Environmental Law 2022 Comparisons

The Constitution of the Dominican Republic, enacted in 2015, recognises the right of the country’s inhabitants to enjoy a healthy environment for the development and preservation of life, the landscape and nature.

The General Law of Environment and Natural Resources No 64-00 (GENRL) was enacted in 2000. It organised the legal and environmental framework in the Dominican Republic and established the basis for environmental protection, management, liability and the use of natural resources. The fundamental values of the GENRL include prevention, polluter-pays, tort, participation, dubious pro-natural, ab initio prohibition, strict liability and public order principles.

The legal framework is completed by several other legal instruments and technical regulations covering water, waste, agrochemicals, soil, dangerous materials, the metal sector and the air. Other vital instruments include the Law on Protected Areas.

A new waste management law was approved in 2021, which brings together all the Dominican Republic's waste management regulations and establishes a new legal framework indicating all parties responsible for waste in its different stages and the details of its final disposition.

The GENRL appointed the Ministry of Environment and Natural Resources as the "environment, ecosystems and natural resources policy-making body". This entity is responsible for monitoring environmental policy compliance through environmental impact assessment and inspections.

The Office for the Defence of the Environment and Natural Resources is a specialised department of the Attorney General's Office, which exercises representation and defence of the state's and society's interests on environmental issues in all proceedings for violations of environmental legislation.

Finally, the National Council on Climate Change promotes and follows up on all initiatives and policies regarding climate change.

The environmental regulator has broad powers to require documents, take samples during inspections, conduct site inspections, interview employees and take whatever other measures are needed to determine the existence of an infringement of environmental law.

Access to the sites for inspection must always be available without restrictions, in favour of the environmental authorities.

Also, according to the Environmental Authorisations Proceeding, the Environmental Agency will follow up, audit, inspect and verify compliance with the operations under specific environmental authorisation. If the environmental authorities fail to fulfil the obligations, several penalties shall be enforced through administrative actions, including suspension of activities and cancellation of the permit.

In this context, the Environmental Control, Surveillance and Inspection, and Administrative Sanction Enforcement Regulations establish that inspectors from the Environmental Agency (the Ministry of Environment and Natural Resources) are empowered to take all necessary measures to prevent environmental damage. These powers include confiscation of objects and related measures.

Before the development and start of the operation, it is necessary to apply for an environmental permit or licence for every project, infrastructure work, industry or any other activity that may affect the environment and natural resources, the quality of the environment and the population's health.

Depending on the impact level, there are four categories for activities and projects requiring a licence, permit or certificate approval. The first two categories (A and B) require an environmental impact assessment. The remaining two categories (C and D) require technical information to be completed to evaluate correctly if an environmental management plan is required. Category D will apply for certain activities or projects with minimum impact, and the Environmental Agency will issue the environmental permit.

The Environmental Authorisations Proceeding has been in force since September 2015 and includes two lists of projects:

• one list of projects that need environmental authorisation to operate; and
• a second list that includes those projects and activities that are exempt from requesting environmental authorisation.

In this order, specific sectorial permits (non-objection) could be granted for those activities or minor projects that may have a particular impact on the environment.

Obtaining Permits and Rights to Appeal

The environmental permit is obtained after the administrative process developed in the environmental legislation compendium has been complied with, which entails the activity promoter presenting documents containing information on the project. The environmental authorities will then evaluate these documents and determine the project category through the reference terms (TDR). After the promoter presents the environmental studies to the ministry's specifications, the permit is issued if the project complies with the regulations.

Given that environmental authorisation, or its denial, is an administrative act, it may be challenged through the different remedies available in the Dominican legislation, including appeal or revision, as appropriate.

Another option available for the promoter of the project or activity would be to file relevant information that proves that the project or activity has been substantially modified and meets the requirements to be approved by the Environmental Agency.

As a last resource, and in the presence of a final judgment issued by the Administrative Court, denial of an authorisation may be contested through an appeal to the Supreme Court of Justice.

