Dear readers,

In our final EEL News Service of 2016 we discuss four CJEU cases, and three AG opinions. Most strikingly perhaps, AG Sharpston delivered her Opinion in the EU-Singapore FTA case, which is set to determine the contours of EU trade policy for years to come, for instance where CETA is concerned. She argued that the trade deal should be concluded as a mixed agreement – requiring signatures from the EU and all of its Member States – since it includes aspects, such as protection of the environment, that are not covered by Union exclusive competence. Mixity brings challenges to concluding agreements with a broad scope, as we recently saw with the Walloon government’s objections to CETA and the Dutch EU-Ukraine agreement. These and other issues will be discussed at our upcoming CETA event in The Hague on 26 January, where you are very welcome to join in. See our Events section in this News Service for more details.

Another AG opinion advised the Court to rule that REACH does not stand in the way of exporting chemicals illegally imported into the EU.

The CJEU delivered its judgment in a case concerning a Decision derogating from ETS Directive 2003/87/EC in the area of aviation, interpreted the notion of ‘similar rights’ in the VAT Directive as including GHG emissions, and ruled in a curious case from Croatia on water pricing policies under the Water Framework Directive. Notwithstanding our usual focus on EU and international law, we also chose to discuss one particularly interesting national case, namely the atomic energy ruling of the Constitutional Court in Germany.

As usual, we address a number of pertinent news items relating to environmental law and policy in the EU. Notable is the unprecedented Commission, European Parliament and Council joint declaration on legislative priorities for 2017, which emphasises inter alia waste management, clean energy and climate change policy. The Commission’s new clean energy package is given some attention, as well as the new Sustainable Development strategy. The new Plant Health Regulation also entered into force, and the Parliament and Council signed more stringent National Emissions Ceilings into law. Conservationists applauded the Commission’s decision to abstain from amending the Birds and Habitats Directives, and the European Parliament’s ENVI Committee voted for stricter ETS requirements, which will be discussed in plenary session in February 2017. We hope this EEL News Service will allow our readers to enter the next year well-informed on all aspects of EU environmental law.

Happy holidays, on behalf of all involved in the EEL News Service and EEL Network!

Wybe Douma and Olivier van Geel

EU Court judgments

No EU obligation to treat third countries equally

CJEU judgment: Case C-272/15 Swiss International Air Lines (21/12/2016)
The Court ruled that Article 1 of Decision No 377/2013/EU, which constitutes a temporary derogation from ETS Directive 2003/87/EC, was not incompatible with the principle of equal treatment. The main question in this case, which was raised by Swiss International Air Lines before a UK Court, was whether the fact that the derogation from requirements of the ETS Directive applied to most flights between the EEA and almost all non-EEA states, but not to flights between EEA states and Switzerland, infringed upon the discussed principle.

The Court found that the EU is not obliged to grant equal treatment to all third countries in its external relations, and that the institutions have a broad discretion to formulate policy in this sphere. Referring to earlier case law, including Faust v Commission (52/81), it was noted that there is no principle requiring equal treatment in external relations in the Treaties and no obligation to treat third countries equally in the Court’s jurisprudence. Thus, the EU had acted within its rights when applying different standards to flights between EEA states and Switzerland.

General Court dismisses action against genetically modified soybean

CJEU judgment: Case T-177/13 TestBioTech and Others v Commission(15/12/2016)
The Court dismissed an action for annulment against a 2013 Commission decision concerning the review of Implementing Decision 2012/347/EU authorising the placing on the market of genetically modified soybean products.

According to the claimants, TestBioTech and Ors., the new Monsanto soybean under discussion in this case, which is mostly grown under the name Intacta in Brazil, was not subjected to the required standard of risk assessment by EFSA. Consequently, the Commission was allegedly wrong to grant authorisation for products containing, consisting of, or produced from the soybean in question.

