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1 678'<219$/8$7,21$1'5(6725$7,212)%,2',9(56,7<'$0$*( )257+(385326(2)(19,5210(17$//,$%,/,7< 7HUPVRIUHIHUHQFHIRUDVWXG\RQPHWKRGVIRUYDOXDWLRQDQGFULWHULDIRUUHVWRUDWLRQRI ELRGLYHUVLW\GDPDJHIRUWKHDSSOLFDWLRQRIDQ(&HQYLURQPHQWDOOLDELOLW\UHJLPH %$&.*5281' 3ROLF\FRQWH[W The European Commission has adopted the White Paper on Environmental Liability on 9 February 2000 (COM (2000) 66 final) (hereafter: the White Paper). The Commission s conclusion in the White Paper is that EC action in the field of environmental liability should be taken in the form of a Community framework directive. At the Environment Council Meeting of 30 March 2000, where environment ministers held an orientation debate on the White Paper, the option of a framework directive on environmental liability was supported by the Council. The White Paper contains concrete proposals for a Community environmental liability regime and describes, in section 4, possible features of such a regime. The scope of the regime in terms of damage to be covered should be environmental damage as well as traditional damage (damage to health and property). Two types of environmental damage are meant to be covered, namely contamination of sites and damage to biodiversity 1. Whereas liability for contaminated sites exists in all Member States in one form or another, this is not the case with respect to damage to biodiversity. Therefore, liability rules and criteria need to be developed in this area. Taking into account that liability for damage to nature or biodiversity damage does not exist in the Community to any meaningful extent, the Commission proposes to make a start with covering this kind of damage within the limits of existing Community biodiversity legislation. The relevant pieces of legislation in this respect are the Wild Birds Directive of 1979 and the Habitats Directive of Damage to natural resources that are protected on the basis of these directives and in Natura 2000 areas, should be covered by the liability regime. 7KHQHHGIRUHFRQRPLFYDOXDWLRQRIGDPDJHWRELRGLYHUVLW\ It is a precondition for making liable parties pay for the costs of damage to biodiversity caused by them that these costs can be calculated. In cases where the damage can be restored, the costs of restoration should be the starting point for this calculation. 1 2 In context of this study biodiversity is defined as natural resources protected under the Wild Birds and Habitats Directives (see footnote 2) and in Natura 2000 areas. Thus, the word biodiversity is used interchangeably with natural resources. Council Directives 79/409/EEC on the conservation of wild birds, OJ L 103 p. 1, and 92/43/EEC on the conservation of natural habitats and wild fauna and flora, OJ L 206, p. 7.

2 However, in cases of irreparable damage, this method can not be applied. The person who caused irreparable damage will have to pay compensation in accordance with the value of the damaged natural resource. Therefore, economic valuation of biodiversity damage is of particular importance for such cases. But even if restoration of damage is feasible, valuation of the damaged natural resource should also be possible, in order to avoid disproportionate costs of restoration and assure that the compensation is spent in a cost-effective way. In other words, methods need to be available for valuing natural resources LQGHSHQGHQWRIWKHFRVWVRIWKHLUUHVWRUDWLRQ. The regime of liability for biodiversity damage should contain an obligation to apply a cost-benefit test in each case, in order to avoid that disproportionate costs are spent on the restoration of such damage. If the costs of restoration are lower than the estimated value of the damaged natural resource, the compensation to be paid by the liable party should amount to the costs of restoration. If, on the contrary, the costs of restoration are considerably higher than the estimated value of the damaged natural resource, the compensation to be paid should amount (at least) to the value of the damaged natural resource but instead of restoring it, it may be more effective to spend the compensation for an equivalent but less expensive purpose, for instance the establishment of a similar natural resource in another place. 678'<2%-(&7,9(6 The objectives of the study are to give guidance to the European Commission on how or to what extent the values of natural resources should be included in a future directive on liability, and on how to define significant damage to biodiversity and a minimum level of restoration in such a directive. 