Environmental Impact Assessment in Malaysia

1.Malaysia's Procedural Requirements for Environmental Impact
Assessment

In Malaysia, anyone proposing a new development project is obliged to carry out a number of procedures to evaluate the project's effects on the environment before implementation. The procedures are mandatory conditions for obtaining permission to operate a factory, and no new projects can get underway without completing these procedures.

The first procedure is the completion of environmental impact assessment (EIA). If the proposed project comes under one of 19 categories of activities prescribed under the Environmental Quality
(Environmental Impact Assessment) Order 1987, the project proponent must prepare an EIA report in accordance with the stipulated procedures, submit it to the Director General of the Department of
Environment (DOE), and obtain approvals.

If the proposed project is not a prescribed activity subject to EIA, Site Suitability Evaluation or Pre-Siting Evaluation is required to assess whether the site of the proposed factory or project is compatible with
other land use in the area, particularly in regard to residential zones. Evaluation is required even when planning to site a factory in an industrial estate. The DOE carries out the evaluation by checking the
development plan against environmental laws and regulations. In terms of both size and industry type, most factory construction projects undertaken by Japanese companies are required to complete only Site Suitability Evaluation.

In addition, depending on where the factory is to be located, a hazardous industry which may potentially generate waste that is injurious to health, such as a petrochemical plant, must submit a separate environmental risk analysis to the DOE. This provision applies to projects that require facilities to handle dangerous chemical substances. The project proponent carries out an environmental risk analysis of the facility and the proposed methods of handling the dangerous substances, and receives risk assessment of the project from the DOE.

These procedures are required not only for new projects, but may also be required for factory expansion and other such activities.


2. Environmental Impact Assessment System

EIA requirements apply to 19 categories of activities, such as airport construction, coastal reclamation, industries, and construction of waste treatment and disposal facilities, as prescribed in the schedule appended to the Environmental Quality (Environmental Impact Assessment) Order 1987. This order also sets forth the size and scope of the prescribed activities in each category. In general, these activities are large-scale development projects that potentially have severe impacts on the environment.

Of the prescribed activities, those in the industry category are most relevant to plant construction by Japanese companies. EIA requirements apply to factory and plant construction projects, exceeding a specified size, in seven types of industries: (1) chemical, (2) petrochemical, (3) non-ferrous, (4) nonmetallic,(5) iron and steel, (6) shipbuilding, and (7) pulp and paper.

The EIA covers not only the likely environmental impact of the proposed project, but also evaluates aspects such as whether the best possible
options have been selected for the project, and whether the
project incorporates appropriate pollution control measures.


Figure 1-7-1 Prescribed Activities Subjected to EIA


1. Agriculture
(a) Land development schemes covering an area of 500 hectares or
more to bring forest land into agricultural production.
(b) Agricultural programmes necessitating the resettlement of 100
families or more.
(c) Development of agricultural estates covering an area of 500 hectares
or more involving changes in type of agricultural use.
2. Airport
(a) Construction of airports (having an airstrip of 2,500 meters or longer
(b) Airstrip development in state and national parks.
3. Drainage and Irrigation
(a) Construction of dams and man-made lakes and artificial enlargement
of lakes with surface areas of 200 hectares or more.
(b) Drainage of wetland, wild-life habitat or of virgin forest covering an
area of 100 hectares or more.
(c) Irrigation schemes covering an area of 5,000 hectares or more
4. Land Reclamation
Costal reclamation involving an area of 50 hectares or more.
5. Fisheries
(a) Construction of fishing harbours.
(b) Harbour expansion involving an increase of 50 per cent or more in
fish landing capacity per annum.
(c) Land based aquaculture projects accompanied by cleaning of
mangrove swamp forests covering an area of 50 hectares or more.
6. Forestry
(a) Conversion of hill forest land to other land use covering an area of 50
hectare or more
(b) Logging or conversion of forest land to other land use within the
catchment area of reservoirs used for municipal water supply,
irrigation or hydro power generation or in areas adjacent to state and
national parks and national marine parks.
(c) Logging covering an area of 50 hectares or more.
(d) Conversion of mangrove swamps for industrial, housing or
agricultural use covering an area of 50 hectares or more.
(e) Clearing of mangrove swamps on Islands adjacent to national marine
parks
7. Housing
Housing development covering an area of 50 hectares or more.
8. Industry
(a) Chemical : Where production capacity of each product or combined
products is greater than 100 tones/ day
(b) Petrochemical -- All sizes
(c) Non-ferrous (Primary smelting)
#Aluminium -- all sizes
#Copper -- all sizes
#Others -- producing 50 tonnes/day and above of product
(d) Non-Metallic
#Cement -- for clinker through out of 30 tonnes /hour and above
#Lime -- 100 tonnes/day and above burnt lime rotary kiln or 50
tones/ day and above vertical kiln.
(e) Iron and steel-- Require in iron ore s raw materials for production
greater than 100 tonnes/ day; or Using scrap iron
as raw materials for production greater than 20
tones /day
(f) Shipyards -- Dead Weight Tonnage greater than 5000 tonnes
(g)Pulp and Paper Industry --Production capacity greater than 50
tonnes/day.
9. Infrastructure
(a) Construction of hospitals with outfall into beachfronts used for
recreational purposes.
(b)Industrial estate development for medium and heavy industries
covering an area of 50 hectares or more.
(c) Construction of expressways.
(d) Construction of national highways.
(e) Construction of new townships.
10. Ports
(a) Construction of ports
(b) Port expansion involving an increase of 50 per cent or more in
handling capa per annum.
11. Mining
(a) Mining of minerals in new areas where the mining lease covers a total
area in excess of 250 hectares.
(b) Ore processing, including concentrating for aluminium, copper, gold
or tantalum
[c) Sand dredging involving an area of 50 hectares or more
12. Petroleum
(a) Oil and gas fields development.
(b) Construction of off-shore and on-shore pipelines in excess of 50
kilometers in length.
(c) Construction of oil and gas separation, processing, handling and
storage facilities.
(d) Construction of oil refineries.
(e) Construction of product depots for the storage of petrol, gas or diesel
(excluding service stations) which are located within 3 kilo meters of
any commercial, industrial or residential areas and which have a
combined storage capacity of 60,000 barrels or more.


