Proposal for an EU Directive on Environmental Liability - Consultation: Overview of Responses

European Commission proposed Directive on Environmental Liability

Overview of responses to public consultation:
12 April to 24 May 2002

1. Introduction

1. This overview covers responses received to the public consultation exercise on the proposed Directive on Environmental Liability, launched on 12^th April 2002.
2. Of just over 190 representative bodies invited to submit views, 27% responded. 92% of these were from business (including professional and trade associations) and 8% from environmental NGOs. 23 responses were received from individuals and other organisations. The consultation posed questions on key themes of the proposed Directive, the responses ¹ are analysed in detail below. ²

2. Overview

3. Over 80% supported the broad principles of the proposed Directive whilst a minority (5%) felt that the proposal did not go far enough. Approximately three quarters of those supporting the broad principles did not think the proposed Directive would achieve its environmental aims, citing the need for greater clarity, particularly in the definitions.
4. A significant minority of responses (42%) felt that the proposal amounted to an unreasonable burden on operators. Furthermore, 69% thought it would place a disproportionate burden on small to medium-sized enterprises.

3. Scope

5. A majority (60%) felt that the regime should be based solely on fault-based liability, or alternatively that strict liability should be subject to a limit. 61% favoured fault-based liability for biodiversity damage caused by occupational activities not listed in Annex I. Opinion was divided on the approach to biodiversity in regard to protected species and protected sites. Some (30%) thought that the regime should be based on Natura 2000 sites only, in order to establish harmonisation across the EU; others (25%) specifically thought that this was too narrow and that all biodiversity which is regarded as valuable, endangered, and in need of protection should be covered. Some 70% specifically supported the inclusion of national protected sites although further concern was expressed over limiting the scope to designated sites. Fifteen individual responses put forward the view that all damage to biodiversity caused by GMOs, wherever it may be found, should be covered.
6. The definition of "operator" attracted criticism (80%): greater precision was needed. Uncertainty was expressed over whether the operator is always the permit holder, and whether those providing financial backing could be held liable.
7. 80% supported the proposal to exclude damage covered under existing international conventions. The implications of a Member State not being a Party to a particular convention was a concern to some. It was also considered important that the Directive should allow for any revision of existing Conventions, along with future Conventions, to be taken into account as necessary.

4. Legal regime

8. Opinion was divided over the Commission's public law approach. On the one hand, a majority (94%) of the representative bodies commenting supported the Commission's public law approach, although it was recognised that a civil liability regime could benefit the environment by imposing additional deterrents to causing environmental damage. A majority of individuals (over 90%) and a small number of representative bodies however, thought that traditional damage should be included specifically in respect of GMO contamination. Additionally, the regime should ensure that there is no conflict between traditional damage and environmental damage.
9. 56% thought that the appropriate forms of environmental damage are included. A small minority believed that the proposed Directive should exclude biodiversity and that a separate regime is required for biotechnology. 20% thought that damage from diffuse pollution should be included.
10. The definitions in Article 2 of the proposed Directive raised concern: a large majority (over 90%) believed that they are inadequate. The key definitions of concern were "operator", "biodiversity", "damage", "occupational activities" and "imminent threat". These definitions would need clarifying to ensure correct interpretation of the measures, and certainty to assist insurability.
11. 57% believed that the prevention provisions were not workable. Imminent threat was felt not to be a workable concept as both the Competent Authority and the operator may not be aware of the threat of damage. Additionally, the responsibilities of the Competent Authority need to be clearer.
12. The proposal for joint and several liability attracted some support (41%). Comments suggested that this would do little to promote a preventative approach, and that liability should be on a proportionate basis. Those in support did so in principle, stating that the proposal would be in keeping with the polluter pays principle.
13. A total of 6 responded on whether there was a likelihood of any adverse implications for company law, 4 did not see a problem. Additional comments suggested however, that some strengthening of company law may be needed, and that liabilities within business and contractual partnerships could become complicated.

5. Exceptions and defences

14. The issue of defences and exemptions elicited the largest response. Over 70% welcomed the proposal for a permit exception, citing it as essential for business certainty and insurability. This was also the case for the state of the art exception. Additional suggestions were for an "in an emergency" exception. Those in opposition argued that any exception was incompatible with the polluter pays principle. A further argument was that the permit exception provided no defence for smaller businesses, where emissions are often below permit thresholds.
15. The question of whether there were sufficient safeguards for operators and competent authorities attracted only a few responses (7) and opinion was equally divided. Additional comments echoed those given in paragraph 14.

6. Non-Retroactivity

16. This was welcomed by the majority of commentators (over 70%), although it was recognised that it would be difficult in some cases to distinguish between environmental damage that occurred before or after the date of implementation, particularly in the case of ongoing activities. Concerns centred on the situation being beyond all reasonable doubt, and the need to avoid costly baseline studies.

7. Financial security

17. Over 40% of the responses commented on the insurability of the regime, with most commentators (67%) believing that insurance would be available. 40% felt that insurance should not be compulsory and that a limit should be placed on strict liability.
18. 40% thought that insurance costs would affect competitiveness. An even larger number (87%) felt that it would place a burden on Small and Medium sized Enterprises (SMEs) in particular. A cap should be established for SMEs if compulsory insurance were to be introduced.
19. A large number (70%) of commentators supported the idea of a national fund although some felt strongly that industry should not be required to contribute. Suggestions included a fund from general taxation, joint contributions from insurance companies and the Government, or a permit levy.

8. Request for Action and Review

20. A majority (60%) believed that the proposal on the request for, and review of action, was workable and reasonable. Some expressed strongly the view that NGOs should not be able to take direct action, and that the term "qualified entity" needed further clarification. Some concern was expressed that the proposed system may open the way for repeated requests to the competent authority to take action. It was also felt that the operator needed to have some form of appeal.

9. Restoration of environmental damage

21. A large majority (65%) opposed the proposed approach to restoration. The view was that authorities should be empowered rather than obliged to restore environmental damage, with the ability to determine priorities, particularly given that restoration may not always be possible. Suggestions included establishing a framework to be backed up with guidelines, or an independent body to oversee restoration. Concern was also expressed over the funding of baseline studies and who would bear the cost.
22. Responses (12) were equally divided over whether sufficient weight is given to the cost and reasonableness of restoration requirements. Comments echoed those given in paragraph 21 above.
23. A small majority (54%) opposed the proposal on interim losses. More precision in the definition of interim losses was urged, whilst there was concern over how this aspect would be implemented.
24. 82% felt that compensatory restoration to be carried out away from the damaged site was practicable. However, some of these also felt that either firm guidance would be required, or that decisions should be taken on a case-by-case basis. Provided that the main focus is on primary restoration, compensatory restoration was deemed acceptable as a fallback option, although it should be regarded as second best.
25. A significant proportion of those who responded (72%) felt that Member States should have greater flexibility in the choice of restoration. However, some of these argue that restoration should always occur and that the Member State should have no discretion on whether it does or not. The remaining 28% felt that the proposed regime offers sufficient flexibility.
26. On the subject of subsidiary responsibility, a majority (85%) of the 12 responding supported the idea of an obligation on Member States if the polluter cannot be found or cannot pay. A proportion of these argued that in such instances the state should pay from general taxation, and not industry.

Defra/EED

1 The responses have been placed in the Defra library

2 The percentages given below are in respect of responses to a particular issue.