Page 14: of Maritime Reporter Magazine (March 2000)

Legal Beat

An Effective Shield from Criminal Prosecution

The maritime community has increas- ingly become the target of Department of Justice (DOJ) and state prosecution efforts to pursue criminal sanctions against corporations and senior manage- ment involved in maritime transporta- tion incidents. Though many of the prosecutorial efforts involve egregious cases, some involve incidents that were previously treated as accidents. DOJ recently announced that federal enforce- ment actions involving environmental issues rose by almost 50 percent from 1996 to 1997. Criminal enforcement efforts often focus on highly visible companies for the maximum deterrent effect and greatest public impact.

Because of aggressive federal and state efforts targeting environmental crimes, and the severe risks and consequences of criminal prosecution, it is time for each and every company to take a hard look at their corporate environmental compli- ance programs. It is simply too late after an incident occurs.

Vessel owners and operators must meet a myriad of domestic and interna- tional requirements, including the Inter- national Safety Management (ISM)

Code with requirements addressing environmental protection. Compliance with these requirements alone will not adequately "shield" owners and opera- tors from prosecution. Shipowners and operators must ensure that an effective and comprehensive environmental com- pliance program is in place. This is cru- cial because the DOJ affords a company with an effective compliance program favorable consideration in criminal actions. Thus, effective environmental compliance programs must be estab- lished and smoothly running prior to an incident. But, what constitutes an effec- tive compliance program?

Unfortunately, there is no universally accepted single standard. For example, the U.S. Sentencing Guidelines for

Organizations, often referred to as the standard for determining whether a company has an effective compliance program, specifically exclude environ- mental crimes from its fine calculation provisions. In fact, guidelines and poli- cies relating to environmental crimes and compliance programs are set forth in various agency documents addressing both environmental crimes and compli- ance programs. The five most promi- nent documents are as follows:

DOJ Policy Statement of July 1, 1991: Contains certain environmental compliance program factors that DOJ prosecutors should consider in making decisions on criminal prosecutions for environmental violations. • EPA Policy Statement of December 22, 1995: Encourages regulated entities to voluntarily discover, disclose, and correct violations of environmental by Jonathan K.

Waldron, partner,

Dyer Ellis & Joseph

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