subsistence of instruments to implement

environmental corporate liability.233

4.3.1 EPA’s Enforcement Policies on Environmental Auditing

In USA, authorized polluters report definite results of self-monitoring and performance of

self monitored pollution control. Further than, no legal bar on corporations to enhance

system of environmental management and to carry out inclusive self-audit. International

Standards Organization (ISO) is welcomed by EPA which supports environmental

management system (EMS) and environmental audits.234

Though, ISO does not execute EPA lawful obligations and are not complying

with it. EPA through its policy included audit decisively in its implementation procedure,

a unique and very important achievement. Environmental auditing was started in 1986

through voluntary effort of violator for the purpose to decrease penal portion of EPA fine

Corpn Chemical in sense of donation is an option in case of substitute fine for societal service and can be

linked with PPP‟s implication. In “Virginia Environmental Endowment” so a specific business are

conducted to carry out donations for environmental pollution. Theses additional measures craft PPP as

“good instructor” and present it much severe. See, Spyros D. Kintas, “What does the „polluter pays

principle‟ mean? How has it been applied its specific legal measures and how effective has its

implementation been in practice?,” Environment, Legal — By admin (February 22, 2012):

http://www.jstor.org/stable/4414525. 233

Ratte, Stephaine, “Enforcing Corporate Environmental Responsibility: Seeking Relief for

Environmental Damage under the alien tort statute,” Brown University, Center of Environmental Studies,

(2010): http://ssrn.com/abstract=850488, accessed July 12, 2012. 234

According to mechanism of several and joint liability, the defendant infringement must followed by a

regulator, if they were mutually accountable, and its additional duty of defendants to calculate their

particular portions of payment and liability. The outcome of this method is, that regulator chases a

defendant and takes compensation from him, that particular defendant pursues other defendants (polluters)

for their proportion of liability and recompense the victims. See, T. Church and R. Nakamura, Cleaning Up

The Mess: Implementation Strategies In Superfund (The Brookings Institution ed., 1993),


http://www.allaboutshipping.co.uk/category/environment/

http://www.allaboutshipping.co.uk/category/shipmanagement/legal/

http://www.allaboutshipping.co.uk/author/admin/


72

estimate. So, small ventures are not awarding penalties if they execute self audit report

and avoid violations. EPA promotes voluntary audit of companies to which they are not

legally bound. In USA, 90 percent corporations conduct environmental audit to accurate

and discover environmental infringements, prior to be found by national police force.235

EPA itself does not determine any breach but encourages corporations to ascertain

infringement and make known to EPA. The method approved for it must be autonomous,

systematic and prompt. The company must agree to stop recurrence, remediate and

accurate damage, regulators assistance and made information openly accessible. EPA

guards the right to environment and community health in cases of grave infringement.

Audit policy of EPA does not forgive where recur transgressions of numerous patterns of

substantial or imminent endangerment, financial advantage of disobedience and criminal

conduct. No complete amnesty is given to violators.236

4.3.2 Case Studies

These rules can bitterly be exemplified by two illustrations of USA cases. For initiations

of any sort of legal proceedings, generally EPA lodge an official complaint to executive

judge or court concerning any infringement. Courts of Civil proceedings and executive

judges awarded fiscal punishments which have been paid to USA exchequer. In addition

to the above, if required, order for clean up or to ban an unlawful or hazardous activities.

The lodged complaint compelled corporate lawyers to discuss the issue with

235

Rietkerk, Theo And Rolleman, Geert, “Environment Cooperation Between The Province Of Overijssel

And The Environmental Committee Of The Chambers Of Commerce,” Published for the Urban

Management Programme by The World Bank, Washington, D.C (1995):

http://www.jstor.org/stable/1228596, accessed May 19, 2012. 236

Janis D. Bernstein, “Alternative Approaches to Pollution Control and Waste Management; Regulatory

and Economic Instruments,” Published for the Urban Management Programme by The World Bank,

Washington, D.C (1995): http://www.jstor.org/stable/4414525, accessed March 19, 2012.



73

administration over declaration of complexities. For the reason that EPA accumulates

solid proofs of infringements, that‟s why most law suits are settled devoid of trial.237

4.3.2.1 Civil Cases

The case of ―Petroleum Refinery Initiative” is main essential implementation initiative

carried out by EPA. This plan exemplifies universal accords regarding corporate sector

which is financially possible while enhancing environmental presentation. EPA entered

into various covenants for environmental conformity with petroleum cleansing

corporation since 2000, which control around 40% of state refining capability. The

settlements are made for decrease of atmospheric discharges of various noxious

substances like benzene, nitrogen oxide and sulphur dioxide. The corporations are agreed

to spend nearly $2 billion for pollution reduction technologies and for damages 36.8

million dollars and to execute “Supplemental Environmental Projects”.238

The above cases exemplify that roughly some extra fines charges are given to

administration as penalty because corporation ultimately cooperates.239

In USA, they

adopted the approach for environmental implementation which comprised payment of

damages in case of infringement which is so deterrent. Many corporations are not

237




http://ssrn.com/abstract=1987809, accessed March 14, 2012. 238

www.elaw.org/search/node/polluter+pays+principle. 239

“Petroleum refineries have new and useful plan that based upon corporate approach to control main

resources of pollutants by any means and specifically refineries. These enterprise based approach are taking

usual violation-by-violation and facility-by-facility implementation pathway. This view allowed EPA and

cleansing corporations to curb speedily and effectively environmental tribulations forwarded by this

intricate and huge industrial sector. For instance, mending and detection of leaking apparatus and benzene

wastes are regulated as national law. Furthermore, many refineries are partnering to expand improved and

latest control technology.” See, www.elaw.org/search/node/polluter+pays+principle, accessed July 12,

2012.


http://www.elaw.org/search/node/polluter+pays+principle

74

complying of their transgression till they caught. Furthermore, administration is not

having proper set up to take legal action against corporations, which are out of

conformity. Consequently, EPA focuses on all the times to enforce damages. The

corporations sometimes deterred and want to observe law due to reason of free and fair

system.240

4.3.2.2 Cases of Criminal Nature

In criminal nature cases, those who commit environmental crimes are put in prison. In

USA, they developed the mechanism of incentives of economic nature to support

observance of law. On the other hand, they concurrently make stronger their mechanism

to coerce the polluters through various methods to deter which can be monetary and

economics punishments. US-EPA has 225 police officers of national force for pollution

control. This national force sends those workers and directors to detention who

deliberately pollutes. Environmental crime is intolerable action among US citizens.

According to an economist report, better information is vital for creating logical

options. Therefore, EPA frequently issues proclamations regarding conclusions and

findings of an enforcement case. The work of agency is much translucent, that violators‟

compliance records are accessible on internet. People can visit their site on internet from

anywhere in the world and can have information about corporations working in USA,

whether they are abiding the law or infringing the law. If any corporation wants to work

in USA, it should consider surveillance and particular permit stipulations.241

240

Eric Larson, “Why Environmental Liability Regimes in the United States, the European Community,

and Japan Have Grown Synonymous with the Polluter Pays Principle,” 38 Vand. J. Transnat‘l l. 541,

(2005): http://www.jstor.org/stable/1228596, accessed November 12, 2011. 241

Ibid.


