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Fuiava, P F --- "Can local government control land use involving genetically modified organisms?" [2004] NZJlEnvLaw 10; (2004) 8 NZJEL 295

Last Updated: 12 February 2023


Can Local Government Control Land Use Involving

Genetically Modified Organisms?

P. F. Fuiava*

This article considers the approach taken in New Zealand to the issue of genetically modified organisms. The gravamen of the article is the interplay between central government and local government with regards to this issue. To determine whether local governments have any authority to control the use of genetically modified organisms via land use, the author examines, inter alia, the role of the Environmental Risk Management Authority, the principles and purposes inherent in the Hazardous Substances and New Organisms Act of 1996, the Resource Management Act, the Local Government Act 2002 and the Royal Commission Report on Genetic Modification. He concludes that Parliament did not intend to grant local governments power to regulate genetically modified organisms and that an examination of statute and case law supports this assertion.


This article examines whether local governments can control genetically modified organisms (“GMOs“) by regulating land use. For the purposes of this article, I have limited GMOs to plants and animals with genetic traits that have been modified that have both indoor and outdoor use. The methodology of this article is to approach the question by first constructing the arguments in favour of local

* 1999 BA, LLB graduate from the University of Auckland, duly admitted Barrister and Solicitor of the High Court of New Zealand from 27 September 1999 and currently practicing criminal law for the Public Defence Service. This work was submitted as a dissertation for the postgraduate paper, Local Government Law towards an LLM postgraduate degree from the University of Auckland.

government having control over land use involving GMOs. Those arguments are then critiqued against the relevant statutory law, common law and the findings of the Royal Commission of Inquiry into Genetic Modification.

I have concluded that local government cannot control land use involving genetically modified organisms under the present statutory and common law. Which public body, therefore, controls land use that involves GMOs? In essence, central government has control over this issue and the Government has delegated this responsibility to the Environmental Risk Management Authority (“ERMA”) via the Hazardous Substances and New Organisms Act 1996 (“HSNO”)1. ERMA enjoys a position akin to a monopoly in deciding applications for the importation, development, field-testing and release of GMOs. As will be shown, central government has made it quite clear that local government has no role to play in controlling GMOs let alone controlling land use involving GMOs.

This article also critiques suggestions that, under the Resource Management Act 1991 (“RMA”)2 and the Local Government Act 2002 (“LGA”)3, local government has the power to control land use involving GMOs.4 My conclusion remains the same notwithstanding the force of these suggestions. Both the RMA and the LGA create expectations on local government to take steps to promote the sustainable management of the natural and physical resources of the districts5 and to promote the social, economic, environmental, and cultural well-being of communities, in the present and for the future.6 What can local government do to change the status quo? I have concluded that the best strategy available is for ‘Local Government New Zealand’ (“LGNZ”) to lobby central government to amend the HSNO. It is suggested that the HSNO be amended so that the submissions of local government become a primary and mandatory consideration in ERMA’s decision-making process for applications seeking approval to use GMOs in the district or region.

  1. The Hazardous Substances and New Organisms Act 1996. In force for new organisms 1st July 1998 and in force for hazardous substances 2nd July 2001.
  2. The Resource Management Act 1991. In force 1st October 1991.
  3. The Local Government Act 2002. In force 1st July 2003.
  4. Royden J Somerville, QC Interim Opinion on Land Use Controls and GMOs (Legal opinion for the Whangarei District Council, 2004)

5 RMA s 5(1).

6 LGA s 10.

Currently, the use of genetic modification (“GM”) is largely regulated under the HSNO7. Those wanting to use a “new organism”, as the term is defined under the HSNO8, must first apply to ERMA for approval. Section 40 of the HSNO requires that applicants seeking approval to import, develop or field test a new organism in containment, must make an application to ERMA. Section 25 of the HSNO prohibits any new organism from being imported, developed, field- tested or released unless ERMA issues an approval pursuant to the HSNO.

Insofar as protecting our environment, our economy, and our selves from the potential adverse effects of GM, considerable trust is placed on the scientific shoulders of ERMA to get it right from the outset in terms of approving applications. This is no easy feat given the scientific and technical uncertainty as to the potential adverse effects of GM (if any). We simply do not have conclusive evidence of the adverse effects from GMOs on the environment, property or people. The Environmental Risk Management Authority finds itself carrying out a difficult balancing act with respect to applications for GMOs. An overly precautious approach will constrict, if not strangle the growth of our knowledge economy. Conversely, however, an over zealous approach might lead to the taking of unjustifiable risks. Should adverse effects of GMOs be detected at a later stage, the harm caused to the environment, property or people may be beyond repair or compensation.

As this article will establish, local governments have made it clear to central government of their desire to have greater involvement and control over the use of GMOs in their districts or regions. The territorial authorities of the upper North Island from Rodney District Council to Kaitaia have been particularly vocal in recent times and quite understandably so, given that their local economies

  1. The use of GM is also controlled under the Biosecurity Act 1993. This Act covers border control for organisms that arrive in New Zealand unintentionally, whereas the HSNO regulates deliberate introductions into New Zealand of new organisms. The Biosecurity Act also manages pest species already in New Zealand. Any containment facilities operated under the HSNO must be registered under the Biosecurity Act. The Food Act 1981 and standards, and the Australia New Zealand Food Standards Authority provide the controls on the importation and labelling of food products, including foods that are derived from GMOs. GM foods in processed form are not covered by the HSNO, however the HSNO does cover any new organism (plant or animal) or GMO that could later become a food product. For example, the HSNO covers genetically modified wheat as viable grains (i.e. able to grow), but not GM flour.
  2. The HSNO defines “new organism” as including “Any micro-organism all genetic structures (excluding those from humans) that have the ability to replicate or create copies of themselves Any organism defined as an organism under the Biosecurity Act 1993A reproductive cell or a developmental stage of an organism”. Under the HSNO, a “new organism” includes a genetically modified organism.

are largely agricultural based. They potentially stand to lose a lot from any adverse effects of GMOs in their district.

1.1 Structure of Article

The article is comprised of four parts. The first part defines what is meant by GM and briefly explains the scientific process. For the purposes of this article, the definition of GM is the same as that used in the Report of the Royal Commission of Inquiry into Genetic Modification. The second part describes the concerns of local government about GMOs in their districts and central government’s response to those concerns. I discuss the purpose and principles behind the HSNO and its limitations. The issue of who bears the risk and who is liable when things go wrong with GM is also discussed in this part. Part three critiques the argument that under the RMA and the LGA, local government can control land use involving GMOs in their districts or regions regardless of the HSNO. The fourth and final part discusses what is the best alternative option for local government in changing the status quo.


