JULY 13, 2009 CIRC ULAR NO. 19/09 TO MEMBERS OF THE ASSOCIATION Dear Member: DIRECTIVE 2004/35/CE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL OF APRIL 21, 2004 ON ENVIRONMENTAL LIABILITY WITH REGARD TO THE PREVENTION AND REMEDYING OF ENVIRONMENTAL DAMAGE The Directive on Environmental Liability with regard to the prevention and remedying of environmental damage (the ELD) entered into force on April 30, 2004. The ELD requires EU Member States to implement and give force of law to the Directive by April 30, 2007. However, a number of Member States have only recently implemented the Directive and some Member States are yet to bring the necessary legislation into force to comply with it. As of July 1, 2009 the following Member States have communicated full transposition of the Directive to the European Commission: Italy, Lithuania, Latvia, Hungary, Germany, Slovakia, Romania, Sweden, Spain, Estonia, Cyprus, Malta, Bulgaria, the Netherlands, Poland, Czech Republic, Portugal, Denmark, Belgium, Ireland, France and Luxembourg. The United Kingdom has notified transposition for England and Wales, but the legislation is still awaiting adoption in Scotland and Northern Ireland. This circular summarizes the key provisions of the ELD, although it should be noted that, as with all Directives, Member States have a degree of flexibility with regard to how the objectives set out in the Directive are met in their domestic law. The ELD does not prevent Member States from enacting more stringent measures in relation to the prevention of and remedying of environmental damage than are contained in the Directive. The fundamental principle of the Directive is that operators (which includes shipowners) whose activity has caused environmental damage or the imminent threat of such damage are to be held financially liable. The Directive’s purpose is therefore to induce operators to adopt measures and develop practices to minimize the risks of environmental damage so that their exposure to financial liabilities is reduced. Under the Directive, environmental damage is defined as ‘damage to protected species and natural habitats or in a site of special scientific interest’, ‘damage to water’ and ‘land damage’. It imposes strict liability on the operator for the costs of preventive and remedial actions for environmental damage arising from a specified range of “occupational activities”, which includes the transportation by inland waterways or by sea of dangerous 1 or polluting goods 2 and the transboundary shipment of waste. 3 1 ‘Dangerous goods’ are defined as goods classified in the International Maritime Dangerous Goods (IMDG) Code, in Chapter 17 of the International Code for the Construction and Equipment of Ships carrying Dangerous Chemicals in Bulk (IBC Code) and Chapter 19 of the International Code for the Construction and Equipment of Ships Carrying Liquefied Gases in Bulk. 2 ‘Polluting goods’ are defined as oils as defined in Marpol Annex I, noxious liquid substances as defined in Marpol Annex II and harmful substances as defined in Marpol Annex III. 3 That requires an authorization or is prohibited within the meaning of Council Regulation 259/93 on the supervision and control of shipments of waste within, into and out of the European Community The Directive provides for fault-based liability of the operator for damage, or any imminent threat of such damage, to protected species and natural habitats caused by all occupational activities other than those list