Water and Ocean Law Utrecht 1 November 2013

1. Water and OceanLawUtrecht 1 November 2013 E.J. Hollo Compensation in FinnishLaw Professor Erkki Hollo University of Helsinki erkki.hollo@helsinki.fi

2. What is ”compensation”? • Whoare the liableactors? • Whoare the beneficiaries? • How is compensationperformed? • Whatare the limits of liability? E.J. Hollo

3. What is compensation? • A substitute for losses • ”Loss” is defined as a monetary, ecologicalor social disadvantageorharm • A lossmaybeabsolute (economic, social) orrelative (protectedsites) E.J. Hollo

4. Main Goals of compensation • Maintenance of a status (withoutnegligence) • EU Directives (Habitat, WPFD, MSD) • Reparation of a damage • Monetary to victims (ev. restorationcosts) • Reparationcosts (causation) to authrorities • Compensatoryfees • Social oreconomic/ecological→ aid (fishery and farminglosses) E.J. Hollo

5. Main legalsources • NatureConservation Act 1996 • Act on Reinstatement of Damage to Nature 2009 (Dir 35/2004) • Water Resources Management Act 2004 • EnvironmentalProtection Act 2000 • MarineEnv. Protection Act 2009 • Water Act 2011 • Act on FloodRiskManagement 2010 • Act on DamSafety 2010 • Act on EnvironmentalProtection in MaritimeTransport 2009 E.J. Hollo

6. General features • Watersareprivateproperty (openseastateproperty) • Specializedenv. authorities for permit and conservationissues • Conservationdecisions (NCA) arebinding for planning and env. and resourceslaw • Compensationissuesaredealtwith in regularadministrativecontexts – the Act on (Civil) Env. Liability 1994 section 6! E.J. Hollo

7. NatureConservation Act Sec. 3 • This Act transposes into Finnish law Council Directive (92/43/EEC) on the conservation of natural habitats and of wild fauna and flora, hereinafter the Habitats Directive, and Council Directive (79/409/EEC) on the conservation of wild birds, hereinafter the Birds Directive, as applicable to species of flora and fauna other than those specified in section 5 of the Hunting Act (615/93), and the Directive of the European Parliament and of the Council (2004/35/EC) on environmental liability with regard to the prevention and remedying of environmental damage, hereinafter the Environmental Liability Directive, unless its transposition is otherwise provided for in other legislation. E.J. Hollo

8. NCA • Section 5 • Favourableconservation status • In order to achieve the aims described in section 1, nature conservation shall focus on attaining and maintaining the favourable conservation status of natural habitats and of wild fauna and flora. … E.J. Hollo

9. EnvLiability Act (Dir 35/2004/EC) • applies to remediation of the following types of damage caused to the environment: • 1) damage to protected species and natural habitats referred to in section 5 a of the Nature Conservation Act; • 2) considerable pollution of a water body referred to in section 84 a of the Environmental Protection Act (soil and groundwater restoration); and • 3) substantially harmful change in the water bodies or groundwater referred to in chapter 14, section 6, of the Water Act E.J. Hollo

10. cont… • Remediation is • /procedurally and substantially/ • regulated under the Nature Conservation Act, Environmental Protection Act, Water Act and Gene Technology Act • The terminology follows the Directive E.J. Hollo

11. remedialmeasures (s. 5) • (1) Natural resources and natural resource services must be restored to the baseline condition by eliminating the harmful change caused by the damage (primary remediation). • (2) If the baseline condition cannot be fully restored, the impairment the damage has caused to the natural resource and natural resource service should be remedied by measures undertaken at the damaged site or elsewhere (complementary remediation). • (3) The interim loss of a natural resource or natural resource service shall be compensated for by taking measures at the damaged site or elsewhere until primary and complementary remediation have taken full effect (compensatory remediation). E.J. Hollo

12. Cont… • Selectionof remedialmeasures • (1) The authority shall take the following into account when considering the measures to be undertaken: • 1) the nature, scope and severity of the damage; • 2) the possibility for natural restoration; • 3) risks posed to human health; • 4) expenses incurred in remedying the damage; • 5) other damages that may have occurred in the area. E.J. Hollo

13. Endingremediation(s. 8) • (1) The authority can decide, by means of the procedure concerning the determination of remedial measures as provided in an act mentioned in section 2(1), to end remediation, if: • 1) the remedial measures implemented guarantee that the risk to human health and natural resources has been eliminated; and • 2) the costs of continuing remediation would be disproportionate compared to the environmental benefits gained. E.J. Hollo

14. Liability • (1) The operator who caused the damage shall be liable for any costs: • 1) arising from the remedial measures …; and • 2) that the authority incurs in assessing the damage and the immediate threat posed by it, and in deciding upon remedial measures and supervising them. • (2) If the damage was caused by more than one activity, the responsibility for the costs referred to in subsection1 shall be allocated among the operators according to their share of the total damage. If this share cannot be assessed, the responsibility shall be divided per capita. E.J. Hollo

15. Furthermeasures • Making costs equitable (s. 12) • Right of the authority to undertake measures (s. 9) • Appeal follows the sectoral act • Detailed provisions by Decree 713/2009 E.J. Hollo