Civil, administrative and criminal liability could result from environmental damage or environmental law breaches, depending on the fault committed.

The GENRL sets forth the environmental liability by including the strict liability principle whereby the classic exclusions in liability clauses are not applied to environmental civil liability. Legal responsibility arises from the production of the damage itself. This doctrine establishes that anyone who causes damage to the environment and natural resources will be liable for it and have to restore it to its previous condition (Article 169 of the GENRL). If that is not possible, additional compensation will apply.

Within the Dominican legal framework, the seller is responsible for any defects, even if they are unknown; this principle applies to contaminated land. Contractual provisions may reduce such liability at the moment of the sale. However, the provisions are not valid before third parties.

The GENRL sets forth environmental liability by including the strict liability principle, whereby anyone who causes damage to the environment and natural resources will be liable for said damage and must restore the environment to its previous condition.

The current owner may impose restoration and compensation measures by the authorities, despite the liability imposed on the former landowner.

Administrative liability has become the most frequent type of liability when a breach of environmental laws and permits occurs. The main administrative penalties contained in the environmental legislation are as follows:

• a fine of up to 3,000 times the minimum wage;
• seizure and confiscation; and
• prohibition or temporary suspension of activities, or partial or total closing of the establishment.

Civil liability damages caused to third parties due to pollution are considered within the Civil Code. Several penalties can arise, including:

• an order to materially restore the damage caused;
• an indemnity order in favour of the state (for the community where the damage happened) and any individuals affected; and
• an order to re-establish the environment to the condition before the deed, whenever possible.

As for criminal liability, competent criminal jurisdiction may impose penalties on individuals or companies that have infringed the Environmental General Law, including:

• imprisonment if deaths occurred due to the infringement;
• fines;
• forfeiture;
• the obligation to compensate those who suffered damages;
• temporary or definitive withdrawal of the authorisation, licence or permit; and
• the obligation to repair, replace, compensate, restore or rehabilitate the natural resource affected to its original state.

Regardless of the type of liability in question, the individual or company sanctioned will always have the corresponding remedies or procedural defence in administrative and judicial courts.

In general, as per the provisions outlined in the GENRL, the consequences of environmental disasters originated by negligence shall be the exclusive responsibility of the persons or entities that caused the disasters, which shall restore the areas or resources destroyed or affected, if possible, and shall respond criminally and civilly for caused damages (Article 76). Additionally, the GENRL provides that, notwithstanding the sanctions provided therein, anyone who causes harm to the environment or natural resources shall have strict liability for damages that may occur, following the GENRL and other supplementary provisions thereof. Also, said persons shall be compelled to repair materially at their own expense, if possible, and to indemnify accordingly.

When more than one person commits an infraction under the GENRL, everyone participating in the infraction shall be jointly and severally liable for economic damages. The GENRL also provides that, in the case of a legal person (eg, corporate entities), the liability provided above shall also be established considering the participation of the directives and representatives of the legal entity that caused the damage.

Traditionally, at least for the more common business associations and corporate vehicles used in the Dominican Republic, the country's legal regime has provided for companies to have different legal capacities (as a legal person) and assets and liabilities different and separate from those of their shareholders, members, directors, officers and employees. Dominican corporate law recognises the principle of the separate legal capacity of companies and partnerships, except in the case of businesses carried out by sole proprietors and partners in general or limited partnerships, which are forms of business associations provided under Dominican law wherein the partners may each be liable for all the debts of the business (unlimited liability).

The system follows the legal assumption of a "corporate veil" and that the corporation's actions are not the actions of its shareholders; therefore, shareholders have no individual liability for the corporation's actions. Their liability is limited to the sums they have contributed to the company's capital stock – that is, to the extent of their investments in shares or quotas. Without fraud or other deceptive practices, there is no personal recourse against shareholders for the company's obligations. Thus, in principle, the corporate entity will protect the shareholders from liability beyond their investments – shareholder's liability is limited to the amount individually invested.

