EPBC Act reforms: Compliance and Enforcement

10 minute read 16.12.2025 Alex Skilling, Lachlan Glaves, Brandon Shiel-Butera

The EPBC Act reforms include the introduction of a new National Environment Protection Agency , expanded enforcement powers and stricter penalties. This is a significant development and a must read for compliance teams on sites and developers/operators generally.

Key takeouts

Independent regulator established:

Expanded powers:

Significantly increased penalties across the board:

This is the final insight in our series examining the reforms to the Environment Protection and Biodiversity Conservation Act 1999 (Cth) (EPBC Act) which received Royal Assent on 1 December 2025.

In this insight, we focus on the changes to the compliance and enforcement regime under the EPBC Act. The content below is important.

For many years, the primary regulators most active in compliance and enforcement across industry have been the State and Territory Environment Protection Authorities, and State/Territory and Local Government Authorities responsible for enforcing compliance with state and territory laws regulating pollution and contamination, land use, biodiversity, water and the like.

The EPBC Act did contain offence provisions and some ability to undertake investigations but in reality it just wasn't as effective as the State and Territory agencies who had the experience and support of central and independent regulator bodies and large teams to investigate incidents and, where appropriate, take further regulatory action including issuing stop work orders, penalty infringement notices, or prosecutions to name a few options available to them.

This will all change on 1 July 2026 with the introduction of a new National EPA (NEPA) that will be vested with broader powers to regulate approvals granted under the EPBC Act in a much more fulsome manner. This is a game changer so to speak for industries who require EPBC approvals because it will add a much more rigorous layer of compliance requirements for industry and practically could result in some real sanctions such as environment protection orders, discussed below.

For landowners and operators who have the benefit of both State/Territory and Commonwealth planning and environmental approvals, this means that a particular asset can be regulated and potentially prosecuted under both State and Commonwealth laws (provided separate offences are investigated and pleaded under the respective Acts). But the more practical reality is that these amendments will require compliance teams to be across a broader range of legislative requirements and these teams may need to grow in size to deal with the demand.

The reforms to the EPBC Act propose to improve the regime by:

establishing the NEPA;
introducing new compliance and enforcement powers, including powers for the NEPA to issue an environment protection order (EPO) and the granting of new auditing powers; and
increasing penalties under the EPBC Act, with a new maximum penalty amount of $825,000,000 for corporations calculated (based on whatever is highest) between either a fixed amount, the financial benefit gained from a breach, or a percentage of annual company turnover. It is unlikely these penalties will manifest themselves to the maximum levels but businesses need to factor in potential compliance costs at least similar to the costs incurred at State and Territory levels.

These key changes are summarised below.

Establishment of the NEPA

One of the more significant aspects to the reform of the EPBC Act is the establishment of Australia's first national independent environmental protection agency, the NEPA. The NEPA's role will be to independently support the delivery of environmental regulatory decision-making. In practice, the undertaking of compliance investigations and possible enforcement activities under the EPBC Act will be a core function of the NEPA.

Established by the National Environmental Protection Agency Act 2025 (NEPA Act), the NEPA will also have functions conferred on it by various other environmentally-relevant Commonwealth Acts, including various acts governing waste and hazardous waste, greenhouse gas management and underwater cultural heritage.

The NEPA Act and the establishment of the NEPA will commence on 1 July 2026.

New compliance and enforcement powers

Enforcement protection orders

The reforms to the EPBC Act introduce a power for the CEO of NEPA to issue an EPO (potentially a type of stop works order amongst other things) in instances where a person has engaged, is engaging or is likely to engage in a contravention of the EPBC Act or the conditions of an environmental authority or environmental exemption. The EPO can only be issued in circumstances where:

the contravention or likely contravention poses an imminent risk of serious damage to a matter protected under the EPBC Act; and
it is necessary to either ensure future compliance with the EPBC Act, the regulations or the conditions of the environmental authority or environmental exemption or to prevent or mitigate damage caused, or eliminate or reduce the risk of damage posed by the contravention or likely contravention.

Requirements imposed by the EPO may include discontinuing or not commencing specified activities, changing the manner in which specified activities are to be carried out, restricting the manner in which specified activities are carried out and broadest of all, requiring the person to take specified action in a specified manner or in specified circumstances.

The creation of this power at the Federal level is consistent with tools available under most state and territory-based environmental regimes.

The introduction of the EPOs to the EPBC Act is a significant departure from the previous regime, where injunctive measures could only be sought through the Federal Court.

However, in terms of potential appeal rights, when issuing an EPO, the CEO must provide the recipient with documents that support the reasonable belief of the matters triggering the issuance. Judicial review rights appear to remain available under section 39B of the Judiciary Act 1903 (Cth) and the Administrative Decisions (Judicial Review) Act 1977 (Cth).

Other key features of the EPO power include:

an ability for such an order to be issued either by notice in writing, or in urgent circumstances, orally (this mirrors some regimes at a State and Territory level);
an initial duration capped at 14 days, with one additional extension of up to 14 days permitted, bringing the maximum possible term of an EPO to 28 days; and
consequent fault-based and strict liability offence provisions for failing to comply with, or hindering or obstructing compliance with, an EPO.

Broader audit powers

The reforms also introduce new, broader audit powers, including:

an ability to require a broader range of people to carry out a directed environmental audit;
introduction of a new 'compliance audit'; and
establishment of a register of auditors assessed as having the appropriate knowledge and experience to conduct audits under the EPBC Act.

