Ashurst legal update highlights interstate compliance risks following the fragmented rollout of PFAS NEMP 3.0 and ADWG updates.

Overview

The management of per- and polyfluoroalkyl substances (PFAS) in Australia has reached a critical juncture. The publication of the PFAS National Environmental Management Plan version 3.0 (PFAS NEMP 3.0) by the Commonwealth in March 2025, alongside the updated Australian Drinking Water Guidelines (ADWG) in June 2025, was intended to harmonise the scientific and regulatory approach across the nation. However, the subsequent implementation of these updated frameworks has highlighted that national consistency in environmental regulation remains a myth. Individual states are adopting the new criteria at varying rates and through different statutory mechanisms, creating a complex and highly fragmented compliance landscape.

For Australian environmental professionals, developers, infrastructure operators, and property lawyers, this regulatory friction represents a significant commercial risk. Transactions, redevelopment projects, and infrastructure works that span multiple jurisdictions are now subject to disparate rules. A site deemed suitable for commercial use or clean enough for soil reuse in one jurisdiction may fail to comply with Commonwealth expectations or the active standards of a neighbouring state. This mismatch exposes project stakeholders to sudden regulatory scrutiny, project delays, and unexpected liabilities under general environmental duty provisions.

Navigating this transitional phase requires a deep understanding of the gap between Commonwealth policy intent and the practical, legally operative standards enforced by state environmental protection agencies. While federal bodies publish guidelines based on the latest toxicology and environmental science, the constitutional responsibility for contaminated land management lies with state governments. As a result, the transition to PFAS NEMP 3.0 is a multi speed process, requiring practitioners to adopt a forward looking approach to risk management rather than relying solely on the local regulations in force at any given moment.

Key details

The PFAS NEMP 3.0, released in March 2025, introduces a series of refined investigation levels and management protocols designed to address a wider range of exposure pathways. Crucially, it incorporates updated guidelines for soil reuse, wastewater management, and resource recovery, reflecting a more conservative understanding of PFAS mobility in the environment. It also incorporates the Industrial Chemicals Environmental Management Standard (IChEMS) Register, specifically the Schedule 7 controls. These controls impose strict national prohibitions and restriction measures on the manufacture, import, use, and disposal of three key PFAS sub-groups: perfluorooctane sulfonic acid (PFOS), perfluorooctanoic acid (PFOA), and perfluorohexane sulfonic acid (PFHxS).

In parallel, the Australian Drinking Water Guidelines (ADWG) updates in June 2025 have established significantly lower health-based guideline values for these substances. The revised guidelines reflect updated international scientific assessments of the long-term health risks associated with PFAS exposure. By establishing separate, much lower acceptable concentrations for PFOS, PFOA, and PFHxS, the new ADWG places intense pressure on groundwater and surface water assessment frameworks. Historically, guidelines allowed for a combined PFOS and PFHxS value of 0.07 micrograms per litre (ug/L), but the updated criteria require distinct, far more stringent assessments that often push the required limits of reporting down to the limits of commercial laboratory detection.

The scientific methodology underpinning PFAS NEMP 3.0 demands a more sophisticated assessment of contaminant pathways. Rather than relying solely on total concentration thresholds, the new framework emphasizes the use of leachate testing, such as the Australian Standard Leaching Procedure (ASLP), to evaluate the risk of groundwater contamination. It also introduces more detailed guidance on assessing the risk of bioaccumulation in terrestrial and aquatic food chains, particularly near sensitive agricultural or conservation areas. Consequently, laboratory testing plans must be designed to achieve ultra-trace limits of reporting, particularly when assessing water samples or soil destined for beneficial reuse.

The enforcement of these new standards is legally complicated. Because the Commonwealth lacks the constitutional power to directly regulate environmental matters at the state level, PFAS NEMP 3.0 and the revised ADWG do not automatically become legally binding. Each state and territory must formally adopt the new criteria into its own statutory framework. This process is highly uneven. For instance, while some states have mechanisms that automatically refer to the latest national guidelines, others, such as Queensland, require lengthy administrative and legislative processes to formally endorse the new thresholds, leaving a clear regulatory gap between current local policies and the latest national science.

Australian context

Contaminated land management in Australia is structurally anchored by the National Environment Protection (Assessment of Site Contamination) Measure 1999, commonly known as the NEPM 2013. However, because the NEPM is difficult to amend quickly, the PFAS NEMP was established as a dynamic, parallel instrument to allow for rapid updates as scientific understanding evolved. The fragmented rollout of PFAS NEMP 3.0 highlights the challenges of this dual system. In Victoria, the Environment Protection Authority (EPA) operates under the Environment Protection Act 2017, which centres on the General Environmental Duty (GED). Under the GED, duty holders must minimise risks to human health and the environment from pollution and waste so far as reasonably practicable. This means Victorian operators must proactively align with PFAS NEMP 3.0 immediately, because the GED legally requires compliance with current scientific knowledge, regardless of whether the state EPA has formally updated its written guidelines.