9DOXDWLRQRIELRGLYHUVLW\GDPDJH The study needs to categorise the different methods for valuing natural resources (as defined in the White Paper) that can be used for the application of the future EC regime on liability. For that purpose, the study has to assess: (1) the applicability and adequacy of methods where empirical estimates (including both use and non-use values) have been derived from valuation of natural resources. The advantages and disadvantages of using these estimates (including characteristics arising from methodological differences) need to be well documented. The study should evaluate the usefulness of benefit transfer techniques to value damage to natural resources and give a recommendation using benefit transfer in the context of the directive. 3 (2) the potential to apply systems where natural resources are priced in terms of points or fixed values for certain purposes, e.g. the application of fiscal or criminal law systems (examples: Hessen system 4 ; Andalusian system 5 ), 3 4 In this context the study should evaluate the applicability (to facilitate benefit transfer) of the Environmental Valuation Reference Inventory (EVRI) or other similar databases. Compensation needs to be paid for disturbances in forests according to a table with points indicating the value of species of trees, laid down in an annex to a Regulation on fiscal levies (of 9 February 1995; GVBl. II ), based on the Nature Protection Law of Hessen of

3 comparable with ranking the value of personal injuries. The study should consider the pros and cons of each valuation method and identify in which contexts they are most suited. 5HVWRUDWLRQ RI ELRGLYHUVLW\ GDPDJH ZKDW LV VLJQLILFDQW GDPDJH OHYHO RI UHVWRUDWLRQ The White Paper states (4.5.1 under bullet point When should damage to biodiversity be covered? ): There should be a PLQLPXP WKUHVKROG for triggering the regime: RQO\ VLJQLILFDQWGDPDJHshould be covered. The study needs to develop criteria to define significant damage to biodiversity for the application of the liability regime. The White Paper moreover states (4.5.1 under bullet point How to ensure a minimum level of restoration? ): Restoration should aim at the return of the natural resource to its state before the damage occurred. To estimate this state, historical data and reference data (what are the normal characteristics of a natural resource like the one concerned) could be used. Replication of the quality and quantity of the natural resources will mostly not be possible, or only at extreme cost. Therefore the aim should rather be to bring the damaged resource back to a comparable condition, considering also factors such as the function, also in the wider context of the ecosystem of which it is a part, and the presumed future use of the damaged resource. The study needs to develop further criteria to define a minimum level of restoration according to the above description. The study needs to take estimation costs and interim losses into account as part of the restoration costs. $SSOLFDELOLW\RIEHQHILWFRVWWHVW The study needs to illustrate how, in general, a µfrvwehqhilw WHVW can be applied by comparing the outcome of applying the methods described under objective 2.1 with the costs of restoration of the damage. The calculation of the costs of restoration should be based on the relevant elements of study objective 2.2. This work will be made concrete through case studies (see below). &DVHVWXGLHV In order to illustrate how the methods and criteria considered by the study would work in practice, the study should elaborate two concrete case studies, for instance: The first case study should be based on the natural resource damage that occurred as a result of a maritime oil pollution case under European jurisdiction, and compare this with the 1989 Exxon Valdez oil pollution accident under American jurisdiction. 5 Table of amounts of compensation to be paid for damage caused to animals of protected species. The amounts reflect the costs of re-introduction of the animals concerned; annex of Andalusian Decree 4/1986 of ; BOJA 1986, 247, 811(reference in Verantwortlichkeit für ökologische Schäden ; Rechtsvergleichende Untersuchung by Michael R. Will; Saarbrücken 1992 (not published). 3

4 Suitable European cases could be the Braer case from 1993 or the Erika accident that occurred at the end of 1999, especially in so far as protected natural resources in the sense of this study were involved. The second case study, clearly linked to a Natura 2000 area, should be a case where it is complicated to judge whether the damage is significant or not, for instance a case where one protected species would benefit from damage done to another protected species. The consultants are requested to present suggestions for suitable concrete cases that could be the subject of this case study. The case studies should show how all the relevant methods for valuation of the damage and the relevant criteria with respect to restoration could be applied. A cost-benefit test should be applied as part of the case studies. 