The terms of reference of the Royal Commission defined GM as:9

the use of genetic engineering techniques in a laboratory, being a use that involves –

(a) the deletion, multiplication, modification, or moving of genes within a living organism; or

(b) the transfer of genes from one organism to another; or

(c) the modification of existing genes or the construction of novel genes and their incorporation in any organisms; or

(d) the utilisation of subsequent generations or offspring of organisms modified by any of the activities described in paragraphs (a) to (c).

The Royal Commission excluded from its definition ‘new organisms’ or ‘products from modern selective breeding techniques’, for example, cloning or controlled cross-pollination. There are three major differences between selective breeding and GM:

  1. Royal Commission on Genetic Modification Report of the Royal Commission on Genetic Modification Wellington (2001) at 366.

The Royal Commission defined a GMO as “an organism that is produced by genetic modification”. The Commission described GM as involving the following process:10

Cells that contain a gene to be isolated are broken open and the strands of DNA are extracted. Then proteins called restriction enzymes are added to break the DNA at particular points, until the short lengths that are individual genes are obtained.

The wanted gene is added to plasmids, small molecules in bacterial cells that contain DNA that is not part of the chromosomes of the cell. It is the discovery that plasmids can move between cells, taking their DNA with them, that has made this technology possible. The plasmids to which the wanted gene has been added are put in with the cells (usually bacteria) where the wanted gene is to go. The plasmids get inside the bacteria and add their genes to the genes of the bacteria. This means the bacteria now have the wanted gene as well as their own. These bacteria are then used to transfer the new genes into plant or animal cells. This process of gene splicing creates recombinant DNA...

Another way to create genetically modified products is to use the bacteria themselves as factories for the introduced genes, producing such things as enzymes used in food production (e.g., chymosin for cheese making) and vitamins for use in making processed foods, or hormones for use in medicine and animal husbandry.

  1. Ibid at 363


3.1 The Royal Commission Report

The Royal Commission began in June 2000 and its members consisted of the Right Honourable Sir Thomas Eichelbaum, Jacqueline Allan, Jean Sutherland Fleming and the Right Reverend Richard Randerson. The specific terms of reference for the Royal Commission were to inquire into:

(a) The strategic options available to enable New Zealand to address, now and in the future, genetic modification, genetically modified organisms, and products; and

(b) Any changes considered desirable to the current legislative, regulatory, policy, or institutional arrangements for addressing, in New Zealand, genetic modification, genetically modified organisms, and products.

The Royal Commission released its report on 27 July 2001. In its Report, the Royal Commission concluded that New Zealand should preserve its opportunities by allowing the development of GM whilst minimising and managing the risks involved.11 Following the Report of the Royal Commission, the Government extended its voluntary moratorium on GM until October 2003. This was to allow for changes to be made to the law and implement the majority of the recommendations in the Royal Commission Report. This article does not discuss the Royal Commission Report in its entirety. However, I do make specific mention of the Royal Commission’s findings on New Zealand’s present liability regime for GMOs.

3.2 The Concerns of Local Government

One of the purposes of local government, according to section 10 of the LGA, is the promotion of the social, economic, environmental, and cultural well being of communities in the present and for the future. Restricting the use of GMOs in a district or region may well fall within section 10. However, in saying this, GM also has an unlimited potential to benefit the community. If a council were to support the use of land involving GMOs, because of these benefits to the community, such support would be a purpose consistent with section 10. In any

  1. Ibid at 2

event, it is suggested that local authorities should widely consult their communities on this issue before embarking on a course of action that may be motivated more from fear of the unknown than being balanced with a sense of realism.

In March 2004, Simon Terry Associates Ltd presented its report to the Whangarei District Council.12 The Report entitled, “Community Management of GMOs - Issues, Options and Partnership with Government” (“the WDC Report”) described the concerns of local government about GMOs in their districts or regions. The report examine, in particular, three areas:

The economic risks included the risk of contamination between GM crops and non GM crops. The harvesting, transport and processing of GM crops posed much greater contamination problems than expected. There were high levels of consumer resistance to eating GM foods in Europe and the wealthier Asian nations in particular:13

Specific risks capable of causing economic damage include: Market rejection of an individual company’s crop due to trace GM contamination. The Gisborne- based company Sunrise Coast experienced this market response in August 2003 when corn it grew for processing into a product for the Japanese market was rejected. Routine testing by the Japanese pizza maker that was to purchase the product showed trace contamination of 0.05%. This resulted in rejection of the entire line and the company estimates its losses were close to $500,000. The incident is likely to have arisen from trace contamination of seed stock.

Non GM Crops could also be rejected due to contamination by another different type of crop altogether. Non GM Crops may also be rejected when there is an apparent concern of a producer’s inability to successfully segregate GM and non GM crops even where there is no chance of cross pollination.

Producers of GM also run the risk of suffering economic loss when their product is used by others in breach of their intellectual property rights. An example of a breach of GM intellectual property rights is found in the recent

  1. Simon Terry Associates Ltd, Community Management of GMOs - Issues, Options and Partnership with Government, March 2004. The report was prepared for the Whangarei District Council in association with Far North District Council, Kaipara District Council, Rodney District Council and LGNZ. Later the Northland Regional Council agreed to support and contribute to the funding of the report. Each territorial authority contributed $5,000 to the cost of the report. The Northland Regional Council and LGNZ contributed $2,500 each.
  2. Ibid at 9.

Supreme Court of Canada decision of Monsanto Canada Inc v Schmeiser14. The salient facts were:

Percy Schmeiser has farmed in Saskatchewan for more than 50 years. In 1996 he assigned his farming business to a corporation in which he and his wife are the sole shareholders and directors. He and his corporation grow wheat, peas, and a large amount of canola.

In the 1990s, many farmers, including five farmers in Mr. Schmeiser’s area, switched to Roundup Ready Canola, a canola variety containing genetically modified genes and cells that have been patented by Monsanto. Canola containing the patented genes and cells is resistant to a herbicide, Roundup, which kills all other plants, making it easier to control weeds. This eliminates the need for tillage and other herbicides. It also avoids seeding delays to accommodate early weed spraying. Monsanto licences farmers to use Roundup Ready Canola, at a cost of $15 per acre.

