COMMISSION NOTICE

Guidelines providing a common understanding of the term ‘environmental damage’ as defined in Article 2 of Directive 2004/35/EC of the European Parliament and of the Council on environmental liability with regard to the prevention and remedying of environmental damage

(2021/C 118/01)

Table of contents

1. Introduction 1

2. The legal and wider regulatory context 2

3. ‘Damage’ 9

4. Overview of ‘environmental damage’ 10

5. ‘Damage to protected species and natural habitats’ 17

6. ‘Water damage’ 26

7. ‘Land damage’ 43

8. Conclusions 48

ANNEX 49

Court decisions cited 49

1. INTRODUCTION

1. The purpose of Directive 2004/35/EC of the European Parliament and of the Council of 21 April 2004 on environmental liability with regard to the prevention and remedying of environmental damage ( 1 ) (the ‘Environmental Liability Directive’ or the ‘Directive’) is to establish a framework of environmental liability based on the polluter pays principle, to prevent and remedy environmental damage ( 2 ) . An amendment adopted in 2019 ( 3 ) requires the European Commission to develop guidelines providing a common understanding of the term ‘environmental damage’ as defined in Article 2 of the Directive ( 4 ) . The present Notice sets out these Guidelines.

2. In the scheme of the Directive, the term ‘environmental damage’ is pivotal. It is used to define the Directive’s overall purpose ( 5 ) . When environmental damage occurs or when there is a threat that it will occur, preventive or remedial action obligations are triggered for operators, as are associated obligations for competent authorities ( 6 ) , with other persons being entitled to request that action be taken ( 7 ) . In the case of transboundary damage affecting more than one Member State, duties of co-operation between Member States are triggered ( 8 ) . In addition, the term carries consequences for financial operators who provide financial security to cover liabilities under the Directive ( 9 ) . The term thus plays a potentially major role in environmental protection – helping to determine whether or not environmental harm is prevented and remedied.

3. The present Guidelines for the common understanding of environmental damage address a need identified in an evaluation of the Directive carried out by the Commission in 2016 (‘the evaluation’). ( 10 ) The evaluation concluded that the Directive’s implementation was hampered by significant lack of uniform application of key concepts, in particular concepts related to environmental damage ( 11 ) . Hence the Commission engaged a contractor to prepare, together with the Environmental Liability Directive government experts group and the relevant Commission service, a Common Understanding Document based on research and consultations ( 12 ) . Although it resulted in neither a Commission document nor a document agreed with the Member States, this ground-work has helped to prepare the way for these Guidelines.

4. Against this background, the Guidelines consider all aspects of the definition of ‘environmental damage’. The term is content-rich, referring to or embedding several other terms and concepts. The Guidelines encompass these, since they are necessary to the term’s understanding. With regard to structure, the Guidelines begin by looking at the legal and wider regulatory context in which the definition is relevant. They then look in turn at the definition of ‘damage’ and the complete text of the definition of ‘environmental damage’, before examining in detail the three separate categories of environmental damage comprised in it, i.e. ‘damage to protected species and natural habitats’, ‘water damage’ and ‘land damage’. Overall conclusions are presented at the end.

5. Given that the objective of the Guidelines is to provide a common understanding of the definition, their content is analytical and detailed. While they are not exclusively intended for any specific readership, they are envisaged as being of use to the following in particular, all of whom have roles under the Directive: Member States, competent authorities, operators, natural and legal persons, and providers of financial security. The Guidelines seek to address as comprehensively as possible the difficulties of understanding that have already arisen or that might reasonably be expected to arise in the future. They do so by closely analysing all parts of the definition of ‘environmental damage’, drawing attention to detailed considerations that can be inferred from the wording and the legal and regulatory context, and referring to case-law of the Court of Justice of the European Union (‘the CJEU’ or ‘the Court’) which can help clarify different aspects of the definition either directly or by analogy.

6. The Guidelines have been prepared under the exclusive responsibility of the Commission. However, only the Court is competent to authoritatively interpret Union law.

2. THE LEGAL AND WIDER REGULATORY CONTEXT

7. [now Directive 2009/147/EC on the conservation of wild birds The Environmental Liability Directive is a general, cross-cutting environmental instrument, applying not to one environmental subject-area but to several. As such, it complements other Union instruments that aim to protect the environment. The definition of ‘environmental damage’ expressly refers to four of these: Council Directive 79/409/EEC of 2 April 1979 on the conservation of wild birds ( 13 ) ( 14 ) ] (‘the Birds Directive’); Council Directive 92/43/EEC of 21 May 1992 on the conservation of natural habitats and of wild fauna and flora ( 15 ) (‘the Habitats Directive’); Directive 2000/60/EC of the European Parliament and the Council of 23 October 2000 establishing a framework for Community action in the field of water policy ( 16 ) (‘the Water Framework Directive’); and Directive 2008/56/EC of the European Parliament and the Council of 17 June 2008 establishing a framework for Community action in the field of marine environmental policy ( 17 ) (‘the Marine Strategy Framework Directive’). Cross-references to, and an understanding of, legal provisions of these other instruments are necessary to an understanding of ‘environmental damage’.

8. The Environmental Liability Directive is based on, and is an expression of, the polluter pays principle ( 18 ) . In addition, a common understanding of ‘environmental damage’ needs to draw on, as appropriate, other principles on which Union environmental policy is founded, namely the precautionary principle ( 19 ) , and the principles that preventive action should be taken and that environmental damage should as a priority be rectified at source ( 20 ) , these being relevant to its interpretation. General principles of Union law, such as the principle of proportionality, are also relevant to the Directive.

9. The Environmental Liability Directive addresses adverse effects on the environment arising from occupational activities. These activities are subject to legal requirements under other Union environmental laws ( 21 ) . The laws concerned create a wider regulatory context which is relevant to the application of the Directive’s obligations concerning environmental damage. This is because the provisions of those laws usually also aim to prevent or limit many of the adverse effects on nature, water and land that come within the scope of the term ‘environmental damage’.

Liability for environmental damage

10. ‘Environmental damage’ needs to be understood in relation to those who may be legally liable for it under the Directive, the circumstances in which and the conditions under which their liability may arise, and the kinds of action that liability will require them to take.

11. Naturschutzbund Deutschland — Landesverband Schleswig-Holstein eV, the Court stated that the concept of ‘occupational activity’ is not limited solely to activities which are market-related or are competitive in nature, but encompasses all activities carried out in an occupational context, as opposed to a purely personal or domestic context, and, therefore, cover also activities carried out in the public interest pursuant to a statutory assignment of tasks Those who may be legally liable are referred to as ‘operators’ ( 22 ) . They are only liable in respect of ‘occupational activities’ coming within the scope of the Directive ( 23 ) . In Case C-297/19,the Court stated that the concept of ‘occupational activity’ is not limited solely to activities which are market-related or are competitive in nature, but encompasses all activities carried out in an occupational context, as opposed to a purely personal or domestic context, and, therefore, cover also activities carried out in the public interest pursuant to a statutory assignment of tasks ( 24 ) . In the specific case, it confirmed that the Directive applied to a public body responsible for drainage of a wetland in the interests of agriculture.

12. The main relevant occupational activities ( 25 ) are those described in Annex III of the Directive. Operators of these may be liable for all three categories of environmental damage under the Directive. Moreover, the liability of operators covered by Annex III is strict, i.e. it is not dependent on their having acted or omitted action on the basis of fault (intent or negligence). For strict liability to apply, it is sufficient that a causal link is established between the environmental damage and the occupational activity. The eighth recital of the Directive sets out the rationale for bringing the occupational activities described in Annex III within its scope. It states that the Directive should apply to occupational activities which present a risk to human health orthe environment, adding: ‘Those activities should be identified, in principle, by reference to the relevant [Union] legislation which provides for regulatory requirements in relation to certain activities or practices considered as posing a potential or actual risk for human health or the environment’.

13. The occupational activities in Annex III are defined by reference to other pieces of Union environmental legislation many of which have been codified, amended or replaced since the Directive was adopted. However, the occupational activities in question continue to come within the scope of the Directive. The Common Understanding Document provided information on how the legislation concerned evolved ( 26 ) . The occupational activities in Annex III cover, amongst other things, the operation of many industrial activities, including bigger or riskier industrial installations such as chemical factories; waste management operations; certain polluting discharges to water; water abstraction and impoundment; the manufacture, use, storage, processing, filling, release into the environment and onsite transport of certain substances, preparations and products, as well as transport of dangerous substances or goods by road, rail, inland waterways, sea or air.

14. For one category of ‘environmental damage’, namely damage to protected species and natural habitats, operators of occupational activities other than those listed in Annex III may also be liable where they are at fault or negligent ( 27 )

15. Commission v Ireland, in which the Court found that a failure to respect inspection requirements linked to permit requirements could arise in respect of waste operations carried out without any permit Under other applicable Union environmental legislation, operators are often required to hold, and respect the conditions of an authorisation; or they may be bound to operate in accordance with general binding requirements. It cannot be excluded, however, that some operators will carry out occupational activities without the required authorisation, or without respecting all the applicable rules. This may be the case, for example, with persons who carry out illegal waste operations. Such illegal conduct does not take such operators outside the scope of the Directive. Were it to do so, the result would be inconsistent with the polluter pays principle. The Directive is an expression of this principle – and needs to be interpreted in the light of it ( 28 ) . Further support for coverage of illegal operators is provided by Case C-494/01,in which the Court found that a failure to respect inspection requirements linked to permit requirements could arise in respect of waste operations carried out without any permit ( 29 ) . By analogy, it can be argued that liability requirements under the Directive can similarly apply in respect of occupational activities carried out in disregard of authorisation or other regulatory requirements.