The claimants argued that the Commission’s confirmation of the authorisation of the soybean was in contravention of several provisions of Regulation No 1829/2003 on genetically modified food and feed, as well as its broader obligation under Article 168 TFEU to protect human health. The Court held, however, that the Commission had fulfilled its obligations by acting on the assessment provided by EFSA. Notably, in its ruling, the Court mentioned the role of the precautionary principle as a duty of the Commission in such cases.

CJEU rules ‘similar rights’ under VAT Directive includes GHG emissions

CJEU judgment: Case C-453/15 A and B (8/12/2016)
The Court ruled that greenhouse gas emissions as defined in Article 3(a) of ETS Directive 2003/87/EC are included in the concept of ‘similar rights’ in Article 56(1)(a) of VAT Directive 2006/112/EC.

The preliminary question in this case arose in a German criminal case concerning VAT evasion in relation to emissions trading. The Court, which ruled on the concept of ‘similar rights’ for the first time, noted that the cases mentioned in Article 56(1)(a) largely corresponded to the sphere of IP rights, unlike GHG emissions. However, following the reasoning of AG Whatelet, the similarities between some or all of these rights and GHG emissions were noted.

Reference was also made to the purpose of the VAT Directive (to avoid conflicts of jurisdiction resulting in double-taxation and avoid non-taxation). Additionally, The Court clarified, pointing to its earlier case law in RCI Europe (C‑37/08), that the underlying logic of EU provisions requires goods and services to be taxed to the maximum extent at the place of consumption. The inclusion of GHG emissions in the concept of ‘similar rights’ was taken to be in line with this purpose and logic.

Water Framework Directive allows variable and fixed water pricing

CJEU judgment: Case C-686/15 Vodoopskrba i odvodnja (7/12/2016)
The CJEU ruled that Water Framework Directive 2000/60/EC does not preclude national legislation providing that the price of water services includes a fixed component not connected to the volume of water actually consumed by the individual in question, as well as a variable component that is calculated according to that volume. The case concerned Croatian legislation that included a fixed component covering charges for connection of buildings to water supply works and related costs, and a lady refusing to pay the fixed part of her water bills.

The Court noted that Directive 2000/60 is a framework directive, meaning that discretion is left to the Member States in implementation. It also referred to, in particular, Article 9 of the Directive, which states that Member States must take into account the principle of recovery of costs of water services, including environmental costs, and ensure that efficient use is incentivised in their water-pricing policies. Nonetheless, referring inter alia to the Commission Communication ‘Pricing policies for enhancing the sustainability of water resources (COM(2000) 477 final)’ and the EEA Report ‘Assessment of cost recovery through water pricing’, where having both a fixed and variable component in water pricing was found to be common practice in Member States, the Court did not consider the Croatian law inconsistent with this provision.

Croatia joined the EU on 1 July 2013 and this case shows that its judges are beginning to pose questions to their Luxembourg colleagues about EU law. A similar question was asked on 15 June 2016 about the way to calculate the fees for the collection and transport of municipal waste in accordance with EU law (case C-335/16). More specifically, the CJEU was asked how Union citizens pay their municipal waste invoices, and whether the volume of the empty containers or of the refuse collected is decisive. The CJEU might very well explain again that this is a matter left largely to the Member States to decide.

AG Opinions

AG: No exclusive external competence for parts of EU-Singapore FTA

AG opinion: Opinion 2/15 Avis rendu en vertu de l’article 218, paragraphe 11, TFUE (21/12/2016)
AG Sharpston has recommended the Court to find that the EU’s external competence to conclude trade agreements does not cover all aspects of the EU-Singapore FTA (EUSFTA), and that the trade deal must thus be concluded as a mixed agreement.

The AG considered that the provisions of the EUSFTA should be divided into several categories: those falling within the scope of the common commercial policy, aspects touching upon transport policy, provisions dealing with investment other than FDI, non-commercial aspects of IP rights, standards relating to social and environmental policy, and provisions on the conservation of marine resources under the fisheries policy. Considering the plurality of relevant policy areas, many of which are shared competences, the agreement could not possibly fall entirely under EU exclusive competence. After all, none of these aspects could be designated as ‘merely incidental’ or ‘extremely limited in scope’, according to Sharpston.