Schmeiser never purchased Roundup Ready Canola nor did he obtain a licence to plant it. Yet, in 1998, tests revealed that 95 to 98 percent of his 1,000 acres of canola crop was made up of Roundup Ready plants. The origin of the plants is unclear. They may have been derived from Roundup Ready seed that blew onto or near Schmeiser’s land, and was then collected from plants along the roadway bordering four of his fields. The fact that these plants survived the spraying indicated that they contained the patented gene and cell. The trial judge found that “none of the suggested sources [proposed by Schmeiser] could reasonably explain the concentration or extent of Roundup Ready canola of a commercial quality” ultimately present in Schmeiser’s crop.

The trial judge rejected the suggestion that the high concentration of Roundup Ready Canola on Schmeiser’s farm was the result of Monsanto’s seeds being blown or inadvertently carried onto Schmeiser’s farm. Monsanto sued Schmeiser for infringing its patent. Monsanto was successful at first instance and the trial judge ordered Schmeiser to account for profits in the amount of $19,832. Schmeiser and his corporation appealed to the Court of Appeal and lost. They appealed to the Supreme Court of Canada and the appeal was allowed in part.

The Supreme Court held that Schmeiser had infringed Monsanto’s patent rights by the act of collecting, saving and planting seeds containing Monsanto’s patented gene and cell. The fact that Schmeiser did not spray the crop with Roundup did not mean that he did not use the patented invention. The Supreme Court however did hold that the trial judge made a mistake in awarding an amount

14 [2004] SCC at 34

for loss of profits, as, on the evidence, Schmeiser and his corporation did not make a profit from using Monsanto’s patented gene and cell.

Scientific research into the environmental effects of GM plants is still at an early stage. The potential dangers that GMOs represent are difficult to predict with certainty because some of the potential negative effects will manifest in the long term and be diffuse in nature.15 GMOs are living organisms with the potential to reproduce. There is also the possibility of gene transfer from one species to another. It will be difficult to assess the extent of environmental damage as a result of a GMO and difficult to assess clean up costs when things go wrong. Dr David Suzuki, a Canadian ecologist, summarised the danger, in his evidence to the Royal Commission, as:16

The difference with this technology is that once the genie is out of the bottle, it will be very difficult or impossible to stuff it back. If we stop using DDT and CFCs, nature may be able to undo most of the damage - even nuclear waste decays over time. But GM plants are living organisms. Once these new life forms have become established in our surroundings, they can replicate, change and spread, so there may be no turning back.

The Whangarei District Council Report makes mention of the following risks which are capable of causing environmental damage:17

Another concern arises in the different approaches that neighbouring local councils may take when GMOs are released in the district. The ‘cross-boundary’

  1. Supra 9 at 311.
  2. Supra 9 at 55.
  3. Supra 12 at 10.

effects of GMOs are a concern. It is suggested that co-operation between local authorities on GM is important and necessary. The shared funding for the WDC Report between several local councils is an example of good co-operation between councils on an important issue of mutual concern. Such co-operation ought to be encouraged as the potential spread of GMOs upon release may cross boundaries between districts and there may be nothing to prevent that from occurring. In that scenario, any adverse effects from GMOs being released into the environment, is unlikely to be confined to a district but is likely to spread across neighbouring districts.

Genetically modified technology allows human kind to design organisms according to their own preference. For some people, this is a significant and irreversible step in human intervention into nature. Ethically, the question becomes whether GM technology should be used at all because nature is being manipulated.

The Law Commission looked into the issue of liability for loss resulting from GMOs and described the adverse cultural effects of GM on Maori:18

Concerns have also been raised by Maori, which arise from a different belief structure. Although the basis for many of the Maori cultural objections to genetic modification vary among iwi, they are usually based around impacts on whakapapa, mauri, kaitiakitanga, and rangatiratanga. The traditional Maori worldview considers all parts of the natural world to be related through whakapapa. Genetic modification risks interfering with such relationships, and threatens the sanctity of mauri (life principle) and wairua (spirit) of living things. In this way, genetic modification may affect Maori’s ability to be kaitiaki (guardians) of their taonga and particularly their ability to care for valued flora and fauna.

3.3 Central Government’s Response to Local Government Concerns

Local government made their concerns known to central government, particularly when the HSNO was amended last year. The Royal Commission Report recommended that the HSNO needed to be amended to make it more robust with respect to GM. However, on the whole, the Royal Commission found the HSNO an appropriate regime to regulate GM on the national level. The reforming

  1. New Zealand Law Commission Liability for Loss Resulting From the Development, Supply or Use of Genetically Modified Organisms, NZLC SP14, May 2002 at 12

legislation came in the form of the New Organisms and Other Matters Bill (“NOOM“).

The NOOM was subject to considerable attention by local government. LGNZ and a number of local authorities filed submissions seeking, at the very least, clarity as to the roles and responsibilities of local government with respect to the regulation of GM. LGNZ argued that the responsibilities placed on local government under the HSNO for hazardous substances, were not matched by provisions allowing local government to influence decisions over the use of GMOs in their districts. Parliament’s Education and Science Select Committee (“the Select Committee”) decided not to amend the NOOM to address these concerns from local government. The Government members on the Select Committee did not see a role for local government in the control of GM.19

There were politicians however who were empathetic to local government. During the parliamentary debates over the NOOM Bill, Brian Donnelly, a member of ‘New Zealand First’ and chairperson of the Select Committee, said:20

The bill contains no clarification at all. It has left the poor old local governments right in the lurch...I want to talk also about the local government issue, and why this particular bill could very well be called the “Leaving Local Government in the Lurch Bill”. This bill, purely and simply, ignores local government.

Simon Power of the National Party, believed that the uncertainty for local government would only benefit lawyers:

It is also worth picking up on Brian Donnelly’s points about local government’s role in all of this, because this is the “Local Government (Caught Down the Creek Without a Paddle) Bill” when it comes to the issue of GE...What worries me most about the introduction of this bill, with regard to the issue of GE, is that the various units of local government have now been put in a position where they are unsure – as the Government members of the select committee stated in the committee’s report – how this legislation will apply to their rights if, for instance, they wish to declare a GE-free area.

