Glossary · Reading the business
Environmental permit
In short
An environmental permit is official permission from a government agency to operate a business activity that might impact the environment. Buyers must confirm all necessary permits are current and transferable to avoid legal issues and operational disruptions.
What it means in a deal
During due diligence, check if the target business requires specific environmental permits for its operations, like waste disposal or air emissions. Verify their status and ensure they can be transferred to you post-acquisition. A Phase I Environmental Site Assessment often uncovers these.
Official sources
SOP 50 10 — Lender and Development Company Loan Programs
U.S. Small Business Administration · SBA Standard Operating Procedure
Last checked 2026-06-15. Official sources control — verify before relying on any rule for a live deal.
Related terms
Common questions about Environmental permit
- When is a lender permitted to waive environmental due diligence requirements for real estate collateral?
- Does the SBA permit a seller to retain a minority ownership stake while holding a standby note?
- When can a lender permit a partial standby seller note if the total equity injection exceeds minimum requirements?
- When does the SBA permit a 7(a) loan to finance a partial buyout where the seller retains a significant ownership stake?
- When a Phase I Environmental Site Assessment (ESA) identifies a Recognized Environmental Condition (REC), what are the lender's subsequent responsibilities?
- If a Phase I Environmental Site Assessment (ESA) identifies Recognized Environmental Conditions (RECs), what are the next steps for a lender?
Defined by CapBench SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
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