The Environmental Protection Agency says local authorities aren't enforcing the law.
The EPA says County Councils across the midlands have to step up when it comes to protecting local environments.
The State body is highlighting the large-scale, illegal commercial extraction of peat taking place across the region.
Offaly and Westmeath are among the seven counties where large scale extraction is taking place without the appropriate licensing.
The Environmental Protection Agency has investigated 9 sites in Offaly, 8 in Westmeath, and 38 in total.
These illegal operations are contributing to an export trade of 300,000 tonnes of peat annually, valued at almost €40m.
The agency is responsible for any extraction sites over 50 hectares
Any smaller sites fall under the remit of the relevant County Council.
The EPA says they're not fulfilling their obligations when it comes to the enforcement of the law.
Longford County Council has been singled out for co-operating and acting on the EPA's information.
While the remaining six local authorities are blaming a lack of resource for their inactivity, according to the EPA.
The State body has issued directions to the other councils and says they'll use their powers to ensure the councils fully implement and enforce environmental requirements.
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