Currently the use of ‘outdoor’ GMOs are limited to a handful of field trials. In the future, the use of outdoor GMOs will increase and so will the level of local

  1. Education and Science Select Committee, Report of the Education and Science Select Committee on the NOOM Bill, September 2003 at 5.
  2. New Zealand Parliamentary Debates Final/FINAL_2003_09_18.htm#_Toc66855472 (all ULRs in this article are as at 26 May 2004 unless stated otherwise).

community interest. Accordingly, the pressure on local government, by communities, will increase as GMO usage does.

The Whangarei District Council believes that LGNZ should consider lobbying central government to amend the HSNO to allow local government to have direct influence in decision-making concerning GMO applications that will affect their region or district:21

Potential reform of the legislation could be made on two levels and provide for:

The attitude of the Whangarei District Council towards GM (and it is suggested this belief is not uncommon with other local councils) assumes that the members of its community are unanimous in their views with regards to GM. Whilst the long term effects of GM are far from certain, one thing that is certain, is that there is no unanimous opinion on GM use. In my opinion, there is a feeling of scare mongering at the local government level that appears very strongly in the WDC Report.

Central government’s response, so far, has been that local government have no rights with regard to the regulation of GM. It has clearly shut them out of the decision-making on GM use and left it to ERMA, applying the HSNO, to decide. It may be noted however, that section 53(4) (c) (ii) of the HSNO was amended, as from 30 October 2003, by s 32(5) Hazardous Substances and New Organisms Amendment Act 2003 (2003 No 54). The new provision requires ERMA to notify any local authority of an application for a new organism, if in the opinion of ERMA, the local authority is likely to have an interest in the application. The local authority can then make a submission on the application. However, ERMA is not bound by those submissions and decides what weight is to be given to those submissions. This is seen as unsatisfactory for local government as their submissions do not carry any greater weight with ERMA than any other submitter. It is suggested that, on the one hand, local government may have legitimate concerns but, alternatively, this may also be seen by some, as political grandstanding.

  1. Whangarei District Council < wdcremittolgnzagm2004.doc

3.4 Who Bears the Risk when GM Goes Wrong?

One of the issues that the Royal Commission looked into was liability; who is and who should be liable for damage caused by GM? The Royal Commission queried whether there was a need for a new liability regime for GMOs because of their special nature. The likely effects of GM22 are likely to manifest only in the long term, be diffuse in nature and involve difficulties and expense in establishing proof of cause, nature and extent of damage.

Notwithstanding this, the Royal Commission concluded that a new liability regime was not necessary for the time being:23

The Commission considers it is unnecessary to recommend legislation providing special features for third parties, where there may have been affected by the release of a genetically modified organism. As technology advanced with ever- increasing pace throughout the 20th century, the common law (that is, law based on court decisions, as distinct from statute law) showed it was well able to mould new remedies for novel situations. Parliamentary intervention has rarely been needed in this area. From a legal liability perspective we have not been persuaded there is anything so radically different in genetic modification as to require new or special remedies.

The Royal Commission was of the view that ERMA could be held liable for negligence, nuisance or misfeasance of public office, in giving or refusing approval for GMOs and where harm was suffered as a consequence.24

Whilst the Royal Commission did comment on the RMA, that provides litigants with an avenue to the Environment Court where there was harm done to the environment as a result of GMOs, the Royal Commission did not take the opportunity to explore the liability of local government under the RMA. It would appear from the Report of the Royal Commission that as the HSNO was regarded as the national regulator of GMOs, ERMA was to be held solely liable.

The Law Commission, at the request of the Minister responsible for the Law Commission, was asked to consider and to report on issues surrounding liability

  1. Supra 9 at 311.
  2. Supra 9 at 328.
  3. Supra 9 at 320.

for loss resulting from GMOs25. Whilst the Royal Commission Report concluded that the existing liability regime of tort26 and statute27 was sufficient, that common law was capable of adapting to create new remedies for novel situations and therefore, a new liability regime was not necessary at the present time, the Law Commission was of a different view:28

The Law Commission has not identified any liability regime that could ensure that all damage that might be caused by GMOs would be compensated. GMOs pose the two possibilities of a low-probability but catastrophically damaging event, and of damage that is very slow in appearing. None of the existing mechanisms are able to guarantee compensation for either circumstance as nothing is likely to be able to compensate catastrophic or irreversible damage, and few remedies will be available for liability claims which may take decades to surface. In either of those situations, the options are that the losses lie where they fall, or that government steps in.

The Law Commission concluded that the present liability regime would not ensure that all damage that could potentially result from GMOs would be compensated. However, it is unlikely that any liability regime could guarantee this. The reason for this is because of the special features of GMOs. The following factors are relevant:29

  1. The fundamental issue to be investigated was the adequacy of current statute and common law for dealing with issues of liability for loss from GMOs. If the current law is not considered adequate, what options exist for specific liability regimes and what are their advantages and disadvantages?
  2. The accident compensation scheme, negligence, nuisance and misfeasance.
  3. HSNO & RMA.
  4. Supra 18 at 27.
  5. Supra 18 at 53.

The Law Commission gave a range of possible options to change the existing liability regime. These included:30

The Law Commission also concluded that central government needed to make some difficult policy decisions. Firstly, central government needs to decide whether to treat “like with like” i.e., should GMOs be treated in a similar fashion to activities that have comparative risks associated with them. Secondly, central government needs to strike the delicate balance between protecting the public against significant losses on the one hand and on the other, protecting the GM industry from added compliance costs that may investment. Thirdly, the decision must be made as to whether central government will step in as guarantor for any damage caused by GMOs. Given the special features of GMOs, as described above, central government will be looked upon to step in and cover the ‘short fall’ when the existing liability regime is unable to fully compensate for loss suffered because of GMOs. Such a policy decision requires considerable discussion and debate and in the end clear agreement.

The liability of local government was not mentioned in the Law Commission Report. Local government, it is suggested, is unlikely to be held liable, as ERMA, via the HSNO, has been charged with the national regulation of GMOs. The

  1. Supra 18 at 54

Law Commission did however suggest creating new public duties, especially under the HSNO, as one potential change to our current liability regime. In essence, this would entail amending the HSNO to enable compensation to be paid to those who suffer loss from GMOs.