75

4.3.3 USA Cases

There are major alterations in global environmental policy and after incident of ―Exxon

Valdez in 1989‖ in Prince William Sound in Alaska is dropped ten million gallons rough

oil. PPP stipulated absolute compensation and unlimited responsibility under the ambit of

novel laws, largely incorporated US Oil Pollution Act, 1990 (OPA). The polluter Exxon

paid a great sum of compensation established to be ineffective for reinstatement of

environment to great level.242

4.4 PPP IN INDIA

In 1996, Indian judiciary has adopted some notions of international law which indistinct

the difference between the monistic and dualistic theories. Additionally, it questions

some basic hypothesis about the practice of international law in Indian courts. For

instance, the Supreme Court of India adopted the PPP with not a lawful right and even

without a reference to the “Treaty of Rome” Article -130. Whilst the Supreme Court

sanctions PPP universal legal notion with huge support, though the verdict not quoted not

quoted customary international law and Indian judiciary directly included in domestic

law to which India is not signatory. The Supreme Court243

adopted certain other treaties

242

“Exxon Shipping Company, et al., Petitioners v. Grant Baker et al,” on writ of certiorari to the united

states court of appeals for the ninth circuit, last modified June 25, 2008, accessed May 14, 2012,

www.elaw.org/search/node/polluter+pays+principle. 243

The Supreme Court had “no hesitation in holding that sustainable development” is basic concept of

ecosystem, and then it becomes part of customary international law although its limits has been concluded

by international jurists. Furthermore, PPP as a vital mark of “sustainable development” as well as

customary international law. The verdict comprises PPP directly in Indian law advise that “once this

principle is accepted as customary international law main feature there would be no difficulty in accepting

them as part of domestic law” So, its does not have any dissention with statutory law and having

compatibility with constitution of India. In numerous cases PPP was adopted as part of Indian

environmental laws. See, Anderson, Micheal R, “International Environmental law in Indian Courts,”

Published by RECIEL, Vol-7, Issue 1, (1998): http://ssrn.com/abstract=907456. AIR 1996 SC 2715,

accessed June 10. 2012.

76

and incorporated to Indian laws upon the plea of customary international law, e.g.

Stockholm 1972 and Rio Declaration 1992. Though, it considers a straight criticism on

the basic principle of dualistic theory. The Supreme Court has made provisions of various

unincorporated Human Rights instruments as implementable as fundamental rights in

Indian judicial system.244

4.4.1 Polluter Pays Principle and National Application

The principle of perfect liability has been enforced in India concerning pollution cases to

allocated liability of environment and has been practiced opposite to legal personalities or

public bodies.245

This concept has been adopted from torts “stringent liability” and is not

permitting any sort of exemption. The cases stated have taken legal action opposite the

government, private companies or corporations. Usually, it has been distinct as an

essential aspect of sustainable development.246

The Indian judiciary implemented polluter

pays principle (PPP) in litigations associated to environmental injuries occurred by

industrial hazards and inadvertent pollution. The court further directed to reimburse for

the damage occurred as well as compensation must be paid for preventive control. Both

in Bangladesh and Pakistan the beginning of absolute liability is not perfect and

244

Anderson, Micheal R, “International Environmental law in Indian Courts,” Published by RECIEL,Vol-7,

Issue 1, (1998): http://ssrn.com/abstract=907456, accessed June 10. 2012. 245

The Indian judiciary have approved that it is the basic constitutional right of every citizen to have

ecologically reasonable, health and pollution free environment. Though, the improvement boom with

current international documents, and its not an imported concept but it originate in locality. Supreme Court

prominent affirmation of “the right of the people to live in healthy environment with minimal disorder of

ecological balance” was adopted without quoted any international legal document. It have basis in Article-

21 of Indian constitution, though in support of PPP, “African Charter of Human and People‟s Right” and

1972 Stockholm Conference. See also T. Damodar Rao v Municipal Corporation., Hyderabad AIR 1987

AP 171, Stockholm Declaration is discussed in this case. 246

In M.C. Mehta (Tanneries) v. Union of India and Others (1997) 2 SCC 411. “The Supreme Court

ordered that one who pollutes the environment must pay to reverse the damage caused by his acts. The

court ordered the unconditional closure of the tanneries and payment of compensation by them for

reversing the damage and for rights and benefits to be made available by them to their workmen”.


77

exceptions are available up to permitted carefulness. Regrettably, there is no

implementation of this principle in case laws of Pakistan.247

4.4.2 Environment Protection in India

The Indian courts have equally implemented and approved this principle in numerous

environmental pollution verdicts. Alternatively, it is also introduced the mechanism to

compensated for environmental damages and inquire it to recompense from those who

violates. Indian environmental judicial verdicts and policies make notable differences

from the rest legal system of common law. This portion provides an imminent into

norms, law-making process and legal standards for environmental legislation in India.248

Furthermore, it discusses the Indian judicial mechanism for no-fault liability,

implementation and interpretation of PPP. This system make possible to analyze the

mechanism to compensate the victims and collect from violators.249

247

Jona Razzaque, Public Interest Litigation in India, Pakistan and Bangladesh (Hague, London, New

York: Foundation for International Environment law and development- Kunwar Law International, 2003),

167. 248

In accordance with global standards, government of India enhances legislation for protection of

environment, air pollution, water pollution and natural life maintenance. Though, these laws were definitely

weakly enforced and this defective implementation simply mattered if the laws were implemented in

priority position. The increasing environmental dilapidation, the ever more advanced Indian judicial system

initiated to take better notice of these legal principles and make tighter the implementation of these laws.

Paramjit S Jaswal, “The basic research regarding the various legislation and environmental cases for this

section was done through, “Environment Law (2008)” (LLM diss. Allahbad Law University, 2008),

http://ssrn.com/abstract=1271843, accessed January 12, 2012. 249

Shurti, Rajagopalan, “The Polluter Does Not Pay Model For Environmental Protection In India (2008)”

(LLM diss. Hamburg, Gent and Bologna University August 10, 2008London, United Kingdom):

http://www.legalserviceindia.com/articles/ev_ex.htm, accessed June 10. 2012.


http://www.legalserviceindia.com/articles/ev_ex.htm

78

4.4.3 Bhopal Gas Tragedy

The incident that guide to sequence of legislation for environmental protection was

Bhopal Gas Disaster. Environmental Protection Act, 1986 had given enormous powers to

standardize and examine the corporations. This Act given huge power to government of

India to formulate regulations, stipulate appropriate procedures, devised standards for

managing industrial regulations, noxious substances and set up guidelines for averting

calamities.250

This also authorized the government to establish agencies for regulations

and responsibilities to protect definite ingredients of environment and also hand over

authority to agency for enforcement. This legislation and its rules evidently include PPP

and enforced civil liability for non-conformity. The Environmental Protection Act

presented criminal penalties for infringements of environmental standards.251

A different response to Bhopal Gas Disaster was the “Regulation and Control of

Hazardous and Solid Wastes under Environmental Protection Act, 1986” to exclusively

authorized the administration to guard the environment from dangerous substances.252

The rules of this Act are comprised no-fault liability and PPP for disasters concerning

250

The 1986, Indian Environmental Protection Act given the administration enormous powers to take all

possible measures necessary for environmental enhancement and protection. The Act also permits for

allocations of numerous specialized and normal authorities for executing government environmental policy.

