Legal Alerts / 28 Jun 2011

Legal Alert – Amendments of the Finnish Environmental Legislation

During the spring 2011, the Finnish parliament has enacted several new statutes that are related to the environmental legislation. New Mining Act, Water Act, Waste Act and two amendments of Land Use and Building Act (132/1999) have been ratified. In addition, the sections of the Act on Production Subsidy of the Electric Power Generated with Renewable Sources of Energy concerning the supply tariffs entered into force on 25 March 2011. The objectives and salient points of the new regulation are discussed in this legal alert.

Mining Act (621/2011)

According to the new Mining Act, the privilege to utilise a deposit still belongs to the discoverer of the deposit regardless of the ownership of the real estate and the exploitation of mineral reserves are not subject to land owner consent. The regulation concerning prospecting corresponds mainly to the repealed old Mining Act (503/1965). Prospecting with wide-ranging effects and prospecting of uranium require, nevertheless, always a prospecting permit. The exploitation of the mineral reserves requires a mining permit. Previously gold panning was carried out based on claim rights, in the new act a specific gold panning permit is introduced. Permits concerning prospecting and mining are endorsable. As a new feature, the new Mining Act enables the commencement of mining activities on the basis of a granted permit even though an appeal against the permit had been made. This is possible also when the appeal has been made against a permit concerning the prolongation of a prospecting permit, however not an original prospecting permit.  

The position of landowners has been strengthened by the new Mining Act. The landowners have a right to claim redemption of a real estate if the mining district or the auxiliary area to the mine cause significant harm to the usage of the real estate or a part of it. In these cases the compensation paid is 150 % of the fair market value. The prospecting fee paid to the state of Finland has been abolished, but on the other hand the level of compensation for landowners has been raised significantly, exceeding the previous overall levels. The rights of the Sami and coordinating mining activities with reindeer herding have been especially taken into account in the new Mining Act.

Compared to the repealed old Mining Act, there are more detailed provisions on mine safety in the new act and the compliance is assured by a new mine safety permit. In comparison to the old Mining Act, also the regulations concerning the closing down and remediation of the areas used for prospecting, mining and gold washing are more extensive. The area must be restored and cleaned up and the safety of the area must be taken care of, too. The new Mining Act also contains provisions on security that must be deposited to ensure the proper remediation.

The functions of the new mining authority are assigned to the Finnish Safety and Chemicals Agency (fi: Tukes). Mining permits concerning the utilisation of uranium and thorium are however handled in the Council of State. Issues related to prospecting and mining permits will be in future handled in a two-step way of appeal. The appeals made against permits granted by the Council of State are still handled by the Supreme Administrative Court as the first instance.  

According to the Transitional provisions of the new Mining Act, the main rule is that the old Mining Act is applied to the existing operations. However, there are a number of detailed exceptions that require the application of the new Act. 

The new Mining Act and other reforms related to the act will come into force on 1 July 2011.

Water Act (584/2011)

The aim of the renewal of the Water Act is to make the handling of water permits more effective and clarify the relation between the Water Act and other environmental regulation. The main principles of the old Water Act (264/1961) have not, however, changed in the reform.  

The granting of a water permit is still based on the weighing of interests. In this consideration the benefits and disadvantages of the planned operation are taken into account. Water permits are granted by the Regional State Administrative Agencies (fi: Aluehallintovirasto). According to the new Act, all such dredging activities that are larger that 500 m³ and all such operations that may endanger a brook’s natural state need a water permit in the future. Notification procedures concerning ditching and dredging have been extended. Also a new section concerning ditching is added to the Land Use and Building Act (132/1999). Inspections, which in some cases have been a part of the handling of water permits, are no more required in the new Water Act. The goal of this change has been to speed up the handling of water permits.

The order of priority concerning abstracting of water has been clarified. Local needs are preferred to other purposes. According to the new act, the timber floating regulations will be replaced by floating permits. The old floating regulations will, however, remain in force. To make the restoration of rivers and lakes easier, the new Water Act contains provisions concerning the permanent changing of water level.

According to the transitional provisions of the new Water Act, the main rule is that the regulation that has been in force before the enactment of the new Water Act is applied to the existing operations. There are, however, some exceptions.

The new Water Act and other reforms related to the act will come into force on 1 January 2012.

Waste Act (646/2011)

The renewal of the Waste Act is based on the recent changes in the emphases of waste and environmental politics and the need to enforce the Directive on Waste (2008/98/EC). The scope and basic duties remain somewhat unchanged even though some specifications have been made.