16. Raffinerie Mediterranee (ERG I) SpA and others , and C-534/13, Fipa Group and others, the Court ruled that the environmental liability mechanism provided for by the Directive requires the establishment of a causal link between the activity of one or more identifiable operators and the environmental damage or the imminent threat of such damage In Cases C-378/08,, and C-534/13,the Court ruled that the environmental liability mechanism provided for by the Directive requires the establishment of a causal link between the activity of one or more identifiable operators and the environmental damage or the imminent threat of such damage ( 30 ) . As for the causal link, the Court has ruled that, if the legislation of a Member State so provides, a presumption, based on plausible evidence, is sufficient in order to establish the link. ( 31 )

17. Folk Naturschutzbund Deutschland — Landesverband Schleswig-Holstein eV show, the Directive covers the consequences of the normal operation of an Annex III occupational activity. In Case C-529/15, the normal operation involved a hydro-electric power-station; in case C-297/19, maintenance of drainage in a wetland. Liability should therefore not be assumed to only arise in respect of one-off accidents or incidents; it may also arise in respect of normal operations and relate to the sorts of circumstances described in paragraphs 18 and 19 below. For ease of reference, the present Guidelines will refer to the range of possible occurrences as ‘damaging occurrences’. The Directive does not define which occurrences will give rise to a causal link between the occupational activity and the environmental damage or imminent threat. At a number of places in the text of the Directive, there are references to ‘an emission, event or incident’. ( 32 ) However, with the exception of ‘emission’ ( 33 ) , these terms are not defined, and, as Case C-529/15, ( 34 ) and Case C-297/19,show, the Directive covers the consequences of the normal operation of an Annex III occupational activity. In Case C-529/15, the normal operation involved a hydro-electric power-station; in case C-297/19, maintenance of drainage in a wetland. Liability should therefore not be assumed to only arise in respect of one-off accidents or incidents; it may also arise in respect of normal operations and relate to the sorts of circumstances described in paragraphs 18 and 19 below. For ease of reference, the present Guidelines will refer to the range of possible occurrences as ‘damaging occurrences’.

18. The nature of the factors causing adverse effects – what can be referred to as the ‘damage factors’ ( 35 ) – may also vary ( 36 ) . Their nature may be additive – involving the deposit of waste on land, or use of inert materials to fill in a wetland, for instance, or the contamination of the receiving environment by pollutants. Or it may be subtractive or extractive – involving an impedance of river flow ( 37 ) or the removal of trees or minerals, for example. Or it may be purely destructive – as where land features are cleared or individuals of a protected species killed.

19. The manifestation of adverse effects may be sudden and accidental – as where an explosion in a chemical factory results in a fire, destruction of buildings and pollution of land and water through release of toxic substances or fire-fighting substances into water. Or it may be immediate – as where a protected woodland habitat is lost through a rapid logging operation. Or it may be gradual – as where a leak from a ruptured pipe leads to cumulative harm in the receiving environment that is detected only after some time. It is also possible that adverse effects from the same damaging occurrence may manifest themselves in both ways – as where a sudden and accidental release of a large quantity of toxic substances into a river results in an immediate fish-kill before causing a slower and more gradual deterioration of the structures of a protected aquatic habitat or of the habitat of a protected species.

20. Likewise, knowledge of both damaging occurrences and the adverse effects they cause may come to light at different times. If the damaging occurrence is a major accident, it will become known at once, but an unknown incident may not come to light for some time – for example, a rupture in an underground storage tank containing dangerous substances. ( 38 )

21. The Directive provides for three main categories of obligation on operators: — Where environmental damage has not yet occurred but there is an imminent threat of such damage occurring, operators are required to take the necessary preventive measures (39) without delay (40); — Where environmental damage has occurred, operators are required to take ‘all practicable steps to immediately control, contain, remove or otherwise manage the relevant contaminants and/or any other damage factors in order to limit or prevent further environmental damage and adverse effects on human health or further impairment of services’ (41). For ease of reference, the present Guidelines will refer to these steps as ‘immediate management of damage factors’; — Where environmental damage has occurred, operators are required to take remedial measures (42). They are to identify the appropriate remedial measures in accordance with Annex II of the Directive, and submit them for approval to the competent authority (43).

22. The references to ‘without delay’ and ‘immediately’ show that the first two categories of obligation are time-critical. This has implications for the common understanding of the term ‘environmental damage’. The operator’s duties to take preventive measures and to immediately manage damage factors under the Directive exist in parallel to similar obligations under other Union environmental legislation, for example Directive 2010/75/EU of the European Parliament and the Council of 24 November 2010 on industrial emissions (integrated pollution prevention and control) ( 44 ) (‘the Industrial Emissions Directive’).

24. The Environmental Liability Directive contains provisions on its temporal applicability, setting limits on its application by reference to the date of 30 April 2007 and the passage of a period of thirty years ( 51 ) . The temporal scope for the specific parts introduced by its amendments is, of course, different – for example, for damage to marine waters, the Directive is applicable as of 19 July 2015 ( 52 ) . It is important to note that occupational activities governed by authorisations that pre-date 30 April 2007 are covered for liability purposes if and to the extent that the damaging activity is continuing after the 30 April 2007. In Case C-529/15, Folk, the Court held that the Directive ‘applies ratione temporis to the environmental damage that occurred after 30 April 2007 but which was caused by the operation of a facility authorised in accordance with the law governing matters relating to water and put into operation before that date.’ ( 53 )

25. Folk The Directive also contains provisions on exceptions, setting limits on its application by reference to a number of specified causes of environmental damage ( 54 ) . Furthermore, it provides for a number of grounds that an operator can invoke to avoid bearing the cost of preventive and remedial actions ( 55 ) . It also gives Member States the possibility to decide to relieve an operator of the cost of remedial actions, where the operator demonstrates that he was not at fault or negligent and fulfilled all conditions of an authorisation ( 56 ) or acted according to the state of the technical and scientific art. ( 57 ) However, there are limits to the last-mentioned possibilities, as is made clear by the Court judgment in Case C-529/15, ( 58 ) concerning Article 8(4)(a) of the Directive.

26. different provisions which do not fulfil the Directive’s requirements; nor is it an entitlement to set aside the liability of operators for ‘environmental damage’ under the Directive. The requirements of the Directive must, as a minimum, be fulfilled in all respects. The Directive allows Member States to maintain or adopt more stringent provisions in relation to environmental damage ( 59 ) . This is in line with Article 193 of the Treaty on the Functioning of the European Union (TFEU). However, the entitlement to have more stringent provisions is not the same as an entitlement to haveprovisions which do not fulfil the Directive’s requirements; nor is it an entitlement to set aside the liability of operators for ‘environmental damage’ under the Directive. The requirements of the Directive must, as a minimum, be fulfilled in all respects.

The role of the competent authorities and relevant wider roles of Member States

27. While the operator is liable for environmental damage, competent authorities ( 60 ) have duties in relation to it. A common understanding of the term ‘environmental damage’ therefore requires some reference to their role.

28. Competent authorities must establish the operator who has caused environmental damage or the imminent threat of damage ( 61 ) . By implication, the competent authorities must know about the existence of the environmental damage or the threat; otherwise the duty of establishing the operator has no meaning.

29. Competent authorities must also assess the significance of the environmental damage ( 62 ) . Once again, the duty of assessing significance only makes sense if the authorities know about the existence of the damage or the threat.

30. Raffinerie Mediterranee (ERG) SpA and others , the Court affirmed the scope for competent authorities to alter the remedial measures, while also pointing to the need to give the operator an opportunity to be heard Competent authorities must determine the remedial measures to be taken by the operator under Annex II of the Directive ( 63 ) on the basis of the identification of the potential remedial measures by the operator and with the cooperation of the relevant operator, as required. In Case C-379/08,, the Court affirmed the scope for competent authorities to alter the remedial measures, while also pointing to the need to give the operator an opportunity to be heard ( 64 )

31. The duties to establish the liable operator, to assess the significance of environmental damage and to determine the remedial measures require the competent authorities to have and to apply relevant information about the damaging occurrence, the occupational activity, the environmental damage and the causal link between them, as well as the operator carrying out the activity. Paragraphs 32 to 37 below describe several potential kinds and sources of relevant information. It should be borne in mind, however, that complete information may not always be readily available and that the competent authorities may need to act swiftly. In such circumstances, the precautionary principle will justify competent authorities intervening on the basis of a reasonable belief that environmental damage has occurred or will imminently occur.