3.5 The Hazardous Substances And New Organisms Act 1996

The Government enacted the Hazardous Substances and New Organisms Act in June 1996 and its purpose is to protect the environment and the health and safety of people and communities. The HSNO accomplishes this by preventing or managing the adverse effects of hazardous substances and new organisms including genetically modified organisms.32

The key principles relevant to the purpose of the HSNO are:33

Those who exercise a power, function or duty under the HSNO to achieve its purpose, must take into account the following matters of importance:34

  1. For a good discussion of the provisions of the HSNO see also Mothers Against Genetic Engineering Inc v Minister for the Environment [2003] HC CIV 2003-404-673
  2. HSNO s 4
  3. HSNO s 5
  4. HSNO s 6

The guiding principles used by ERMA to base decision upon include:35

Section 7 states that those who exercise a power, function or duty under the HSNO are to take a precautionary approach. Hazardous substances and new organisms must be adequately assessed before they are allowed into New Zealand. Where there is scientific and technical uncertainty about the adverse effects of a hazardous substance or new organism, the HSNO requires that caution should be exercised in order to control any potential effects. Section 7 is especially relevant to GMOs, whose effects on the environment are regarded by the Royal Commission to be diffuse and long term.

A hazardous substance, generally speaking, includes any substance that can damage the environment or harm human health and safety. However, the HSNO does not control radioactive, ozone-depleting and infectious substances.36 A ‘new organism’ is an organism that was not legally present in New Zealand before 29 July 1998, the date that the HSNO came into force for new organisms. ‘New organisms’ include any species of any animal, plant, bacterium, virus and GMOs.37 Genetically modified organisms are defined in the HSNO to include plants, animals or micro-organisms that have had their genetic material altered using genetic engineering techniques.38

  1. HSNO Your Guide to the Hazardous Substances and New Organisms Act 1996 (2003) 45

<> (as at March 2004).

  1. HSNO s 2.
  2. HSNO s 2A.
  3. HSNO s 2.

3.6 The Environmental Risk Management Authority

The Ministry for the Environment administers the HSNO. It achieves this by:39

ERMA is an independent crown agency responsible for making decisions, implementing the HSNO and coordinating enforcement. ERMA is accountable to the Minister for the Environment, currently the Honourable Marian Hobbs. The Minister for the Environment can set the priorities for ERMA through the ‘Purchase Agreement’. Part IV of the HSNO provides for the setting up of ERMA and states its functions. ERMA consists of eight members who are appointed by the Minister. ERMA is supported by a technical and administrative organisation called ‘ERMA New Zealand’. ERMA New Zealand is made up of a Chief Executive and support staff. One of its more important tasks is to evaluate and review applications and to provide reports that will assist ERMA in its decision- making. This task requires support staff that are competent and adequately trained.

The Crown is subject to ERMA’s decisions; ERMA’s decision-making must be independent and not subject to government influence. However, where an application is held by the Minister to be of national or international significance, the Minister can make the decision. In these circumstances, ERMA conducts an inquiry and makes recommendations to the Minister. The Minister may also appoint people with special knowledge to assist ERMA in its inquiry.

Section 9 of the HSNO provides for a methodology to be established and for ERMA to consistently apply the methodology when making decisions. The methodology was established in the New Organisms (Methodology) Order 1998 (“the Methodology Order”). In considering an application, ERMA must evaluate risks, costs and where applicable, benefits, based on:40

  1. Supra 35 at 22.
  2. Supra 35 at 45.

Under section 40 of the HSNO, applications for approval to import, develop or field test a new organism in containment are to be made to ERMA. The application must include information about the containment system for the organism. An application for the development of an organism must include information concerning:

An application for field-testing shall include information concerning:

Under section 39, ERMA can approve an application for the importation, development, or field-testing of any new organism in containment. ‘Containment’ is defined in section 2 of the HSNO as meaning to restrict an organism or

  1. Note that new organisms that are to be released do not have any controls attached to their approval.

substance to a secure location or facility to prevent escape; and, for GMOs, includes field testing and large-scale fermentation. One recent example was an application by the University of Otago, in 2002, to import into containment, GM mice for use in studying the action of vitamin C and its relevance to the development of diseases associated with inflammation such as chronic lung disease, arthritis and atherosclerosis. That application was approved with controls:42

Containment means that the organism is kept under strict laboratory or field conditions, under controls set by the Authority and in containment facilities registered by MAF. This could include a contained laboratory, which has to operate to standards known as PC1, PC2, PC3 and PC4 conditions. PC stands for ‘physical containment’ and refers to the degree of security in laboratories. PC1 is less secure, with PC4 being the most secure. There are no PC4 facilities in New Zealand and only two rated PC3. Most are PC2 or PC1.

Anyone who wants to import, develop, field test43 or release44 a GMO must apply to ERMA for approval. It may be noted however, that before the HSNO came into force there were already a number of GMOs present in New Zealand:45

Some of these were in existing laboratory experiments or field trials, e.g., GM crops or animals, approved with management controls by the Minister for the Environment, on the recommendation of the Advisory Committee on Novel Genetic Techniques (ACNGT) or the Interim Assessment Group (IAG). These operated under a voluntary regime before the HSNO Act was passed... As at December 2000 there were six field tests still operating, either with research still to be completed or post-harvest monitoring of pine trees...

The existing (pre-HSNO) field tests were reviewed by ERMA New Zealand in 1998-1999. The Authority was asked to reassess the conditions for three field tests: GM salmon, and two GM canola sites. In the case of the salmon, a formal

  1. HSNO <> (as at June 2004).
  2. “Field test”, in relation to a new organism, means the carrying on of trials on the effects of the organism under conditions similar to those of the environment into which it is likely to be released. Such trials must be carried out in such a way that the organism never escapes into the environment or affects other organisms and all the examples of the organism are either retrieved or destroyed at the end of the test.
  3. “Release” means in relation to new organisms, allowing the organism to move within New Zealand free of any restrictions other than those imposed in accordance with the Biosecurity Act 1993 or the Conservation Act 1987 (s 2 HSNO).
  4. HSNO <> (as at June 2004).

reassessment decision was issued, requiring tighter conditions at the research facility. In the case of the canola, the [ERMA] decided that the period of post- harvest monitoring should be extended.

It is now possible to make an application to ERMA for approval.46 Needs to mention the moratorium – when it was imposed and when it was lifted.