The five-step waste hierarchy of the Waste Directive is included into the new Waste Act. According to the hierarchy, the generation of waste should be first and foremost prevented. If prevention is not possible, the waste must be prepared for re-use or recycled. If the waste cannot be re-used or recycled, other recovery is a possible way to handle the waste. The disposal of waste should always be the last option. Waste hierarchy directs for example the drafting of waste management plans but also binds individual operators and affects environmental permits for waste operations. According to the new Waste Act, for example the operators’ technical and financial possibilities to comply with the waste hierarchy are taken into account. More detailed provisions on the possible ways to handle waste may be enacted by a Decree of the State Council. 

According to the new Waste Act, the municipality is responsible for the organising of the waste management of private sector health and welfare services as well as the waste management of private sector schools. There are also new provisions concerning the quality requirements of waste management organised by municipalities. The producer responsibility is extended to cover all packing waste. In addition, the producer responsibility concerning electrical and electronic appliances and car tyres is specified in a way that the distributor is obliged to receive the waste from the consumers and the producer is obliged to organise the transportation to further treatment.   

The main reforms concerning the supervision are the introduction of a payment due to neglect and the extending of legal obligations to keep books on waste and waste management. The new Waste Act also contains provisions concerning operators’ obligation to monitor their own operations. The provisions concerning supervision, administrative compulsion and right to appeal have been specified.

The terminology used in the new Waste Act is partly changed. For example, instead of the Finnish term of “ongelmajäte” the term “vaarallinen jäte” is adopted (both referring to hazardous waste) and the term handling of waste covers both the re-use and disposal of waste.

In the context of the renewal of the Waste Act, some changes have been made also to the Environmental Protection Act (86/2000). In future the environmental permit may contain regulations concerning material efficiency. The efficiency is assessed for example in the light of the amount of waste generated and the usage of recovered materials. The possibility to depart from the obligation to deposit a security is extended to also cover operations concerning the treatment of hazardous waste. The security must cover the costs of after-treatment of landfill sites and certain operations that are covered in the waste management plan of mines. Acceptable securities are a guarantee, an insurance or a bank deposit granted by a professional bank or an insurance company. The possibility for intra-group guarantees is removed. Fixed term securities are also possible. The amendments implement the rulings by the Supreme Administrative Court in the Talvivaara-case 2010:80. (Legal Alert 7 January 2011)

The new Waste Act and amendments to the Environmental Protection Act will come into force on 1 May 2012. New permit security obligations will apply at the time the permit is amended or reviewed.

Land Use and Building Act

The provisions concerning large retail units are gathered into a new chapter 9 a. The special status of trading in special goods that require a great deal of space is abolished and in future all shops larger than 2 000 m² are considered to be large retail units. A new provision concerning the required content of such regional plan (fi: maakuntakaava) or local master plan (fi: yleiskaava), which are drafted to direct the location of the large retail units, is included in the Land Use and Building Act. The purpose is to secure the availability of services and the status of city centres as the main trade centres. According to the new provisions, the regional plan must determine the size of a regionally significant large retail unit and with sufficient accuracy regulate the maximum size of the large retail units.   

The primary nature of city centres as the location of large retail units is stated in the Land Use and Building Act. The placement of a regionally significant large retail unit outside an area, that is in a regional plan defined as a central area, is possible only if the regional plan allows the placement. If a large retail unit is located outside a central area defined in a regional plan or a local master plan, the location must also be included in a detailed local plan (fi: asemakaava).

According to the transitional provisions, the renewal of the Land Use and Building Act will be applied to trading in special goods that require a great deal of space in four years time from the coming into force of the renewal. This means that during the transition period, a municipality may accept such a local master plan or a local detailed plan according to which a regionally significant retail unit that requires a great deal of space is located in an area that is not in a regional plan defined as an area for large retail units. The new provision concerning the required content of regional plans and local master plans is not applied to such plan proposals that have already been presented in public. The renewal of the Land Use and Building Act concerning large retail units came into force on 15 April 2011. 

Another amendment of the Land Use and Building Act concerning the building of wind power plants came into force on 1 April 2011. According to the amendment, a building permit for a wind power plant may be granted on the basis of a local master plan if the plan contains a specific regulation that allows the permitting. The requirement for such a specific regulation is that the local master plan must direct the land use of the area with sufficient accuracy. 

For additional information:

Casper Herler

Hanna Lehtinen 

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