32. As noted at paragraph 23 above, operators have duties under the Directive to inform the competent authorities about damaging occurrences and related environmental damage. As also noted, operators may have separate duties to provide information about damaging occurrences to competent authorities under other Union environmental legislation. It cannot be excluded, however, that some operators will fail to report. Damaging occurrences and environmental damage causally linked to clandestine illegal activities or illegal or negligent acts or omissions within authorised activities, for example, are unlikely or less likely to be reported.

33. Recital 15 of the Directive indicates that public authorities should ensure the proper implementation and enforcement of the scheme provided for by the Directive, and the Directive contains provisions according to which the competent authorities may require more information and an increased level of engagement from the operator ( 65 ) . It is nevertheless important that competent authorities have recourse to sources of information other than that provided by the operator under the Directive.

34. One potential source of information on damaging occurrences and environmental damage consists in requests for action made by the natural or legal persons entitled to make such requests. ( 66 ) Requests for action are required to be ‘accompanied by the relevant information and data supporting the observations submitted in relation to the environmental damage in question’. ( 67 )

35. Another possible source of relevant information consists in the results of regulatory oversight under other applicable Union environmental legislation. An example would be routine inspections of industrial facilities under the Industrial Emissions Directive ( 68 ) . While, for purposes of liability, not all damaging occurrences will coincide with regulatory infringements by an operator, regulatory infringements make damaging occurrences more likely. This is because the regulatory requirements concerned are aimed at controlling the potential or actual risks to human health and the environment associated with the occupational activities concerned. As a consequence, compliance with them should, in practice, reduce the likelihood that damaging occurrences will arise. By the same token, non-compliance with these requirements – including serious flouting of them – makes it more likely that damaging occurrences will arise. Provided that there are good systems for sharing information, monitoring of compliance with regulatory requirements should therefore help competent authorities under the Directive to know about environmental damage or the imminent threat of damage, establish the operator and characterise the damaging occurrence. It may also assist competent authorities in the assessment of environmental damage, furnishing information about the nature of polluting emissions, for example.

36. As will be clear from later sections of these Guidelines, the assessment of the significance of environmental damage generally requires information about the state of the receiving environment. Some state-of-the-environment information will be directly linked to the damaging occurrence – for example, records of fish mortality in a river recently adversely affected by a polluting emission. But other relevant state-of-the-environment information will consist of records and information gathered for other purposes – to determine the general conservation status of a protected species, for instance, or the condition of a protected nature site, such as a Natura 2000 site. Much relevant state-of-the-environment information will derive from state-of-the-environment monitoring carried out by national administrations. Of particular relevance will be information gathered and collated under the four directives mentioned in paragraph 7 above. This may be supplemented by other relevant information of acknowledged scientific value – for example, an environmental non-governmental organisation (NGO) may provide extensive information through citizen science ( 69 )

37. Closely related in potential importance to state-of-the-environment information is scientific and technical information on the subject-matter of the environmental damage – for example, scientific knowledge about the life cycle of a protected species adversely affected, or about the human health risks of exposure to certain contaminants.

38. not a reason to set aside the duties that competent authorities have to ensure that environmental damage is assessed and prevented, damage factors immediately managed or damage remediated in accordance with the Directive (the reverse is also true: the pursuit of environmental liability is not a reason to disregard the role of sanctions). As observed above, the occurrence of environmental damage or its imminent threat will often, although not always, coincide with an infringement of other Union environmental legislation. Such infringements may require or warrant separate action by Member State authorities, to secure the results required by other Union legislation (for example, the protection of nature sites under the Birds Directive and the Habitats Directive), and to implement sanctions that are effective, proportionate and dissuasive. Thus, the same factual circumstances may give rise to both environmental liability and liability to sanctions, and in practice assessment of environmental damage under the Directive may take place in parallel with the assessment of breaches for other purposes. For example, conduct that Member States are required to criminalise under Directive 2008/99/EC of the European Parliament and of the Council of 19 November 2008 on the protection of the environment through criminal law (‘the Environmental Crime Directive’) ( 70 ) includes some (although not all) conduct likely to give rise to environmental liability. ( 71 ) In this context, in order to assess the significance of environmental damage, competent authorities may find themselves drawing on the same information sources as those authorities responsible for sanctions. It is to be stressed, however, that application of liability requirements under the Directive is separate to the application of sanctions. In this regard, the fact that authorities may be taking action to impose administrative or criminal sanctions isa reason to set aside the duties that competent authorities have to ensure that environmental damage is assessed and prevented, damage factors immediately managed or damage remediated in accordance with the Directive (the reverse is also true: the pursuit of environmental liability is not a reason to disregard the role of sanctions). ( 72 )

39. Commission v Romania, which concerned the Extractive Waste Directive A number of further points arise with regard to situations where liability under the Directive coincides with regulatory breaches under other relevant Union environmental legislation, in particular the other legislation referred to in the Directive itself. Firstly, if damage factors are not being controlled in accordance with the Directive or other legislation, the principle of effectiveness will require Member States and their authorities to act to ensure compliance with the relevant provisions of the Directive and the other legislation that are being contravened. Secondly, the Directive does not explicitly provide for secondary liability for public authorities to take preventive measures, measures to immediately manage damage factors, and remedial measures, but neither does it explicitly provide that all of these measures can be dispensed with if the operator fails to adopt them, or if the operator can justify not having to bear their cost. ( 73 ) The distinction that the Directive draws between the measures and the costs of those measures indicates that the measures are required irrespective of whether the operator can or should bear the cost ( 74 ) . Thirdly, case-law shows how a Member State may be required to take further steps if a required result is not achieved despite the authorities having taken action against an operator. In Case C-104/15,which concerned the Extractive Waste Directive ( 75 ) , the Court found that the Member State remained liable for failure to control toxic dust emissions from a mining waste facility, notwithstanding the fact that it had imposed sanctions on the operator ( 76 ) and that the operator had become insolvent ( 77 )

3. ‘DAMAGE’

40. The definition of ‘environmental damage’ incorporates the term ‘damage’, which is separately defined. The term ‘damage’ is not self-standing (in the sense that the obligations of the Directive do not apply at the level of generality found in it). When it comes to applying the Directive to concrete situations, it is necessary to rely on the more precise formulations contained in the definition of ‘environmental damage’. This reservation notwithstanding, the definition of ‘damage’ is important not only because it is embedded in the definition of ‘environmental damage’ but because it presents four basic concepts which are refined in the more elaborate definition. The Guidelines therefore address ‘damage’ before addressing other elements of the definition of ‘environmental damage’. Box 1: Definition of ‘damage’

Article 2(2) of the Environmental Liability Directive provides that ‘damage’ means ‘measurable adverse change in a natural resource or measurable impairment of a natural resource service which may occur directly or indirectly.’

41. The four basic concepts found in the definition of ‘damage’ are: — The material scope of what is affected, i.e. natural resources and natural resource services; — The concept of adverse effects, i.e. adverse changes and impairments; — The scope of these adverse effects, i.e. measurable ones; — The ways in which these adverse effects can occur, i.e. directly or indirectly.

Material scope of natural resources and natural resource services

Box 2: Definitions of ‘natural resource’ and ‘natural resource service’

Article 2(12) of the Environmental Liability Directive provides that ‘natural resource’ means ‘protected species and natural habitats, water and land.’ Article 2(13) of the Environmental Liability Directive provides that ‘services’ and ‘natural resource services’ mean ‘the functions performed by a natural resource for the benefit of another natural resource or the public’.

42. With regard to material scope, the definition of ‘damage’ refers to two concepts which are themselves also expressly defined in the Directive, namely ‘natural resource’ and ‘natural resource service’. ‘Natural resource’ is defined to mean three separate resource categories: protected species and natural habitats; water; and land. At the same time, the definition of ‘natural resource service’ highlights the inter-dependencies of these different categories by referring to the functions they perform for each other. The following are some non-exhaustive examples: a salt marsh (a type of natural habitat) may protect coastal land; surface water (a category of water) may support protected species of wild bird; land may filter out pollutants which might otherwise reach groundwater (a category of water). The definition of ‘natural resource service’ also refers to natural resource functions which benefit people. By way of non-exhaustive examples, some natural habitats such as peatlands serve as important carbon stores; some waters are a source of drinking water and some provide fish for recreational fishing; and land is necessary for food production and habitation.

Adverse effects

43. With regard to adverse effects, the definition of ‘damage’ relates, firstly, to an ‘adverse change’ to a natural resource and, secondly, to ‘impairment’ of a natural resource service. More precision is found in the definition of ‘environmental damage’, but it is useful to keep in mind three general considerations: — Both ‘adverse change’ and ‘impairment’ imply adverse effects; — These adverse effects concern both the state of a natural resource and the beneficial functions performed by the natural resource for both other natural resources and people. Adverse effects therefore include not only adverse effects on the properties of a natural resource but also adverse effects on the interdependencies and dynamic relationships within and between natural resources and services, i.e. the functions that natural resources provide to each other as well as the public; — The notions of change and impairment imply a difference between the situation ‘before’ and the situation ‘after’ a damaging occurrence.

Measurable

44. For the definition of ‘damage’ to apply, adverse changes and impairment must be ‘measurable’. Measurable means that damage needs to be capable of quantification or estimation, and that the situation before and the situation after a damaging occurrence must be capable of being meaningfully compared.

