CHANGES to eliminate anomalies in a federal environmental law has potentially cleared the way to ensure the future of Gippsland's native forest industry.
Professor Graeme Samuel's interim report into the Environment Protection and Biodiversity Conservation Act has backed the need for clarity around Regional Forest Agreements, which govern timber harvesting in Victoria.
This follows the decision in May by the Federal Court, which ruled that state-owned timber company VicForests breached environmental laws by harvesting sections of the Central Highlands inhabited by the critically endangered Leadbeater's possum.
Mr Samuel said the Environment Protection and Biodiversity Conservation Act recognised the RFA Act, and additional assessment and approvals, were not required for forest activities under the RFA.
Exceptions were operations in a World Heritage property or a Ramsar wetland.
"These settings are colloquially referred to as the 'RFA exemption', which is somewhat of a misnomer," he said.
Mr Samuel said legal ambiguities in the relationship between the Environment Protection and Biodiversity Conservation Act and RFA Acts should be clarified so the Commonwealth's interests in protecting the environment interacted with the RFA framework in a "streamlined way".
The report also recommends that the act be amended to establish 'single touch approvals' and bilateral agreements with state and territory governments, as RFAs do.
This model reduces duplication and strikes the right balance between environmental, economic and social outcomes.
Australian Forest Products Association chief executive Ross Hampton said the Federal Court decision had created uncertainty around RFAs nationally.
He called for the Environment Protection and Biodiversity Conservation Act to be amended to reaffirm the intent of the RFAs.
"RFAs are required by law to be independently reviewed every five years, and all reviews have found they are meeting or exceeding all environmental objectives, while providing a level of certainty to industry," Mr Hampton said.
"However, the Federal Court decision has created enormous challenges for the future of Victoria's sustainable hardwood timber industry," he said, despite VicForests' plan to appeal the decision.
Mr Hampton said the uncertainty could be addressed if the federal government urgently amended section 38 of the Environment Protection and Biodiversity Conservation Act to affirm and clarify the Commonwealth's intent regarding RFAs.
"That would make it explicit that forestry operations in RFA regions are exempt from the act, and that compliance matters are to be dealt with through the state regulatory framework and do not invalidate the RFA provisions," he said.
Mr Hampton said the minor amendments to clarify the intent of the RFA exemptions should be dealt with urgently and separately to the environment protection and biodiversity conservation process.
The Federal Court found that the Environment Protection and Biodiversity Conservation Act applied to VicForests' operation because harvesting at 26 coupes was in breach of the code of practice that governed forestry management, and that its operations at an additional 41 coupes were unlikely to comply.
All of the coupes are home to either the Leadbeater's Possum or the threatened Greater Glider. Retired forester and author Mark Poynter said the court ruling was based on a literal interpretation of the 'precautionary principle' that was 'out-of-step' with past interpretations, and that there were strong grounds for an appeal.
"The precedent is the Weilangta Forest case in Tasmania in 2007-08, where a similar initial ruling was overturned on appeal," he said.
Mr Poynter said this was based largely on a concern that a literal interpretation of the 'precautionary principle' could make other resource uses such as mining or farming unworkable.