Asset purchase transactions—EHS issues to consider
Asset purchase transactions—EHS issues to consider

The following Environment guidance note provides comprehensive and up to date legal information covering:

  • Asset purchase transactions—EHS issues to consider
  • Transfer of environmental permits
  • Contaminated land
  • Waste management
  • Packaging waste
  • Waste Electrical Electronic Equipment
  • CRC Energy Efficiency Scheme
  • Energy Savings Opportunity Scheme

This Practice Note is part of the Environmental transactions asset purchase toolkit. It has been produced in partnership with ELM Law.

The following questions can be used as a checklist by the seller’s solicitors preparing the data room, or by the buyer’s lawyers advising their client whether the environment, health and safety (EHS) documents in the data room are sufficient for the type of business.

See Practice Note: Environmental issues when selling a company or business.

Transfer of environmental permits

If the seller has an environmental permit for operating the target business, it will remain legally liable as permit holder until the date of the permit transfer, which is usually after completion.

It typically takes two to three months to transfer a permit, so the asset purchase agreement (APA) may need to contain environmental permit transfer provisions including an indemnity from the buyer.

See Precedent: Transfer of environmental permits. This Precedent is drafted from the position of the seller and contains an indemnity from the buyer.

For further information, see:

  1. Environmental Permitting Regulations 2016—permits, applications and exemptions

  2. Environmental permit transfer requirements—Checklist

The following questions should be raised at the outset of the transaction:

  1. Does the seller or business have any environmental permits?

  2. Are the permits in force and in the correct name?

  3. Have there been any breaches of permit conditions or threats from regulators?