Consequently, numerous environmental authorities and pollution control boards are permitted to take

proper measures comprising closing down of industries and criminal liability against those who infringes

the principles of environmental laws. See also, Section 3, 4 and 5 of the Environment Protection Act, 1986

& Suo Moto v Vatva Industries AIR 2000 Guj 33. 251

Section 15, Environment Protection Act, 1986. 252

India have such an pervasive and broad legal system once could imagine, they have protection from

calamities and secured compensation for victims due to no-fault liability, some extra procedures as

compulsory insurance for accidents. Though, the actuality is fairly diverse from law-making purposes.

Indian policy for the environment is the ideal instance of under-enforcement and over-legislation.

Environmental legislation was impudent response to proceedings that extended in the 1970s and 1980s in

India. Numerous were international commitments to UN treaties while other were in the middle of anger

over Bhopal disaster. See also Geetanjoy Sahu, “Implications of Indian Supreme Court‟s Innovations for

Environmental Jurisprudence,” Law Environment and Development Journal (2008): http://www.lead-

journal.org/content/08001.pdf, accessed June 10, 2012.



79

dangerous substances. It particularly presented for the responsibility operator, occupier

and carrier of a capacity of managing dangerous waste and implemented PPP.253

4.5 ENVIRONMENT AND THE PUBLIC INTEREST LITIGATION

In spite of under-enforcement and over-legislation, rivers and cities in India, specifically

tolerate unparalleled dilapidation. The Indian Courts took particular attention in issue of

social justice that bulk of poor Indians were drinking polluted water and are fading of

respiratory ailments. The majority of sufferers of such environmental dilapidation has no

probable tools of independently prosecuting the polluters.254

In Indian environmental laws, the Public Insurance Liability Act was possibly

final proof for implementation of PPP. Due to noxious substances, it was the earliest time

that government approved complete responsibility for calamities. This Act precise how

much compensation was to be rewarded for every level of injuries to victims or deaths of

workmen or civilians. The Act commanded holders of amenities utilizing dangerous

substance define insurance policies for catastrophes. The “Environmental Relief Fund”

was established by Central government255

under which owner could formulate insurance

253

Rule 16, The Hazardous Wastes Management and Handling Rules, 1989. 254

A.K. Tiwari, Environmental Laws in India; Contribution of the Supreme Court (Published by Deep &

Deep Publications Private Limited, F-159, Rajouri Garden, New Delhi, India), 346.

255 Because of PILs and community activism, the Indian Supreme Court in 2004, “Supreme Court‟s

Monitoring Committee (SCMC)” ordered the corporation to scrutinize the location. The corporation has

already been directed to remove the wastes through some expert organization and not by corporation itself,

to avoid further environmental degradation. The court further ordered the “National Institute of

Occupational Health (NIOH)” to carry out the survey for medical purposes to assess the impact of noxious

wastes on community health at vicinity, with intention to pay compensation to victims. The corporation

was directed by court to deposit 3.7 million US dollars for early work of remediation.

80

policy in case of payment or they utilized funds to recompense victims in case of

disasters.256

The normal remedy, one particularly chases in USA is group tort action- where

the demand for several persons can be clustered and this effect in decreased cost of legal

actions for each person in group. Indian law identifies a representative suit or group suit,

because the group or representative having similar interest may defend or prosecute on

themselves or other group individuals. Though, this has been practiced in numerous suits

and with minimum success. On the other hand, given the restriction of Indian legal

system, it determined to take separate measure to make capable victims to search for

compensation from polluters.257

PILs given the Indian judiciary vast powers to interfere in environment related

issues and passing rigorous punishments against corporations which have been found

responsible, because there was no proper regulatory mechanism to cope with

contaminated locations in India. Though, a large amount still required to be completed by

administration in this regard. Consequently, the government has freshly initiated

environmental courts for environmental cases such as National Green Tribunals and

soliciting observation for creating a “National Environmental Assessment and

Monitoring Authority (NEAMA)”.258

256

Shurti, Rajagopalan, “The Polluter Does Not Pay Model for Environmental Protection in India (2008)”

(LLM diss. Hamburg, Gent and Bologna University August 10, 2008London, United Kingdom):

http://www.legalserviceindia.com/articles/ev_ex.htm, accessed June 10. 2012. 257

PP Craig and SL Deshpande, “Rights, Autonomy and Process: Public Interest Litigation in India,”

Oxford Journal of Legal Studies, Vol. 9, no. 3, (1989): 356-373, http://www.jstor.org/stable/4414525,

accessed November 19, 2012. 258

“After few years, in Indian southern states of Andhra Pradesh (60) and Tamil Nadu (59) thousands of

people becomes victims of sulphur dioxide which were producing noxious by tanneries and other

corporations. A suit was lodged under PIL in both circumstances and Supreme Court viewed that it is



81

4.5.1 Indian Constitution

Indian Supreme Court unlocked the floodgates for environmental litigations by

permitting them to lodged writ petition as known as right for clean environment is main

element of Article 21, “Fundamental Right to life”.259

If the grievances is of lawful

wrong, then according to Article 226 of constitution the High court of the state can be

approached. The approach right of the Supreme Court or High Court, if one of the

individual “fundamental rights” is infringed, is incorporated under Article 32 of Indian

constitution in chapter of fundamental rights.260

4.5.2 Indian Supreme Court

The Indian Supreme court has consumed this authority as implementer (enforcer) of

basic rights by the side of its plenary powers to interfere in litigations, which according to

estimation are eligible for litigations of public interest.261

For the reason given above the

Supreme Court put some requirements for pleading a case in court which meant that the

sufferer could not file a suit himself in court. A philanthropic or person of high social

class can approach to court on behalf of deprived groups or an individual of destitute

branch of international environmental law which are not adopted by local law through interpretation of SC

and treaties. This endorsed precautionary principle and PPP as significant doctrines of sustainable

development, and seized the pollution corporations enormously responsible for their noxious activities.”

