Audit Policy - Voluntary Compliance
Audit Policy - Voluntary Compliance practice requires that we address issues on behalf of our clients that include:
- Providing advice to client regarding implementation of self audits
- Self-audit compliance activities and documents required by state and federal administrative laws and regulations
- Environmental and safety audits of fixed facilities as a part of self-auditing or due diligence assessments performed in anticipation of property/facility transactions
- Representing clients in self-reported non-compliance
Those Audit Policy - Voluntary Compliance matters in which the firm has or attorneys with the firm have been involved include the following:
- Performed a hazardous waste and an OHSA compliance audit for a chemical blending company
- Conducted an audit of the Clean Water Act discharge record keeping activities for a company that supervises private sewage treatment plants
- Environmental audits of fixed facilities as a piece of self-auditing or transactions
- Environmental assessments of the property involved in transactions
- Conducted multi-media audits
On May 11, 2000, the EPA issued its revised final policy on ‘‘Incentives for Self-Policing: Discovery, Disclosure, Correction and Prevention of Violations,’’ most commonly referred to as the ‘‘Audit Policy.’’ This Policy is intended to enhance protection of the environment and human health by encouraging regulated entities to voluntarily discover, punctually disclose and expeditiously correct any violations of Federal environmental requirements. Incentives that the EPA makes available for those who meet the terms of the Policy are the elimination or substantial reduction of the gravity component of civil penalties and also a determination not to recommend criminal prosecution of the disclosing entity. The Policy also restates the EPA’s long-standing practice of not requesting copies of regulated entities’ voluntary audit reports in order to trigger Federal enforcement investigations.
The revised Policy replaced the 1995 Audit Policy (60 FR 66706), which was issued on December 22, 1995, and became effective on January 22, 1996. The revisions maintain the essential structure and terms of the 1995 Policy while broadening its availability, clarifying some of its language, and conforming the provisions of the Policy to actual Agency practice. The EPA revisions lengthened the prompt disclosure period to 21 days, clarified that the independent discovery condition doesn’t automatically preclude penalty mitigation for multi-facility entities, and clarified how the prompt disclosure and repeat violation conditions should apply to newly acquired companies.
To address the special needs of small businesses the EPA issued the “Policy on Compliance Incentives for Small Businesses,” which is also commonly called the “Small Business Policy,” in June 1996. (See 61 FR 27984 June 3, 1996). The Small Business Policy facilitates the implementation of section 223 of the Small Business Regulatory Enforcement Fairness Act (SBREFA) of 1996. On May 11, 2000, the EPA issued its revised final Small Business Compliance Policy to expand the options that are allowed under the Policy for discovering violations and to establish a time period for a disclosure.
On August 1, 2008, the EPA announced and requested comment on its Interim Approach to Applying the Policy to New Owners (‘‘Interim Approach’’). The Interim Approach offered a detailed description of how the EPA will apply its Audit Policy to the new owners of regulated facilities. Under the Interim Approach, the EPA will offer certain incentives tailored to new owners that want to make a ‘‘clean start’’ at their new facilities by addressing environmental noncompliance that began prior to acquisition. This Interim Approach is intended to motivate new owners to audit newly acquired facilities and use the Audit Policy to correct, disclose, and prevent the recurrence of violations.