With many of its applications ERMA will notify these to the public for example, through major newspapers or through its website. Any member of the public may make a submission on a publicly notified application. Hearings of applications are also open to the public. As previously mentioned section 53(4) of HSNO requires ERMA to notify local government of applications for activities involving GMOs that ERMA considers may be of interest to them.

The Environmental Risk Management Authority may approve the importation, development47 or field-testing of new organisms in containment in the following cases:48

It may be noted that the HSNO controls on new organisms only apply to new organisms in containment because when organisms are released, they reproduce and cannot be controlled. Whilst ERMA does not attach any controls to approvals for a release of an organism, the potential effects of the new organism’s release

  1. The moratorium did not apply to applications already approved by ERMA; applications made to ERMA before the moratorium took effect but on which it has not made a decision; gene technology medical trials on humans (these are covered by the Medicines Act 1981 and not by the HSNO Act); the production of foods and medicines using genetic modifications which do not include viable GMOs; the import or development of GMOs in containment.
  2. “Development”, in relation to new organisms, means genetic modification of any organism but does not include field-testing (s 2 HSNO).
  3. Supra 35 at 33.

on the environment are taken into account in considering an application. It is now assumed that the organism will be released eventually into the environment.

The offences, enforcement and penalties regime under the HSNO was examined by the Royal Commission. On the whole, the Royal Commission was satisfied with the regulatory regime provided for in the HSNO, in so far as GMOs are concerned. However, the Royal Commission did note that ERMA had no power to impose conditions on general releases. It was arguable whether any adverse effects from the general release of a GMO into the environment could be remedied by the use of a compliance order (discussed below). For this reason, the Royal Commission recommended that a new category of “conditional release” be added to the HSNO.49 The Royal Commission observed that under the HSNO those who50:

have committed a strict liability offence where the Prosecution are not required to prove intent. However, there are recognised defences such as necessity, unforeseen events beyond the defendant’s control, or the defence that all reasonable steps were taken to prevent the harm occurring51.

The HSNO provides for ‘compliance orders’. Compliance orders prohibit dangerous conduct or actions that contravene the HSNO, its regulations or controls attached to an approval. A compliance order can also order a recipient to comply with the HSNO, its regulations or controls attached to an approval or do what is necessary to avoid, remedy, or mitigate any actual or likely adverse effects on people or the environment resulting from any breach of any regulations or any controls imposed by an approval granted under the HSNO52.

A successful prosecution under the HSNO carries with it stiff monetary penalties ranging from $50,000 to $500,000 and a maximum term of imprisonment of three months depending on the type of HSNO infringement.53

  1. Supra 9 at 313.
  2. HSNO s 109. 51 HSNO s 117(2).
  3. HSNO s 104.
  4. HSNO s 114.
The Hazardous Substances and New Organisms Act requires ERMA to keep a public register of all the applications it has received and its decisions. The register is made available to the public and is easily accessible at any office of ERMA New Zealand, online or in “The Bulletin”, ERMA New Zealand’s official record that is mailed to key stakeholders. Anyone can ask to be put on ERMA New Zealand’s mailing list. Through publication of every application and every decision, ERMA is making its decision-making process more transparent and accessible to the public. Rather than shying away from the public and making its decisions behind closed doors and in secret, ERMA is showing that it carries out its business in the light of day and is making every effort to be accountable for the decisions it makes.

It has been decided that: additional controls may be set on hazardous substances and new organisms under other legislation where these controls are more stringent or specific than those under the hazardous substances and new organisms legislation, and are required to meet other outcomes or responsibilities.

However, it is difficult to be persuaded to agree with the view expressed in the WDC report. The statement from the Ministry, that the view is based upon, was made well before GMOs became a contentious issue in New Zealand. Since the statement was made the HSNO has been enacted; the Act has been amended to include GMOs within the definition of new organisms and a new section has been inserted into the Act concerning the ‘conditional release’ of GMOs.

The WDC Report seeks to argue that, under section 142(3) of the HSNO, Parliament has empowered local government to set higher standards for hazardous substances through the RMA. Section 142(3) states:

Nothing in subsection (2) of this section shall prevent any person lawfully imposing more stringent requirements on the storage, use, disposal, or transportation of any hazardous substance than may be required by this Act or

  1. Supra 12 at 4.
  2. Hazardous Substances and New Organisms: Proposal for Law Reform, Ministry for the Environment, October 1992 at 36.

regulations made under this Act where such requirements are considered necessary by that person for the purposes of the Resource Management Act 1991.

The amendment to the HSNO last year was an opportunity for Parliament to provide a similar provision in relation to new organisms, however Parliament chose not to do so. It cannot be argued that Parliament overlooked this issue, given the submissions from local government that would have made central government aware of their concerns during the legislative process. It is, therefore, suggested that Parliament intended that local government should not be permitted to control land use involving GMOs, notwithstanding the fact that local government can control land use involving hazardous substances under the RMA. Further, it is suggested that this inconsistency is the result of central government having little faith in local government with respect to GMOs. This stance is made clear in the advice given by the Ministry for the Environment to the select committee that reviewed the changes to the HSNO via the NOOM Bill:56

It is clear in our view that [local authorities] have little, if any ability to control GMOs under the RMA or the LGA. Nor does the Ministry consider that the New Organisms and Other Matters Bill should give local authorities the ability to control GMOs

The Ministry for the Environment also had little faith in the capacity of local councils to regulate GMOs effectively and even went so far as to suggest that local council involvement would only undermine the HSNO: 57

Most local authorities would not have the level of expertise required to establish the specific controls needed for the management of a particular GMO. It is unlikely therefore, that any controls placed on a GMO by a local authority would have a sound technical basis. In addition, this would undermine the HSNO regime, which is based on comprehensive scientific, economic and cultural risk assessments. Moreover, giving local authorities the ability to control GMOs would introduce a dual permitting regime with consequent additional costs of compliance and enforcement.

However, not everyone agrees, as the next part of this article will illustrate.

  1. Ministry for the Environment letter of 26 August 2003 from Dave Brash to the Education and Science Select Committee, 2.
  2. In a Ministry for the Environment letter of 26 August 2003 from Dave Brash to the Education and Science Select Committee considering the New Organisms and Other Matters Bill which amended the HSNO.


4.1 The Somerville Opinion

Dr Somerville was instructed by Whangarei District Council to draft a legal opinion58 in respect of three issues:59

In response to the first question, Dr Somerville concluded that:60

  1. Royden J Somerville QC, Interim Opinion on Land Use Controls and GMOs. Legal opinion for the Whangarei District Council, 2004.
  2. Ibid at 5.
  3. Ibid at 3.

