Workshop on

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Workshop on
Zsuzsanna Kocsis-Kupper Environmental pollution
cases and their legal consequences

• Transboundary Accidental Water Pollution,
  Liability and Compensation Challenges and
  Opportunities
• 21-22. 05. 2007- Budapest

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Examined cases
Name of the case Type of accident Total cost/ Damage claimed Legal procedures Amount paid
Sandoz (Nov. 86) transboundary Ch, D, Fr, Nl River pollution fire at the store of the Sandoz Company D 31 M DEM FR 16 M DEM N 2,7 M DEM Quick settlement, mixed procedures, Rhine Commission, Action Plan Sandoz agreed to pay within 2 years D 14 M DEM FR 13 M DEM N 1,8 M DEM Ch 5,7 M DEM
Summitville (Dec 92), inland USA Soil and river pollution, spills of cyanide and other contaminants EPA paid 155 M for the site Criminal proceedings ended in settlement The site is still operating In 2000 the operator after 5 years of criminal proceedings agreed to pay 27,7 M over 10 years (17, 20 years)
The Aznalcóllar tailing dam accident (April, 98), inland Sp a dam failure at a lead, zinc, copper mine Total cost of the disaster has been calculated at EUR 377.7 M Criminal procedures were unsuccesful. Civil claim was rejected. Admin. procedure penalty of 45 M EUR fine was imposed. MIne was closed in 2001, company filed for insolvency. EUR 96 M spent by the operator for clean up, no additional compensation paid yet (25, 8 years)

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The Baia Mare tailing dam accident (January, 2000), transboundary, Ro-HU River pollution, dam failure cyanide and heavy metal The Hungarian State claimed 143 M as total cost The criminal procedure was suspended. Civil procedure temporary decision on 15 operation(2005), decision on operators responsibility (2006) Decisions are not enforced, the company did not pay anything. The case concerning the amount of damages are still ongoing. The company started an insolvency procedure in 2006. New env. licence was obtained in 2005. The site still operates. (7 years, 0)
The Songhua river pollution, (November, 2005) transboundary, Cn-Ru River pollution, chemical explosion Beijing adopted a plan that includes spending 1.7 billion on restoration Administrative procedure 125,000 M fine in Jan 2007. The civil claim for compensation was rejected. 1,5 years after the accident there are no intentions on claiming state responsibility, no data on operation



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What are the legal choices of action following an
accident?

• Against the operator (national courts - national
  or private int. law)
• Administrative sanctions are low, fines are
  ineffective, licences are not suspended
• Criminal usually penal responsibility is
  rejected, sanctions are low, ineffective,
  punishment is not preventive
• Civil claims for compensation are many times
  rejected, if responsibility is established,
  usually there is another procedure concerning the
  amount of damage. The operators often become
  insolvent, and at the end compensations are not
  paid
• Against the state of origin (int. courts, special
  courts, arbitration - pub. int. law)
• International claims for state responsibility
  are rarely submitted, not effective

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Other possibilities

• Outside court settlements
• OK Tedi mining accident Papua New Guinea, 1984
  (500 M USD)
• the Contara chemical tank accident, USA, 1991 (38
  M USD)
• the Lower Fox PCP accident, USA, 1997 (10 M USD)
  
• the Exxon Valdez, Gulf of Alaska, 1989 (150 M
  fine, 100 M restitution)

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What are the results?

• The actual amount of compensation paid to the
  victims remains bellow 10 of their claims,
• The clean up costs are mostly born by the state
  or municipality and only partially by the
  operator,
• The restoration of the environment is not
  complete,
• The future operation of the site is technically
  not secured.

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Therefore the conclusion is that

• There is not yet an effective legal regime to
  make operators accountable after the accident
• the procedures are time consuming and ineffective

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Development of legislation

• EC law development of special environmental
  legislation (modification of the Seveso II
  directive, new mining directive, new BREF
  document, Liability directive, Proposal on Env.
  crimes)
• General international law ILC Articles on
  prevention of transboundary damage from hazardous
  activities
• Special liability regimes Lugano Convention,
  Basel Protocol, Kiev Protocol (various
  activities, operators liability)
• Special regimes Oil Funds, Nuclear Regimes,
  Transport regimes (special, limited schemes)

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Among the previous regimes

• From the point of operators liability up till
  now only the special Oil Funds were really
  operational
• There are uncertainities with the implementation
  of the EC Liability Directive, problems with the
  issue of financial securities
• Problems with ratifying the special liability
  regimes

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Not surprising that

• After an accident everyone wants to act
• many new pieces of legislation is adopted,
• many states join to already existing treaties and
  regimes
• However, attention is mostly paid to prevention
  and the issue of liability is never settled
  effectively even though it is in the interest of
  all states and inhabitants.

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Pollution does not stop at the borders

• Attention is indeed to be paid to preventive
  measures, but follow- up actions are inevitable
  as well
• Transboundary pollution needs to be tackled
• The operator should be held liable whether the
  pollution is inland or transboundary

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The past showed us that

• There is definitely a need for an effective
  liability regime in the international field just
  as much
• there is a need for establishing adequate
  insurance systems and/or other financial tools
  for rehabilitating the damaged sites and for
  compensating the victims of the accidents.
• Beyond further inevitably necessary discussions,
  positive actions on behalf of the states are
  necessary
• Lets not wait for another accident to act!

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• Thank you for your attention
• and
• wish all of us fruitful discussions!