Vellore Citizens Welfare Forum v. Union of India (1996) 5 SCC 647. 259

“Article 21 states 'No person shall be deprived of his life or personal liberty except according to

procedure established by law'. The narrow interpretation of this right was that that the state had to

demonstrate only that the interference with the individual accorded with the procedure laid down by

properly enacted law. However the Supreme Court intended to give substance to this fundamental right as

opposed to interpreting it in a narrow procedural manner. Therefore the right to life now extends to many

other rights such as; right to livelihood, rights of slum dwellers and hawkers, right to medical care, right to

shelter, right to education, right to food, right to privacy, right to a clean environment, and other

socioeconomic rights.” 260

MP Jain, Indian Constitutional Law (Wadhwa & Company Nagpur: New Delhi India, 2005), 532. 261

PP Craig and SL Deshpande, “Rights, Autonomy and Process: Public Interest Litigation in India,”

Oxford Journal of Legal Studies, Vol. 9, no. 3, (1989): 356-373, http://www.jstor.org/stable/4414525,

accessed April 14, 2012.


82

group. The point is that underprivileged group is incapable to move toward the court due

to their social rank.262

The Supreme Court held in M.C Mehta vs Union of India that industrial wastes

and environmental pollution were possible civil torts, and were grievous infringements of

fundamental rights which were compensatable straightly by SC in case of public interest

litigation under Article 32. While SC has implicit authority in numerous environmental

litigations using writ of mandamus263

and mediate in environmental issues such as

pollution occurred by Delhi chemical corporations264

, pollution of Ganga River265

, River

Gomti water contamination case266

, pollution from tanneries267

, contamination case of Taj

Mahal268

, H-Acid pollution case269

and Yamuna water river contamination case.270

4.5.3 PPP and Absolute Liability in India

PPP was once again applied when H-Acid shaped greatly poisonous environmental

heights in Bicchri town in Rajasthan in 1996. The court called the polluters corporations

as “rogue corporations”, who defied all environmental permits and standards and

262

SP Gupta v Union of India 1981 Supp SCC 87. 263

“This writ is given to a lower-level court or a government officer to mandate that proper laws are

followed. Mandamus might be given if an official is not using his position appropriately or if a court is not

following the laws of the state or country. This writ (also called the “writ of mandate”) ensures that the

government and the individuals in charge are performing their functions properly, or Article 199 of

Pakistani Constitution Writ of mandamus/prohibition: Granting a writ in the nature of

mandamus/prohibition, person whose acts of commission or omissions were challenged, held must have

performed or omitted to perform acts complained of within territorial jurisdiction of High Court”.

“Mandamus,” Pakistan Constitutional Law, last modified August 26, 2011, accessed Feburary 12, 2012,

http://www.ehow.com/list_6701890_types-writ-petitions_.html#ixzz2C5q1UhdL. 264

M.C.Mehta v. UOI & Others Writ Petition (Civil)No.4677 of 1985. 265

M.C.Mehta v. UOI & Others Writ Petition (Civil) No. 3727/1985. 266

Vineet Kumar Mathur v. UOI & Others (1996) 7 SCC 714. 267

Vellore Citizens Welfare Forum v. Union of India (1996) 5 SCC 647. 268

M.C.Mehta v. UOI & Others Writ Petition (Civil) No.13381 of 1984. 269

Indian Council for Enviro-Legal Action v Union of India AIR 1996 SC 1446. 270

AQFM Yamuna v Central Pollution Control Board (2000) 9 SCC 499.

http://www.ehow.com/list_6701890_types-writ-petitions_.html#ixzz2C5q1UhdL

83

determinedly infringed laws to hide mire and other noxious releases. The Supreme Court

restated the norm of stringent liability was inappropriate for Indian situations and perfect

liability with no exemptions was norm appropriate in this case.271

The case quoted above, the SC has implemented and recognized this Principle in

cases related to environment and permitted for no-fault responsibility. In case of Bicchri

town, the court apprehended that query for compensation of environmental injuries must

be resolved by now commonly acknowledged PPP.272

The undertakings are taken from

corporations to grant compensations in case of noxious pollution, and PPP stressed the

fiscal charges for pollution abatement.273

In 1990s, in several cases the court has unconditionally sanctified the bond of PPP

and absolute responsibility on polluters, which is now chased as recognized jurisprudence

regarding environment.274

“The polluter pays principle as interpreted by this court means

that the absolute liability for harm to the environment extends not only to compensate the

victims of pollution but also the cost of restore the environmental degradation”.

According to this principle, it is not the duty of administration to meet the charges

271


The PPP was invoked by Indian judiciary in case of “Indian Council for Enviro-Legal Action v. Union

of India”. The dangerous or inherently hazardous activity passed on to polluter whom responsible for such

loss occurred by him and to make good such environmental degradation. The principle extends to other

party who are indirectly affected by polluter‟s activities irrespective of the situation whether he took

rational care while running the corporation. Consequently, PPP was adopted by Indian Judiciary and has

been identified as essential motive of administrative policies to control and avert pollution and victims‟

compensation. “Government of India, National Environmental Policy, 2006,” accessed June 22, 2012,

http://www.envfor.nic.in/nep/nep2006.html. AIR 1996 SC 1446. 273


“In case of ―M.C. Mehta v. Shri Ram Foods and Fertilizer Industries” absolute liability doctrine was

evolved. The Indian Judiciary said that when corporations are engaged in inherently or dangerous activity

and they occurred damage to the community by some calamity in process of such naturally of dangerous

activity. Consequently, the corporations are absolutely or severely responsible to recompense all the

victims of calamity, there will be no exemption which operate in respect of tortuous principles of stringent

responsibility as under in case of Rayland vs Fletcher.‖ (1868) LR 3 HL 330 & AIR 1987 SC 965.

http://www.envfor.nic.in/nep/nep2006.html

84

concerned in curative measures or preclusion of such damage, since the result of this

would be to alter fiscal responsibility of taxpayers for pollution occurrence.275

4.6 PPP & ENVIRONMENTAL JURISPRUDENCE IN INDIA

THROUGH CASE LAWS

In criminal law, there are numerous provisions concerning public nuisances which were

quite out-dated. In recent era, the superior judiciary has passed on new scopes to these

remedies by their general production to allow inhabitants to carry proceedings against

corporations to compel them to be attentive to keep the environment clean and

unpolluted.276

The Supreme Court scrutinized in case of “Gobind Singh vs Shanit Swaroop”

under the scope of section 133 of Criminal Procedure Code (CrPC), to endorse the

magisterial orders to raze chimney and oven of a baker as roasting procedures basis air

pollution. The Supreme Court affirmed as follow.

“It is clear from the verdict of the learned Sub-Divisional Magistrate that the

evidence revealed that the smoke emitted by the chimney constructed by the

appellant was „harmful to the health and physical comfort of the people living or

working in the proximity‟ of the appellant‟s bakery and that there was no

justification on the part of the appellant for discharging the smoke from the

chimney. Considering the nature of this construction and the volume of smoke

emitted by it the learned Magistrate concluded that the chimney was not only an

encroachment upon a public place but its construction led to a graver

275

MC Mehta v Union of India AIR 1997 SC 761. 276

Arpita Saha, “Judicial Activism in Curbing the Problem of Public Nuisance on Environment (July –

November 2009),” (LLM diss. National Law University, Jodhpur, 2009) http://ssrn.com/abstract=1156979,

accessed June 10, 2012.