Whereas the EU was, of course, found to enjoy exclusive competence in the areas of the agreement falling within the scope of the CCP, as well as the conservation of marine and biological resources under the CFP and the trade in rail and road transport services, a number of areas were considered shared. Specifically, the AG pointed to air and maritime transport services and transport by inland waterway, types of investment other than FDI (notably portfolio investment), government procurement in relation to transport services, non-commercial aspects of IP rights, and labour and environmental standards.

Ultimately, the AG even suggested that Article 9.10.1 of the EUSFTA, which terminates bilateral agreements between certain Member States and Singapore, falls within the exclusive competence of the Member States. The conclusion was thus that the FTA should be considered a mixed agreement, to be adopted jointly by the EU and its Member States.

This case has special relevance for trade policy in the EU, as the CJEU’s Opinion will be the final word on the division of external competences for concluding international trade deals. The AG’s Opinion is thus also interesting in light of the Commission’s earlier claim that the content of the Comprehensive Economic and Trade Agreement (CETA) with Canada, containing an identical broad number of issues as present in the EUSFTA, falls entirely under EU exclusive competence.

AG: REACH allows for export of illegally imported dangerous chemicals

AG opinion: Case C-535/15 Pinckernelle (21/12/2016)
A consignment of 19.4 tonnes of nicotine sulphate was illegally brought to Germany from China by the applicant, Mr Pinckernelle. He demands that the chemicals are returned to him so that he can export them to Russia. Nicotine sulphate is a flammable product, toxic to humans, with long term adverse effects for the aquatic environment. The chemical is used in Russia as an industrial disinfectant and as a disinfectant in installations housing animals. In the EU, this use of the substance is banned under the Biocides Regulation (EU) No 528/2012.

The AG recommended the Court to find that Article 5 of REACH Regulation 1907/2006 should be interpreted in such a way that, notably given the possibility of a rigorous application of the requirements enumerated in Articles 6, 7, 21, 23, and 126 of the Regulation, substances not registered in accordance with the relevant provisions of Title II may be exported out of the EU. If the CJEU follows this opinion, REACH would not stand in the way of exporting the hazardous substances that were illegally imported into the EU.

The preliminary question asked by a German Court was whether export to a third state of chemicals unregistered at import into the EU amounts to an autonomous breach of Article 5 of the REACH regulation, separate from the compliance failure that occurred at import. In order to answer this question, the AG turned to an assessment of the meaning of ‘placed on the market’. in the REACH Regulation, which he interpreted, notably looking at different language versions and at Lucas Bergkamp’s explanations, as only meaning the EU internal market. A strict enforcement of Articles 5, 6, 7 and especially 126 of the REACH Regulation imposing penalties for non-compliance should, according to the AG, provide sufficient safeguards to prevent the opening of a door to ‘rogue importers’ wilfully breaching registration requirements. What happens outside the EU stays outside the EU, in other words.

AG: Pleadings of parties and requests for preliminary rulings should be put on Court website

AG Opinion: Case C-213/15 Commission v Breyer (21/12/2016)
In a non-environmental case, the AG proposed that external judicial documents, such as pleadings submitted by the parties, in principle ought to be made available upon request in both closed as well as, to a more limited extent, in pending cases. The AG also suggested that the pleadings of the parties and the request for a preliminary ruling could be put on the website of the Court as a matter of routine.

Also see:
* CJEU Press Release: Advocate General Bobek proposes broader access to Court documents

National Cases

German Court rules on compatibility Atomic Energy Act with Basic Law

German Constitutional Court judgment: 1 BvR 2821/11, 1 BvR 1456/12, 1 BvR 321/12 (6/12/2016)
The German Constitutional Court has ruled that the government amendments to the Atomic Energy Act in 2011 aimed at speeding up the nuclear phase-out were not in violation of IP rights, though the companies were entitled to reasonable compensation for lost profit.

