New Insights into Liabilities for Environmental Torts in China

At the end of 2009, a long-awaited law concerning tort liability was issued in the People’s Republic of China (“PRC”), and will take effect on 1 July 2010. Significantly, the Tort Liability Law of the People’s Republic of China (the “Tort Law”), in Chapters 8 and 9, specifically addresses liability for environmental pollution and clarifies certain principles which have existed in various of the PRC’s earlier-issued environmental laws, regulations, and policies.

Some of the main environmental-tort issues addressed in the Tort Law include: triggers of liability for pollution; evidentiary burdens; and the apportionment of liability. Overall, the environmental-related provisions in the Tort Law seem to increase recourse options for victims of environmental pollution, and also to increase the liability to be borne by polluters.

Polluter Strictly Liable

Articles 65 and 68 of the Tort Law provide that for damage caused by environmental pollution, a polluter bears strict liability. Moreover, subjective fault of the polluter is not required in order for such liability to arise.

Article 65 broadens the concept of liability in environmental tort. Previously, liability for such torts was based primarily on a defendant’s violation of applicable environmental laws and regulations. Now, under the Tort Law, it seems that a defendant could be found liable for an environmental tort even though such defendant complies with applicable environmental laws and regulations.

Polluter Bears Burden of Proof

Article 66 of the Tort Law provides that in a dispute arising from environmental pollution, the polluter bears the burden of proof regarding any exemption or mitigation of that liability, as well as regarding any lack of causal linkage between the polluter’s behavior and the damage. The provisions in Article 66 echo evidence guidelines issued by the PRC’s Supreme People’s Court several years ago.

Article 66 indicates that an injured plaintiff needs only to provide prima facie evidence about the likelihood that the polluter’s action caused the damage. The polluter, then, is required to provide evidence to refute that causal linkage, and can do so by establishing that the following circumstances exist: (i) PRC laws exempt or mitigate the liability; or (ii) a causal link between the polluter’s action and the damage is absent, and thereby the polluter either is not liable or is less liable for the damages caused by the environmental pollution.

The Tort Law’s Article 26 offers insights into what types of situations give rise to a polluter either being exempt from tort liability or being able to mitigate such liability. Those situations include the following: force majeure; contributory fault of the injured party; intentional cause by the injured party of the pollution; and third-party cause of the pollution.

Liability Apportioned

Article 67 of the Tort Law addresses apportionment of liability between and among polluters and provides that such apportionment will depend on various factors, including the type and amount of pollutants emitted by the respective polluter.

However, neither Article 67 nor other provisions in the Tort Law provide any substantive guidance or standards about how, in practice, those factors will operate and impact the apportionment of joint liability.

Additional Avenues of Recourse for Victims

Article 68 of the Tort Law introduces the concept that, for damages caused by pollution, a polluter bears joint and several liability with a third party, even if those damages are due to the fault of such third party.

Moreover, Article 68 increases the capacity for victims to achieve compensation for damages which they have suffered – it provides that, in situations where that damage is caused by environmental pollution attributable to a third party, the injured party may seek compensation either from the polluter or from that third party. Article 68 leaves it to the polluter and the third party to handle and resolve the issue of compensation between them. If the injured party chooses to seek compensation from the polluter, then such polluter, after compensating the victim, may then claim compensation for that from the third party.

Heightened Awareness?

It is yet unclear how the Tort Law, in practice, will be implemented. However, its provisions concerning environmental torts suggest that those at-risk for producing pollution and/or discharging wastes in the PRC should increase their awareness — not only about the actual or potential impacts of those pollutants, but also about the possible roles and impacts of third parties in relation to such pollution.