Directly or indirectly

45. Túrkevei Tejtermelő Kft. , the Court noted that, while air pollution as such does not constitute environmental damage, damage to natural resources may arise as a result of air pollution Finally, the definition of ‘damage’ allows for the possibility that adverse changes or impairments may occur both directly and indirectly. ‘Directly or indirectly’ concerns the causal link between a damaging occurrence, on the one hand, and specific adverse effects, on the other. Sometimes the causal link will be direct, as where an operator’s act of deforestation destroys a protected natural woodland habitat. Sometimes it will be indirect, as where nutrient discharges to a water body lead to the deterioration of a distant protected aquatic habitat. For the chain of cause and effect, it is useful to refer to a source-pathway-receptor model. Damage factors associated with an occupational activity (i.e. source), may pass through air, water or land (i.e. pathway) before affecting a specific natural resource (i.e. receptor). In Case C-129/16,, the Court noted that, while air pollution as such does not constitute environmental damage, damage to natural resources may arise as a result of air pollution ( 78 ) . A damaging occurrence may be separated from the adverse effects it causes in terms of time (e.g. the natural resource suffers a delayed reaction) or space (e.g. the natural resource suffers adverse effects at a location which is distant from where the damaging occurrence arose) or in terms of the natural resources involved (e.g. an act consisting of applying a toxic substance to land causes the death of a protected species). The notion that adverse effects can occur indirectly is also related to the functions that natural resources provide for each other.

4. OVERVIEW OF ‘ENVIRONMENTAL DAMAGE’

46. The definition of ‘environmental damage’ incorporates and refines the definition of ‘damage’. First of all, with regard to material and geographical scope, it disaggregates and compartmentalises the three categories of ‘natural resource’ that feature in the definition of ‘damage’, i.e. protected species and natural habitats; water; and land. Furthermore, for the first two natural resource categories, it includes certain details that help to determine the geographical scope of obligations under the Directive. Secondly, within each of the natural resource categories, relevant adverse effects are described in more detail by reference to certain concepts (which these Guidelines call ‘reference concepts’). Thirdly, a notion of significance is included to further define the scope of the adverse effects that need to be addressed. A fourth point to note is that the definition of environmental damage does not preclude the possibility that all three sub-categories of natural resource damage will be relevant at the same time. Box 3: Definition of ‘environmental damage’

Article 2(1) of the Environmental Liability Directive (79) provides that ‘environmental damage’ means: ‘(a) damage to protected species and natural habitats, which is any damage that has significant adverse effects on reaching or maintaining the favourable conservation status of such habitats or species. The significance of such effects is to be assessed with reference to the baseline condition, taking account of the criteria set out in Annex I; Damage to protected species and natural habitats does not include previously identified adverse effects which result from an act by an operator which was expressly authorised by the relevant authorities in accordance with provisions implementing Article 6(3) and (4) or Article 16 of Directive 92/43/EEC or Article 9 of Directive 79/409/EEC or, in the case of habitats and species not covered by Community law, in accordance with equivalent provisions of national law on nature conservation. (b) water damage, which is any damage that significantly adversely affects: (i) the ecological, chemical or quantitative status or the ecological potential, as defined in Directive 2000/60/EC, of the waters concerned, with the exception of adverse effects where Article 4(7) of that Directive applies; or (ii) the environmental status of the marine waters concerned, as defined in Directive 2008/56/EC, in so far as particular aspects of the environmental status of the marine environment are not already addressed through Directive 2000/60/EC. (80) (c) land damage, which is any land contamination that creates a significant risk of human health being adversely affected as a result of the direct or indirect introduction, in, on or under land, of substances, preparations, organisms or micro-organisms.’

Material and geographical scope of each natural resource

47. Because of the degree of compartmentalisation of the material scope, a common understanding of ‘environmental damage’ requires a close analysis of each category of natural resource. This includes the geographical scope of each resource category. Commentary on material and geographical scope is provided in the next sections of these Guidelines.

Reference concepts for adverse effects

48. For all three categories of natural resource, the definition of ‘environmental damage’ uses a reference concept to determine whether adverse effects are relevant. For protected species and natural habitats, the reference concept is the favourable conservation status of these species and habitats. For water, it is the ecological, chemical or quantitative status or the ecological potential of waters under the Water Framework Directive and the environmental status of marine waters under the Marine Strategy Framework Directive, which have different dimensions. For land, it is risks to human health. The function of these reference concepts is to provide parameters and criteria against which the relevance of adverse effects can be examined. The concepts provide elements in respect of which adverse effects are to be measured. The concepts are analysed in more detail in the sections of these Guidelines devoted to the specific categories of natural resource damage.

The assessment of significance

49. The reference concepts qualify the kinds of adverse effects that are covered by the Directive. The definition of ‘environmental damage’ contains a further qualification: the words ‘significant’ or ‘significantly’ figure in relation to each natural resource category, and the Directive requires preventive measures, immediate management of damage factors or remedial measures only if the adverse effects are assessed as significant in terms of the reference concepts mentioned.

50. sui generis . Amongst Union environmental law instruments, a requirement to assess significance is not unique to the Environmental Liability Directive. Such a requirement also features in the Habitats Directive ( 81 ) , for instance, and it is at the heart of Directive 2011/92/EU of the European Parliament and of the Council of 13 December 2011 on the assessment of the effects of certain public and private projects on the environment ( 82 ) (the ‘Environmental Impact Assessment Directive’). Assessment of significance pursuant to the Environmental Liability Directive is, however,

51. In the context of the Environmental Liability Directive, a common understanding of the assessment of significance can benefit from a consideration of the following: — The circumstances in which the need for assessment of significance arises; — The purposes of assessment of significance; — Legal responsibilities with regard to carrying out of the assessment; — The context or contexts in which the assessment is to be carried out; — The focus of the assessment; — The carrying out of the assessment; — The determination of significance.

Circumstances

52. As section 2 of these Guidelines indicates, damaging occurrences, damage factors, relevant occupational activities, operator conduct, and the nature of the causal link may all vary considerably. The assessment of significance will need to be adaptable to all of these variables. For instance, a one-off accident will present a different set of challenges to an ongoing operation such as that featuring in Case C-529/15, Folk.

Purposes

53. The assessment of significance of adverse effects is not an end in itself. It is for the purposes of determining whether adverse effects require: — Preventive measures; — Immediate management of damage factors, and/or — Remedial measures.

54. These three purposes are distinguishable, and, depending on the circumstances, some may be relevant and others not. For example, in situations of imminent threat, the sole purpose of the assessment will be to prevent a damaging occurrence from taking place. In situations where a damaging occurrence has already taken place, it may or may not be necessary to immediately manage the damage factors. For example, such immediate management may no longer be possible where the damage factors have already created adverse effects and are exhausted. All three purposes may, of course, become sequentially relevant, as where an imminent threat of a damaging occurrence becomes an actual damaging occurrence that requires immediate management of damage factors as well as subsequent remedial measures. The assessment of significance will, therefore, need to be adapted to the purposes which are relevant to the specific circumstances that have arisen.

55. The purposes of prevention and immediate management of damage factors relate to potential or actual damage factors. These purposes reflect the Treaty principles of prevention and rectification at source. As previously noted, they are time-critical.

56. Folk case indicates The purpose of identifying a need for remedial measures is closely related to the Directive’s specific requirements on remedial measures, which are described in detail in Annex II. In the case of damage to protected species and natural habitats, and water damage, remedial measures are aimed at restoring the environment to its baseline condition (see Box 4 below) by way of primary, complementary and compensatory remediation, all of which terms are defined. As can be seen, these requirements focus on the environment that has been adversely affected, rather than on the damage factors – although further management of damage factors cannot be excluded, as thecase indicates ( 83 ) . In the case of land damage, remedial measures are aimed at further management of damage factors, if such factors remain a significant risk to human health even after fulfilment of the second purpose mentioned above. Box 4: Definition of ‘baseline condition’

Article 2(14) of the Environmental Liability Directive provides that ‘baseline condition’ means ‘the condition at the time of the damage of the natural resources and services that would have existed had the environmental damage not occurred, estimated on the basis of the best information available.’

Duties of those concerned

57. As indicated in paragraph 29, the competent authority is responsible for the assessment of significance. Recital 24 of the Directive states: ‘Competent authorities should be in charge of specific tasks entailing appropriate administrative discretion, namely the duty to assess the significance of the damage and to determine which remedial measures should be taken’.

58. It must be borne in mind, however, that operators bear the responsibility to prevent damaging occurrences without delay and to immediately manage damage factors. These responsibilities imply a need for operators to independently recognise damage factors linked to their occupational activities and to proactively respond to them. Furthermore, relevant provisions of the Directive indicate that the assessment of significance should take place against the backdrop of a dynamic relationship between the operator and the competent authority, with the former required to actively provide information and respect instructions given by the competent authority ( 84 ) . These can include an instruction to the operator to carry out his own assessment and to supply any information and data necessary ( 85 ) . This dynamic relationship is especially important where adverse effects have already occurred and it is necessary to take remedial measures.