Impact assessment takes approximately three months for thepreliminary assessment only. In 1997, a total of 414 cases of environmental impact assessment were conducted during the year, and most of these were completed at the preliminary assessment stage.

Further particulars about EIA procedures and an overview of how the EIA process is conducted are available in "A Handbook of Environmental Impact Assessment Guidelines," published by the DOE. In addition, "Specific Environmental Impact Assessment Guidelines" are being prepared for specific types of industries, and there are currently 16 different sets of guidelines available.


(2) Registration of Environmental Impact Assessment Consultants

To improve the quality of EIA reports, Malaysia in 1994 initiated a registration system for consultants who carry out assessment. The purpose is to clarify the consultant's area of specialization, services, and
scope of responsibility. The DOE registers consultants who pass a certain standard of expertise. As of 1997, 216 individuals and 63 consulting firms were registered.

The current registration system is not based on laws. The DOE wants to have registration of consultants made mandatory under the law, and has submitted a proposed amendment to the Environmental Quality
(Environmental Impact Assessment) Order 1987 to the Attorney General. The proposed amendment recommends incorporation of registration standards, rules of ethics for consultants, and criteria for revoking registration.


3. Site Suitability Evaluation

Site Suitability Evaluation is required for activities which are not subject to the EIA system. Whereas the EIA system emphasizes prevention of environmental impacts by large-scale development projects,
Site Suitability Evaluation assesses whether a project will cause any environmental problems, particularly in relation to residential areas, in the vicinity of the proposed factory construction site. The aim is to encourage companies to select appropriate factory sites. The evaluation is carried out based on the DOE's brochure, "Guidelines for the Siting and Zoning of Industries." Any person wishing to build a factory is obliged to contact the DOE in regard to site suitability.

On receiving an inquiry from a person proposing to build a factory, the DOE evaluates the site suitability in terms of the surrounding land use, the capacity for additional pollution load, problems of waste disposal in the area, and regulations regarding buffer zones stipulated in the guidelines. Depending on the assessor's opinion, the project proponent may be directed to change the proposed site of the factory.

Under the guidelines' provisions regarding buffer zones, industries are classified into four categories: (1) Light industry A, (2) Light industry B, (3) Medium industry, and (4) Heavy industry. The desirable buffer distance from residential areas is specified separately for each of these categories. For example, the provisions state that a buffer distance of 250 meters is desirable for Medium industry, a category of industry that uses toxic and hazardous substances as raw material and generates some gaseous emission, industrial effluent, noise, odor and scheduled wastes.

Since a high proportion of Japanese companies in Malaysia are assembly industries in the electrical and electronics sector, most companies will have to conduct only Site Suitability Evaluation as the required EIA procedure.