The Court’s ruling thus largely favoured the government, finding the measures mostly compatible with the German Basic Law, and consistent with the protection of legitimate expectations and of the principle of equality. However, the amendments relating to compensation should be instituted by 30 June 2018, subsequent to an agreement with the three parties involved, E.ON, RWE and Vattenfall. For more in-depth analysis of this important case, see Catherine Banet’s very interesting Blog Post on the topic.

Also see:
* Press Release: The Thirteenth Amendment to the Atomic Energy Act Is for the Most Part Compatible with the Basic Law

Joint declaration Commission, EP and Council on legislative priorities for 2017

European Commission Press Release: A Union that delivers swifter and better results: Three Institutions sign Joint Declaration on the EU’s legislative priorities for 2017
On 13 December 2016, the Commission, European Parliament and Council adopted a joint declaration on legislative priorities for the following year for the first time. Environmental concerns were given some attention, particularly clean energy and climate change (priority 6), and the improvement of waste management in the circular economy (included in priority 1).

Also see:
* Commission, EP and Council: Joint Declaration on the EU’s legislative priorities for 2017

Highlights from the EP plenary session of 12-15 December

European Parliament press release: Plenary highlights: Sakharov Prize, railways, fundamental rights in the EU
From 12-15 December 2016, the EP’s plenary session took place in Strasbourg. Notable environmental topics discussed were the Commission’s clean energy package and deep-sea fishing. Significantly, in a vote that took place on Tuesday the 13th of December, MEPs chose to ban trawling below a 800 metre limit in the Northeast Atlantic.

Also see:
* European Parliament press release: MEPs ban deep-sea fishing below 800 meters in the North-East Atlantic

Trump appoints climate change sceptic Scott Pruitt as EPA chief

New York Times: Trump Picks Scott Pruitt, Climate Change Denialist, to Lead E.P.A.
US president-elect Donald Trump has selected Oklahoma attorney general and climate change sceptic Scott Pruitt as EPA chief. Mr. Pruitt filed suit against the EPA in 2015, seeking to stop the Obama’s Clean Power Plan, which Trump (in)famously referred to as a ‘war on coal’.

Also see:
* Sierra Club: Meet Scott Pruitt, the man picked to lead the EPA
* Asser event on Trump’s World: The Trump administration and international law, The Hague, 27 January 2017 (details below under Events)

Summary of key Commission infringement decisions for December

European Commission Fact Sheet: December infringements package: key decisions
A summary of the key infringement decisions for December 2016. Notably, the Commission is taking Italy to Court for alleged violations of urban waste water Directive 91/271/EEC, and France for failing to address continued violations of Birds Directive 2009/147/EC. Additionally, reasoned opinions were issued in relation to Cyprus’ failure to bring its national legislation in line with the Waste Framework Directive, and illegal hunting in contravention of the Birds Directive in Finland.

EU sets out Sustainable Development priorities

European Commission Press Release: Sustainable Development: EU sets out its priorities
In three Communications of the 22nd of November 2016, the EU set out a broad strategic approach to Sustainable Development. These documents addressed the next steps for a sustainable European future, a new European Consensus on Development and a renewed partnership with ACP countries respectively. The EU promotes a two-stream approach to implementing Agenda 2030 by 1) mainstreaming the SDGs and 2) launching a reflection on the further development of a long-term vision and the focus of sectoral policies after 2020.

EU approves new rules on National Emissions Ceilings

European Commission Press Release: EU approves new rules for Member States to drastically cut air pollution
On 14 December, the European Parliament and the Council signed into law the new National Emissions Ceilings (NEC) Directive, which is set to enter into force on the 31st of December. This Directive, which sets stricter limits on the five main pollutants in Europe, namely ammonia, sulphur dioxide, volatile organic compounds, nitrogen oxide and fine particulate matter, will reduce the negative health impacts of air pollution by 50% when implemented properly, according to the Commission.

