Member Article

The Environmental Liability Directive aims to establish a common framework of environmental liability across the EU to prevent and remedy certain types of environmental damage. The framework is based on the “polluter pays principle”. The implementation date for member states was 30 April 2007. Ireland has not complied with this transposition date and will not have transposed it as a current estimate until early 2008. Ireland has been engaged in a regulatory impact analysis process on its implementation over the last number of months.

1. What does it Cover?

   The Directive is about preventing and remedying environmental damage. It aims to make operators whose activities have caused environmental damage strictly liable to pay to remedy that damage. It also aims to force remedied action where an imminent threat of damage is imposed.

   The Directive covers damage to;

   • Protected species and natural habitats covered by the Habitats Directive (92-43-EEC) and the Wild Birds Directive (79-409-EEC).

   • Water covered by the Water Framework Directive (2000/60/EC).

   • Land.

   The Directive is not retrospective and will not apply to damage if more than 30 years has passed since the incident that gave rise to the damage occurred.

2. Who is Liable?

   Operators of “occupational activities” that cause environmental damage or where an imminent threat of such damage occurs. “Occupational activities” are widely defined to include public and private activities, business and undertakings, irrespective of whether or not they are undertakings for profit.

3. Exemption from liability

   Member states have a discretion to provide exemptions in certain circumstances i.e. if;

   • The damage was caused by a third party despite appropriate safety measures being put in place.

   • The damage resulted from compliance with a compulsory purchase order.

   • It can show that it was complying with an environmental permit (“the permit defence”).

   • The activity was not considered likely to give rise to environmental damage at the time the activity took place (the “state of knowledge” defence). Therefore, it is necessary to show that the operator was at fault or negligent to establish liability except for certain operators who are subject to strict liability. These activities are listed in Annex III of the Directive and include most of the activities that are currently subject to EC environmental regulation.

4. The operator is responsible for taking:

   5.1. Preventative measures: ie action to prevent or minimise environmental damage where there is an imminent threat of it occurring.

   In respect of preventative measures, there is an obligation on operators to notify the competent authority or authorities appointed under the Directive if they cause environmental damage and to make proposals to remediate such damage. It should be noted that there is no need for the competent authority to do anything to trigger that duty, for example, to serve a notice.

   5.2. Remedial measures: ie action to restore, rehabilitate or replace damaged land, water, protected species or natural habitats and/or impaired functions performed by such natural resources.

   In respect of remedial measures, the operator is not only liable for remediation to a “base line condition”, but also for “compensatory” and “complimentary” remediation.

5. Enforcement

   Each member state has to designate a body that will be responsible for taking steps to ensure that environmental damage is prevented or remediated. Competent authorities may undertake preventative and/or remedial measures themselves in certain circumstances and recover the costs from the operator where it can be found. In Ireland this will probably be the Environmental Protection Agency (EPA) and maybe local authorities.

   The Directive allows qualified NGO’s and other members of the public to make observations to the competent authority relating to any environmental damage, and to request the competent authority to take action. They can also request for the Court to review the legality of the authorities decisions, acts and/or failure to act, by judicial review or similar proceedings.

6. Irish Implementation

   The Department of Environment, Heritage and Local Government is engaged in a consultation process currently. A consultation process for England, Wales and Northern Ireland (where the transposition issues are similar to Ireland) commenced in 2006. Comments in response to the screening Regulatory Impact Analysis are due by 19 September 2007. See www.environ.ie/en/publicationsdocuments (see “latest publications”). While narrower in scope than the Directive, the EPA published guidance on 17 August 2006 regarding the assessment and management of environmental liabilities associated with activities licensed under its waste and IPPC regimes designed to meet the requirements of the Directive. The guidance sets out how companies can identify risks associated with their activity, eliminate and reduce the risks and financially plan for environmental liabilities.

   It also indicates that future IPPC and Waste Management Licences will contain conditions to implement the Directive. This could result in more stringent conditions to take account of the ‘permit defence’.

For further information please contact:
Alison Fanagan – Partner and Head of Environmental Law Group
Tel: +353 1 649 2432
Email: [email protected]