Nitrogen news: Decision by the Council of State on the framework for revoking (irrevocable) nature permits and the permit obligation for internal netting
On 20 January 2021, the Administrative Jurisdiction Division of the Council of State (hereinafter: the ''Council of State'') rendered a judgment in a case concerning the revocation of a nature permit, which we believe has or may have serious consequences for practice. In this blog, we analyse the judgment and the answers to the questions (i) under what conditions can an irrevocably granted nature permit be revoked, and (ii) whether, since the legislative amendment of 1 January 2020, there is no (longer) a permit requirement for projects that use internal netting. Finally, we will briefly discuss the possible consequences for practice.
The Foundation of Brabant for Environmental federation (Stichting Brabantse Milieufederatie) and the Society for the Preservation of Nature reserves (Vereniging tot Behoud van Natuurmonumenten) ('BMF' and 'Natuurmonumenten') requested the Provincial Executive of Noord Brabant (the 'Provincial Executive', the competent authority) to withdraw a nature permit (1) granted to De Logt B.V. in 2013. The nature permit concerned the establishment of a pig farm with 19,008 weaned piglets. The resulting nitrogen deposition on the surrounding Natura 2000 areas could be compensated by means of 'internal netting' (so that on balance there was no increase in nitrogen deposition), by means of a so-called 'deterioration permit'. To date, no use had been made of the nature permit. According to the BMF and Natuurmonumenten, putting the pig farm into operation would lead to a sharp increase in deposition in the Natura 2000 area of Kampina & Oisterwijkse Vennen, while that area is already overloaded. For this reason, the BMF and Natuurmonumenten requested that the permit be revoked pursuant to Article 5.4 of the Nature Conservation Act (''Nca''). The Provincial Executive rejected the request, after which the case was brought before the court and finally before the Council of State.
(i) Article 5.4 of the Nature Conservation Act: amending or revoking a nature permit
Pursuant to paragraph 1 of article 5.4 of the Nca, the competent authority can revoke or modify a nature permit if one of the circumstances mentioned in that paragraph occurs. Pursuant to article 5.4, paragraph 2, of the Nca, a nature permit is in any case revoked or amended if this is necessary for the implementation of article 6, paragraph 2, of the Habitat Directive (2). Below, we will limit ourselves to the most important considerations regarding paragraph 2 of article 5.4 of the Nca.
The revocation of a nature permit, an appropriate measure?
The Council of State ruled that article 5.4, paragraph 2, of the Nature Conservation Act contains an independent ground for revoking or amending the nature permit, namely: 'the threat of deterioration or disturbance with significant consequences of a species or habitat type for which a Natura 2000 area has been designated'. If this ground occurs, it is certain that appropriate measures must be taken. This is based on a number of principles:
- The competent authority has discretion on the choice of appropriate measures and will therefore have to decide whether to withdraw or modify the nature permit as an appropriate measure or whether other appropriate measures (will) be taken (3);
- If the withdrawal or amendment of a nature permit can contribute to preventing the imminent deterioration of natural values, it may be an appropriate measure;
- If the withdrawal or amendment of the nature permit is the only appropriate measure to prevent the impending deterioration of natural values, the competent authority must withdraw or amend the nature permit;
- However, it does not follow from article 5.4, paragraph 2, of the Nca that the competent authority only withdraws or amends a permit if that is the only appropriate measure to prevent the impending deterioration of natural values. Even if other appropriate measures can be taken, the competent authority can, within its discretion, opt to withdraw or modify the nature permit.
Motivation for the decision on a request to revoke or amend a nature permit
The Council of State considers that in the decision on a request to withdraw or modify the nature permit, the competent authority will have to make clear how it has exercised its discretion. In other words: the competent authority must substantiate why it chooses which suitable measures. If the competent authority does not want to use the withdrawal or amendment of the nature permit as an appropriate measure while it could, then the competent authority must make clear that the withdrawal or amendment is not the only appropriate measure and if so, why the withdrawal or amendment of the nature permit does not need to be part of the measures or package of measures that will be taken. The time frame in which the measures are carried out and when their effect is expected can contribute to a justification.
(ii) (No) permit requirement for internal netting
The permit obligation for projects is regulated in article 2.7, second paragraph, of the Nca. Previously (until 1 January 2020), based on this article, projects that could have some, but not significant, impact on a Natura 2000 area were subject to the permit requirement (also called the 'deterioration permit'). In this judgment, the Council of State ruled that the effect of the law change as of 1 January 2020 is that there is only an obligation to obtain a permit for projects that may have a significant impact.
Significance for internal netting
In determining whether a project has significant effects, it is relevant whether internal netting can be used for a project. According to established case law of the Council of State, it can be ruled out, based on objective data, that a change or extension of a project will have significant effects if internal netting is applied (= the change or extension will not lead to an increase in nitrogen deposition compared to the baseline situation (4)). In other words: if a project can make use of internal netting, significant effects are excluded. In the light of the amendment of the law, this means that the figure of the 'deterioration permit', whereby significant effects are excluded via internal netting, is no longer an issue.
Consequences for the nature permit of De Logt B.V.
The expiry of the permit obligation on 1 January 2020 does not mean that the nature permit will be withdrawn. It does mean that withdrawing the nature permit (granted on the basis of internal netting) is no longer an appropriate measure. After all, withdrawing the permit is no longer a way to ensure that the activity is terminated or to prevent the project from being realised (after all, no permit obligation applies for the realisation of the project).
Implications for practice
The disappearance of the permit requirement appears to be an unintended or ill-considered consequence of the change in the law on 1 January 2020 (as evidenced also by the provincial policy frameworks on internal and external netting), and in our view raises various implementation and enforcement issues. We are thinking of, among others:
- How can the competent authority supervise the correct use of internal netting (are the calculations and substantiation correct), if projects no longer have to apply for a permit for a change or expansion?
- Do the nature permits of companies still provide a realistic picture of the business operations, if these permits do not need to be modified in the context of an expansion or change that makes use of internal netting?
- Should a company always have its netting calculations and justification ready during an enforcement visit, in order to be able to demonstrate that it does not need a licence despite changed activities?
- What does the ruling mean for the 'internal and external netting' policy rules adopted by the provinces, now that the legal basis for them has expired?
For the sake of legal certainty, we can imagine that companies would still like to obtain a 'permission' from the competent authority. It cannot be ruled out that the legislator will eventually create a monitoring system, for example by means of an obligation to report. How these things will work out is something that will become apparent in the near future. Provinces have in any case indicated that they will consider the ruling and its consequences for their task in relation to Natura 2000 (granting permits, supervision and enforcement). (5)
Do you have any questions about the above or what it means for you? Please do not hesitate contact us.
- Granted under the predecessor of the Nature Protection Act: the Nature Protection Act 1998.
- It follows from Article 6(2) of the Habitat Directive that appropriate measures must be taken to prevent deterioration and disturbance that could have a significant effect on the species and habitat types for which a Natura 2000 area has been designated. The Council of State noted in this judgment that the second paragraph of Article 5.4 of the Nca does not provide a basis for revoking or amending a nature permit in order to implement Article 6, paragraph 1, of the Habitat Directive.
- N.B. This is different from the application of Article 5.4, paragraph 1, of the Nca, where the competent authority has room to make a weighing up of interests (such as the interest that a permit has formal legal force).
- The reference situation is taken from the nature permit in force or, in its absence, from the environmental permit in force on the reference date (the date on which Article 6 of the Habitats Directive became applicable to the nature area concerned), unless an environmental permit has subsequently been granted for an activity with less impact. In the latter case, that consent is taken as the reference situation.