Self-Disclosure Strategies and Legal Protections for Environmental Audits

摘要

EPA's self-reporting framework provides immunity from civil and criminal liability and a qualified privilege for audit reports for qualifying self-reported environmental violations. Many states also provide incentives for companies to self-report possible violations with environmental standards and requirements, but the state programs vary widely and may not provide equivalent protections as the federal policy. When faced with an environmental issue, determining whether the issue warrants reporting to an agency - and what the repercussions of that disclosure could be - can be complicated. State and federal incentives for self-reporting of environmental possible violations make self-disclosure an attractive option at times. A company may be able to avoid significant civil and criminal penalties by simply taking the initiative to monitor its compliance and notify the appropriate agency of a violation before the agency discovers the violation on its own. Self-disclosure, however, is not without its drawbacks. Self-reporting does not make the company bulletproof from enforcement. The regulatory agency makes the decision as to whether the self-reported violation meets all required conditions for protection from enforcement, and there is the risk that the agency could deem the voluntary disclosure deficient and proceed with enforcement. On balance, the benefits of self-reporting typically outweigh the risks. When a company becomes aware of environmental non-compliance, it should thoughtfully consider the pros and cons of self-reporting in light of the incentives described in this article.