Tag: A1P1

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Dutch court denies RWE, UNIPER damages for coal phase-out. Rejects ia ‘permit defence’ under the EU Emissions Trading Scheme ETS.

RWE’s case (seeking huge damages for the impact on its assets following the Dutch coal phase-out) under investor-State dispute settlement (ISDS) continues I understand (I would also suggest it is problematic given the ECT’s fork in the road provisions), while Uniper’s will be dropped as part of its bail-out conditions. Yet this post is about yesterday’s first instance Uniper judgment and RWE judgment in the Dutch courts. I use the Uniper judgment for this post, the RWE judgment is not materially different as to its legal analysis.

Of note is first of all that these judgments are by the ‘commercial’ chamber at the Den Haag court, not an ‘environmental’ chamber. This might be relevant for those wishing to present the judgment as one of a maverick band of environmental crusaders.

RWE and UNIPER’s claims are based on ‘A1P1‘ (Article 1 of the First Protocol to the European Convention on Human Rights) and Article 17 of the Charter of Fundamental Rights of the EU, both of which protect the right to property.

[5.6] the court lays out the benchmarks (translation courtesy of DeepL and double-checked by me):

( a) is there “possession” (property)

( b) is there “interference,” that is, deprivation or regulation of the right to property?

If both these conditions are met, then the following requirements are examined:

( c) is the interference “lawful,” that is, provided for by law;

( d) if so, does the infringement have a legitimate objective that serves to promote the “general interest,” and

( e) if so, is there a “fair balance,” that is, a reasonable balance, between the requirements of the general interest and the protection of the fundamental rights of the individual?

The latter “fair balance test” is not satisfied if there is an individual and excessive burden on the person concerned.

[5.9] the State had argued that uncertain future earnings are not caught by A1P1 however the court [5.10] disagrees. The corporations have a long-term guarantee to use of the site, ia via a long-term lease. That the earnings might potentially not qualify as possessions, does not diminish the qualification of the guaranteed economic interest as ‘property’.

Interference, lawfulness and general interest are established each in one para [5.11 ff] , and did not seem to be the focus of much discussion even by the parties.

Fair balance is discussed extensively [5.14] ff. [5.15.3] the court qualifies the measure as regulatory interference and not de facto expropriation (the latter would have triggered guaranteed compensation rights). Even if electricity generation using coal will be phased-out, after the end of the transition period, Uniper will continue to have use of the site and has indeed already assumed such use in announced coal-free business plans.

The court then discusses the foreseeability at length, concluding [5.16.31] that although the Dutch Government frequently expressed support for modern facilities generating electricity using coal, this was always done with the caveat that that method had to be compatible with the Dutch climate commitments. [5.16.35] the ETS permit defence is dismissed.

[5.17.9] the court, having studies the various scientific reports presented to it, holds that there are most definitely alternative uses for the site. That their profitability is uncertain, is simply also a feature of energy markets as a whole.

[5.18] the court holds that the Dutch coal phase-out does have an effect on reduced CO2 emissions (carbon leakage is not accepted as being of much relevance to that conclusion). For the measure to be considered not the least trade-restrictive, the Dutch State is held to have a wide margin of manoeuvre and it is not established that the State gravely erred in opting for a coal phase-out [5.18.7]. The long transition period is held to substantiate enough room for compensation [5.19.6], again with reference to the volatility of market returns as being part and parcel of energy markets full stop.

Like the Dutch judgments eg in Urgenda, this judgment on protection of property rights viz GHG emission reduction policies, is likely to serve as an international benchmark. It can be appealed, of course.

Geert.

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A primer on the latest climate litigation judgment: Friends of the Earth et al v UK Government. Victory on transparency and data grounds.

Others will no doubt analyse Friends of the Earth Ltd & Ors, R (On the Application Of) v Secretary of State for Business, Energy and Industrial Strategy [2022] EWHC 1841 (Admin) at much more length. I just thought I would pen down my thoughts when reading the judgment.