Also see:
* European Commission Fact Sheet: EU approves new rules for Member States to drastically cut air pollution
* Council of the EU Press Release: Air quality: new stricter limits for pollutant emissions

Minutes from Commission meeting confirm US/Canadian pressure endocrine disruptors

Euractiv: New endocrine disruptor rules address your trade concerns, EU tells US, Canada
The minutes from a Commission meeting, received through a freedom of information application, confirm that the EU has been subject to US and Canadian pressure over its standards on endocrine disruptors, according to Euractiv. This pressure is said to have been exercised in relation to the transatlantic trade deals CETA and TTIP.

This interesting read claims that the EU follows a precautionary rather than a risk based approach. It seems more correct to say that the EU follows a risk based approach, and should follow a precautionary approach where science cannot (yet) determine what the risks are. Whether the latter always happens in practice is doubted by some, notably in the EDC dossier. The topic was discussed again on 21 December 2016 in Brussels (see for instance http://www.edc-free-europe.org).

Finland plans to become first country to completely ban coal

Huffington post: Finland Is Set To Become The First Country To Ban Coal Power
Finland is likely to become the first country to ban the use of coal energy entirely. The government is expected to announce the new decision along with its new climate and energy strategy in March 2017.

UK slashes Foreign Office climate change staff

The Guardian: UK slashes number of Foreign Office climate change staff
The UK has reduced its foreign office climate change staff to 8 people in London, compared to 26 in 2013, an 149 abroad, compared to 177 in 2013. This decision, which also occurs in the context of a president-elect in the US vowing to frustrate international climate efforts, seems to suggest that climate change is less of a priority in current government policy than it was in the past.

The Commission’s Winter Package in focus

EEB ‘Metamorphosis’: newsletter #82
On 30 November 2016, the Commission proposed its new clean energy transition ‘winter package’ of legislation. The package, which comprises eight legislative proposals, focuses on three key priorities, namely making energy 1) efficient, 2) affordable and 3) renewable. In this regard, the proposals are intended to contribute to the climate and energy targets for 2030 and international climate agreements, particularly the Paris Agreement. Significantly, the proposed legislation aims at a 30% decrease in energy consumption by 2030. Also important is the ecodesign aspect, which encompasses more stringent requirements for ICT products including smartphones, and the goal to have 27% renewable energy by 2030 in the EU. However, the proposal still has to be debated by the European Parliament, with many MEPs eyeing it as lacking ambition and the Member States, some of which see it as too ambitious, must still vote on the package in the Council.

The Commission’s winter package, though lauded for its increased ambition on energy efficiency, has also faced critique from many angles. For instance, it has been suggested that the renewable energy targets are extremely weak. A more credible target, which would be needed for meeting the 2 degrees climate goal, would be 35 rather than 27%, according to various commentators. It has also been put forward that a more ambitious 40% decrease in energy consumption would save the EU a large sum of money by reducing expensive fossil fuel imports. These concerns led to EEB Secretary General Jeremy Wates’ claim that Member States and the European Parliament should ‘shake up’ the winter package, and that ‘Europe can, and must, show the way forward to the rest of the world’.

Commission decides against amending Birds, Habitats Regulations after fitness check

The Guardian: Conservationists declare victory for wildlife as EU saves nature directives
The proposed review of the Birds Directive and Habitats Directive to make them more business-friendly has been abandoned by the European Commission. This move was lauded by conservationists who feared that such a fitness check would lead to a lowering of protection and thus have negative consequences for wildlife in the Union.

MEPs demand greater protection for EU citrus trees

European Parliament Press Release: Plant pests: MEPs call for tougher import checks to protect EU citrus trees
In a resolution passed on 15 December, MEPs voted that Draft EU measures aiming to prevent import of tree pests were not sufficient to protect growers in the EU. Tougher rules to prevent tree pests from spreading are required according to the MEPs. Others claim that the protection of EU oranges is what is really at stake.