85

consequence. Allowing the use of the oven and the chimney was, according to

the Magistrate, „virtually playing with the health of the people.”277

The Court also directed in case of ―Rural Litigation and Entitlement

Kendra vs. State of U.P.‖ of closing down of numerous limestone mines due to grave

scarcity concerning safety of environment and environmental hazards, which affected the

residents of vicinity.278

The Gujrat High court considered the writ petition in case of ―Janki vs Sardar

Nagar Municipality‖ in public interest suit of Article 226. This petition convinced the

state government and municipality to supply drainage and sewerage arrangements for

inhabitants of location.279

The Court directed in case of “M.C. Mehta vs Union of India‖ for shutting down

of Jajamua tanneries which were contaminating the River Ganga, till they must took up

appropriate measures to established curing plants.280

The A.P. High Court accepted an

appeal in case of ―T.Damodhar Rao vs S.O.Municipal Corporation, Hyderabad‖

prohibiting the erecting of building of houses for governmental institutions on land

allotted for entertaining park.281

The Supreme Court proposed in notable ―Bichhri Village case‖ that High Court is

suitable forum to entertain the suit that appealing to environmental pollution due to

restricted character of tribulations. The lower judiciary role is prominent because it have

essential resources to evaluate the medium of dilemma and properly determine its

interference ahead of passing any verdict.282

277

AIR 1979 SC 143. 278

(1985) 2 SCC 431. 279

AIR 1986 Guj 49. 280

(1987) 4 SCC 463. 281

AIR 1987 AP 171. 282

Indian Council for Enviro-Legal Action v. Union of India, AIR 1996 SC 1446.

86

In case of ―Vellore Citizen‘s Welfare Forum v. Union of India‖ the Supreme

court issued numerous dimensions for relocation and closing down of Tamil Nadu

tanneries and also directed High Court of Madras to monitor this issue.283

The Supreme

Court “requested” to constitute “Green Bench” to Madras High court concerning

environmental issues as practiced in Madhya Pardesh, Calcutta and in several other High

Courts. The court authorized Central authority to examine the execution of treatment

plants, closing down of corporations, which are unable to take effective measures for

fixing of treatment units under Environmental Protection Act of 1986. It further

authorizes to enforce fines on tanneries and arrange “Environmental Protection Fund” to

recompense the victims as identified by administration. It approved the “National

Environmental Engineering Research Institute (NEERI)” standard of “total dissolve of

solids”.284

The interference of court in ―Vineet Kumar Mathur vs Union of India‖ which

required to avert pollution of Uttar Pardesh Gomti River, because of release of effluents

distillery of industry. The court ordered the taking away of shortages in the seepage

management plant and also enforced five lakhs fine on corporation. 285

There is bulk of cases which implemented PPP, these are Pollution Control Board

direction concerning appropriate look of effluents in ponds286

, managing CNG pollution

in Delhi of vehicles and old vehicles phasing287

and “regulating shrimp industry in the

283

AIR 1996 SC 2715. 284

Karni Singh, Environmental Justice: Experience Vs. Expectations (India: Legal Service, 2009), 45,

quoted in Saha, Arpita; “Judicial Activism in Curbing the Problem of Public Nuisance on Environment

(July – November 2009),” (LLM diss. National Law University, Jodhpur, 2009):

http://www.legalserviceindia.com/articles/ev_ex.htm, accessed June 10. 2012. 285

(1996) 7 SCC 714. 286

AIR 1998 SC 2059. 287

M.C. Mehta v. Union of India, AIR 1999 SC 291.


87

ecologically fragile coastal areas”288

. There are further regulation concerning clear out of

crowded cities and solid waste removal289

, banning of loudspeaker for propagation of

religious motives creating troubles to children, aged, students and sick290

and Yamuna

River protection.291

In addition to above cases, the implementation of the Forest

(Conservation) Act292

, public places smoking prohibitions293

, enforcing exemplary

damages for restitution of ecology and environment of Hotel Span Pvt on River Beas294

and Cubban park Bangalore protection .295

In these cases the PPP has been implemented

specially in Mumbai urban planning intervening on sustainable development standard296

,

issuing guidelines for removal imported polluted dissipate oil297

and rationalization of

meat export supply procedure.298

4.6.1 Corporate liability via Supreme Court Judgments

The following is the better example of corporate environmental responsibility, in which

the Indian Supreme Court approved the view to enforce the remediation cost on polluter,

specifically in Bicchri village case.

288

S. Jagannath v. Union of India, AIR 1997 SC 811; Gopi Aqua Firms v. Union of India, AIR 1997 SC

3519. 289

Almitra H. Patel v. Union of India, AIR 2000 SC 1256. 290

Church of Lord in India v. K.K.R. Majestic Colony Welfare Association, AIR 2000 SC 2773. 291

AQFM Yamuna, AIR 2000 SC 3510. 292

T.N. Godavarman Thirumulpad v. Union of India, (2006) 1 SCC 1. 293

Murli S. Deora v. Union of India, AIR 2002 SC 40. 294

Murli S. Deora v. Union of India, AIR 2002 SC 40. 295

Bimal L. Desai v. State of Karnataka, AIR 2003 SC 2246. 296

Bombay Dyeing Mfg. Co. Ltd. v. Bombay Environmental Action Group, (2006) 3 SCC 434. 297

Research Foundation for Science v. Union of India, (2005) 13 SCC 675. 298

Akhil Bharat Go-seva Sangh v. State of Andhra Pradesh, (2006) 4 SCC 162.

88

“Where an corporation is engaged in a dangerous or inherently hazardous activity

and causes damage to any one on account of an accident, the corporation is

stringently and completely responsible to reimburse all those who are effected by

the accident and such liability is not subject to any of the exemptions as laid

down in tortuous principles of strict liability under the rule laid down in Rylands

Vs Fletcher”.299

So in this verdict of Indian Supreme Court it clearly makes the polluters responsible for

environmental damages. The said court also favors to put strict liability and there will be

no exemptions for any person or public body. This judgment explains concept of perfect

liability upon the corporations whether accidently or deliberately.

Additionally, the Supreme Court has interpreted PPP in case of Vellore tanneries case of

pollution, which are as under.

