CELEX: 51974PC0233
Language: en
Date: 1974-03-05
Title: DRAFT RECOMMENDATION BY THE COUNCIL TO THE MEMBER STATES regarding cost Allocations and action by public authorities on environmental matters (submitted to the Council by the Commission)

ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (74) 233
Vol. 1974/0045
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 ---pagebreak--- COMMISSION OP HIE EUROPEAN COMMUNITIES
                                                     COM(74)233 Final
                                                     Brussels , 5 March 1974
                                       DRAFT
                        RECOMMENDATION BY THE COUNCIL
                               TO HIE' MEMBER STATES
              regarding cost Allocations and action "by public
                     author it es on environment ;:.! matters
                                                                  \
                ( submitted to the Council by the Commission )
   C0H(74 ) 233 Final
 ---pagebreak---                                            SNV/20/74-E
Communication from the Commission to ths Counoil
regarding cost allocations and action by publio
     authorities on environmental matters
 ---pagebreak---                                           - X -                      ^ 0/
    Cost allocation and action "by public authorities on environmental
    matters - Principles and methods of application
                                » «
1 , In the framework of the Declaration of the Council of the European CommaAities
    and of the representatives of the Governments of the Member States meeting
    in the Council of 22 November 1973 on the programme of action of the European
    Communities on the environment , the principle of the internalisation of
    external costs known as "polluter pays " was accepted , The programme of action
    provides that the Commission should submit to the Council a proposal concerning
    the application of this principle including possible exceptions .
    In this regard it is necessary to allocate the costs of environmental protection
    against pollution according to the same principles in the whole of the Commity
    so that distortions of competition , may not affect trade and the location of
    investments , which would be incompatable with the proper functioning . of the ,.
    Common Market .
            *   ■ •      *
2 . To achieve this , the European Communities at Community level and the Member
    States in their national legislation on environmental protection should
    apply the " polluter pays " principle under which natural or legal persons
    responsible for pollution must bear the cost of such measures as are necesg
     ary to eliminate or roduce this pollution to the. desired level as laid down
    by the authorities .
    Consequently environment al protection must not be the responsibility of
    national policies , which rely mainly on grants of aid and hence put the
    burden of pollution control . on the community . ■          -
3 . Application of the " polluter pays ", principle generally requires that , in
    each case , it is necessary to determine who the real polluter is and to
    ascertain the precise extent of pollution for which a firm or individual
    is responsible.           '      ,                                 -         1
    Whore the p'olluti'on results from a production process or the provision of
    a service , the cost of the anti-pollution measures should in principle be     ,
    borne by the producer or by the person providing the service .
                                                                          ./
 ---pagebreak---                                      - 2 -                 ENV/20/74-E
     Where the pollution results from the use of certain products , the
      cost of the anti-pollution measures should in principle be borne •
   . "by the user.                             r
     If finding the real polluter proves impossible or too difficult and
     hence arbitrary - especially when there is a "pollution chain" or
     " cumulative pollution" - the cost of pollution control should be
      charged at certain points along the pollution chain or during the
      cumulative pollution ; this cost allocation would be carried out by
     whatever legal or administrative means offered the best solution from
     an economic and administrative point of view .
4* The optimum purity level for the environment should be determined by
     the public authorities at a given moment in time now or in the future
     in keeping with the natural or agreed purposes for whioh an area or
     part of an area is designated, account being taken of economic and
     sooial considerations together with the marginal cost of purification
     or prevention .
     This optimum level should be fixed at least at a level where human
     health and the survival of animal and plant life are not threatened.
     Even if this level varies from one region to another , it is desirable
     that account be taken not only of the inhabitants' interests in the
     region for which the quality objective has been fixed , but also of
     the drawbacks for all interested parties .
                                                             <
5 . The main means of action available to public authorities to reduoe .
     the pollution to the desired level of environmental quality are
     standards and levies , with the possibility of oombining the two .
     a) Standards set the maximum permitted values for;            T
 ---pagebreak---                                                            ENV/20/74-E
    i ) the concentration of pollutants in a given environmental medium
        or part of an , environmental medium ( immission standards)
   ii ) the emission of pollutants or nuisances from fixed installatiens
        ( emission standards )
 iii ) the level of pollutants or nuisances which is not to be exceeded
        in the ocmposition or emissions of a product ( product standards )
ad      i ) Harmonization of existing immission standards in the Member
            States or the fixing of Community immission standards can be
            justified either in order to fix a basic protection level or
            in cases of pollution extending across national frontiers .
ad     ii ) Emission standards may be uniform for an entire economic area
            or may vary depending on the region ? however , for the emission
            of persistent and harmful substances , harmonization of minimum
            standards may be necessary so as to minimize the accumulation
            of these substances in the environmental milieu .
ad iii ) Product standards should generally be uniform throughout the
            Community . Exceptions to this rule can only be made following
            the same procedure by which the standards themselves were drawn
            up .
            As a rule , product standards apply to finished products . It
            is only when all or a large proportion of products made from
            the same semi-product cause the same level of pollution that
            the standard is applied at the semi-product or raw material
            stage . A decision on this should be taken for each individual
            case .
 ---pagebreak---                                                       ENV/20/74-3
b ) Levies may have an incentive or redistributive function, the rate
    being fixed accordingly . The rates may be uniform or may vary for
    each emission depending on the quality objective to be attained..
    The levies must be fixed by emission units and applied according to
    the quantity of the pollution emitted.