Prior to the reforms, a notice to conduct an environmental audit could only be issued to the holder of an approval or permit issued under the EPBC Act. The expanded power will permit notices also to be issued to persons subject to an EPO, a conservation order, a remediation determination, a remediation order, and national interest exemptions.

The newly introduced compliance audit will allow the CEO of NEPA to require an audit to be completed for a range of activities purported to be carried out under the EPBC Act, including checking compliance with conditions or requirements of the relevant permission (i.e. approval, permit, exemption, etc.) to ensure that activities being carried out are both covered by the relevant permission and are not having an impact significantly greater than was initially assessed at the time of grant.

Under the Reforms, the Commonwealth Government will establish a register of auditors under the EPBC Act. The CEO of the NEPA must be satisfied that the individual applying for registration possesses the requisite qualifications, knowledge, expertise, competence and independence. The explanatory memorandum notes that the register intends to provide greater levels of assurance as to the use of independent auditors and create a pool within which a timely appointment can be made to carry out compliance and environmental audits.

A person required to provide the audit can only appoint an unregistered auditor with the approval of NEPA, in circumstances where a registered auditor is not reasonably available.

Increased penalties

The reforms significantly increase the maximum penalties that can be imposed under the EPBC Act, and also introduce a new formula for determining penalties which take into account the benefit derived by any non-compliance. (i.e. under Chapter 2, Part 3 and breaches of approval conditions). The new penalty formula has been modelled off comparable Commonwealth schemes targeting financial crime under the Corporations Act 2001 For the most serious contraventions (including taking action without approval or breaching approval conditions), Courts can now impose the highest of three possible penalties. These include: For individuals, whichever is highest, of: 5,000 penalty units (i.e. $1,650,000); or
3x the combined value of any financial benefit obtained, and costs avoided from a breach (with the Court to determine such amounts).

Previously, the EPBC Act only provided a maximum penalty of $1,650,000 for individuals in contravention.

For body corporates, whichever is highest, of:

50,000 penalty units (i.e. $16,500,000); or
3x the combined value of any financial benefit obtained, and costs avoided from a breach (with the Court to determine such amounts); or
10% of a company's annual turnover for the 12-month period ending at the end of the month when a breach occurred (capped at $825,000,000 or 2.5 million penalty units).

Previously, the EPBC Act only provided a maximum penalty of $16,500,000 for body corporates in contravention.

An example of what this may look like in practice is as follows. A mining company clears 500 hectares of endangered species habitat without approval to fast-track a development project. The Court determines the company has saved $20,000,000 in delays and environmental mitigation costs through proceeding without approval. Under the new penalty calculation formula, the penalty would be 3 x $20,000,000 = $60,000,000, which far exceeds the previous maximum penalty of $16,500,000 for body corporates.

Transitional provisions

We have published a separate article examining the transitional provisions of the reforms in greater detail.

In relation to the compliance and enforcement amendments:

NEPA's enforcement mechanisms and Environment Information Australia (EIA) provisions will commence on 1 July 2026, while a bulk of the reforms come into effect on a date to be proclaimed or if no date is set, automatically 12 months following Royal Assent i.e. 1 December 2026);increased penalties and the new civil penalty formula will only apply to conduct constituting a contravention which occurs wholly on, or after, the commencement of the reforms.

Takeaways

Increased attention at both State/Territory and Commonwealth levels: Previously, State and Territory EPAs have led the charge on environmental compliance enforcement pursuant to the EPBC Act. However, under the Reform Act, a new Commonwealth EPA will also regulate and monitor compliance with the EPBC Act. If you hold both State/Territory and Commonwealth approvals, your asset can now be prosecuted under State and Commonwealth laws, doubling your compliance exposure.

Reporting requirements under Reform Act: The Reform Act introduces broader audit powers including a new compliance audit, which provides NEPA's CEO with the ability to check whether activities comply with approval conditions and are not causing environmental impacts greater than initially assessed. NEPA audits can be from a wide range of people rather than solely being from approval holders. Proponents and operators can now expect higher regulatory scrutiny.

Risks of EPOs being issued and appeal rights: NEPA's CEO can also issue EPO's without natural justice requirements where there are imminent risks of serious environmental damage. EPO's can be issued orally in urgent cases, lasting up to 28 days. Judicial review remains available, and the sudden shift from court-based injunctions to administrative enforcement means you must be prepared to respond on short notice.

New penalty amounts and potential costs: Penalty amounts have substantially increased. The new civil penalty formula can reach 10% of annual turnover for body corporates (capped at $825,000,000), which is an increase of over $800 million from previous maximum penalty amounts.

Risks of potential prosecutions: Prosecutions are now far more likely. NEPA has express powers to undertake compliance investigations and enforcement activities, including criminal prosecutions for the most serious contraventions. The reforms introduce both criminal offences (with potential imprisonment) and civil penalty provisions, with NEPA empowered to choose the most appropriate enforcement response based on the severity and circumstances of the breach.

For advice on how these compliance and enforcement reforms may impact your projects, or to discuss strategies for managing increased regulatory scrutiny under the reformed EPBC Act, MinterEllison is well placed to advise your business.

Please feel free to contact one of our specialists and otherwise read our other insights released as part of our EPBC Act Reforms – What You Need to Know series: