The New South Wales Government has recently passed legislation to significantly increase the penalties for breaches of planning and contamination laws.

The key increases to penalties and enforcement powers include:

• a maximum penalty for corporations of $1 million for a breach of the duty to report contamination of land under the Contaminated Land Management Act 1997 (NSW).
• a maximum penalty for corporations of $5 million for a serious intentional breach of the Environmental Planning and Assessment Act 1979 (NSW) (EP&A Act);
• a maximum penalty for corporations of between $1 million and $2 million for other breaches of the EP&A Act; and
• new offences under the EP&A Act, such as providing false or misleading information in connection with planning matters (for example in relation to environmental impact statements and heritage impact statements), and aiding, abetting or procuring another person to commit an offence against the EP&A Act. 

The changes will mean that New South Wales has one of the toughest enforcement regimes in Australia for failure to report contamination and non-compliance with the planning system. Given the significant penalties, and increased enforcement powers, it would be prudent when conducting a legal due diligence to ensure that the target entity has complied with any reporting obligations under contamination laws and is operating its business in material compliance with planning laws.