Posts Tagged Directive 2008/98
It is too readily assumed by many that general Member States’ obligations under the EU’s environmental laws are context only, and not really legally binding. In my Handbook of EU Waste law however I report on a number of cases where the European Court of Justice has rebuked Member States for having failed to take measures to attain some of these general objectives. These cases relate to waste law, evidently, however in other cases the Court’s case-law extends this to EU environmental law generally.
One can now add C-153/16 EC v Slovenia to this list. Slovenia had attempted to address the continuation of waste tyres storage and processing at an abandoned quarry, in contravention of an expired environmental permit. The company dug in its heels, ia via prolonged litigation, with storage and processing continuing.
The Court of Justice found that Slovenia had infringed the general duty of care provisions, as well as enforcement obligations of the landfill Directive and the waste framework Directive. (On the related issues with respect to hazardous waste, the Court found the Commission’s infringement proceedings wanting).
Not all that glitters is gold, of course. The direct effect of these general duty of care provisions remains an issue, as does the absence, arguably, in EU law of a duty of care directly imposed upon waste holders and processors. For that, citisens need to pass via national law wich as current case shows, is not always up to scratch.
The CJEU’s finding in Shell, was applied by the Court of first instance at Antwerp in a judgment from October last, which has just reached me. (I have not yet found it in relevant databases (not uncommon for Belgian case-law), but I do have a copy for those interested). The case concerned debunkered off-spec fuel, off the ship Else Maria Theresa (her engines apparently having been affected by the oil being off-spec), blended into /with a much larger amount of bunker oil.
The court applied the Shell /Carens criteria, leading to a finding of waste. In brief, the blending in the case at issue was not, the court held, standing practice in the bunkering /debunkering business, and /or a commercially driven, readily available preparation of off-spec for purchase by eager buyers. Rather, a quick-fix solution to get rid off unwanted fuel.
The judgment (which is being appealed I imagine) emphasises the case-by-case approach needed for the determination of ‘waste’. It relies heavily on (the absence of) evidence on market consultation and signals from interested buyers for the off-spec fuel.
Update 11 January 2016: Shell inform me that the DA (‘parket’ /Openbaar Ministerie) has appealed.
I have reported some time ago on the reverse logistics case involving Shell and Carens. As noted in that post, the CJEU instructed the court at Rotterdam to gauge the ‘true intentions’ of Shell vis-a-vis the contaminated fuel which it had taken back from one of its clients (Carens).
The Court at Rotterdam issued its final judgment on 23 December last, truly a christmas present for the companies involved for the accusations of illegal waste shipments were rejected. (I could not locate the judgment on ECLI yet: I have a copy for those interested).
The court first of all rejected a rather neat attempt of the Dutch prosecutor to get around the CJEU’s finding in para 46 of its judgment : ‘it is particularly important that the Belgian client returned the contaminated ULSD to Shell, with a view to obtaining a refund, pursuant to the sale contract. By so acting, that client cannot be regarded as having intended to dispose of or recover the consignment at issue and, accordingly, it did not ‘discard’ it within the meaning of Article 1(1)(a) of Directive 2006/12.‘ It was suggested that incoterm FOB (‘Free on Board’), applicable to the agreement between Carens and Shell, meant that the qualification of the payment by Shell could not have been a refund for defective goods (ownership of the goods already having been transferred prior to contamination) but rather the payment of damages for a contract not properly carried out. This, it was argued, made para 46 irrelevant for the facts of the case. The court at Rotterdam essentially argued that par 46 needs to be applied beyond the black letter of the law: in effect, in acting as they did and following their running contractual relationships, Shell and Carens had decided to annul the sale, sale price was refunded, and Carens could therefore not be seen as owner or holder of the goods.
Neither, the court held, could Shell be considered a discarding the fuel: the court paid specific attention to testimony that the fuel concerned was actually presented to market, with a view to establishing what price it could fetch. Offers were made which were not far off the initial sale price. Re-blending of the fuel was only done to obtain a higher price and was carried out in accordance with established market practices. Shell’s resale of the fuel, as holder of it, was not just a mere possibility but a certainty (language reminiscent of what the CJEU normally employs for the distinction recovery /disposal).
Final conclusion: the fuel at no stage qualified as waste and no one could have discarded it.
A very important judgment indeed – it will be interesting to see whether the prosecutor’s office will appeal.
Ragn-Sells: Court leaves open violation of primary EU law by waste shipments Regulation – Free movement of services question left unanswered
The ECJ’s December judgment in Ragn-Sells Case C-292/12 came recently to my attention in revisiting the waste ownership and freedom to provide services question for a brief. The case concerns the combined application of the waste framework Directive, the waste shipments Regulation, the public procurement Directives, the free movement of goods and of services, and, for good measure, competition law, exclusive rights and abuse of dominant position.
The dispute in the main proceedings concerns the lawfulness of contract documents stipulating that mixed municipal waste had to be transported to the landfill facility which was the subject-matter of an earlier public procurement procedure — located 5 km from the contracting town, whilst industrial and building waste was to be taken to a landfill site, located 25 km away.
Not all of these issues were addressed by the ECJ, though: for the issue relating to competition law /creation of exclusive rights which might lead to abuse of dominant position, not enough information had been furnished by the national court.For the issue of free movement of services, there was nothing in the file submitted to the Court indicating that undertakings established in other Member States have been interested in treating waste produced in the territory of the municipality at issue.
The latter especially is a pity (on the competition issue there is plenty of case-law): for the extent of free movement of services in the waste sector (and environmental services generally), is not at all clearly laid out in case-law. Hint for those wanting to use free movement of services arguments in their struggle against restrictive national measures: ensure paper trail of, or indeed if need be, trigger, foreign interest in the waste streams provided.
