European Commission welcomes new directive on environmental liability

The European Commission has welcomed the agreement on the groundbreaking Environmental Liability Directive that has been reached in conciliation by the European Parliament and the Council.

March 1, 2004 -- The European Commission has welcomed the agreement on the groundbreaking Environmental Liability Directive that has been reached in conciliation by the European Parliament and the Council.

It will enable the proposed Directive now to be swiftly adopted. Agreement on an EU measure on Environmental Liability has been sought since the late 1980's. The new Directive is the first EU law specifically based on the "polluter pays principle".

It will ensure that future environmental damage in the EU is prevented or remedied and that those who cause it are held responsible. Environmental damage includes damage to animals, plants, natural habitats and water resources as well as contamination of land which causes significant harm to human health.

Environment Commissioner Margot Wallström commented: "I am delighted that we have finally come so far, after 15 years of trying, and now have an agreement on an EU Directive on Environmental Liability. This was one of my big commitments when I became Commissioner, and I am proud now to deliver on this important file.

"The idea that the polluter must pay is a cornerstone of EU environmental policy, and with the new Directive, we are, for the first time, putting the 'polluter pays principle' into practice in a comprehensive manner. The new Directive should be a strong incentive to prevent environmental damage from happening at all. I find it particularly important and relevant that the new Directive will apply to protected habitats and species at a time when so many threats adversely impact the world's biodiversity."

Agreement in conciliation

Four issues were subject to conciliation, which was opened on 27 January 2004. The amendments as now agreed by Parliament and Council do not significantly change the forthcoming Environmental Liability Directive.

The most important amendment relates to the issue of financial guarantees, whose use is only voluntary under the Directive. It has been agreed that the European Commission will review this matter in a report six years after the entry into force of the Directive, considering the following aspects: a gradual approach in developing possible mandatory financial security, a ceiling for liability and the exclusion of low risk activities from mandatory insuring. In the light of that report, and of an extended impact assessment, it will decide whether to submit proposals for a system of harmonised mandatory financial security.

The compromises found for the remaining three amendments are essentially clarifications that do not alter the scope and effectiveness of the Directive.

Main features of the forthcoming Directive

The Directive will establish a framework based on environmental liability to ensure that environmental damage is prevented or remedied. Environmental damage includes damage to species and natural habitats protected at EU level under the 1992 Habitats and 1979 Birds Directives (92/43/EEC and 79/409/EEC), to waters covered by the 2000 Water Framework Directive (2000/60/EC), as well as land contamination which causes significant risk of harming human health. There will be no retrospective effect.

The parties potentially liable for the costs of preventing or remedying the environmental damage are the operators of the risky or potentially risky activities listed in one of the Annexes attached to the Directive.

These include activities releasing heavy metals into water or into the air, installations producing dangerous chemicals, landfill sites and incineration plants. Other economic operators may also be liable for the costs of preventing or remedying damage to protected species and natural habitats, but only in case they are found to be at fault or negligent.

Public authorities will play an important role in the proposed liability scheme. It will be their role to ensure that responsible operators undertake themselves, or finance, the necessary preventive or remedial measures.

Public interest groups, such as non-governmental organisations, will be allowed, under the system, to require public authorities to act, if this is necessary, and challenge their decisions before the courts, if those decisions are illegal.

As the Directive does not oblige operators to ensure coverage of their potential liabilities by appropriate financial security products, such as insurance, Member States are required to encourage the development of such security instruments and their use by the operators. As agreed in conciliation, the Commission shall present a report after six years in which it will address this issue.

Next steps

The political agreement now needs to be formally adopted by Parliament and Council within 6 weeks. It is likely that this will happen in the course of March 2004. Once the Directive is published and enters into force, Member States will have three years to implement it into national law.

For more information on the subject, see:

More in Environmental