ELD Effectiveness: Scope and Exceptions (BIO Intelligence Service - - PowerPoint PPT Presentation

ELD Effectiveness: Scope and Exceptions (BIO Intelligence Service (2014))

Valerie Fogleman Consultant, Stevens & Bolton LLP Professor, Cardiff University School of Law

Issues

 Scope of strict liability  Scope of environmental damage  Appropriateness of the “severity / significance

thresholds” for land and water damage

 Application of the permit and state-of-the-art defences  Application of the marine and nuclear international

Conventions specified in Annexes IV and V of the ELD

 Possible eligibility and/or need to incorporate other

international instruments into Annexes IV and V

Scope of strict liability

 Options analysed

– Unlimited strict liability for all professional activities – Extending the list of activities in Annex III to include, eg, pipeline transport of dangerous substances, mining activities, shale gas exploration and exploitation, and invasive alien species – Leaving the list in Annex III unchanged – Reducing the list in Annex III by indicating which activities should be removed

Scope of strict liability

 Some MS have extended strict liability to non-Annex III

incidents by – Additional activities in Annex III (France – transport of substances by pipeline; Belgium (Federal and Brussels- Capital Region) – transport and other activities involving invasive alien species) – Strict liability for biodiversity damage from non-Annex III activities (Greece) – Strict liability for environmental damage from non-Annex III activities (Hungary, Lithuania, Sweden (with exceptions))

Scope of strict liability

 The Commission may wish to consider as a priority in a

possible future revision of the ELD extending strict liability to non-Annex III activities for biodiversity damage

– To assist in halting the loss of biodiversity in the EU due to damage to biodiversity from agriculture, forestry, fisheries, and other non-Annex III activities – To fill a gap in the legislation of most MS because

– Few MS impose liability for restoring biodiversity damage – MS that impose liability, limit restoration requirements to an unlawful act and/or following a conviction

Scope of strict liability

 The Commission may wish to consider as a priority in a

possible future revision of the ELD, extending strict liability for non-Annex III activities for all environmental damage

– Extension to land and water damage would

– Promote the polluter pays principle and internalise the costs of preventing and remediating environmental damage – Simplify and streamline the ELD by, among other things, removing the need for operators (and competent authorities) to determine whether new versions of legislation in Annex III exist and whether an activity is covered by the detailed legislation in Annex III

Scope of strict liability

 Alternatively, the Commission may wish to consider as

a priority in a possible future revision of the ELD, extending the list of Annex III activities to include pipeline transport of dangerous substances, invasive alien species and, perhaps mining activities

– Serious environmental damage has been caused by a ruptured pipeline and mining activities since adoption of the ELD – Invasive alien species harm human health, property and biodiversity

 The study examined shale gas operations but does not

make a recommendation because the Commission has already taken action concerning them

Scope of strict liability

 We do not recommend that the Commission considers

in a possible future revision of the ELD, leaving the list in Annex III unchanged or reducing the list because doing so would not further the polluter pays principle, internalise the costs of preventive and remedial actions, or streamline and simplify the ELD

Scope of environmental damage

 Options analysed

– All-inclusive broad scope (general reference to environment, landscape, human health, etc) – Defining environmental sectors/categories of environmental damage which currently fall outside the scope of environmental damage

Scope of environmental damage

 All-inclusive broad scope (general reference to

environment, landscape, human health, etc)

– The ELD divides environmental damage into three categories: land, water, and biodiversity damage – Most MS impose liability for the prevention and remediation of the risk of, or actual, damage/harm to human health and the environment (including air) – Most MS (including Austria, Belgium (Regions), Cyprus, Denmark, Estonia, Finland, France, Netherlands, Slovakia, Sweden, UK) impose liability for remediating contaminated land

Scope of environmental damage

 All-inclusive broad scope (continued)