The Court did entertain the free movement of goods questions. As regards, first of all, waste destined for disposal operations and mixed municipal waste, it follows, the Court held, from Article 11(1)(a) of Regulation No 1013/2006, read in the light of recital 20 in the preamble thereto, and Article 16 of Directive 2008/98, that the Member States may adopt measures of general application restricting shipments of that waste between Member States, in the form of general or partial prohibitions of shipments, by way of implementation of the principles of proximity, priority for recovery and self-sufficiency under Directive 2008/98. By analogy the court then applied Case C‑209/98 Sydhavnens to find eventually that ‘Accordingly, in the case of waste destined for disposal operations and mixed municipal waste collected from private households and, as applicable, other producers, a Member State may confer on local authorities, on the geographical scale it deems appropriate, powers to manage the waste produced on their territory in order to ensure compliance with its obligations under Article 16 of Directive 2008/98. Those authorities may, as part of the powers conferred upon them, provide that those types of waste will be treated in the nearest appropriate facility (at 63).
I continue to argue that especially with respect to mixed municipal waste, this room for manoeuvre provided for by the Regulation combined with the Directive, itself is incompatible with primary EU law. However I am not sure how much longer I can argue that as a result of judicial economy, the ECJ has never really properly addressed this question.
As regards, secondly, shipments of waste destined for recovery operations, other than mixed municipal waste, the Court by contrast held that the combined effect of Regulation and Waste Framework Directive does not provide for the possibility for a national authority to adopt a measure of general application having the effect of prohibiting, totally or partially, shipments of such waste to other Member States for treatment.
In summary, some remaining doubt re free movement of goods (primacy EU law) in my mind. Undoubtedly a lot of remaining doubt re free movement of services. Waste law and free movement: they continue to fascinate!
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.
JÄÄSKINEN AG in Shell: Re-blended fuel was discarded. Waste status of off-spec and reverse logistics products remains uncertain.
I have reported earlier on the importance of the judicial review in Shell. JÄÄSKINEN AG this morning opined that A consignment consisting of fuel which the vendor takes back and processes through blending with a view to placing it back on the market, because the fuel had been unintentionally mixed with a substance and therefore no longer satisfies safety requirements so that it could not be stored by the buyer pursuant to an environmental permit, must be considered as waste
The Advocate-General’s Opinion was very much focused on the factual aspects of the case. Disappointingly, he did not much entertain many of the criteria suggested by the court at Rotterdam – for reasons of judicial economy, one imagines. However Advocate Generals do often get carried away on the analysis. A pitty that did not happen here. Core to the AG’s Opinion is his finding (at 25) that
re-blending of the fuel before its resale, in my opinion, points towards an intention to discard it, and the act of re-blending itself amounts to recovery;
With respect to the contractual context, the AG notes (at 26) that the fact that the contaminated fuel was ‘off-spec’ in relation to the specifications appearing in the contract between Shell and Carens is irrelevant to determining whether it amounts to waste under mandatory EU waste law, the latter being of a public law nature and not subject to the will of the parties to a contract.
While I am of the view that the contract cannot singlehandedly determine the qualification or not as waste, its (seemingly at least) outright dismissal by the AG as a factor to consider (at least in this para), is disappointing. It is not, I submit, in line with the WFD. Neither arguably is the link which the AG makes at 14 (and in his final Opinion) between an environmental permit, and the qualification of the substance as waste. Ad absurdum: a stolen tanker full of diesel is left for re-sale in a rented garage. The garage has not been given a permit for storage of diesel. Yet the diesel has not turned into waste.
With respect to the overall debate on reverse logistics, there is an interesting section in the Opinion at 37: ‘a consignment consisting of ULSD mixed unintentionally with MTBE and having as a result a flame point lower than allowed for diesel sold from the pump becomes waste within the meaning of Article 1(1)(a) of Directive 2006/12 at the point of contamination, and remains as such up to its recovery by blending or by its commercial re-classification in a manner that is objectively ascertainable.‘[emphasis added by me]. This latter part does open room for products re-sent across the logistics chain not to be considered waste, however there needs to be some kind of ‘objectively ascertainable’ re-classification: this requires some thinking in terms of compliance.
The AG makes the following comparison at 40:
I would like to close by emphasising that mere failure to fulfil agreed contractual specifications does not, as such, mean that a substance or product is necessarily to be considered as waste. If a trader delivers to a restaurant minced meat that is a mixture of beef and horse, instead of pure beef as agreed between the parties, he may be contractually obliged to accept return of the delivery without it thereby becoming waste. However, if the product results from accidental contamination of beef with horse meat during the processing of minced meat, he has an obligation to discard the minced meat up and until its precise characteristics have been ascertained and the minced meat is either disposed of or commercially reclassified, for example, as feed for minks, or as a beef-horse meat mixture for human consumption, provided it satisfies the relevant requirements under food-stuffs regulations. More generally, a non-intentionally manufactured mixture of compound is prima facie waste if the use to which it is intended to be put is not safe, in the absence of knowledge of its composition. This applies to products such as food or fuel whose qualities are important to human health and the environment.
In this section, therefore, the contractual context between parties to a transaction, does seem to enter the train of thought when deciding on the waste status of an off-spec or reverse logistics product.
The ink on the Opinion is literally still drying and undoubtedly there are more angles to it than I report above. However I for one should like the ECJ to state something more unequivocal on the impact of the contractual context, when it delivers its judgment presumably in the autumn.