59. The assessment of significance may take place in situations where there are parties concerned other than the competent authority and the operator. In particular, the competent authority has to fulfil several legal duties in respect of a valid request for action ( 86 )

60. Where environmental damage affects or is likely to affect several Member States, the Member States concerned have duties to co-operate which are relevant to the assessment of significance ( 87 )

Context

61. The categories of natural resource that are relevant and the corresponding reference concepts will determine the elements to be assessed. For example, damage to protected species and natural habitats will require quite different elements to be considered compared to land damage. These specific elements are considered in more detail in the next sections of these Guidelines.

Focus of the assessment

62. The focus of the assessment will need to vary according to the relevant circumstances, purposes and context.

63. The definition of ‘damage’ shows that adverse effects comprise changes and impairments that need to be measurable, and the definition of ‘environmental damage’ shows that these changes and impairments need to relate to the reference concepts.

64. before the damaging occurrence took place with their condition after the occurrence took place (obviously, so far as the condition after is concerned, this comparison will be notional in the case of an imminent threat, since the imminent threat will not yet have materialised as damage). The comparison involves two distinct forms of quantification or estimation, one focused on the situation before and the other on the situation after the damaging occurrence took place Raffinerie Mediterranee (ERG) SpA and others. ( 89 ) Measurement involves comparing the condition of natural resources and servicesthe damaging occurrence took place with their conditionthe occurrence took place (obviously, so far as the conditionis concerned, this comparison will be notional in the case of an imminent threat, since the imminent threat will not yet have materialised as damage). The comparison involvesdistinct forms of quantification or estimation, one focused on the situation before and the other on the situation after the damaging occurrence took place ( 88 ) . It is important to stress that, although relevant to both preventive and remedial action, assessment will need to be treated differently depending on whether the action is time-critical. Where time-critical, the assessment will need to be done on the basis of rapid judgment drawing on existing and immediately accessible information – often of a general character. Support for such a differentiated approach can be found in Case C-378/08,

65. With regard to measurement of the situation before, the concept of the baseline condition comes into play (see Box 4 above). While the baseline condition may be constant, it is likely that it may vary over time. For example, the condition may fluctuate regularly or predictably (as with a flood-plain or a seasonal lake such as a turlough, for instance ( 90 ) ), or the area of habitat or population of a species affected may already be increasing or decreasing.

66. As for the change or impairment, this will consist of the difference between the situation of the natural resource or service after the damaging occurrence took place and the baseline condition. The situation after the damaging occurrence must also, therefore, be known.

67. The gap between the baseline condition and the situation after the damaging occurrence may be an unstable one, as where the damage factors are continuing to generate adverse effects, and the magnitude of these adverse effects is growing. From the purpose of immediately managing the damage factors, it can be inferred that an assessment of significance will also need to address the damage factors causing the adverse effects.

The carrying out of the assessment

68. Depending on which purposes are relevant to the circumstances that present themselves, the assessment of significance of changes to the natural resource may involve different stages and a consideration of different types of information. ( 91 )

69. Where preventive measures are required in respect of an imminent threat, the operator – and, as necessary, the competent authority – will need to recognise the potential damage factors associated with the occupational activity, and without delay ensure that these do not cause significant adverse effects to the relevant natural resources or impair any natural resource services.

70. Likewise, where damage factors require immediate management, the operator – and, as necessary, the competent authority – will need to recognise the damage factors associated with the occupational activity, and ensure rapid interventions to manage these so as to stop the chain of causation of significant adverse effects on the relevant natural resources or impairment of natural resource services.

71. For purposes of preventive measures and immediate management of damage factors, the need for rapid assessment means that reliance will need to be placed on and conclusions reached on the basis of readily available information. General information about the nature of the damage factors and the exposure of a natural resource to their adverse effects will often be key, since there may be no time to wait for site-specific details to emerge. The application of the precautionary principle is necessary in such circumstances. ( 92 )

72. Where remedial measures are required, a more in-depth assessment is appropriate, and this should be less time-critical. It should, nevertheless, be timely, as time is also a relevant factor with respect to the remedial measures described in Annex II ( 93 )

73. Where remedial measures in particular are concerned, it cannot be excluded that, as paragraph 20 shows, there will be a time-lag between the damaging occurrence and the first opportunity to assess its significance. Subject to the Directive’s provisions on temporal scope (as mentioned in paragraph 24 above), the existence of a time-lag is not, however, a reason to refrain from assessment, particularly where the damaging occurrence has had enduring adverse effects.

74. ex post environmental impact assessment) to correct both a regulatory failure (such as the failure to carry out a required prior environmental impact assessment) and an assessment of significance of changes to a natural resource under the Environmental Liability Directive must be consistent with the requirements of the latter. The circumstances giving rise to possible liability under the Directive may also require assessment to address a regulatory failure in respect of another environmental instrument, such as the Environmental Impact Assessment Directive or the Habitats Directive ( 94 ) . Assessment of significance under the Environmental Liability Directive should not, however, be conflated with – or made subject to – forms of assessment required to address a regulatory failure. Any joint procedure (such as anenvironmental impact assessment) to correct both a regulatory failure (such as the failure to carry out a required prior environmental impact assessment) and an assessment of significance of changes to a natural resource under the Environmental Liability Directive must be consistent with the requirements of the latter.

Determination of significance

75. Significance needs to be determined in the light of the purposes that require fulfilment. Having regard to the definition of ‘baseline condition’, it needs to be determined in relation to the actual physical area of land or water or (in the case of protected species) actual populations adversely affected or at risk of being affected, taking account of any pre-existing intrinsic characteristics or dynamic factors that may have been influencing the natural resources concerned independently of the damaging occurrence.

76. Naturschutzbund Deutschland — Landesverband Schleswig-Holstein eV , the Court stated: ‘It follows from the use of the adjective “significant” in the first subparagraph of Article 2(1)(a) of Directive 2004/35 that only damage of a certain seriousness, classified as ‘significant damage’ in Annex I to that directive, can be regarded as damage to protected species and natural habitats, which means that it is necessary in each specific case to assess the importance of the effects of the damage concerned.’ As regards ‘significant’, in Case C-297/19,, the Court stated: ‘It follows from the use of the adjective “significant” in the first subparagraph of Article 2(1)(a) of Directive 2004/35 that only damage of a certain seriousness, classified as ‘significant damage’ in Annex I to that directive, can be regarded as damage to protected species and natural habitats, which means that it is necessary in each specific case to assess the importance of the effects of the damage concerned.’ ( 95 ) This case indicates that what is ‘significant’ is ultimately a matter of Union law. With regard to ‘damage to protected species and natural habitats’, Annex I of the Environmental Liability Directive provides that ‘significant adverse changes to the baseline condition should be determined by means of measurable data such as’. The passage from Case C-297/19 quoted above therefore also indicates that, for this category of environmental damage, the determination of significance is a matter of objective, technical assessment based on measurable data. It can be inferred that the same holds true for the other categories of environmental damage under the Directive.

77. It can also be inferred from the foregoing that the Directive’s application cannot be excluded on the basis of arbitrary, subjective opinions of what is significant or on the basis of any reliance on socio-economic considerations that are external to the Directive in order to assess and determine significance. Use can, however, where appropriate, be made of the range of exclusions, exemptions ( 96 ) and defences ( 97 ) provided for in the Directive to address socio-economic considerations or of the proportionality assessments inherent in the Directive ( 98 )

78. The significance of effects does not necessarily depend on their being present on a large scale. In Case C-392/96, Commission v Ireland, the Court noted in relation to the Environmental Impact Assessment Directive, that ‘Even a small-scale project can have significant effects on the environment if it is in a location where the environmental factors set out in Article 3 of the Directive, such as fauna and flora, soil, water, climate or cultural heritage, are sensitive to the slightest alteration.’ Similar reasoning can be considered applicable in the context of the Environmental Liability Directive.

79. With regard to the purpose of ensuring preventive measures, significance will relate to the avoidance of damage factors causing adverse effects on specific areas or populations. The same is true of the purpose of ensuring immediate management of damage factors. The adverse effects will be those referred to in paragraphs 82 and 83 below. The determination should turn on whether the damage factors are likely to result in some or all of these adverse effects arising.

80. not to take or require preventive measures or an immediate management of damage factors, its decision should be on the basis that there is no reasonable scientific doubt as to the absence of measurable adverse effects to a natural resource The Directive is subject to interpretation in accordance with the interpretation methods of the Court, and in the light of relevant legal principles, such as the precautionary principle ( 99 ) (see also paragraph 8 above). Under the precautionary principle, scientific certainty that measurable adverse effects will arise is not required. A reasonable belief is sufficient. Furthermore, if the operator or the competent authority decidesto take or require preventive measures or an immediate management of damage factors, its decision should be on the basis that there is no reasonable scientific doubt as to the absence of measurable adverse effects to a natural resource ( 100 )

81. If there is a determination of significance for purposes of preventive measures and immediate management of damage factors, the question arises as to what preventive measures and damage factor management will be necessary and appropriate. The measures and management should be aimed at stopping or breaking any chain of causation arising from the damage factors which could result in – or has already resulted in – the natural resource experiencing adverse effects of the kind mentioned in paragraphs 82 and 83 below. The Folk case shows that an existing authorisation in respect of the damage factors will not necessarily exempt the operator from the need to intervene. To the extent that the Directive allows reliance to be placed on an existing authorisation, relevant conditions must be fulfilled. Furthermore, a lack of fulfilment of relevant authorisation or other regulatory requirements is, of itself, likely to be a strong indication of the need to apply preventive measures and measures to manage damage factors under the Environmental Liability Directive. This is because it is likely to demonstrate that relevant damage factors have not been placed under the degree of control that fulfilment of regulatory requirements would ensure and are therefore more susceptible to cause adverse effects that come within the scope of the Directive.