The case is a further judgment holding Governments to account for not addressing climate change challenges properly. The United Kingdom being a dualist country (all the more so following Brexit), the arguments do not much feature the Paris Agreement directly. Rather, claimants aim to hold Government to how Parliament said it should act in addressing climate change  in the Climate Change Act 2008 – CCA 2008, and, additionally, through the requirements of the European Convention on Human Rights, whether or not in combination with the UK Human Rights Act. The core of the exercise and judgment therefore is one of statutory interpretation.

Of note first of all is that most of the claimants’ arguments were rejected and one assumes therefore that they will be seeking permission to appeal (just as the Government will).

The judgment kicks off with the oblique reference to trias politica. Holgate J [22] cites R (Rights: Community: Action) v Secretary of State for Housing Communities and Local Government [2021] PTSR 553 at [6]: –

“It is important to emphasise at the outset what this case is and
is not about. Judicial review is the means of ensuring that public
bodies act within the limits of their legal powers and in
accordance with the relevant procedures and legal principles
governing the exercise of their decision-making functions. The
role of the court in judicial review is concerned with resolving
questions of law. The court is not responsible for making
political, social, or economic choices. Those decisions, and those
choices, are ones that Parliament has entrusted to ministers and
other public bodies. The choices may be matters of legitimate
public debate, but they are not matters for the court to determine.
The court is only concerned with the legal issues raised by the
claimant as to whether the defendant has acted unlawfully.”

And [194]: judicial review in this case must not be merits review and the judge must adopt a ‘light touch’.

Starting with the ECHR arguments, there were summarily dismissed [261] ff. They engaged with Article 2 ECHR’s right to life, Article 8’s right to family life (these two being the classic anchors for environmental rights in the ECHR) and Article 1 of the first protocol (‘A1P1′)’s right to [protection of property. Holgate J holds that the claimants’ argument on the ECHR ‘goes beyond permissible incremental development of clear and constant Strasbourg case law’ [275] and [269-270] that the Dutch Urgenda decision offers a narrow window of ECHR relevance to climate law which does not open in the current case (with [270] in fine an explicit warning that Dutch authority, it being a monist country, should not hold much sway in England and Wales).

A first ground discussed the role of quantitative v qualitative assessment and whether and the degree to which the Minister was to show the targets could be met quantitatively. The judge held that ‘the CCA 2008 does not require the Secretary of State to be satisfied that the quantifiable effects of his proposals and policies will enable the whole of the emissions reductions required by the carbon budgets to be met. The [statutory] obligation …does not have to be satisfied by quantitative analysis alone.’ [193].

However one of the grounds on which the challenge did succeed is the quality of the input for the Minister’s decision: this overall briefing was held to have omitted data the minister was legally obliged to take into account, and which was not insignificant. As a result the Minister failed to take it into account as a material consideration, so that his decision was unlawful (compare [200]). [221] the briefing was held to have been wanting, in that it failed to identify under the quantitative analysis the contribution each quantifiable proposal or policy would make to meeting the UK’s carbon budgets; and it failed to identify under the qualitative analysis which proposals and policies would meet the 5% shortfall for one of the carbon budgets and how each would do so.

[246] ff (where Holgate J does refer, albeit with statutory distinguishing, to relevant Irish cases), another partial ground is upheld namely that of proper information given to Parliament (and therefore also the public; both a sore point in the current UK Government) on the data reached for the Ministerial conclusion and data on the pathways for delivery themselves. [257]: ‘contributions from individual policies which are properly quantifiable must be addressed in’ the report given to Parliament and hence the public.

The result therefore is important in terms of accountability and transparency (where unfortunately no mention was made of the Aarhus Convention which continues to apply to the UK), with the latter element also being inspirational for other jurisdictions where Governments have been told to go back to the climate change drawing board.

Geert.