16. NCA Section5 a (29.5.2009/384) Damage to protected species and natural habitats • Damage to protected species and natural habitats refers to a significant, measurable, direct or indirect adverse effect on reaching or maintaining a favourable conservation status: • 1) with respect to the ecological values of the areas selected for inclusion in the Natura 2000 network referred to in Chapter 10; • 2) with respect to the species referred to in Article 4(2) of the Birds Directive and the species listed in Annex I of the Directive, as well as the species listed in Annex II of the Habitats Directive; • 3) with respect to the sites providing habitats for species referred to in subparagraph 2 that are protected against deterioration and destruction in accordance with section 47 of this Act; and E.J. Hollo

17. … • 4) with respect to the species listed in Annex IV of the Habitats Directive or the breeding sites and resting places of individual animal species referred to in Annex IV(a) of the Directive. • However, an adverse effect for which a derogation has been granted in accordance with section 48, paragraph 2, section 49, paragraph 3, or section 66, will not be regarded as damage to protected species and natural habitats. • The significance of the adverse effect shall be assessed in relation to the conservation status of the natural habitat or species in question at the time of the damage and to the services they provide and their natural ability to recover. Further provisions on factors determining the significance of the adverse effect shall be given by government decree. E.J. Hollo

18. Side-effect • Section 53 Duty of the State to pay compensation • If the property owner or holder of special rights incurs significant inconvenience due to a /conservation measure/ …. he is entitled to full compensation from the State. • The State is not required to pay compensation until the owner has applied for a derogation under the provisions of …section 31 or section 48, paragraph 2, or section 49, paragraph 3, and said application has been denied. If it is manifestly impracticable to grant any derogation, no further special application is needed in order to institute compensation proceedings. (553/2004) E.J. Hollo

19. …. • …The right to compensation does not apply, however, if the inconvenience is caused: • 1) by refusal of an application …referred to in the Water Act; • 2) by refusal to grant a permit referred to in the Environmental Protection Act; • THIS INDICATES that compensation is not given in cases where damage to nature (or waterm soil) is ground for refusal of a permit or a plan. E.J. Hollo

20. Compensatorymeasures in permit cases • The preventionprincipleentitlesauhtorities to prescribemeasuresaimed at the preventionorrestoration of damage (of anykind) • E.g. Water Act 3:10: • A permit shallincludeprescriptionsneeded to minimisedamage and supportrestoration. Theseprescriptionsshallbeenacted as along as the costsarereasonable and technicallyfeasible. • There is no general ruling on the obligation to paycompensation for losses to publicinterests, onlyprivateeconomiclosses. Exception; fisheryfee. NCA applies. E.J. Hollo

21. Soil and groundwaterprotection • EPA provides for prohibitions to pollute • A) soil • B) groundwater • C) marinewaters • Theseprohibitionsareabsolute: no permit is granted • In case of illegalor de facto pollution • A) coercivemeasuresmaybetaken (includingreparationcosts) • B) explicitprovisions on liability for purificationorrestorationapply: the polluter/thelandowner is liable for compensatorymeasures and eventually for costs to authorities. E.J. Hollo

22. Coercivemeasures/Reparation(NCA s. 57) • Should anyone fail to observe the provisions and regulations laid down in or by virtue of this Act, or embark upon action contrary to them, the centre for economic development, transport and the environment can forbid that person from continuing or repeating the offence or instance of negligence and require that he correct the unlawful situation or redress his negligence under threat of penalty payment or suspension, or issue threat of having the necessary measures taken at his expense. E.J. Hollo

23. Prevention and remediation of damage to protected species and natural habitats (NCA 57a (relates to Dir 35/2004/EC) • If a natural or legal person who operates an occupational activity or who de facto controls said activity (operator) deliberately or through negligence causes damage, or imminence of damage, to protected species and natural habitats through action contrary to the provisions and regulations laid down in or by virtue of this Act or by failure to observe said provisions and regulations, the operator shall notify the centre for economic development, transport and the environment of the damage or the imminent threat thereof without delay and take the necessary measures to prevent or minimise any adverse effects. E.J. Hollo

24. Natura 2000 sites (NCA ss. 64-69) • No specificoradditionalprovisions on compensationorreparationareenacted. Act 383/2009 on env. liabilityapplies, also the NCA. • Assessment /need of prevention is estimated as usual in permit cases (EPA, WA, alsoGenetechnAct) E.J. Hollo

25. Cont…/Also: penalty and forfeiture • Once notified of damage to protected species and natural habitats or the imminent threat thereof, the centre for economic development, transport and the environment shall, …require that the operator who has caused the damage take measures to prevent any adverse effects or limit them to the minimum and, if necessary, require that the operator take remedial measures referred to in the Act on the Remediation of Certain Environmental Damages (383/2009). The centre for economic development, transport and the environment may intensify the effect of an order that it has issued by conditional imposition of a penalty payment, by having the omission corrected at the expense of the defaulting party, or by suspending operations. E.J. Hollo

26. Similarprovisions… • Also the Environmental Protection Act, the Water Act, the Nature Conservation Act and the Gene Technology Act: • provisions on how, in accordance with the Environmental Liability Act, orders may be issued to remedy significant environmental damage caused by activities falling within the scope of application of these acts. • Regular provisions on administrative enforcement (coercive measures) apply E.J. Hollo

27. Conclusions • Compensationissuesaredealtwith in administrativeprocedures • Thereare no preciseguidelines for measurement of damageorcompensation • Therearerules for the assessment of impacts and for the choice of alternativemeasures • Legal practice on guidelinesdoesnotexistsofar E.J. Hollo

28. Thankyou for yourAttention! E.J. Hollo