“The „Polluter Pays Principle‟ as interpreted by this Court means that the

absolute liability for damage to the environment extends not only to

compensate the victims of pollution but also the cost of restoring the

environmental dilapidation. Remediation of the damaged environment is

part of the process of „Sustainable Development‟ and as such the polluter

is liable to pay the cost to the individual sufferers as well as the cost

reversing the damaged ecology”.300

In this case it clearly mentions the PPP301

as part of Indian and ordered that

polluters are absolutely liable for environmental costs. The polluters should

299

Ravi Costa and Sanjay Sampath, “India: Environmental Liability and Contamination Regulations,”

Environmental Management 3, (2011): 34, http://ssrn.com/abstract=1679245, accessed December 12, 2011. 300

Ibid. 301

The concept of corporate environmental liability is gaining highly attention after the Bhopal and Bicchri

village calamities. After the emergence of PPP, the corporations are held to be responsible for

environmental damages and will pay compensation to victims and to government for their share of

http://ehsjournal.org/http:/ehsjournal.org/author/ravi-costa-and-sanjay-sampath/

http://ehsjournal.org/http:/ehsjournal.org/category/environment/


89

recompense the victims; pay the remediation costs as well as to repair the

damaged ecology.

pollution. So, in this concern the Indian regulatory system and laws are inspiring from USA development

of their legal system. The US EPA put a precedent by banning noxious chemicals, which create anxiety and

movement to raise alertness concerning perilous properties of such substances and there is necessity to ban

from India. See, “Corporate crimes: the need for an international instrument on corporate accountability

and liability,” Greenpeace international, last modified June 2002 accessed March 12, 2012,

http://www.jstor.org/stable/3312323.

90

CONCLUSION

The Indian Supreme Court and US-EPA role for environmental protection, wild life,

forests and ecology has been unparalleled. In spite of some administrative restrictions the

Supreme Court and US-EPA played an essential role for the betterment of environment.

The most significant which was required from an environmental perspective is the future

vision. There were numerous statutes in both the countries, but the enforcement of these

laws is upon the governmental authorities. Free from corrupt practices and better

environmental governance is vital requirement for environmental protections. Justice

Frankufurter citing, “A cumbrous obligation, we owe to posterity, clean air, clean water,

greenery and open space. They ought to be elevated to the status of birth right of every

citizen.”

The US-EPA and Indian judiciary mainly focused on different modes of liability

for implementation of PPP which is not mentioned in International Environmental law. If

any environmental issue occurs, it forwarded to judiciary which apply absolute liability

principle and no concession to any public body, corporation or polluter. Unluckily, this

was not implemented in Pakistan, though India adopted it as part of customary

international law. This principle provides a clear guidance about the venerable laws on

criminal law and evidence concerning environment. Moreover, both the states comply

with the notion “pay up or close down” and make corporations liable for executing

naturally hazardous activities. This notion must be adopted in Pakistan and to liable the

polluter for their hazardous activities. US-EPA and Indian judiciary effectively applied

PPP and it is probable that it will be implemented against every polluter specifically

corporation.

91

CHAPTER # 5

CONCLUSION AND RECOMMENDATIONS FOR PAKISTAN

The research has been specified that the origin of PPP was an economic principle and not

adopted as a legal principle in various states either expressly or impliedly. For the

implementation of this principle in corporate legal regime, appropriate legal measures

should be taken to enhance corporate environmental liability and imposition of civil

liability upon public bodies. This principle become so much effective, that‟s why

incorporated in various legal regimes rather than economic principle in numerous

international agreements. The rationale of the PPP to stop the degradation of natural

sources and free use of the environment.

In corroboration to above, the PPP is not a principle of equity or its purpose to

penalize the polluters specifically corporations. The purpose of PPP to creates

environmental friendly atmosphere for sustainable development. The PPP provided

mechanism to internalize the environmental cost for sustainable development in legal as

well as economic perspective. This would be promising to include PPP in law-making

procedure and decision-making developments. This principle will reduce fabrication in

international trade and investment to guard economic competency.

Implementation of PPP to certain discharges from corporations are vigorous than

other emissions. That‟s why our main focus in this research works on industrial and

tanneries pollutions to build ETP and CETP‟s. But the reluctance to implement PPP on

corporations, are to be justified in parts by the persistent manner towards corporations.

Most significant aspect, though, are the process of companies production and the way its

92

discharge pollution. So, the demography and mechanism of diffusion make it inefficient

to enforce proper regulation regarding PPP. In 1989, OECD approved that appropriate

steps should be taken to apply this principle to industrial pollution to overcome hurdles.

In 2004, OECD concluded to put environmental costs for effective implementation of

PPP in corporate sector. Though, Pakistan have limited role in this concern.

National Environment Policy, 2005, has various mechanisms for PPP, but it was

not fully explained. There was apparent future mechanism for PPP implementation and is

part of PEPA, 1997. For effective execution of environmental laws in Pakistan‟s various

policies, regulations, and plans must to be operationalized. There are rare registered

environmental cases, and for coping environmental litigations, the establishment of green

courts are vital for provincial and divisional level. PEPA, 1997 are having authority to

approved international treaties regarding environment, which Pakistan has ratified. The

PEPA initiated NCS, sustainable development funds, EIA, IEE, federal and provincial

agencies, environmental magistrates, tribunals and public awareness through media.

Before PEPA, environmental complaints were lodged under public interests under

constitutional provisions 199(1) and 184(3).

The comparison with the Indian Judicial system regarding PPP, this principle

playing an essential role for protecting environment, flura and fauna, ecology through

implementing PPP. More significantly, PPP is desirable from environmental point of

view is a vision for future generation. India has various legislation to protect

environment, but it lacks implementations lacunas due to executive authorities. Indian

Judiciary applied absolute liability upon polluter, whether be it a public body or

corporations. PPP is executed directly, because it provides better solution against

93

industrial pollution despite out-dated laws. PPP should applied mechanism of absolute

liability, and treated as part of customary international law. Indian courts adopted the

principle to “pay up or close down” and make corporations responsible to pay social-cost

of executing dangerous activities, though US have different approach.

In USA, they implement PPP under the ambit of civil liability and given

enormous powers to EPA. They enacted CERCLA, which main object is to allocate

pollution charges, for clearing up of polluted locations and to make violators accountable.

They introduced the “Superfund” and also establish special environmental police force

under EPA for criminal proceedings. They make corporations responsible and introduces

corporate reporting, self-auditing system, for deterrence of polluters. Resultantly, USA

put stringent, joint and several liabilities to implement PPP which is not mentioned in any

Pakistani law regarding PPP.

The non-implementation of PPP put various negative effects on environment

since, 1987, which cause blatant pollution discharges and deprived the environment.

Government should adopt proper steps to assign economic or taxable liability for the

control and prevention of pollution upon corporation with suitable exceptions. The

government of Pakistan is reluctant to pay total sum to establish ETP and CETP‟s for

hazardous substances. The reconciliation process between government and corporations

are blurred regarding environmental policies and law. Both have devised various

exemptions but eventually they did not endorse any practical law which is future

challenge.

The implementation of PPP is an apparent confront ahead of Pakistan‟s

government, for the reason that a bulk of developed and various developing states

94

approved it as part of their environmental laws and policies. Government has an

incomplete and illogical arrangement of limited payment for building new CETP‟s. The

pollution caused by industrial polluters is responsible to pay for pollution mitigation for

reason of corporate environmental liability, as whole corporate sector is lucrative and

financially practical. An additional advantage of PPP implementation is observance of

indistinguishable regulations for all corporations.