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The mooted Flemish ban on fireworks displays. A concise primer (with referral) on exhaustion, property rights (ECHR) and the internal market (TFEU).

Update 18 December 2020 the Decree saw the light but was annulled by the Constitutional Court yesterday for reasons of internal devolution in Belgium (infringement of the federal head of power for product standards).

Anyone short of exam essay Qs, consider the planned Flemish ban (with room for local, event-related exceptions) on fireworks displays. Akin to the issues in Ivory Ban or pet collars, at the core of the legal analysis is the legality of use restrictions on goods lawfully marketed in other Member States (see also my brief review of Amsterdam’s booze bikes here).

The exhaustive effect or not of EU secondary law will have to be discussed, as will Article 34 TFEU (including consultation and commissioned research issues and of course proportionality), and indeed A1P1 (Article 1, first Protocol) ECHR.

(For a recent more locally relevant issue, see the Supreme Court’s (Raad van State) December 2019 annulment of an Antwerp highway code rule banning the use of quads and introducing a strict exemption policy).

Geert.

 

 

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The High Court on the lawfulness of the proposed ivory ban.

Update 18 May 2020 confirmed today by the Court of Appeal in [2020] EWCA Civ 649.

Hot on the heels of yesterday’s post on e-collars, a short note on yet another trade and animal welfare /biodiversity case. In [2019] EWHC 2951 (Admin) Friends of Antique Cultural Treasures v Secretary of State for the environment, food and rural affairs, Justice Jay (‘Jay J’ even though correct might sound a bit too intimate) upheld the UK’s planned ban on ivory trade, stricter than anything in place elsewhere. As a general rule, the Act interdicts the sale of antique worked ivory, that is to say pre-1947 artefacts, unless one of limited exemptions is applicable.

The discussion engages CITES, pre-emption /exhaustion by harmonised EU law, the environmental guarantee of Article 193 TFEU (albeit not, oddly, the issue of notification to the EC), Article 34 TFEU, and A1P1 ECHR.

On uncertainty, Justice Jay refers to the precautionary principle: at 155: ‘we are in the realm of scientific and evidentiary uncertainty, and the need for a high level of protection. §3.1 of the Commission’s 2017 Guidance makes that explicit. Although the evidence bearing on the issues of indirect causation and demand in Far Eastern markets may be uncertain, statistically questionable, impressionistic and often anecdotal, I consider that these factors do not preclude the taking of bold and robust action in the light of the precautionary principle.’

Rosalind English has analysis here and refers even to Edmund de Waal’s novel The Hare with the Amber Eyes which has been on my reading list after my wife recommended it – this is a good reminder.

Geert.

EU environmental law (with Leonie Reins), Edward Elgar, 2018, p.28 ff., and Chapter 17 (p.308 ff).

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The UK ban on e-collars. High Court finds decision does not breach property rights (ECHR) or internal market (TFEU).

Update 11 May 2021 the Court of Appeal has upheld the decision: [2021] EWCA Civ 666, only succinctly engaging with the A1P1 issue and hardly with the A34 TFEU arguments.

Update 30 September 2020 for a similar judgment at the Belgian Constitutional Court, see here. This judgment engaged with A1P1 ECHR,  as well as alleged discrimination, particularly viz dog therapists where use may be continued; and viz electric cattle prods. Re e-collars for dogs the point is made that the danger to the animal’s welfare lies with its inappropriate use by the owner, something which the drafters of the statute is not the case with farmers; I do not think that is a correct assumption). The legality of the device in other Member States was not discussed.

I tweeted the judgment the day it was issued, apologies for late succinct review. I wrote a few years back on the legality of use restrictions on goods lawfully marketed in other Member States, and see also my brief review of Amsterdam’s booze bikes here. In [2019] EWHC 2813 (Admin) The Electronic Collar Manufacturers Association v Secretary of State for Environment, Food and Rural Affairs, Morris J upheld the UK Government’s ban on e-collars (a hand-held remote-controlled (not automated: a distinction that matters as Rosalind English points out) e-collar device for cats and dogs, used particularly in dogs for training purposes).