For Dr Somerville to be correct with his primary conclusion, he would have to argue that the HSNO (being a statute enacted later in time to the RMA and being a more specific statute in relation to GMOs than the RMA) did not expressly or impliedly preclude the operation of the RMA and its general provisions in so far as land use controls for GMOs were concerned.

Dr Somerville begins his argument by stating the law thus:61

Where two statutes deal with the same subject matter and it is reasonably possible to construe the provisions so as to give effect to both, then that must be done. In such a case the correct approach to interpretation is to first attempt to give each its effect without creating conflict or inconsistency between the two. It is only in cases where statutes are “so inconsistent with, or repugnant to the other that the two are incapable of standing together” that it is necessary to decide which statute is to prevail...Where there is overlap between the two statutes and inconsistency is unavoidable, then the specific statute will prevail over the general...In principle, the general provision remains intact but it is inapplicable to the situation covered by the specific legislation and is impliedly repealed.

Dr Somerville argues that there are no provisions in the HSNO that prevent a district council performing its function under the RMA.62 Such a provision, it is suggested, would only undermine the HSNO in achieving its purpose, as local authorities play a key role in the enforcement of hazardous substances.63

Dr Somerville further argues that there is no inconsistency between the HSNO and the RMA. This is because when ERMA considers an application for the use of a GMO, its focus in considering the application is related to the environmental effects concerning that specific GMO. Whereas, under the RMA, a local council’s focus would be on a considerably larger scale, that is on a district wide basis and for the purpose of promoting the sustainable management of the natural and physical resources of the district.64 Dr Somerville concludes that as both ERMA and local authorities are going about achieving the same goal but with a different focus, there is no inconsistency between the later but specific provisions of the HSNO and the earlier but general provisions of the RMA:65

  1. Ibid at 17, 18.
  2. Ibid at 19.
  3. Local authority’s responsibilities in enforcing the HSNO in relation to hazardous substances include private dwellings, the ability to enforce during inspection of land use controls for hazardous substances under the RMA, functions transferred by other enforcement agencies, dangerous goods during the transitional period of the HSNO.

64 RMA s 5(1)).

65 Supra 58 at 20.

Therefore, the functions of each authority need not produce inconsistent controls and as such it should be presumed that the HSNO Act was not intended to limit the general provisions of the RMA and the functions of a territorial authority in relation to managing the risk of significant or irreversible adverse environmental effects from the use of land for GMO-related activities to promote the purpose of the RMA. A contextual interpretation of the HSNO Act and the RMA suggests that the application of the decision-making process by ERMA under the HSNO Act and the WDC under the RMA need not be incompatible with the legislative regimes in each statute. However, the WDC would need to take into account ERMA’s view of site specific matters and, to use the High Court term, “tread carefully”.

With respect to Dr Somerville, I do not agree with him when he concludes that there is no inconsistency between the HSNO and RMA in so far as the control of GMOs are concerned. Whilst I agree with Dr Somerville where he says the HSNO was enacted later in time to the RMA and its provisions are more specific to GMOs as oppose to the general provisions of the RMA, I do not agree that ERMA takes a narrower view than would a local council.

4.2 The Arguments Against Local Government Control of GMOs under RMA & LGA

To justify my assertion, firstly I rely on principles of statutory interpretation. Those of particular relevance have already been mentioned above. In my opinion, there is a clear inconsistency between the HSNO and the RMA in so far as GMOs are concerned. I begin by referring to the purpose66 of the HSNO and its guiding principles67. These are couched in very wide terms. The HSNO’s key principles are similar to the wording of the purpose of the RMA described in section 5 of that Act:

  1. To protect the environment, and the health and safety of people and communities, by preventing or managing the adverse effects of hazardous substances and new organisms.
  2. The key principles relevant to the purpose of the HSNO are: (a) the safeguarding of the life- supporting capacity of air, water, soil and eco systems (b) the maintenance and enhancement of the capacity of people and communities to provide for their economic, social and cultural well-being and for the reasonably foreseeable needs for future generations.

(a) Sustaining the potential of natural and physical resources (excluding minerals) to meet the reasonably foreseeable needs of future generations; and

(b) Safeguarding the life-supporting capacity of air, water, soil, and ecosystems; and

(c) Avoiding, remedying, or mitigating any adverse effects of activities on the environment.

At first glance there would appear to be several similarities in wording. However, the major difference between the wording of the HSNO’s purpose and principles and the RMA’s purpose is that there is no mention of GMOs in the RMA whatsoever. The HSNO on the other hand is a law enacted by Parliament to manage the adverse effects of hazardous substances and new organisms, including GMOs. It is specifically made for this purpose. The provisions of the RMA are of a more general application to the environment. Parliament could not have intended for these more general provisions that were enacted earlier in time to expressly or impliedly repeal the specific provisions of the HSNO.

Earlier in this article I discussed section 53(4) of the HSNO. This provision requires ERMA to notify local government of any applications for activities involving GMOs that ERMA considers may be of interest to them. If Dr Somerville is correct, section 53(4) would be superfluous. Parliament intended section 53(4) to mean something. It is suggested that Parliament intended ERMA to be the final decision maker and accordingly reduced local government to the status of a mere submitter. To suggest otherwise, as Dr Somerville argues, would require express provisions in the HSNO or the RMA allowing local government to exercise some manner of control over land use involving GMOs. Such express provisions simply do not exist.

Perhaps the strongest argument against Dr Somerville’s primary conclusion is the reforming legislation to the HSNO that has previously been discussed. Parliament did not, at that opportunity, choose to enact express provisions allowing local government to control land usage involving GMOs.