Based on the above, the civil liability of a shareholder that has caused damages to the environment or natural resources may only be established in principle if the shareholder has participated directly in the actions or has authorised them.

Article 171 of the GENRL states that any company's manager, administrator, director or officer who authorises activities, actions or the developments of a project that causes harm to the environment shall be jointly and severally liable with the company and other individuals implementing the activity or development. The criminal liability of a representative or shareholders of a company, as per the provisions outlined in Articles 174 and 186 of the GENRL, may only be established upon such a person's wilful misconduct or criminal intent.

In general, a person determined as being liable for damages to the environment shall be required to repair or indemnify such damages for an amount set by the court by considering the reports from the Ministry of Environment's technicians and inspectors or any other experts appointed by the acting judge. A corporate entity may also be required to pay fines, and a court may order its activities to be suspended for a month or up to three years. Other criminal penalties may include imprisonment of up to three years.

Article 173 of the GENRL states that the Ministry of Environment may require a mandatory civil liability insurance policy to cover damages to the environment to the extent caused accidentally.

In general, a lender should not be liable for the actions of its borrower or individuals acting on behalf of said borrower, in the case of corporate entities.

Typically, lenders would include indemnification clauses in their loan documents and provide affirmative and negative covenants concerning the borrower's environmental obligations. Monitoring the borrower's activities periodically and requesting evidence of formal compliance with any regulatory reporting requirements to the environmental authorities is also common for credit facilities in the Dominican Republic.

The Dominican Civil Code indicates that civil liability arises from damages caused to third parties. This means that any damage caused shall be compensated to the victim (Article 1382 of the Civil Code and following), including damage brought by negligence or imprudence and damage caused by dependents (children, employees, etc).

The Dominican legal system is a civil law system primarily influenced by French law. It does not allow the use of punitive damages. The criteria in this matter only include compensation for the damages caused to the victim.

So, the concept of punitive damages as a sanction or exemplary manner of making a statement would sometimes exceed the limit of simple retribution. Nevertheless, within the "compensatory issue", the judge has a wide range of actions and could decide on a more or less severe compensation, depending on the case or the circumstances, without crossing the limit of the indemnity.

The GENRL sets forth the possibility of class action for pursuing environmental claims. Certain restrictions regarding NGOs apply: an NGO must have as its primary object the protection of the environment and should have been incorporated before the date of the environmental damage.

In 2020, the Dominican Republic had a change in its government. The new administration has been characterised by being stricter in compliance with the country's environmental regulations, including the following actions:

• suspension and elimination of permits in environmentally sensitive zones;
• the control of invaded protected areas;
• initiation of administrative proceedings against public authorities for mismanagement; and
• cases related to land use are expected to increase within the following years.

Environmental provisions in the Dominican Republic, as established by the GENRL, are of public order. Therefore, any agreements between the parties that lower liabilities in the case of environmental damage will not affect third parties, including the regulators.

However, it is possible to limit liability. Said contractual provisions may include the creation of an escrow fund to protect the purchaser in case of any event, and would be valid among the parties.

An insurance bond to fulfil the obligations established in the Environmental Management Regulation for operation is mandatory and will be presented as a condition of approval of the environmental authorisation. The renewal must be requested yearly by the environmental regulator.

No additional insurances have yet been established in the regulation.

The recently approved Law for Waste Management includes a section regarding contaminated land. Different dispositions apply, including specific provisions in the GENRL and special resolutions from the Ministry of Environment and Natural Resources. The new Law for Management and Co-processing of Waste establishes a new national regulation for the remediation of contaminated sites.

The regulation's main objective is to prevent the contamination of sites and establish the necessary actions for the remediation and rehabilitation of contaminated sites. The law established the registry of all contaminated sites in the Ministry of Environment and Natural Resources. Those who are found responsible for contaminating the sites are liable for their remediation. If the contaminated sites are located within private property, the owners will be considered jointly responsible for the contaminated site.

