Has the ECJ saved reverse logistics from a compliance nightmare? Judgment in Shell

The ECJ this morning held in Case C-241/12 and C-242/12 Shell Nederland Verkoopmaatschappij NV and Belgian Shell. The judgment was not yet uploaded unto the ECJ website however it should be soon (and presumably also in English). I reported earlier on the AG’s Opinion which was not very favourable. There is much more hope in today’s judgment.

Most important to me is the finding by the Court (at 46) that in order to determine whether client who received the off-spec product, discards it, particular attention needs to be paid to the fact that the (Belgian) client returned the off-specification fuel with a view to obtaining repayment in accordance with the sales agreement. As I discuss in my posting on the Opinion, the Advocate General generally and unjustifiably dismissed the relevance of the contractual context.

The Court also emphasises that Shell at any rate cannot have been considered to have discarded the product before it was discovered that the product was off-spec (as a result of contamination). The ECJ instructed the Court at Rotterdam to discover Shell’s true intention, taking into account in particular the possibility to sell the off-spec product to another buyer in its off-spec state; the fact that no waste operations (disposal or recovery) such as outlined in the Waste Framework Directive had to be carried out; that the market value of the off-spec product sold corresponds almost one to one to the value of the on-spec product; and Shell’s acceptance of the product with a view to blending so as to re-market it. This latter point is important: blending is not seen by the Court as a waste recovery operation.

Back to Rotterdam therefore without a definitive answer however with another piece in the waste definition jigsaw laid (in particular: the contractual context). Very very important judgment.

Geert.