– Some MS (including Hungary, Latvia, Lithuania, Poland, Romania, Slovenia) impose liability for remediating environmental damage in general, which includes land, water, and flora and fauna – Some MS (Ireland, Latvia, Poland, UK) impose liability for restoring flora and fauna dependent on an aquatic environment

Scope of environmental damage

 All-inclusive broad scope (continued)

– Some MS impose liability for restoring protected species and natural habitats damaged by an unlawful act or following a conviction

– Only Germany includes liability for complementary remediation, and only for biodiversity damage, not water damage

Scope of environmental damage

 The Commission may wish to consider as a priority in a

possible future revision of the ELD, revising the categorisation of environmental damage in the ELD

– Doing so would simplify and streamline the ELD because the categorisation has led to problems in some instances in determining the applicable category of environmental damage

– Some Article 18(1) reports include incidents under more than one category – Environmental damage that may fall under more than one category includes damage to wetlands and, perhaps, sediment

Scope of environmental damage

 The Commission may wish to consider as a priority in a

possible future revision of the ELD, including air damage

– Although air cannot be remediated in the same way as land and water, measures to prevent pollutants entering the air (such as fire-fighting measures) would prevent harm to human health and may also prevent other environmental damage

Scope of environmental damage

 We do not recommend that the Commission consider

as a priority in a future possible revision of the ELD including flora and fauna that is not protected by nature conservation legislation

– Although their inclusion would fill a gap in MS legislation, it would, among other things, be difficult to establish significance thresholds

Scope of environmental damage

 We do not recommend that the Commission consider

as a priority in a possible future revision of the ELD including landscapes, seascapes, cultural buildings or ancient monuments

– It would, among other things, be difficult to establish significance thresholds, and no MS has included them in its transposing legislation

Appropriateness of the “severity / significance thresholds” for land and water damage

 Options analysed

– Broadening land damage to cover risks to the environment as well as the “risk of human health being adversely affected” – Setting up criteria or thresholds (limit values) for land damage – Bringing the remediation standard for land damage to a comparable level for biodiversity and water damage – Determining the significance threshold for water damage by setting criteria (similar to criteria in Annex I for biodiversity damage) and/or thresholds (limit values)

Appropriateness of the “severity / significance thresholds” for land and water damage

 “Land damage”

– “any land contamination that creates a significant risk of human health being adversely affected as a result of the direct or indirect introduction, in, on or under land, of substances, preparations, organisms or micro-

• rganisms”

Appropriateness of the “severity / significance thresholds” for land and water damage

 “Water damage”

– “the ecological, chemical or quantitative status or the ecological potential, as defined in [the Water Framework Directive (2000/60/EC)], or the waters concerned …, or – the environmental status of the marine waters concerned, as defined in the [Marine Strategy Framework Directive (2008/56/EC)], in so far as particular aspects of the environmental status of the marine environment are not already addressed through [the Water Framework Directive]”

Appropriateness of the “severity / significance thresholds” for land and water damage



The ELD must contain “significance thresholds” for land, water and biodiversity damage because it imposes liability to carry out remedial measures if, and only if, the threshold is exceeded



Often lengthy assessments are generally needed to establish whether thresholds for an imminent threat of, and actual, environmental damage have been exceeded, particularly for water and biodiversity damage



The ELD defines an “imminent threat” narrowly (“a sufficient likelihood that environmental damage will occur in the near future”)



The potential thus arises that operators are not notifying competent authorities of an imminent threat of, or actual, environmental damage, because it is impossible to know whether the damage is subject to the ELD

Appropriateness of the “severity / significance thresholds” for land and water damage

 The Commission may wish to consider as a priority in a

possible future revision of the ELD, lowering the threshold for an imminent threat of environmental damage – The revision would

– Make the ELD more effective because operators would know when they must notify competent authorities of an incident, and must carry out preventive and emergency remedial actions – Not result in a lowering of the threshold for long-term remedial measures (primary, complementary and compensatory remediation) because an operator is not required to carry these out until the competent authority has determined the measures to be carried out