    Where the main aim of the levy is to bring about a -redistribution ,
    it should be calculated in such a way that , for a given region and
    quality objective, the sum of the levies equals the collective
    purification charges .
    Where it is not possible or desirable to install collective
    purification plants or where these plants will have a limited
    capacity , the levy should be calculated so that it largely matches
    its incentive function.        , .   -             ,        .
    Once collected, the levies may be used either to finance collective
    purification infrastructures or to provide grants for major
    polluters to set up such equipment ; in the latter case the - grants
    should be calculated in such a way as to cover the services these
    polluters render the community but without .passing to the community
    the cost of the investment which the polluters themselves must
    bear to ensure that their own pollution is eliminated.
    Where the total revenue from levies exceeds the sum of the •
    collective and individual purification charges , the difference
    should preferably be used by each government within the , framework
    of its environmental policy.
    As far as possible , Member States should endeavour to standardize
    methods of calculating the levies. Harmonization of the incentive
    levies would seem desirable to avoid • ' distortion of competition
    in the Community.                                             '
 ---pagebreak---                                 - 5 -                 ENV/20fi4-E
c ) In order to avoid serious distortions of competition affecting
    trade and the distribution of investments in the Community, it
    will nndoubtedly "be necessary to harmonize more and more closely
    the various instruments - and especially standards – at Community
    level .
Those responsible for pollution will be obliged to meet ;
a) the expenses incurred as a result of compliance with the standards
    laid down by the public authorities ( investment in anti-pollution
    plant and equipment , introduction of new processes , cost of running
    anti-pollution plants , etc.),
b ) expenses in respect of payment of levies ,                   i
c) compensation paid to victims of a particular pollution or nuisance .
The costs to be borne by the polluter (under the^ "polluter pays"
principle) should include all the expenditure necessary to achieve
an environmental quality objective as well as the compensation paid
to victims in cases where it has not been possible to achieve this
objective ; this would also include the 'administration costs directly
linked to the implementation of anti-pollution meas'asrea.
The cost of buying , constructing and operating pollution measuring
and control equipment should , however, be borne by the public
authorities .
Exceptions to the"polluter-pays"principle oould be justified by
a) real difficulties in adapting to environmental quality standards ,
    particularly for economic , technical and social reasons .
    where the immediate application of very severe standards or heavy
 ---pagebreak---                                 - 6 -                    ENV/20/74-E
levies "to meet the cost of pollution control is likely to cause
serious upsets in some sectors or regions , the unduly hasty incorporation
of pollution control oosts into production costs may give rise to
higher social costs . In that case it might prove necessary
- to allow some producers a certain period of time to adapt their
  products or output to the new standards ,
- or to give transitional aid to the industrial sectors or regions
  concerned ; such aid could , of course , only be granted by Member
  States with due regard to the provisions on state aid set out in
  the Treaties establishing the European Communities , in particular
  articles 92 et seq . of the EEC Treaty .
Such measures can , in any case ,, apply only to existing undertakings ?
the interplay of other policies ( regional , social , research ) together
with the environmental protection policy .
The indirect effect of some types of aid granted to aohieve objectives
other than environmental protection may be to cover part of the costs
which the companies , benefiting from it would normally have had to
bear themselves to reduce pollution of their own making ; this type of
aid is . also subject to the provisions of . the Treaties establishing
the European Communities , in particular articles 9 ?., et seq . of the
EEC Treaty .
 ---pagebreak---                                  - 7 -                 ENV/20/74-E
The Commission , in the execution of its tasks within the framework of
the environmental policy of the Community , will comply with the defini­
tions and methods of application of the above-mentioned polluter pays"
principle .
The Commission asks the Council to take note of these definitions and
methods of application and to recommend to the Member States to conform
to them in their legislation and administrative acts involving the
allocation of costs in the environmental field .
The Commission reserves the right to submit to the Council at a lster
date more specific proposals in this field .
 ---pagebreak---                                              ENV/20/74-E
                      Draft
         RECOMMENDATION BY THE COUNCIL
             TO THE MEMBER STATES
regarding cost allocations and action by public
     authorities on environmental matters
 ---pagebreak---                                                           EJjT/20/74-E
In the Declaration of the Council of the European Communities and of
the resprescntatives of the Member States at a meeting of the Council
or* 22 Uovcmbcr 1973 (1 )? concerning en action programme of the" European
Communities on the environment , the "polluter pays" principle was
accepted .
The costs associated with the protection of the environment ag&inst
pollution should properly "be imputed according to the same principles
in the whole of the Community to avoid the creation of distortions in
trade and competition incompatible with the harmonious functioning of
the Common Market , and taking- account of the aims of balanced economic
expansion pursued by the Community.
To facilitate the application of this principle , the European Communities
and the Member States must give it~"grear^^pr«ci«i©n~by--4^i«ing-^bh«–––
conditions of application as well as some exceptions to it which could
be allowed , with due regard to the difficulties of applying this
principle and to the interplay of other policies with the environmental
protection policy. .
For these reasons , and in accordance with article 145 of the Treaty
instituting the European Economic Community , the Council recommends
to the Member States to conform , in respect of the allocation of oosts
and the action of public authorities on the subject of protection
of the environment , to the principles and to the conditions of
application laid down in the £nramHn±oat"&oripDtfsth& Boami>3©icifttiftnexed to the
present Recommendation .
( 1 ) O.J.S.C. no. C 112 of 20.12.1973