Fundamental reforms to Australia's environmental laws are passed – now the real work begins

Multiple changes to the Environment Protection Reform Bill 2025, agreed to with the Greens, have allowed the Federal Government's package of seven Bills to pass Senate this evening.

Although detailed regulations, standards and guidance are still to come, the direction of travel is clear. All project proponents – whether in resources, energy, infrastructure, property or agribusiness – will need to reassess approval strategies and compliance settings.

We'll be analysing the changes in the weeks and months ahead as the full package of Standards and Regulations are finalised, but the headline changes to the Bill include some significant changes on stakeholders' wishlist.

Unacceptable impacts on Matters of National Environmental Significance (MNES)

Unchanged: Projects with unacceptable impacts on MNES cannot be approved under the EPBC Act, and offsets cannot be used to compensate for those unacceptable impacts. Unacceptable impacts must be avoided or mitigated below the unacceptable criteria before a project can be approved. The 37 separate unacceptable impacts definition criteria remain, rather than the single universal criteria proposed by a number of groups in Senate Inquiry hearings.

What's changed: The words "or be likely to have" have been removed from various provisions applying the unacceptable impacts test and the MNES-specific criteria set out in the section 527F unacceptable impacts definition. Only actions that will have an unacceptable impact will pass the test, and only significant impacts that seriously impair the viability of a listed threatened species – rather than "seriously impair, will seriously impair, or is likely to seriously impair" – will meet the threatened species criteria in the definition (as one example of the amendments to the unacceptable impacts criteria).

Noting concerns raised in submissions and the Senate Inquiry about the layers of definitions and ambiguity in the drafting of the unacceptable impacts criteria (including, for example, the references to "seriously impair", "serious damage" and "seriously altered for the worse", in addition to "significant impact", in a single MNES criteria):

• the definition of "seriously impair" has been amended by replacing the reference to "the thing being seriously altered for the worse" with "an impairment or alteration of the thing that is of a severe nature and extent";

• an additional provision clarifies that an action causes serious damage if "the damage is of a severe nature and extent",

providing some consistency in meaning of "seriously impair" and "serious damage" and removing the reference to "seriously altered for the worse".

The definition of "viability" has also been amended to remove the reference to "either as a whole or in a particular region".

Impact: Retaining 37 separate unacceptable impacts criteria, in circumstances where there has not been time to fully test each set of words against real examples, increases the risk of unintended consequences. These unintended consequences could include:

• the capture of projects which are not "clearly unacceptable" (per the Government's stated intent) within the criteria, making them incapable of assessment; and/or

• additional delay in the referral and assessment process, including for confirming relevant information and requests for further information, exacerbated by different opinions of NEPA/Department officers about the meaning of terms.

The amendments relating to the meaning of "seriously impair" and "serious damage", and the removal of references to "likely" unacceptable impacts, are intended to mitigate this risk to an extent but will not eliminate it.

National environmental standards test

Unchanged: The Minister may make national environmental standards for the purposes of the Act. These standards will be relevant to many EPBC Act decisions and processes.

What's changed: The original Bill required that actions be "not inconsistent" with the national environmental standards. The onus of this test has been reversed by the amendments so that actions must now be consistent with the standards.

Impact: This change in onus represents a significant shift, relevant to numerous steps in the accreditation, assessment, approval and implementation processes. There will now be a positive onus on the decision-maker to be satisfied of an action's consistency with all prescribed standards, which is materially different to a failure to identify any inconsistencies.

"Not a controlled action" decisions

Unchanged: The Environment Protection Reform Bill proposed that decisions that an action is "Not a controlled action" would automatically lapse after five years if not substantially commenced. This provision remains.

What's changed: A new section 79G has been added, allowing the approval holder to request an extension of a "Not a controlled action" decision to a date up to 10 years from the original decision.

Similar provision is made for priority actions registered for a development zone identified in a bioregional plan. A decision to register a priority action will lapse after five years if not substantially commenced, subject to a new power to request an extension.

Impact: This amendment was requested by industry to allow flexibility in the application of the new "automatic lapse" provisions, particularly where a project cannot be commenced for reasons outside a proponent's control, such as delays in obtaining other project approvals.