Secondly, I rely on case law. Bleakley v Environmental Risk Management Authority68 concerned an appeal, against the approval by ERMA, of an application

68 [2001] 3 NZLR 213.

to field-test a GMO. One of the concerns raised by the appellants was the potential for general contamination from the disposal of milk from genetically modified cattle. The High Court noted that where questions of environmental effects arise, if those questions involve “heritable materials” (that is genetic materials), such questions are to be dealt with under the HSNO. However, if there are wider environmental effects, such as contamination from products not involving new organisms, those matters must be addressed under the RMA:69

Given that the authority found there was no such danger of escape, there was no obligation in law – and it certainly was not appropriate – for the authority to venture into more orthodox pollution issues. It is true that the Act has an environmental protection purpose, as does the Resource Management Act, however, that prima facie wide purpose is to be read in the context of its subject- matter and specifics. It is to protect the environment against hazardous substances and organisms, and not on a wider scale. The wider scale is the role of others under general legislation in the RMA . Thus, if spraying milk on pastures were to raise a concern that heritable material might escape, that would be a concern for the authority [ERMA] [my emphasis]. If after authority action, there was no risk of escape of heritable material but there remained a risk of another environmental character – e.g. destruction of aquatic life in streams – that would be a concern to be dealt with under the Resource Management Act. It would not be an authority matter, despite the breadth of the opening sections of the Act.

The Environment Court has recently been afforded an opportunity to comment on a local council’s suggestion that it had authority under law to make rules governing the use of GMOs in the unreported decision of Ngatiwai Trust Board v The Whangarei District Council70. In that case the referrer, Ngatiwai Trust Board sought to introduce rules to the effect that “any activity involving genetic engineering” should be listed as a prohibited activity in the Whangarei District Council’s proposed District plan. That attempt was opposed by the council on a number of grounds including inconsistency with the objectives and policies of the proposed District plan. The Council also initially suggested that there was no jurisdiction under the RMA for a territorial authority to make rules governing the use of GMOs. However, at the time of the hearing the Council71

... signalled that it does not wish to pursue that issue. It apparently considers that it does have authority at law to do so, but in the case of its presently proposed

  1. Ibid at 243.
  2. [28 April 2004] Environment Court, Auckland, A057/2004.
  3. Ibid at 3.

plan it has elected not to do so. Neither party made any further mention of the point, and we make no ruling on it.

It is suggested that the Whangarei District Council was now relying on Dr Somerville’s opinion. It is my opinion, that if local councils were to rely on Dr Somerville’s primary conclusion, they would be held by the judiciary to be acting ultra vires. Given the specific provisions provided for ERMA in the HSNO, any bylaw passed by a local council would share a similar fate. It is suggested that any decision by local councils to impose controls on land usage involving GMOs is likely to result in litigation and accordingly, this is not a sound policy for local authorities to adopt.

The Royal Commission did consider the concept of GM free zones and noted that such a proposal might be possible under the RMA. However, the Royal Commission also noted that such a proposal was fraught with difficulties and could potentially divide communities:72

First, it would require widespread acceptance in a given region before it could be put in place without impinging unduly on the rights of those who wished to avail themselves of selected genetic modification technologies. Second, and for the same reasons that we found on “all or nothing” approach to be too inflexible, a blanket ban on applications of genetic modification would be a blunt instrument when a genetically modified form of Crop A might be quite compatible with a non-genetically modified form of Crop B.

The Commission also discussed a more selective concept relating to the Resource Management Act provisions for different land uses. Genetically modified and non-genetically modified crops might be permitted or prohibited on a crop-by- crop and region-by-region basis. This would require a genetically modified crop to be designated as a different use from a non-genetically modified crop of the same species. It may also be that over a period of time an aggregation of genetic modification or non-genetic modification uses became characteristic of particular regions and that identifiable regional differences emerged. These distinctions in land use might be written into regional or district plans, just as industrial use is separated from residential use. At the same time, the Commission acknowledges there are considerable practical difficulties with such proposals, which have the potential for dividing communities. Because of these difficulties the Commission is unable to reach a decision but notes the possibilities.

  1. Supra 68 at 337.

It is our view that an appropriate regulatory and institutional framework for the controlled use of genetic modification is already provided by the Hazardous Substances and New Organisms Act 1996 (HSNO). ...


As has been previously mentioned, the best strategy for local government to bring about change is to lobby central government to amend the HSNO. The best organisation to accomplish this is LGNZ. In my view this will not be easily accomplished, especially under the present government. It is suggested that the HSNO be amended so that the submissions of local government become a primary and mandatory consideration in ERMA’s decision-making process for applications seeking approval to use GMOs in the district or region.

Local government would need to convince central government of their ability to be fair in their treatment of GM users if they are ever to successfully lobby central government to empower local government to exert an influence or to contribute meaningfully in GM decision-making. It is unfortunate that the WDC Report has taken the stance that there is something inherently suspicious about GM. It is my view that local authorities need to be aware of the needs and concerns of all GM users, not just those in their community who are against GM. Local councils would also need to convince central government that their involvement in the decision making process would supplement and not undermine the HSNO. It is suggested that local government would have to work in partnership with ERMA if the HSNO was amended in local government’s favour. I do not envisage local government taking over the “monopoly” that ERMA now shares in deciding applications for GMOs. This is because ERMA New Zealand possesses the scientific and technical skills that I doubt most local councils, except perhaps for the major metropolitan councils, would be able to muster.

A number of local councils have already adopted some form of policy on GM. The Nelson City Council, for example, has declared itself a GM free city. It is a symbolic gesture only and is unlikely to survive a judicial review for the reasons discussed above. The LGNZ news website stated the following:73

The moratorium on the release of GMOs will expire in October 2003 when ERMA will be able to consider the release of GMOs. We circulated a discussion document prepared by Environment Bay of Plenty and undertook a survey of the sector to assess the level of interest in proposed management framework

  1. Local Government New Zealand < 1080265436.pdf>).

associated with the release of GMOs in local areas. Twenty-four councils responded. A number of these have adopted some form of policy on GMOs. Importantly, most of the respondents thought a coordinated sector response to management issues was needed.

Central government also needs to make some difficult policy decisions and it is suggested that it should not procrastinate with regard to issues of liability involving GMOs. The Law Commission found that our current liability regime would be inadequate to fully compensate for losses that resulted from a ‘worst- case’ scenario. No liability regime could ever compensate such extreme adverse events. However, it is suggested that the central government must take steps now to alleviate potential losses stemming from GMOs. Such steps could take the form of a special levy on GMOs or require users of GMOs to take out insurance or to pay a bond. At the same time, it is important that these added costs should still make it attractive for businesses to invest in GM. This is a difficult balance to strike, but achievable.

The HSNO is likely to be amended sometime this year with respect to hazardous substances. I anticipate that LGNZ will take that as another opportunity to lobby central government. It will be interesting to see what develops. However, under this government, I would not be surprised if the status quo remained.

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