82. With regard to the purpose of identifying a need for remedial measures, the provisions of Annex II on damage to protected species and natural habitats, and water damage indicate how a determination of significance and findings on impairment of services should be made in respect of these natural resources. The following all need to be considered in the light of the relevant reference concepts and the notion of impairment of services: measurable permanent loss of an area, part of an area, population or part of a population ( 101 ) ; measurable deterioration of an area, part of an area, or life conditions of a population or part of a population, which is, however, capable of being restored ( 102 ) ; measurable loss of services provided by the areas or populations affected ( 103 ) ; and the measurable time-gap that would arise before the baseline condition could be restored if restoration is possible ( 104 ) . The adverse effects on the resource will be significant if there is a measurable loss or deterioration in respect of an area or population. As for associated services, there needs to be a measurable loss of the services that these natural resources provide.

83. So far as land damage is concerned, the provisions of Annex II indicate that the following should at least be considered: the presence, type and concentration of relevant contaminants, their risks and the possibility of their dispersion; the characteristics and function of the soil; and the current and approved future use of the contaminated land. The risk to human health will be significant if, in the specific local environment, there is a measurable change in the level of direct or indirect harmful exposure of human beings to contaminants that can be causally linked to an Annex III occupational activity. Indirect exposure may arise if the contaminated land provides services to other natural resources, for example if it filters pollutants that may reach water, or if there is dispersion of contaminants via the soil, air or water.

Combinations of different categories of environmental damage

84. The fact that the definition of ‘environmental damage’ comprises three distinct sub-categories of natural resource damage does not mean that all categories need to feature in the adverse effects in order for liability to arise. Liability can arise where there is only one category of environmental damage. By the same token, where environmental damage features more than one category, all the categories concerned need to be addressed. The Directive does not give a discretion to limit its application to certain ones.

5. ‘DAMAGE TO PROTECTED SPECIES AND NATURAL HABITATS’

85. The definition of ‘damage to protected species and natural habitats’ is closely linked to provisions of the Birds Directive and the Habitats Directive. These directives are collectively referred to in these Guidelines as the ‘Nature Directives’. In particular, the Environmental Liability Directive and the Nature Directives share several common concepts. As the fifth recital of the Environmental Liability Directive indicates, when a concept derives from other relevant Union legislation, the same definition should be used so that common criteria can be used and uniform application promoted. At the same time, account needs to be taken of a number of differences of coverage between the Nature Directives on the one hand and the Environmental Liability Directive on the other.

86. The Guidelines draw attention to the following in particular: — The material and geographical scope of the protected species and natural habitats concerned; — The reference concept for adverse effects, i.e. favourable conservation status; — The assessment of significance; — Exclusions.

Material and geographical scope of protected species and natural habitats

Box 5: Definition of ‘protected species and natural habitats’

Article 2(3) of the Environmental Liability Directive provides that ‘protected species and natural habitats’ means: ‘(a) the species mentioned in Article 4(2) of Directive 79/409/EEC or listed in Annex I thereto or listed in Annexes II and IV to Directive 92/43/EEC; (b) the habitats of species mentioned in Article 4(2) of Directive 79/409/EEC or listed in Annex I thereto or listed in Annex II to Directive 92/43/EEC, and the natural habitats listed in Annex I to Directive 92/43/EEC and the breeding sites or resting places of the species listed in Annex IV to Directive 92/43/EEC; and (c) where a Member State so determines, any habitat or species, not listed in those Annexes which the Member State designates for equivalent purposes as those laid down in these two Directives.’

87. not a perfect overlap between species covered by the Nature Directives on the one hand and the Environmental Liability Directive on the other. ‘Protected species’ cover, firstly, certain species protected under the Nature Directives, and, secondly, any additional species that a Member State decides to include for liability purposes. The second species’ category is at the discretion of Member States, based on the option in Article 2(3)(c) of the Environmental Liability Directive. More than half of the Member States have availed of this option ( 105 ) . With regard to the first category of species, there isa perfect overlap between species covered by the Nature Directives on the one hand and the Environmental Liability Directive on the other.

88. sub-set of the European avifauna not apply to bird species which are absent from Annex I of the Birds Directive and which are not regularly occurring migratory species – unless they are added by a Member State. So far as bird species are concerned, the species covered by the definition presented in Box 5 above are those referred to in Article 4(2) or listed in Annex I of the Birds Directive. Article 4(2) of the Birds Directive refers to regularly occurring migratory species, and Annex I of the Birds Directive lists certain other bird species. Taken together, these represent aof the European avifauna ( 106 ) . The ‘protected species’ definition doesapply to bird species which are absent from Annex I of the Birds Directive and which are not regularly occurring migratory species – unless they are added by a Member State.

89. not directly cover certain species which are only listed in Annex V of the Habitats Directive With regard to non-bird species, the definition covers animal and plant species listed in Annexes II and IV of the Habitats Directive. It doesdirectly cover certain species which arelisted in Annex V of the Habitats Directive ( 107 ) – unless Member States specifically add them, or unless they represent typical species of a natural habitat listed in Annex I of the Habitats Directive ( 108 ) . It should be noted, however, that Annex V includes fish species which may feature in ‘damage to water’ (see Section 6 below).

90. The habitats listed in Annex I of the Habitats Directive will, in particular, be found in Natura 2000 sites identified for these habitats. However, the Environmental Liability Directive is not limited in its application to Annex I habitats found in Natura 2000. Under Article 17 of the Habitats Directive, Member States report ‘distribution maps’ of Annex I habitats, which cover their entire territory ( 109 ) . These should not, however, be treated as the only information on the presence of Annex I habitats. It is to be noted that natural habitats are comprised of different elements, including typical species, which are described in the Habitats Manual ( 110 )

91. The habitats of regularly occurring migratory bird species and of bird species listed in Annex I of the Birds Directive will, in particular, include those found in special protection areas (SPAs) classified under Article 4 of the Birds Directive. However, while SPAs are likely to comprise the most important habitats, the wording of the Environmental Liability Directive does not restrict application of damage to habitats to bird species’ habitats within SPAs. Member States report to the Commission breeding distribution maps (10 km x 10 km) for all Annex I breeding species (including sedentary) and other migratory breeding species triggering SPA classification ( 111 )

92. The habitats of species listed in Annex II to the Habitats Directive will, in particular, be found in Natura 2000 sites identified for these species. However, the Environmental Liability Directive is not limited in its application to natural habitats found in Natura 2000. Under Article 17 of the Habitats Directive, Member States report to the Commission ‘distribution maps’ of Annex II species, which cover their entire territory ( 112 )

93. only listed in Annex IV). With regard to the breeding and resting places of species listed in Annex IV of the Habitats Directive, the Commission has developed guidance which can be of assistance in identifying these ( 113 ) . However, there is no obligation under the Nature Directives for Member States to report to the Commission on their location (for specieslisted in Annex IV).

94. As with species, Member States may include natural habitats designated for equivalent purposes at national level that are additional to those linked to the Nature Directives ( 114 )

95. As regards geographical scope, some protected species, for example cetaceans, and some natural habitats, for example reefs, are found off-shore. The Environmental Liability Directive applies to these in respect of the following: internal waters and the territorial sea; the exclusive economic zone (EEZ) and/or to other areas where Member States are exercising equivalent sovereign rights; and, for species and habitats on or depending on the sea-bed, for example sea-turtles, the continental shelf ( 115 )

Reference concept for adverse effects

96. The reference concept for adverse effects on protected species and natural habitats, ‘favourable conservation status’, is expressly defined in both the Environmental Liability Directive and the Habitats Directive ( 116 ) and the definitions are similar. Box 6: Definition of ‘favourable conservation status’ in the Environmental Liability Directive

Article 2(4) of the Environmental Liability Directive provides that ‘conservation status’ means: ‘(a) in respect of a natural habitat, the sum of the influences acting on a natural habitat and its typical species that may affect its long-term natural distribution, structure and functions as well as the long-term survival of its typical species within, as the case may be, the European territory of the Member States to which the Treaty applies or the territory of a Member State or the natural range of that habitat; The conservation status of a natural habitat will be taken as ‘favourable’ when: — its natural range and areas it covers within that range are stable or increasing, — the specific structure and functions which are necessary for its long-term maintenance exist and are likely to continue to exist for the foreseeable future, and — the conservation status of its typical species is favourable, as defined in (b); (b) in respect of a species, the sum of the influences acting on the species concerned that may affect the long-term distribution and abundance of its populations within, as the case may be, the European territory of the Member States to which the Treaty applies or the territory of a Member State or the natural range of that species; The conservation status of a species will be taken as ‘favourable’ when: — population dynamics data on the species concerned indicate that it is maintaining itself on a long-term basis as a viable component of its natural habitats, — the natural range of the species is neither being reduced nor is likely to be reduced for the foreseeable future, and — there is, and will probably continue to be, a sufficiently large habitat to maintain its populations on a long-term basis.’