Streamlined assessment process

Unchanged: The Bill proposed to replace the current Assessment on Referral Information, Assessment on Preliminary Documentation and Assessment on Public Environment Report assessment processes with a single streamlined assessment process. The Assessment on Referral Information and Assessment on Public Environment Report processes are still to be removed.

What's changed: Assessment on Preliminary Documentation will be preserved, in addition to the new streamlined assessment process.

Separately, amendments now exclude actions involving the production or extraction of petroleum or coal (referred to as "fossil fuel actions") from reliance on the new streamlined assessment process.

Impact: The new streamlined assessment process is intended to bring forward the provision of all relevant information to the start of the assessment process. It remains unclear how these two processes will differ in practice. Fossil fuel actions will need to rely on the Assessment by EIS process.

Accreditation of State and Territory approval processes

Unchanged: Mechanisms for accreditation and bilateral agreements to allow accreditation to continue even where the statutory framework is amended.

What's changed: Whereas the original Bill allowed provision in a bilateral agreement for the Commonwealth or State Ministers to exclude specific actions from the operation of the bilateral agreement, the amendments make it mandatory that a bilateral agreement must allow the Commonwealth Minister to exclude a specified action from its operation.  

Impact: The amendment effectively operates as a new Commonwealth call-in power. Even where the State approval process is accredited, the bilateral agreement must preserve the Minister's right to determine that an action should be excluded from the accredited process.

Restoration contribution charges (offset fund)

Unchanged: A condition can be imposed on an approval requiring an offset and/or payment of a restoration contribution charge that results in a "net gain" for the MNES in question.

What's changed: Amendments allow the Minister to specify in a protection statement for a listed species or community that payment of a restoration contribution charge should not be available in relation to residual significant impacts on that species or community.

Impact: We understand that this limitation is intended to apply where a species is in danger of extinction. However there do not appear to be any limitations in the legislation on the circumstances in which such a statement could be included in a protection statement. It is also expected that the mentioned circumstances, where there is a danger of extinction, would fall within the unacceptable impacts criteria in any case so offsetting would not be an option. On this basis, it remains unclear when this new limitation on contribution charges will be applied. Protection Statements are subject to public consultation requirements.

Environment Protection Orders

Unchanged: New environmental protection orders (EPO) can be made if a breach presents an imminent risk of serious damage, allowing for a broad range of orders including "stop work". At the time we noted that without a specified end date, and limits on challenging an EPO, this new power was potentially concerning.

What's changed: An EPO will only remain in force for up to 14 days unless extended for a maximum additional 14 days. Additional provision has also made for the CEO to give the recipient of an EPO information supporting his or her reasonable belief about the matters giving rise to the issue of the notice.

Impact: Section 474G removing the application of the nature justice hearing rule to the issue or variation of an EPO remains in the Act. The new time limit and information requirement is intended to mitigate concerns expressed in relation to section 474G.

Lawful continuation of use exemption

Unchanged: The existing section 43B lawful continuation of use exemption to approval is retained (with an amendment).

What's changed: Clearing within 50m of water/drainage features in the Great Barrier Reef Marine Park catchment area, and non-forestry operation clearing that has not been cleared for at least 15 years, are excluded from the existing exemption.

Specific projects – Fossil fuels and forestry

What's changed: The Greens' amendments include particular provisions targeting petroleum and coal projects and forestry agreements.

A fossil fuel action cannot:

• be a priority class of actions for the purposes of a bioregional plan;

• be a national interest proposal or subject to any of the exclusions on national interest grounds;

• (as noted above) use the streamlined assessment pathway; and

• in circumstances where an unconventional gas development or large coal mining development is subject to the water trigger, be approved pursuant to an accredited State or Territory approval process under a bilateral agreement.

Clearing under regional forestry agreements is also to be brought under the EPBC Act and made subject to the National Standards and other tests.

We understand that clearing under regional forestry agreements is to be made subject to usual EPBC Act approval requirements, including new national standards, after a transition period.

Review of the Act

What's changed: The amendments require review of the Act every five years, in place of the existing requirement for 10-yearly reviews.