The GENRL also sets forth environmental liability by including the strict liability principle. Anyone who causes damage to the environment and natural resources will be liable for it and have to restore the environment to its previous condition. If that is not possible, additional compensation will apply. The polluter must rectify soil or groundwater contamination, control the impacts and immediately notify the environmental authorities, as established by Article 83 of the GENRL.

The Environmental Ministry may also use public funds to restore land contaminated by unknown persons.

The Dominican Republic has signed various treaties regarding climate change, such as the United Nations Convention on Climate Change in 1992, the Kyoto Protocol to the United Nations Framework Convention on Climate Change in 1996, and the Paris Convention on Climate Change.

The Dominican Constitution has recognised the importance of climate change for the Dominican territory and ordered the approval of territorial planning law considering this aspect. In this sense, the government created the National Council for Climate Change, which has the goal of implementing renewable energy, energy efficiency, methane recovery, the use of cleaner fuels and reforestation projects, among others, within the framework of the Convention on Climate Change and the Kyoto Protocol.

Consequently, the National Congress approved the Law on National Development Strategy 2010–30 (Law 1-12), establishing the fundamental objectives for sustainable development and adequate adaptation to climate change.

There is currently a discussion of an initiative at the Congress that aims to establish the regulatory framework or policies, principles, strategies and instruments to manage the cause and consequences of climate change in the national territory.

Moreover, a recently issued Presidential Decree (Decree No 541-20) creates a National System for the Measurement, Reporting and Verification of Greenhouse Gases in the Dominican Republic. This system aims to establish a framework for accounting for greenhouse gas emissions and executing mitigation actions to guarantee financing for sustainable climate actions.

Law 1-12 on the National Strategy of Sustainable Development (2010–30) contains specific measures to reduce greenhouse gas emissions without establishing targets.

The Dominican Republic contributes low environmental emissions and has committed to reducing emissions by 27% under the "business as usual" (BAU) project by 2030, taking the 2010 emissions as a baseline.

The Economic Development Plan, compatible with climate change, includes the strategy promoted by the Dominican government to reduce emissions (GEI) for the following sectors, which have the highest potential to achieve relevant reductions in emissions to the air:

• energy;
• transportation;
• tourism;
• cement; and
• solid waste.

The Management of Hazardous Substances and Chemical Waste Regulation, which refers to the National List of Hazardous Substances and Chemical Waste, classifies asbestos as a toxic substance. Any activity involving substance management requires a permit and special registration from the Environmental Ministry.

The new Law for Comprehensive Management and Co-processing of Waste was approved in August 2020. It includes several new dispositions regarding managing waste and promoting the reduction and recycling of such waste. These regulations apply to the public and private sectors, citizens, and companies and organisations.

For the first time in the Dominican Republic, the producer's extended liability principle is in force, and several rulings will have to be approved.

Certain products that are considered non-recyclable or large amounts of produced waste have also been forcibly subjected to special extended responsibility regulations destined to reduce waste. The manufacturers of these products (such as polystyrene foam, plastic bags and plastic bottles) will have to reduce the amount of waste they produce and increase the amount of waste they recover from their products.

The Ministry of Environment has approved several regulations for different types of waste, including the Regulation for Environmental Management of Non-Hazardous Solid Waste, pathogenic waste, hazardous waste, metallic waste and radioactive waste.

The regulations generally include specific dispositions concerning labelling, the elimination of hazardous materials, segregation, transportation and final disposal.

The Dominican Republic is also part of the Basel Convention on Transboundary Movements of Hazardous Waste and Disposal, which implies that certain obligations must be fulfilled when importing and exporting such waste.

The disposal of specific waste (hazardous or pathogenic, for example) that needs specific handling and compliance with disposal obligations must be addressed by authorised companies, among other requirements. In general, the producer would retain liability if such obligations were not fulfilled.