97. The reference to the ‘sum’ of influences in the definition presented in Box 6 indicates that different individual influences contribute to the overall conservation-status outcomes mentioned. Influences may be positive or negative, and create their effects directly or indirectly. The damaging occurrences that cause environmental damage will count amongst but not represent the entire sum of influences.

98. The definition of ‘conservation status’ refers to a number of parameters when describing the conservation-status outcomes of the sum of influences. In the case of natural habitats, these parameters comprise the long-term natural distribution, structure and functions as well as the long-term survival of the typical species of the habitat within, as the case may be, the European territory of the Member States to which the Treaty applies or the territory of a Member State or the natural range of that habitat. In the case of a species, the parameters consist of the long-term distribution and abundance of its populations within, as the case may be, the European territory of the Member States to which the Treaty applies or the territory of a Member State or the natural range of that species. The geographical references to different scales are considered further in paragraph 118 below in relation to the assessment of significance.

99. The above-mentioned parameters are further qualified in the precise descriptions of what constitutes ‘favourable’ conservation status. For example, in relation to natural habitats, the qualification corresponding to the parameter of long-term natural distribution reads as follows: ‘its natural range and areas it covers within that range are stable or increasing’.

100. Individual influences – such as damaging occurrences that cause environmental damage – may relate to one or more of these parameters and qualifications. An individual influence does not necessarily need to affect all the different parameters and qualifications at the same time. Although a damaging occurrence may represent an individual influence, however, it cannot be excluded that some of the adverse effects it creates will arise in combination with other influences. For example, a damaging occurrence may consist of the poisoning of individuals belonging to a population of a protected species in a context where the population already suffers from other negative influences that then act in combination with the adverse effects of the poison.

101. In the context of the nature directives, the Commission services have produced documentation clarifying concepts such as ‘natural range’ ( 117 )

The assessment of significant adverse effects

Circumstances

102. As is clear from paragraph 14 above, a wider range of operators and a wider range of occupational activities are relevant for purposes of damage to protected species and natural habitats than for purposes of water damage and land damage. The assessment of significance of adverse effects therefore relates to a potentially wider range of causes, liable persons and damage factors.

Context

103. As can be seen from the text in Box 3, the concept of significance is expressed in terms of damage having ‘significant adverse effects on reaching or maintaining the favourable conservation status’ of protected species and natural habitats.

104. As can be inferred from paragraphs 98 to 101 above, adverse effects may be significant where a damaging occurrence influences only one or some of the parameters and qualifications mentioned in the definition of ‘favourable conservation status’. For example, the killing of a rare bird of prey through illegal use of poison in a land management activity may adversely affect the bird’s population dynamics and range without reducing the available habitat (although the presence of poisons will, of course, impair the natural resource services that the habitat provides for the bird).

105. The conservation status of protected species and natural habitats is a matter of fact and is not fixed and immutable. The Nature Directives aim to either maintain favourable conservation status where this is already attained, or to reach favourable conservation status where the current status is unfavourable. By referring to reaching or maintaining favourable conservation status, the text of the definition takes account of both possibilities. Thus, where the conservation status is already favourable, adverse effects might compromise the maintenance of a positive status quo ; and, where the conservation status is unfavourable, the adverse effects might further deteriorate or jeopardise the needed improvement of a current negative status quo . This means that adverse effects on a protected species or natural habitat in unfavourable status cannot be treated as lying outside the scope of damage to a protected species or natural habitat on the sole ground that the species or habitat is already in a poor condition. Instead, the capacity of the species or habitat to reach favourable conservation status – and any set-back to that capacity – must be addressed. As noted at paragraph 118 below, assessment of the significance of adverse effects must be meaningful at the local level.

106. In practice, many of the protected species and natural habitats falling within the scope of the Environmental Liability Directive and the Nature Directives are in unfavourable conservation status ( 118 )

107. Where a species or habitat listed in the Nature Directives has unfavourable conservation status, the Nature Directives require measures to restore it to favourable conservation status ( 119 ) . In this context, adverse effects on restoration measures in place with a view to reaching favourable conservation status need to be taken into account. Such measures can take the form of habitat restoration measures or species reintroduction programmes, for instance. An example would be taking into account, in respect of a damaging occurrence involving fish mortality, any site-specific active conservation measures aimed at improving the conservation status of a fish species affected. This will relate to the aspect of population dynamics. Adverse effects on restoration potential should also be considered. For example, an affected site may host a species in a condition which is not favourable, but with a restoration potential reflecting its current presence. Adverse effects which have a negative impact on the species’ presence may also reduce the restoration potential.

The carrying out of the assessment

108. The definition requires that significance is assessed ‘with reference to the baseline condition, taking account of the criteria set out in Annex I’. Box 7: Text of the criteria set out in Annex I of the Directive

‘The significance of any damage that has adverse effects on reaching or maintaining the favourable conservation status of habitats or species has to be assessed by reference to the conservation status at the time of the damage, the services provided by the amenities they produce and their capacity for natural regeneration. Significant adverse changes to the baseline condition should be determined by means of measurable data such as: — the number of individuals, their density or the area covered, — the role of the particular individuals or of the damaged area in relation to the species or to the habitat conservation, the rarity of the species or habitat (assessed at local, regional and higher level including at Community level), — the species’ capacity for propagation (according to the dynamics specific to that species or to that population), its viability or the habitat’s capacity for natural regeneration (according to the dynamics specific to its characteristic species or to their populations), — the species’ or habitat’s capacity, after damage has occurred, to recover within a short time, without any intervention other than increased protection measures, to a condition which leads, solely by virtue of the dynamics of the species or habitat, to a condition deemed equivalent or superior to the baseline condition. Damage with a proven effect on human health must be classified as significant damage. The following does not have to be classified as significant damage: — negative variations that are smaller than natural fluctuations regarded as normal for the species or habitat in question, — negative variations due to natural causes or resulting from intervention relating to the normal management of sites, as defined in habitat records or target documents or as carried on previously by owners or operators, — damage to species or habitats for which it is established that they will recover, within a short time and without intervention, either to the baseline condition or to a condition which leads, solely by virtue of the dynamics of the species or habitat, to a condition deemed equivalent or superior to the baseline condition.’

109. The baseline condition relates to the specific area or the specific species population or populations concerned by the adverse effects. The best information available should be used to address these.

110. Allowing for the area-specific or population-specific nature of the assessment exercise, the baseline condition should relate to the parameters and qualifications mentioned above. For natural habitats listed in Annex I of the Habitats Directive, for instance, this would involve looking at the habitats present on a particular site, the way they are structured and function, and their typical species. There may, for instance, be a mosaic of different natural habitats present – or a habitat may function in relationship to a water body (as where a salt-marsh functions according to the tidal movements in a coastal water). For Natura 2000 sites, the standard data form is likely to be an important source of information ( 120 )

111. In determining these specificities, a number of possible practical challenges may arise: determining the best information available in the circumstances, and ensuring the reliability of the information.

112. ex post. This may be especially evident in the sorts of circumstances illustrated by Cases C-529/15, Folk, and C-297/19, Naturschutzbund Deutschland — Landesverband Schleswig-Holstein eV, i.e. an occupational activity may have been creating adverse effects cumulatively over a much extended period of time, suppressing the manner in which a habitat would otherwise naturally function or suppressing the presence of a protected species. Exact quantification of what has been suppressed or lost is not, however, required, since the definition refers to ‘estimated’. Reference can also be made to Case C-374/98, Commission v France Where damage has already occurred, the damage itself may be an impediment to estimating the baseline condition. Where a habitat has been damaged or destroyed, or species displaced from it, it may be very difficult to ascertain the baseline condition by means of information collectedThis may be especially evident in the sorts of circumstances illustrated by Cases C-529/15,and C-297/19,i.e. an occupational activity may have been creating adverse effects cumulatively over a much extended period of time, suppressing the manner in which a habitat would otherwise naturally function or suppressing the presence of a protected species. Exact quantification of what has been suppressed or lost is not, however, required, since the definition refers to ‘estimated’. Reference can also be made to Case C-374/98, ( 121 ) in which the Court indicated that an advantage should not be derived from non-fulfilment of the requirements of the Birds Directive. In the context of the Directive, an operator who, through an unlawful act or omission, destroys or damages the basis on which data might be collected (by, for example, filling in a protected wetland for economic gain) should not derive a benefit from this as compared to an operator who acts lawfully.