RECOMMENDATIONS FOR PAKISTAN

Following are the main recommendations regarding the implementation of PPP in

Pakistan‟s corporate legal regime:

For promotion and implementation of PPP, we necessitate enhancing our

environmental regulations, executing mechanisms for this principle, policies and

laws for internalization of external costs.

PPP must be part of state environmental policy.

There are numerous issues concerning environment in Pakistan. These are

concerning water, air, noise pollutions made the situations unhygienic. The issues

of emissions form industrial sector and their pollutions costs are not in vogue in

Pakistan till time, which cause environmental degradation. The corporations are

mostly responsible for environmental dilapidation and to recompense the victims

as well as pay the environmental damages. The polluting industries like bricks,

Sugar, Cement, Steel and Tanneries which mandated strong regulations to

implement PPP in Pakistan‟s corporate legal regime.

95

There must be “Green courts” at provincial, divisional and districts level, which

can only cop environmental litigations and exclusively implement PPP especially

in industrial pollutions of various kinds as mostly practicing in India.

There must be specific legislation regarding PPP in Pakistan, and make it part of

environmental regulations and policies in express interpretation.

This Principle is incorporated in Pakistan Environmental Protection Act, 1997,

but enormous powers should be given to EPA to inquire environmental matters of

polluters liability and wherever necessary to make reports under the influence of

PPP like US-EPA.

Making the tanneries and corporations liable under the ambit of PPP, whether that

is public body, legal personality or any violators who violates the environment.

The mechanism of Command and Control (CAC) which imposing charges and

taxes on pollution should be adopted in Pakistan effectively and PPP is

implemented in its full version.

In Pakistani corporations, the mechanism of Tradable Discharge Permits (TDPs)

is imposed as part of environmental policy, especially for emissions.

To build political and community support for implementing PPP for

environmental protection and improvement, after scrutiny of environmental

issues, environmental information access and community collaboration in

environmental decision-making.

Corporate reporting and self-auditing of companies, especially practiced in USA,

concerning environment and that should be promoted and improved for the sake

of “green project” and corporate environmental responsibility.

96

Our judiciary should take proper measures to implement PPP in environmental

pollution related litigations as practiced in India.

The states should take appropriate measures to execute the Rio covenant. The

case of Bhopal proves that it is essential to put corporate environmental

responsibility to endow with environmental damages and damages to pollution

sufferers. This corporate responsibility should be implementing on Holding

companies and not only on Subsidy Company.

The scope to Public Interest Litigations (PIL) must have been developed and its

must authorize every citizen to access to any judicial forum for environmental

issues. The same step is supported in UK and USA, and India for intervening and

initiating criminal and civil procedure for environmental protection.

New sections must have been incorporated in Companies Ordinance regarding

corporate environmental liability and corporate philanthropy for better execution

of PPP.

For protection of Biosphere preservation, there are limited species of flaura and

fauna in our country, but unluckily they are fading due to lack of environmental

protection. There are numerous scattered environmental statutes at regional and

international level. So it is vital to collect disperse environmental laws and

incorporate PPP and to compile a complete code of environmental protection.

It is vital need for implementation of PPP in Pakistan, to make stronger the

legislatures, judges, prosecutors and every citizen to play it serious role at state

level for implementation of PPP.

97

The PPP can be implemented for the purpose of noise pollution, because some

existing laws are out of date. So new technological tools are vital for assessing

noise pollution of industries and traffic. So it is essential to put this principle in

existing laws or enact novel laws.

Strict environmental laws should be enacted by government for environmental

protection from noxious substances. So the manufacturing, disposal, use and sale

of such poisonous substances industries are violators, and PPP must be

implemented against such corporations.

The PPP can be implemented in Pakistan due to swift development of multilateral

environmental accords, laws and order regarding environmental protection and

state constitution necessitates the court to apply and interpret innovative legal

mechanism for sustainable development.

There must be proper awareness, appropriate expertise and effective information

concerning PPP execution. The lack of above elements be short of efficient of

implementation, environmental law enforcement and development.

In USA, for implementing PPP, they given enormous powers to EPA and

establishes environmental police force for arresting the corporate violators of

environment. The same measure is suitable for Pakistan.

Appropriate judicial procedure and autonomous judiciary is essential for

environmental law enforcement and its progress and execution of PPP in Pakistan,

as Indian judiciary are practicing.

98

For Corporations

To make alertness and initiate the notion of PPP in corporate sector after

discussions with owners steadily and progressively.

For implementation of PPP in corporate legal regime, there must proper

institutional framework for investment and trade which required numerous vital

instruments, like translucent executive practices, corporate governance, and

effective anti-corruption mechanism, rule of law and averting of bureaucratic

influence.

For command and control system enforcement, there should be measures like

voluntary programmes, economic tools, confessions and lucidity.

To devise inclusive health based Air Quality Standard (AQS), having

comparisons with current standards, WHO guiding principles and neighboring

states.

To assist the corporation for taking soft loans for dirt-free technology for

environmental purpose and regulatory steps similar to no import duty on such

technology.

For better ecological performance, government must constantly analyze and

enhance existing legislation, execution of latest dirt-free technology and make

certain their observance by implementing legislature procedures.

For effective observance to PEPA, they launch on private and public joint venture

basis Central Effluent Treatment Plants (CETP‟s) by making active Sustainable

Development Fund (SDF) instrument.

99

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RELEVANT STATUTES

Pakistan Environmental Protection Act (PEPA), 1997

The Anti-Dumping Duties (Amendment) Act, 2008

SARA, 1986

Companies (Amendment) Ordinance 2002

Companies Ordinance 1984

Environmental Tribunal rules, 1999

The Monopolies and Restrictive Trade Practices (Control and Prevention)

Ordinance, 1970.

West Pakistan Fisheries Ordinance. 1961

Motor Vehicles Ordinance, 1965

Code of Criminal Procedure. 1898.

Factories Act 1934

Forest Act, 1927

The Air (Prevention and Control of Pollution) Act, 1981

The Constitution of India, 1950



http://www.defra.gov.uk/corporate/consult/env-liability

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107

The Environment (Protection) Act, 1986

The Forest (Conservation) Act, 1980

The Indian Penal Code, 1860

The Water (Prevention and Control of Pollution) Act, 1974

National Environmental Policy, 2005.

National Environmental Quality Standards (Certification on Environmental

Laboratories) Regulations, 2000.

Pollution Charge for Industry (Calculation and Collection) Rules, 2000.

Pakistan Sustainable Development Fund (Utilization) Rules, 2001.

Pakistan Environmental Protection Agency (Review of IEE/EIA) Regulations,

2000

National Environmental Quality Standards (Self Monitoring and Reporting By

Industries) Rules, 2001.

Environmental Samples Rules, 2001.

Environmental Tribunals Rules, 1999.

Hazardous Substances Rules, 2003.

National Environmental Quality Standards (Certification of Environmental

Laboratories) Regulations, 2000.