New Plant Health Regulation enters into force

European Commission Fact Sheet: New Plant Health Regulation: stringent rules for a better protection from plant pests
On 13 December 2016, the new Plant Health Regulation (EU) 2016/2031 entered into force. The added value of this new piece of legislation is particularly in its contribution to the prevention of entry or spread of plant pests in the EU.

Also see:
* Statement by Commissioner Andriukaitis on the entry into force of the new Plant Health Regulation

EMIS Committee publishes draft report

European Parliament Press Release: Car emissions: first committee findings and draft recommendations
The Committee of Inquiry into Emission Measurement in the Automotive Sector (EMIS) published its draft report on Monday 19 December 2016. The report delves into evidence surrounding the shortcomings of law enforcement in EU Member States with regards to car emissions. The EMIS Committee will have its first public debate on 12 January 2017.

Also see:
* Draft factual part of the report
* Draft recommendation of the report
* Draft conclusions of the report

EP ENVI committee votes on review ETS, including shipping reforms

European Parliament Press Release: Environment MEPs for a stronger EU carbon market
On 15 December, MEPs in the ENVI Committee voted on plans to revise the EU ETS, by reducing the amount of emissions to be auctioned by 2.4% each year, doubling the capacity of the market stability reserve, and including shipping in the ETS, in the absence of IMO action. These rather progressive proposals must face a more difficult vote in EP plenary in February, and also be approved by the Council before they can become law.

EU legal action against MS over dieselgate

The Guardian: Dieselgate: EC begins legal action against UK and other EU nations
The European Commission has initiated legal action against several Member States over the ‘dieselgate’ emissions cheating scandal. The claim is that certain Member States, including Spain and Germany, failed to set up adequate penalty systems for violations of emissions law.

Four major global cities set to ban diesel cars from their centres

The Guardian: Four of world’s biggest cities to ban diesel cars from their centres
Paris, Madrid, Athens and Mexico are to ban diesel vehicles from their centres by 2025 in order to address growing air quality concerns. These plans were discussed at the C40 Conference of mayors on climate change, which took place in Mexico City from November 30 – December 2 2016.

26 January 2017

Reminder

Event: HELF/VMR Conference “Trade and Sustainability: CETA Dissected”

Registration for Dutch speakers
Registration for English speakers

Venue: T.M.C. Asser Instituut, R.J. Schimmelpennincklaan 20-22
2517 JN, The Hague, The Netherlands

Time: 14:00-16:00 hrs

Programme:
* 14.00 Introduction about CETA and resetting EU trade policy, Joris Larik (Leiden University and The Hague Institute of Global Justice)
* 14.20 Regulatory Cooperation, Ronald Roosdorp (Ministry of Foreign Affairs)
* 14.40 Q & A
* 15.00 Break
* 15.20 Investment Court System, Laurens Ankersmit (Client Earth)
* 15.40 Regulatory Chill, Wybe Douma (T.M.C. Asser Instituut)

Click here for more information

27 January 2017

Registration open

Event: Trump’s World – The Trump Administration and International law

Description: On 27 January 2017, the Asser Institute will host an event on the implications of a Trump presidency for international law. One part of the programme will focus on the Trump administration and climate change law, particularly the Paris Agreement.

Venue: T.M.C. Asser Instituut, R.J. Schimmelpennincklaan 20-22
2517 JN, The Hague, The Netherlands

Time: 13.00 – 19.00 hrs (followed by reception)

Click here to register

Click here for more information

Editors-in-Chief

Wybe Th. Douma (Senior Researcher, T.M.C. Asser Instituut and Lecturer of
International Environmental Law, The Hague University)

Leonardo Massai (Senior Lecturer on International and EU Environmental Law, Catholic University of Lille)

Editors

Olivier van Geel (T.M.C. Asser Instituut, The Hague)

Steffen van der Velde (Researcher, T.M.C. Asser Instituut, The Hague)