113. Commission v Italy , the Court considered the concept of best information available in the context of the Birds Directive, confirming the role of authoritative scientific literature of a general character in a context where more specific literature is unavailable Also relevant is Case C-157/89,, the Court considered the concept of best information available in the context of the Birds Directive, confirming the role of authoritative scientific literature of a general character in a context where more specific literature is unavailable ( 122 )

114. Even where a site has been seriously damaged, it may be possible to obtain information on the baseline condition using existing earth observation data. Furthermore, where information is limited, it may be appropriate to establish the baseline condition by using data from similar sites unaffected by a damaging occurrence (i.e. ‘reference sites’) or by using models. ( 123 )

115. Biodiversity baseline condition The Commission has published an Excel table entitled ( 124 ) . This refers to a very extensive range of information sources at Union level and at the level of all Member States, including site-specific information such as ‘Standard Data Forms’ of all Natura 2000 sites, and also provides methodological approaches at Union level and national levels to help determine the baseline condition of protected species and natural habitats ( 125 )

116. quality of the information used to establish the baseline condition, and the inferences drawn from the information used. Care needs to be taken with the reliability and validity of information as well as the inferences drawn from it, in particular if an operator denies that adverse effects have arisen or will arise. In this context, reference may be made to Case C-209/02, Commission v Austria, in which the Court found that the competent authorities had not drawn the correct inferences from a scientific appraisal of the likely effects of a project in a Natura 2000 site The concept of best information available also covers theof the information used to establish the baseline condition, and the inferences drawn from the information used. Care needs to be taken with the reliability and validity of information as well as the inferences drawn from it, in particular if an operator denies that adverse effects have arisen or will arise. In this context, reference may be made to Case C-209/02,in which the Court found that the competent authorities had not drawn the correct inferences from a scientific appraisal of the likely effects of a project in a Natura 2000 site ( 126 )

117. With regard to the situation after the damaging occurrence, the first sentence of the first paragraph of Annex I helps to put the baseline condition in context, referring to conservation status, services provided by amenities, and capacity for natural regeneration. These represent general contextual criteria, i.e. what is generally known about the protected species or natural habitats exposed to adverse effects from the damaging occurrence (the above-mentioned Excel table entitled Biodiversity baseline condition is intended to help). The references in the definition of ‘conservation status’ to the European territory of the Member States to which the Treaty applies, the territory of a Member State and natural range allow for this context to be established at different levels. A rare endemic and geographically confined habitat, for instance, will present a different picture to a habitat that is widely distributed both within and across Member States.

118. The second sentence of the first paragraph of Annex I refers to the determination of adverse changes by reference to measurable data, providing examples. This sentence serves to underline that adverse effects concern measurable adverse changes and impairments. The data relates to both the specific areas and populations affected and the species and habitat types concerned more generally. This implies a role for both site-specific and population-specific information and information of a more general character (such as that found in scientific literature, for instance): — The first indent refers to ‘the number of individuals, their density or the area covered’. For protected species, this can encompass both the number of specimens killed or the number of specimens that have suffered harm or other detriment. For habitats, the area covered can encompass the habitats of protected species, breeding sites and resting places, and habitats listed in Annex I to the Habitats Directive, and can relate to habitat loss, habitat deterioration and impairment of the services these habitats provide; — The second indent has a comparative purpose and aims at relating the specimens and area affected with the wider conservation of the species and habitats concerned. The reference to assessment at local, regional and higher level resonates with the reference to European and Member State territories and natural range in the definition of ‘conservation status’. Assessment and determination of significance need to be meaningful at the local level. References to the national and European levels provide an additional orientation to enable specimens and habitats to be placed in different geographical contexts. It does not mean that adverse effects have to be demonstrated at the national and European levels; — The third indent focuses on the capacity for recovery of the species and habitats affected. Clearly, these may vary. Some habitats have abiotic features which cannot regenerate. An example is the limestone pavement which featured in Case C-258/11, Sweetman (127) and which was identified as threatened with permanent destruction in the context of an assessment process under the Habitats Directive. Such a situation of permanent loss could conceivably arise with regard to the Environmental Liability Directive; — The fourth indent focuses on a time factor, and is closely related to the third indent. The references to a ‘short time’ and to an absence of intervention allows for the possibility that a species or habitat may recover quickly of its own accord. It is to be stressed, however, that this is in relation to the baseline condition. The specifics of the area and population affected must therefore be taken into account. It cannot be excluded, for instance, that local factors may result in recovery taking longer than might be the case elsewhere. What constitutes a ‘short time’ is not defined, but the expression implies that the species or habitat must at least have the capacity for rapid recovery. Species with long reproduction cycles and habitats that are slow to form will not have such a capacity.

119. As previously noted, the assessment process is not an end in itself, but for the purposes of identifying a need for preventive measures, immediate management of damage factors and remedial measures, as the case may be. The time-critical nature of the first and second purposes needs to be reflected in the assessment process. The text of the definition of ‘damage to protected species and natural habitats’ refers to assessment ‘taking account’ of the criteria of Annex I. This should allow a focus on those aspects of Annex I that are necessary for a rapid determination of the need for preventive measures or immediate management of damage factors. For purposes of remedial measures, a more in-depth assessment is likely to be appropriate.

The determination of significance

120. For purposes of preventive measures and measures to immediately manage damage factors, a determination of significance should be made if the assessment results – or ought to result – in a reasonable belief that, without such measures, adverse changes and impairments of the kind mentioned at paragraphs 121 and 122 below will result.

121. Subject to the criteria on non-significance mentioned at paragraph 124 and 125 below, for purposes of remedial measures in respect of natural habitats, adverse changes will be significant and impairments will arise if, in respect of the area of natural habitat affected, they result in one or more of the following: — A measurable permanent or interim loss of the area covered by the habitat; — A measurable deterioration in respect of the structure or functioning of the habitat; — A measurable permanent or interim reduction of the range of the habitat; — A measurable permanent or interim loss of typical species, or a reduction in their range or available habitats; — A measurable permanent or interim impairment of natural services linked to the area, structure, and functions of the natural habitat and its typical species; — A measurable gap between the time when the adverse effects occur and the time when, for the area, structure, functions and typical species concerned, the baseline condition is restored.

122. Subject to the criteria on non-significance mentioned at paragraphs 124 and 125 below, for purposes of remedial measures in respect of a protected species, adverse changes will be significant and impairments will arise if, in respect of the population affected, they result in one or more of the following: — A measurable permanent or interim population loss (including the loss of a specimen or specimens) or deterioration in the health of a population which affects population dynamics in the area where the adverse effects occur. Population loss may arise through mortalities causally linked to the damaging occurrence. A deterioration in the health of a population might involve, for example, forms of harm such as the bioaccumulation of toxins or deleterious genetic modifications following cross-fertilisation with genetically modified individuals that are deliberately released into the environment (128); — A measurable permanent or interim reduction in the range of the species concerned; — A measurable permanent or interim reduction in habitats available to the species concerned for its long-term maintenance; — A measurable permanent or interim impairment of natural services linked to the population loss, range reduction or reduction in available habitats; — A measurable gap between the time when the adverse effects occur and the time when, for the population, extent of range, and availability of habitats, the baseline condition is restored.

123. The second paragraph of Annex I provides that damage with a proven effect on human health must be classified as significant damage. It is possible that an adverse change in a protected species or a natural habitat could include effects which, because of the damage factors involved, have a parallel relevance for human health. For example, the contamination of a natural habitat by toxic substances might, at the same time, expose human beings to adverse health effects.

124. Naturschutzbund Deutschland — Landesverband Schleswig-Holstein eV , the Court stated that: ‘It is apparent from the use of the words ‘does not have to’ that it is open to the Member States when transposing the directive to regard such damage as significant or as not significant for the purposes of Annex I thereto.’ The final paragraph of Annex I indicates what need not be considered as significant. In Case C-297/19,, the Court stated that: ‘It is apparent from the use of the words ‘does not have to’ that it is open to the Member States when transposing the directive to regard such damage as significant or as not significant for the purposes of Annex I thereto.’ ( 129 ) The Court also found that the provisions of this paragraph must be interpreted strictly ( 130 )

125. As regards the content of the final paragraph of Annex I: — The first indent refers to negative variations that are smaller than normal natural fluctuations. This relates to the possible non-static nature of the baseline condition mentioned at paragraph 65 above. There is a focus on the size of the negative variations relative to natural variations. — The second indent refers to negative variations due to natural causes or normal site management. The Court considered this indent in detail in Case C-297/19, Naturschutzbund Deutschland — Landesverband Schleswig Holstein e. V. The case concerned regular drainage of a Natura 2000 wetland carried out by a public body in order to serve agriculture. The drainage caused water levels to fall, with adverse effects on a protected bird species, the Black Tern, Chlidonias niger. The Court ruled that the term ‘normal management’ relates to both habitats records and target documents (which concern those management measures directed by competent authorities) as well as previous management by owners or operators (131). It found that ‘in order not to negate the effectiveness of the word ‘normal’ in the context of environmental protection, it should be added that management can be regarded as normal only if it is consistent with good practices such as, inter alia, good agricultural practices.’ (132) The Court also found that the management of a site covered by the Habitats and the Birds Directive can cover agricultural activities, including irrigation, but can be regarded as normal only if it complies with the objectives and obligations laid down in those directives (133). This ruling applies to all sites covered by the Nature Directives, not just Natura 2000 sites (134). So far as Natura 2000 sites are concerned, the importance of appropriate site conservation objectives deserves mention. — The third indent refers to short natural recovery times for habitats or species to a condition equivalent or superior to the baseline condition.

Exclusions

126. Natur