His analysis engages all the right issues in discussing the lawfulness of a ban at 204 ff under Article 34 TFEU (including consultation and commissioned research issues and of course proportionality), less focused than I would have expected perhaps on the fact that these items are lawfully marketed elsewhere in the EU, and indeed A1P1 (Article 1, first Protocol) ECHR. The remainder of the judgment discusses internal UK judicial review. An excellent primer on trade and animal welfare under EU and ECHR law.

Geert.

 

 

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The perfect (take home) exam question. Court of Appeal plain packaging v Bundesverfassunsgericht Energiewende.

Update 12 april 2017: the UK Supreme Court refused permission to appeal [the decision should appear here in due course], hence the Court of Appeal’s ruling is now final.

Isn’t it just a perfect exam question for a graduate course, nay this question involves so many issues it could arguably serve as one single exam for a whole law degree: such is the intensity of legal areas at issue: constitutional law, international law, international trade, regulatory law and risk analysis, intellectual property law…

Discuss why the Court of Appeal for England and Wales denied Government wrongdoing in plain packaging, while the German Bundesverfassungsgericht rejected an argument of expropriation in Energiewende yet held that German Government must nevertheless pay compensation to the energy companies involved (E.ON, RWE and Vatenfall).

Source tip: you may want to consult my former student Dr Catherine Banet’s excellent analysis on the Vatenfall issue.

Issues tip: a good way to go about it would be to draft a table of issues that both cases have in common and those which they do not (eg the Court of Appeal’s review of intellectual property). A discussion of the precautionary principle would not go amiss (in the plain packaging case: specifically whether precaution applies to uncertainty as to efficiency of remedies rather than uncertainty as to a phenomenon). A point of discussion may also be why the CA refers profusely to European precedent while the Bundesverfassungsgericht does not. Finally, any consideration of the link between the latter proceedings and the concurrent ISDS procedure, will gain you brownie points.

To fellow faculty out there: if you do use this exam Q, please do share good student answer copies.

Geert.

 

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Flury of WTO domestic regulatory autonomy cases continues: Ontario’s feed-in tariff program illegal

Just before the Christmas break, a WTO Panel ruled at the request of Japan and the EU that Ontario’s feed-in tariff program is illegal under the GATT and TRIMs agreement.  Feed-in tariff programs are a popular means to boost renewable energy. Typically, they imply that producers of renewable energy are nurtured through preferential, long-term and advantageous electricity purchase contracts (either through obliging private electricity distributors to enter into such contracts, such as in the infamous European PreussenElektra case, or such as in the case of Ontario’s law, through employment of a Government Agency which enters into these contracts). Governments are often tempted to throw ‘local content requirements’ into the mix: in the case of Ontario, domestic content requirements must be complied with in the design and construction of the relevant electricity generation facilities utilizing solar photovoltaic and wind power technology in order to qualify for guaranteed electricity prices offered under the FIT Program.

The Panel rejected the EU’s claim with respect to Subsidies, however it did accept that the regime infringed GATT Article III, as well as the Agreement on Trade-Related Investment Measures. The former to me was no great surprise. Infant industry arguments are often made with respect to renewable energy however these do not in my view carry much weight with respect to either solar, wind or hydropower. The finding on TRIMS is encouraging: it shows that the Agreement (I sometimes dub it a mini-MAI) does have some bite.

The EU has had internal issues with feed-in tariffs and the like (see e.g. my paper here on (di)similarities between EU and WTO law on the matter), and (update 5 May 2015) in the UK the Courts are considering the extent to which Article 1 of the first Protocol to the European Conention on Human rights (‘A1P1’), which protects property, shields investors in solar energy from changes in feed-in tariffs.

Geert.

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