We would like to encourage the Committee to look into several matters relating to the regeneration of contaminated land and the regulation of waste management licensing activities. This letter, therefore, sets down a number of specific issues for the Committee's consideration, together with an explanation of Certa's particular interests and activities.

1.  CERTA (UK) LTD

  Certa was launched in 1997. Since that time, we have been involved with several hundred contaminated sites in the UK. Our work brings us into contact with a range of professional advisors and their clients (property developers, FTSE companies, public sector bodies, regeneration agencies etc). We therefore have a potentially unique insight into the practical issues, together with the concerns, that face businesses wishing to buy, sell, fund and redevelop brownfield and environmentally suspect sites throughout the UK.

  It is this day-to-day experience that has highlighted a number of practical issues relating to the workings of the Environment Agency (and the Scottish Environment Protection Agency). We thought it would be of interest to the Committee to draw these matters to your attention.

2.  MATTERS ARISING

2.1  Awareness of Environmental Insurance (as a facilitator for the redevelopment of Brownfield Sites)

  We are aware that the US Environmental Protection Agency has produced reports, from time-to-time, into the availability and terms of Environmental Insurance which is designed to facilitate the transaction and redevelopment of Contaminated Land.

  Whilst the USEPA, as a public body, cannot advocate the use of Environmental Insurance (or the Policies of a particular Insurer), in our view it is a helpful public service to increase awareness as to the availability of such Risk Transfer mechanisms.

  We would refer the Committee to the USEPA's 1996 report into Environmental Insurance (Reference: Potential Insurance Products for Brownfields Clean-up and Redevelopment—Survey Results of Insurance Industry products available for transference of risk at potentially contaminated property)—Reference PB96-963244, June 1996, publication of the Office of Emergency and Remedial Response (5101).

  Compared to the US approach, the UK's Environment Agencies have been surprisingly quiet on this matter. We would encourage the Agency to increase public awareness to help to educate all relevant stake-holders about the availability and use of Insurance Risk Transfer mechanisms.

2.2  Work of Environment Agency/Quality Division

  It would be helpful if the existence and activities of the West Midlands-based Ground Water and Contaminated Land National Centre were more widely known. A publication explaining how to access the available expertise in the Environment Agency would be particularly useful.

2.3  Waste Management Licences

  We think the whole question of "financial provision" (and the financial/insurance-based mechanism to secure this) is very unclear.

  We are aware of one case where the Environment Agency has supported the use of an insurance-backed bond to satisfy the regulatory requirements of Part II of the Environmental Protection Act 1990. However, the general opinion of the waste management industry (as far as we are aware), is that the only mechanism which is available is the use of Bank Bonds.

3.  THE NEXT STEPS

  At this stage, all we have done is to flag-up, in general terms, a few matters that may be of interest to the Committee. If you require us to elaborate on our points (either in writing or in the course of a meeting), we will be more than happy to do so.

  Certa designs bespoke long-term Insurance Solutions for "brownfield" and environmentally suspect sites. Certa acts as an underwriting agent for Europe's largest general insurer (Allianz Cornhill).

  We are a multi-disciplinary company, combining legal, technical, commercial, property and insurance expertise. We deploy multi-disciplinary teams to analyse environmental risks of concern to vendors, purchasers and funders involved in land transactions, so as then to transfer these risks (principally liabilities and associated costs) for up to 25 years.

October 1999