Appropriateness of the “severity / significance thresholds” for land and water damage

 The Commission may wish to consider as a priority in a

possible future revision of the ELD, re-defining land damage to include groundwater damage (or re-defining environmental damage concerning land and water)

– Most MS already had regimes to impose liability for remediating land damage – Many MS regimes included the remediation of groundwater (and sometimes other water) pollution – Differentiating between land damage and water damage creates problems due to the close relationship between soil and groundwater (and other waters)

Appropriateness of the “severity / significance thresholds” for land and water damage

 We do not recommend that the Commission considers

in a possible future revision of the ELD, raising the remediation standard for soil until the Commission has considered a re-definition of land / water damage because raising the standard would necessitate differentiating soil from groundwater

Appropriateness of the “severity / significance thresholds” for land and water damage

 We do not recommend that the Commission considers

proposing EU-wide soil limit values (trigger levels) because many MS (eg, Belgium (Regions), France, Germany, Italy, Latvia, Netherlands, Poland, Spain, Sweden) have developed varying trigger levels

 Difficulties in establishing EU-wide soil limit values

include

– Policy as well as scientific determinations in establishing levels, with policy decisions differing between MS – Differences in mineralogy of soil, depths of water tables, background levels of contaminants, etc, across the EU

Appropriateness of the “severity / significance thresholds” for land and water damage

 The definition of water damage refers to

– Criteria on the status of surface and ground water bodies in respect of a key objective of the Water Framework Directive; to reach good status by 2015 – Criteria on the status of marine waters, based on the management plan for achieving or maintaining the good environmental status of marine waters by 2020

Appropriateness of the “severity / significance thresholds” for land and water damage

 The Commission may wish to consider as a priority in a

possible future revision of the ELD, revising the definition of water damage rather than setting further criteria for them under the current definition, because

– It is questionable whether the significance threshold for a liability systems such as the ELD should be based on a management plan for achieving an objective

 We note that any re-definition of “water damage” could

impact on a re-definition of “land damage” if the Commission was to decide to consider the re-definition

• f both terms

Appropriateness of the “severity / significance thresholds” for land and water damage

 The Commission may also wish to consider as a

priority in a possible future revision of the ELD, clarifying or revising the definition of water damage

– Some MS have interpreted the definition to refer to water bodies; other MS have interpreted it to refer to waters under the Water Framework Directive – Applying the criteria to waters outside water bodies would not be subjective – The water body approach results in the ELD not applying to many areas of the EU due to the large size of water bodies, and non-application of the ELD to unclassified waters and water bodies with the lowest status

Application of the permit and state-of-the-art defences

 Options analysed

– How often the optional permit and state-of-the-art defences were used by MS that incorporated them in their national legislation – Whether their use had an effect on the remediation of environmental damage – What the difference in environmental and economic terms for the MS and industry with special regard to the “level playing field” possible was – The need and potential for harmonisation at EU level of the optional defences

Application of the permit and state-of-the-art defences

 14 MS adopted the permit defence with no exceptions  15 MS adopted the state-of-the-art defence with no

exceptions

 Some other MS adopted variants  Other MS did not adopt either defence

Application of the permit and state-of-the-art defences

 The study found only one case in which the permit

defence was raised

– A remediation notice was not served in the UK because the operator had a permit defence

 The study did not find any cases in which the state-of-

the-art defence was raised

 It was, thus, not possible to analyse the application of

the defences

Application of the permit and state-of-the-art defences

 The study, however, noted many criticisms of the

defences, including

– The creation of an un-level playing field across the EU – Favouring large companies as opposed to SMEs – Not furthering the polluter pays or preventive principles – Being contrary to the economics approach to law

 The Commission may, therefore, wish to consider as a

priority in a possible future revision of the ELD, deleting the optional defences