In contrast, the regulatory landscape in New South Wales and Queensland relies more heavily on statutory guidelines. In New South Wales, the EPA regulates contaminated land under the Contaminated Land Management Act 1997 and the Protection of the Environment Operations Act 1997. While the NSW EPA expects practitioners to refer to the latest version of the PFAS NEMP, there is often a lag in updating formal statutory instruments and waste classification guidelines. In Queensland, the Department of Environment, Science and Innovation manages contamination under the Environmental Protection Act 1994. The formal adoption of NEMP 3.0 thresholds is still progressing through Queensland regulatory channels, creating a scenario where local site assessments may technically follow older standards while leaving developers exposed to liability under common law and general environmental duties.

This state-by-state variation is further complicated by water quality management frameworks. Groundwater assessments must consider the Australian and New Zealand Guidelines for Fresh and Marine Water Quality (ANZG), which are also influenced by the updated ADWG criteria. Where groundwater on a site has the potential to migrate to surface water bodies or drinking water extraction zones, the applicable guidelines must be carefully integrated. In South Australia, where the EPA operates under the Environment Protection Act 1993, the definition of environmental harm is tied to the current state of scientific knowledge. Thus, even without formal legislative adoption of NEMP 3.0 in Adelaide, a failure to account for these lower thresholds can be interpreted as a failure to manage environmental harm, creating significant compliance risks during transactions and site redevelopments.

Practical implications

The immediate consequence of this fragmented regulatory rollout is that environmental site assessments must be designed with extreme foresight. When preparing a sampling and analysis quality plan (SAQP) for a Detailed Site Investigation (DSI), consultants must specify laboratory analytical methods capable of achieving the lower detection limits required by PFAS NEMP 3.0 and the updated ADWG. Relying on historical data sets or standard limits of reporting is a high risk strategy, as past assessments may have failed to detect PFAS at concentrations that are now considered actionable. A site that was previously cleared of contamination under older guidelines may require re-evaluation if new pathways are identified or if the property is subject to a change of land use.

Waste classification and the management of surplus soil represent some of the most significant commercial risks under the new regime. As states gradually align their landfill acceptance criteria and resource recovery exemptions with PFAS NEMP 3.0, the cost of soil disposal is expected to rise sharply. Materials that were once acceptable as clean fill or low level contaminated soil may now be classified as regulated waste, requiring transport to specialized, high cost disposal facilities. This shifts the financial viability of major infrastructure and development projects, making the early development of a comprehensive Remediation Action Plan (RAP) and a Construction Environmental Management Plan (CEMP) critical to project budgeting and execution.

For corporate transactions and due diligence, the regulatory lag creates a need for robust contractual protections. Property buyers, developers, and institutional investors must ensure that environmental due diligence reports evaluate site conditions against the latest Commonwealth guidelines, not just the currently operative state standards. Contractual warranties, indemnities, and disclosures must be drafted carefully to define “contamination” by reference to emerging national standards. This mitigates the risk of purchasing a property that satisfies local state rules today but becomes a liability tomorrow when the state formally implements the stricter NEMP 3.0 and ADWG criteria.

Article Summary

In our experience delivering complex site contamination projects across Australia, the biggest risk is not the chemistry of PFAS, but the regulatory lag between Commonwealth policy and state enforcement. When we review environmental due diligence reports or design a Detailed Site Investigation (DSI) for acquisitions, relying on local state guidelines is no longer a defensible position. In jurisdictions like Queensland and New South Wales, where formal endorsement of PFAS NEMP 3.0 lags, we must design sampling plans and target detection limits to meet the strict Commonwealth and updated ADWG values. This ensures projects remain viable through future regulatory transitions. Conversely, in Victoria and South Australia, general environmental duty provisions mean that ignoring these new standards could immediately trigger regulatory enforcement or void a Site Audit Statement. This mismatch directly impacts the Remediation Action Plan (RAP) and waste classification pathways. A site soil classification that works today under local state guidelines may result in a stranded asset tomorrow. Developers and in-house counsel must update transaction warranty wording to define contamination against these emerging Commonwealth standards. Managing this risk during due diligence, rather than late in the construction phase under a CEMP, is the only way to avoid regulatory notices and project delays.

References and related sources

• Primary source: www.ashurst.com
• PFAS National Environmental Management Plan (NEMP)
• Australian Drinking Water Guidelines

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This is an iEnvi Machete news summary. Prepared by iEnvi to summarise the source article for contaminated land, groundwater, remediation, approvals and site risk professionals.

Published: 21 May 2026

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