13 June 2017

Preliminary questions on Dutch Nitrogen Approach Programme: what to do in the meantime

The Dutch Council of State has asked the European Court of Justice for a preliminary ruling on whether the Nitrogen Approach Programme is compatible with EU law, specifically the Habitats Directive. The programme is known in the Netherlands as the “PAS” and is based on the Dutch Nature Conservation Act. Activities that enhance nitrogen deposition are only allowed if they meet the conditions in the PAS. If the Court of Justice rules that the PAS conflicts with EU law, this would, for example, mean that a permit based on the PAS is no longer an option and that the system of exemption for minor nitrogen deposition has to be reconsidered. For now, the big question is what to do with nitrogen deposition-enhancing activities, existing permits and pending procedures under the PAS until it is clear if the PAS is permissible.

The Court of Justice has been asked to decide if the Habitats Directive allows a programme-based approach where the appropriate assessment of an individual project (as required by EU law) is replaced by the appropriate assessment under the PAS. The Council of State is also asking the Court of Justice if how the PAS is carried out is compatible with the Habitats Directive. Due to the economic and ecological interests involved, and the uncertainty faced by permit holders until the Court of Justice issues its ruling, the Council of State has urgently requested the Court of Justice to give priority to these questions and issue its ruling before 1 July 2018.

The Council of State has also ruled that a number of choices, data and assumptions on which the PAS is based are unclear. The Council of State has ordered the Dutch authorities to clarify these uncertainties. After the Court of Justice’s ruling, the Council of State must still give a final decision on the permissibility of the PAS. This means that the fate of the PAS will not be known before January 2019 at the earliest, but more likely around July 2019.  The permissibility of the PAS depends on how the Court of Justice answers the preliminary questions and on whether the existing deficiencies can be remedied. The Council of State assumes that the PAS is permissible and has not issued a preliminary injunction, meaning that the PAS is still valid. The big question is how pending and future permit applications, and administrative and appeal proceedings, should be dealt with until the fate of the PAS is clear. As the Council of State has not decided on this, every administrative body, and possibly district court, will have to take its own decision on those applications and proceedings.

There are three possibilities. First, proceedings about the PAS can be deferred until there is more clarity. A second possibility is that the permits will be reversed or not granted because of the uncertainty of the PAS’s fate. The third possibility is that decision-making on the basis of the PAS will continue – due to the PAS still being valid.

The Council of State has stated that it will defer all PAS proceedings. We think that the district courts will do the same. However, this may be different for the administrative phase. As competent authorities can take their own decisions, uncertainty and inequality may occur during that phase. Holders can, for now, use permits which have already been issued, but they do this at their own risk, according to the Council of State.

The current uncertainty could delay projects, especially if they depend on external financing. A fallback scenario is therefore necessary where a permit can be granted for projects based on an appropriate assessment made separately from the PAS. This will not be easy and requires legal and factual disconnection from the PAS.

Click here to download our infographic reflecting the Council of State ruling and its consequences (in Dutch only).