National Environmental Quality Standards (Self-Monitoring and Reporting by

Industry) Rules, 2001.

Pakistan Biosafety Rules, 2005.

Provincial Sustainable Development Fund (Utilization) Rules, 2003.

The Capital Development Authority (Environmental Protection) Regulation,

2008.

Motor Vehicle Rules, 1969.

http://www.environment.gov.pk/NEQS/selfmon_ru01.pdf

http://www.environment.gov.pk/NEQS/selfmon_ru01.pdf

108

RELATED CASES

Abul Ala Maududi case – PLD 1964 SC 673

Akhil Bharat Go-seva Sangh v. State of Andhra Pradesh, (2006) 4 SCC 162

Almitra H. Patel v. Union of India, AIR 2000 SC 1256.

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A.P. Pollution Control Board v. M.V. Nayudu, AIR 1999 SC 812

Asif Ali Zardari v State – PLD 2001 SC 568

Attorney General v BBC, (1980) 3 All ER 161,

Benazir Bhutto v Federation of Pakistan, PLD 1988 SC 416.

Bimal L. Desai v. State of Karnataka, AIR 2003 SC 2246

Bombay Dyeing Mfg. Co. Ltd. v. Bombay Environmental Action Group, (2006) 3

SCC 434

Chevron v Natural Resources, 467 US 837

Church of Lord [Full Gospel] in India v. K.K.R. Majestic Colony Welfare

Association, AIR 2000 SC 2773.

Council of Civil Service v Minister, (1984) 3 All ER 935

Darshin Masih v the State, PLD 1990 Supreme Court 513.

Doody v Secretary of State, (1993) 3 All ER 92

Dr. Ram Raj Singh v. Babulal, AIR 1982 All 285

Ex p Pinochet No.2, (1999) 1 All ER 577

Gobind Singh v. Shanti Swaroop, AIR 1979 SC 143

Gopi Aqua Firms v. Union of India, AIR 1997 SC 3519.

High Court of Lahore in State v M.D. WASA 2000 CLC 471.

Himmath Singh v. Bhagwan, 1988 Cri LJ 614.

India -- Soman vs Geologist [2004 (3) KLT 577] (Restrictions on sand/clay

mining)

India -- Karnataka Industrial Areas Development Board v. C.Kenchappa and

others (2006).

http://www.elaw.org/node/1458




109

India -- M.C. Mehta v. Kamal Nath, WP 182/1996 (2002.03.15) (Beas River

Case: Imposition of Exemplary Damages)


Case: )

India -- Sujatha vs A.Prema and others (2005.06.20)

India -- Thilakan v. Circle Inspector of Police, Cherpu Police Station and Others

W. P. (C) No. 24627/2007(F) (2007.10.23).

India -- ICELA v. Union of India, WP 967/1989 (1996.02.13) (Bichhri Industrial

Pollution Case).

India -- Vellore Citizens Welfare Forum vs. Union of India, WP 914/1991

(1996.08.28) (Tamil Nadu Tanneries case).


Case) (unofficial Spanish translation).

India -- M.C. Mehta v. Union of India, WP 3727/1985 (1996.12.19) (Tanneries

Case: Calcutta).

Indian Council for Enviro-Legal Action v. Union of India, AIR 1996 SC 1446.

In re: Bhavani Rivers Shakthi Sugars Ltd., AIR 1998 SC 2059.

J.C. Galstaun v. Dunia Lal Seal, (1905) 9 CWN 612

Janki v. Sardar Nagar Municipality, AIR 1986 Guj 49.

Krishna Panicker v. Appukuttan Nair, (1993) 1 KLJ 725.

Krishna Gopal v. State of Madhya Pradesh, 1986 Cri LJ 396.

Lorbai Limited case, (2000) 1 All ER 65

Maneka Gandhi v. Union of India, AIR 1978 SC 853.

Marbury v. Madison, 5 US (1 Cranch) 137 (1803)

Marbury v. Madison, 5 US (1 Cranch) 137 (1803)

Marbury v Madison, 5 US 137

M.C. Mehta v. Union of India, AIR 1996 SC 851

M.C. Mehta v. Shri Ram Foods and Fertilizer Industries, AIR 1987 SC 965.

M.C. Mehta v. Union of India, (2002) 4 SCC 356.

M.C. Mehta v. Union of India, AIR 1998 SC 2663














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M.C. Mehta v. Union of India, (2002) 5 SCALE 538.


M.C. Mehta v. Kamal Nath, AIR 2002 SC 1515.





M.C. Mehta v. Kamal Nath, (1997) 1 SCC 388.


Montgomery Flour & General Mills v Director Food – PLD 1957 Lahore 914

Mumbai Kamghar Sabha v. Abdul Bhai, AIR 1976 SC 1465

Murli S. Deora v. Union of India, AIR 2002 SC 40.

Municipal Council, Ratlam v. Vardhichand, AIR 1980 SC 1622.

News Item ‗Hindustan Times‘ AQFM Yamuna, AIR 2000 SC 3510.

Padfield case, (1968) 1, All ER 694

Pakistan -- Dr. Amjad H. Bokhari vs. Federation of Pakistan, (Constitutional

Petition 45/2003), Amicus Curiae by Dr. Parvez Hassan.

R v Gough, (1993) 2 All ER 740

Ramakrishnan v. State of Kerala, 1999 (2) KLT 725.

Research Foundation for Science v. Union of India, (2005) 13 SCC 675.

Ridge v Baldwin, (1963) 2 All ER 66.

Rural Litigation and Entitlement Kendra v. State of U.P., (1985) 2 SCC 431

Rylands v. Fletcher, (1868) LR 3 HL 330.

S. Jagannath v. Union of India, AIR 1997 SC 811.

S.S Mirinda Ltd v Chief Commissioner Karachi - PLD 1959 SC (Pak) 134, 145

Secretary of State v Tameside (1976) 3 All ER 665

Shehla Zia case [PLD 1994 SC 693.

State of Madhya Pradesh v. Kedia Leather and Liquor Ltd., (2003) 7 SCC 389.

111

Subhash Kumar v. State of Bihar, AIR 1991 SC 420.

T. Damodhar Rao v. S.O. Municipal Corporation, Hyderabad, AIR 1987 AP 171.

T.N. Godavarman Thirumulpad v. Union of India, (2006) 1 SCC 1

Tariq Transport Co Lahore v Sargodha Bhera Bus Service Sargodha – PLD 1958

SC (Pak) 437

University of Dacca v Zakir Ahmed – PLD 1965 SC 90

University of Ceylon v Fernando, (1949) 1 All ER 109

United Engineering Workers v Devanayagam, (1967) 2 All R 367

Vineet Kumar Mathur v. Union of India, (1996) 7 SCC 714.

Vellore Citizens Welfare Forum v. Union of India, AIR 1996 SC 2721.

Wednesbury Corporation (1947) 2 All ER 680

West Pakistan Salt Mines Labour Union vs. Director of Industries, PLD 1994

SCMR 2061.

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