By Sarah Fountain, Partner and Adiam Tsegay, Senior Associate

In August 2024, the Environment Protection Agency of Victoria (EPA) commenced proceedings against Veolia Recycling & Recovery Pty Ltd (Veolia) alleging breaches of conditions of its operating licence and the general environment duty in connection with Veolia’s landfill operations in Hampton Park, Victoria. This case was one of the first civil penalty proceedings commenced by the EPA in Victoria under the Environment Protection Act 2017 (Vic) (EP Act).

Veolia admitted contraventions of the EP Act, including breaching conditions of its operating licence and breaching the general environmental duty (GED) set out in section 25 of the Act. The parties reached an agreement on relief and submitted consent orders and joint submissions to the Court.

In November 2025, the Court handed down its decision (Environment Protection Authority v Veolia Recycling & Recovery Pty Ltd [2025] VSC 696) in which it approved the settlement, confirming it was satisfied with the orders sought by the parties. The orders required Veolia to pay $1,000,000 to a Restorative Project Account (in lieu of a pecuniary penalty), publish an adverse publicity order, undertake monitoring of landfill gas emissions, and pay the EPA’s costs of $75,000.

Background

Veolia operated a landfill under an operating licence issued by the EPA.  The licence set out conditions relating to the landfill operations, including prohibiting landfill gas emissions that exceeded specified levels of odour and leachate at its site.

Between January 2022 and December 2023, the EPA received over 1,000 complaints from members of the community regarding odour that was believed to be from Veolia’s landfill. The EPA inspected the site and confirmed the odour originated from the landfill.

Veolia self-reported licence breaches to the EPA at the earliest opportunity.  It also implemented a number of measures in an effort to comply with its licence conditions, but those efforts ultimately were unsuccessful.

EPA’s Civil Penalty Proceeding

In the Supreme Court proceeding, the EPA alleged that Veolia had contravened:

• its operating licence contrary to section 63(1) of the EP Act, which requires that a person must not breach a condition of a licence issued by the EPA; and
• the GED in section 25(1) of the EP Act, which requires a person who is engaging in an activity that may give rise to risks of harm to human health or the environment to minimise those risks, so far as reasonably practicable.

The EPA sought, among other things, a pecuniary penalty, an adverse publicity order and a compensation order.

Joint Submissions and Court’s Reasoning

The parties jointly submitted that Veolia had contravened the GED between July 2022 and September 2023 in that it:

• failed to have in place a Landfill Gas Remediation Action Plan; and
• failed to undertake certain measures in its Environmental Management Plan when it recorded exceedances of landfill gas, which were reasonably practicable measures available to minimise the risk of an adverse effect on the amenity of land,

both of which were reasonably practicable measures available to minimise the risk of an adverse effect on the amenity of land.

The parties jointly submitted that Veolia had breached licence conditions in that it, among other things:

• failed to take all practicable measures to prevent emissions of landfill gas exceeding the specified levels;
• failed to implement odour source controls;
• failed to manage and maintain leachate levels in various cells.

The Court set out a helpful summary of the principles applicable to courts acting on a joint position of the parties regarding the appropriate penalty to be imposed for contraventions in civil penalty proceedings, noting that it is consistent with the nature of civil proceedings for a court to approve a compromise of proceedings on terms proposed by the parties, provided the Court is persuaded that what is proposed is appropriate. The Court also noted that it should not depart from a penalty figure jointly submitted by the parties merely because the Court “might otherwise have been disposed to select some other figure”, provided that the figure advanced falls within the permissible range.

The parties jointly submitted that an order for payment of $1,000,000 into the Restorative Project Account instead of a pecuniary penalty was appropriate because:

• the proposed payment is intended to provide direct benefit to the public;
• the quantum is significant and will have significant deterrent value, consistent with the primary purpose of the imposition of penalties in civil penalty proceedings. An order “of this magnitude for environmental matters is unprecedent in Victoria”.

The Court noted that the landfill gas odour had resulted in an adverse impact on the amenity of land, but no other form of harm to the environment or human health was alleged by the EPA.

The quantum of the payment into the Restorative Project Account took into account Veolia’s cooperation throughout the EPA investigation and the proceeding, as well as its cooperation in self-reporting licence breaches, and in reaching an agreement on proposed findings and orders.

Key Take Aways

There have been very few civil penalty proceedings by the EPA to date, but this decision highlights the potential for significant civil penalties to be imposed for breaches of the EP Act.

Until this decision, a civil penalty (or payment into the Restorative Payment Account) of $1 million was unprecedented in Victoria for environmental matters. While this figure was agreed by the parties, the Court was of the view that it was appropriate and falls within the permissible range.  It gives helpful guidance about the quantum of penalties the EPA is likely to seek in future civil penalty proceedings.