Application of the marine and nuclear international Conventions specified in Annex IV and V of the ELD

 Options analysed

– Compare the treatment incidents under the scope of the IMO Conventions would have received under the ELD had the ELD been applied – Analyse any possible difference as regards the environmental outcomes, in particular with respect to environmental remediation (standards) by taking account

• f environmental benefits and economic costs

Application of the marine and nuclear international Conventions specified in Annex IV and V of the ELD

 The exclusions for the marine and nuclear Conventions

in the ELD are unclear whether

– The Conventions are excluded entirely if an incident

• ccurs in a MS in which the relevant Convention has

been implemented, or – They are excluded only to the extent that they include environmental damage covered by the ELD

 The Commission may wish to consider as a priority in a

possible future revision of the ELD, clarifying the scope

• f the exclusions

Application of the marine and nuclear international Conventions specified in Annex IV and V of the ELD

 Main differences between the treatment of incidents

under the Conventions and the ELD

– The Conventions are compensation regimes, not regimes to remediate environmental damage – Their primary focus is human interests; biodiversity damage is a secondary concern – They do not include complementary and compensatory remediation

Application of the marine and nuclear international Conventions specified in Annex IV and V of the ELD

 Main differences (continued)

– Their coverage of environmental damage may be limited to pure economic loss, in which case they do not cover primary remediation and, perhaps, do not overlap with the ELD – The term “incident” in the Conventions is arguably higher than the significance threshold in ELD – The Conventions limit liability, which is contrary to the polluter pays principle, but (unlike the ELD) impose mandatory financial security to ensure compensation for claims (which may be limited to claims for bodily injury, property damage and economic loss)

Application of the marine and nuclear international Conventions specified in Annex IV and V of the ELD

 Other issues involving the IMO Conventions

– The decision maker in a claim under the 1992 Fund Convention is the Fund, not a competent authority, leading to an argument that the decision maker is acting, at least in part, on behalf of commercial interests not the public – Commercial concerns and balancing in the IMO Conventions would be disrupted if the exclusion was deleted

Application of the marine and nuclear international Conventions specified in Annex IV and V of the ELD

 The Commission may wish to consider as a priority in a

future possible revision of the ELD, entering into discussions with the IMO to clarify the scope of the Conventions and their overlap (or not) with the ELD with a view to resolving their extent in respect of the ELD

Application of the marine and nuclear international Conventions specified in Annex IV and V of the ELD

 Other issues involving the nuclear Conventions

– The decision maker concerning significance thresholds and the extent of environmental damage subject to compensation is a court – The amount of compensation payable by the public increased following their revision after Chernobyl, which is contrary to the polluter pays principle – Their limits, other criteria concerning them, and their ratification, vary dramatically across the EU

Application of the marine and nuclear international Conventions specified in Annex IV and V of the ELD

 The Commission may wish to consider as a priority in a

possible future revision of the ELD, clarifying the scope

• f cover for environmental damage provided by the

nuclear Conventions

 We recommend that the discussions include the

nuclear insurance pools, in addition to nuclear

• perators, in order to ensure the continuation of

insurance cover

Possible eligibility and/or need to incorporate other international instruments into Annexes IV and V

 Options analysed

– Incorporating the following instruments into Annexes IV and V

– Offshore Protocol to the Barcelona Convention for the protection of the marine environment and coastal region of the Mediterranean – Protocol on Civil Liability and Compensation for Damage Caused by the Transboundary Effects of Industrial Accidents on Transboundary Waters – Nagoya-Kuala Lumpur Supplementary Protocol on Liability and Redress to the Cartagena Protocol on Biosafety

Possible eligibility and/or need to incorporate other international instruments into Annexes IV and V

 We do not recommend that the Commission consider

incorporating the three international instruments into Annexes IV and V as a priority in a future possible revision of the ELD

– The last two instruments have not entered into force – None of the instruments is as broad as the ELD