However, if the producer complied with all obligations and there was still damage to the environment, the producer's liability – even joint and several liabilities with the third party – would depend on the circumstances of the disposal. The transfer of the waste would not release the producer from third-party claims.

The extended liability of a producer was included in the Dominican legal framework using the Law for Comprehensive Management and Co-processing of Waste. The new obligations include dispositions regarding the design, take back, recovery, recycling or disposal of the goods once they become waste.

As mentioned in recent updates, the Environmental Agency issued a new ruling on waste to promote waste recycling. New obligations apply to single homes, buildings, towers, commercial businesses, industry and public institutions. In this sense, waste must be segregated and disposed of in two bags:

• inorganic waste (paper, cartons, plastics, glass and metals) in one bag; and
• organics (food, wood, etc) in another.

Local authorities must provide a selective service for handling said bags and transporting them to specific areas for recycling. However, certain aspects remain uncertain, especially regarding timings, the implementation of selective recovery, etc.

All citizens are responsible for notifying the Environmental Ministry of any event that could negatively affect the environment. If said damage could cause risks to the community’s health, it must be notified to the Ministry of Health immediately.

If the pollution is caused under operations that are authorised by an environmental permit, the operator must inform the authorities as soon as possible, restore and fix the problems that caused the incident, and include this information within the Environmental Compliance Report filed every six months with the Environmental Ministry. The events will be described in the report, and the actions to restore the environment to its previous condition will be taken.

The GENRL establishes the right to free access to environmental information, as it guarantees all citizens “access to truthful and timely information concerning the situation and condition of natural resources and the environment” (Article 6 of General Law 64-00).

In addition, the Free Access to Public Information General Law No 200-04 sets forth that "any individual has the right to request and receive complete, truthful, adequate and timely information from anybody of the Dominican State, as long as this access does not affect national security, public order, health or moral, or the right to privacy and intimacy of a third party or others' right to reputation."

However, exceptions apply when "information may jeopardise public health and safety, the environment and public interest in general" (Article 17 of the Free Access to Public Information General Law).

Recent developments include the signing by the Dominican state of the Escazu Agreement, the regional Latin American environmental treaty that includes provisions regarding access to environmental information and justice and protection for environmental activists.

Corporate entities are not required to disclose environmental information in their annual reports. However, under the country's securities market law and regulation, a corporate entity issuing debt or equity instruments may be required to disclose environmental information. This is understood to include any facts, circumstances or information that may influence its value or an investor's decision in negotiation with such security.

Environmental due diligence is typically conducted on M&A and finance deals. However, in many circumstances, depending on the activities of the targeted business, the due diligence is limited to verifying formal compliance with the GENRL and its rulings of enforcement by assessing the existence of required environmental permits and compliance with reporting obligations.

A business that is deemed to potentially and materially affect the environment may require the appointment of special environmental consultants to conduct further and more extensive due diligence and assessment.

In general, a seller would be required to disclose all environmental information to a purchaser.

There is only one type of green tax in the Dominican Republic, which was introduced in 2012 with the tax reform. This green tax would consist of a reduction of the payment of the first registration of a car if the vehicle was considered to have a minor environmental impact due to low emissions of CO₂.

The Law for Comprehensive Management and Co-processing of Waste contemplates a unique contribution that must be made by all companies, organisations and public institutions. This is a new tax to organise and create the infrastructure for the final disposal of waste. It will directly contribute to the new public-private Trust for the Comprehensive Management of Solid Waste created by the Law for Comprehensive Management and Co-processing of Waste.

Companies must make an exceptional contribution relating to their income. Several different income brackets dictate the amount of money to be paid. Companies with no income will still have to pay this unique contribution under the lowest income bracket.

As the legality of such a tax could be questioned, it will be necessary to wait for the rulings of this newly approved law.