1.EXECUTIVE SUMMARY

The Environmental Liability Directive (ELD) was drafted to apply common, legally binding EU standards designed to reduce damage to natural resources (biodiversity, water and land). Its purpose is to prevent any imminent threat of environmental damage and, if damage occurs, to restore the pre-damage (baseline) condition. It is based on the ‘polluter pays’ principle, which means that the polluter, and not the general public (taxpayer), must take the preventive or remedial action needed and bear the costs. It establishes a system of strict liability for operators carrying out the dangerous activities listed in Annex III of the ELD and it requires Member States to encourage the development of financial security instruments and markets for operators carrying out these dangerous activities.

Nearly 12 years after its adoption, and after several years of implementation by the Member States (the last Member States transposed the ELD in 2010), it is time to evaluate whether the Directive is fit for purpose. This REFIT evaluation ties in with the Commission report required by the Directive on its application (COM(2016)204).

The evaluation is based on more than three years of investigation, including several specific studies of the ELD, 27 national reports on its application, and numerous stakeholder and expert meetings and consultations . The first chapters explain the purpose and scope of the evaluation and then provide general information on the initiative (its objectives, scope and principles, how it works, the base line and intervention logic). After explaining the process and methodology of the evaluation follows an analysis based on the national reports of how the Member States have transposed and implemented the ELD.

Answering a set of questions relating to the five principal evaluation criteria of relevance, effectiveness, efficiency, coherence and EU added value, the evaluation provides a picture of how the Directive works and identifies what has been achieved and where challenges and gaps need to be addressed.

The evaluation shows that despite delayed transposition by many Member States and several non-compliant provisions found by the Commission in the transposing legislation, national laws are now in place. This led to better coherence of national environmental liability laws in comparison to the situation before the ELD was transposed (some MS did not have any environment liability regime in place). However, the degree of diversity and complexity of the current situation cannot be described as a level playing field. The evaluation also indicates that the Directive has improved, to a certain degree:

the standards of prevention and restoration of environmental damage, in particular by requiring equivalent alternatives if the original natural resources cannot be restored,

the application of the ‘polluter pays’ principle,

strict liability across the EU for environmental damage,

EU-wide liability for biodiversity damage, and

public participation and access to justice for people affected and NGOs.

At the same time, implementation still varies significantly from one Member State to another in terms of the number of ELD cases and the way the Directive is implemented. A few Member States appear to make use of the ELD relatively frequently for environmental damage incidents, using it as a mainstream enforcement tool in circumstances where EU law might in any case require action (e.g. biodiversity damage). Other Member States appear to apply national legislation for environmental damage incidents instead of the ELD, by making extensive use of their interpretation of the ‘significance threshold’. The use of complementary and compensatory remediation methods could also be more frequent, even in some Member States that reported more cases. The observed ‘patchwork’ of environmental remediation, together with the lack of some key data on implementation and on the cost (both administrative and financial security), is a major challenge which needs to be addressed in the Action Plan following this evaluation. To better monitor and implement the ELD and to prepare robust ground for the next evaluation, a regulatory monitoring framework and other measures need to be considered and developed.