6&23(2)7+(678'<)857+(5(;3/$1$7,216 Considering that the scope of the liability regime for biodiversity damage will be constituted by damage to natural resources protected under the Habitats and the Wild Birds Directives and the Natura 2000 network, the study should take these natural resources and the legislation applying to them as a basis. The liability regime should apply criteria for damage to such natural resources that are in accordance with relevant notions in this legislation. A relevant provision in the Habitats Directive in this respect is article 6(2), requiring Member States to prohibit, in the special areas of conservation, deterioration of natural habitats and the habitats of species, as well as significant disturbance of species for which the areas have been designated. For the interpretation of the notion of significant damage introduced in the White Paper (paragraph 4.5.1, second bullet point), the relevant notions from this provision in the Habitats Directive are namely deterioration of natural habitats and significant disturbance of species. A relevant document in this respect is the paper published by the European Commission, April 2000, on µ0dqdjlqj 1DWXUD VLWHV 7KH SURYLVLRQV RI $UWLFOH RI WKH ³+DELWDWV 'LUHFWLYH ((&, which contains indicators of disturbance of species and deterioration of habitats (section 3.6). For liability purposes, compensation means dealing ex post with unlawful damage, preferably by way of restoration. This is in contrast to the ex ante preparation of compensatory measures to satisfy article 6(4) of the Habitats Directive in cases of a plan or project to be carried out in conformity with the conditions of the directive. Even if the liability regime will in principle not apply to the cases covered by this provision, the interpretation of and experience with compensatory measures in this context can be used as a source of inspiration for the application of the liability regime, especially in cases where damage is irreparable, with a view to defining equivalent natural resources to be established at the cost of the liable party. Relevant in this context is also a study, launched by DG Environment of the European Commission (O.J. S 150 of 5 August 1999) on the preparation of a methodological guide on procedures to follow for plans or projects significantly affecting Natura 2000 sites (Article 6.3 and 6.4 of Directive 92/43/EEC). 4

5 Other relevant provisions of the Habitats Directive are articles 12 and 13 about the strict protection of species of animals and plants respectively, that are listed in annexes to the directive. The liability regime should also apply to damage caused by breaches of these provisions. What is said here about specific provisions of the Habitats Directive applies also to similar provisions in the Wild Birds Directive (e.g. article 5). The study should explore what happens in practice to a defendant breaching one of the relevant provisions of the Wild Birds and the Habitats Directives and in particular, if a breach of the prohibitory regime involves (a) any valuation of the damage and (b) any mechanism for compelling the defendant to restore the damage. The study should consider how far the valuation methods to be applied and the criteria to be developed for restoration could or should take specific account of the different natural habitat types of Community interest that are described in Annex I of the Habitats Directive or of different (categories of) species protected under the relevant legislation. The study should consider possible problems with the application of the valuation methods and restoration criteria to animals of a protected species that are damaged when located outside a designated Natura 2000 area, for instance migrating birds, and how to overcome such problems. The valuation methods to be applied and the restoration criteria to be developed should be, on the one hand, as clear, unambiguous and operational as possible, but on the other hand, they should be sufficiently flexible so as to allow their application throughout the Community. 5(/(9$17%$&.*5281'0$7(5,$/ The outcome or interim outcome of the study concerning article 6(3) and 6(4) Habitats Directive mentioned in section 3 above. The Commission can make available to the team of consultants several books and studies that may be relevant, for instance a study on Liability for damage to natural resources from 1997 carried out for the Commission by Edward Brans and Mark Uilhoorn In order to fulfil the study objectives, the following outputs need to be delivered: (1) A description of different methods that can be applied for the valuation of biodiversity damage, the pro s and con s of each method and a recommendation as to the best method or combination of methods to be applied under the EC liability regime. (2) Practicable criteria for the definition of significant damage and for defining a minimum level of restoration, both with a view to the application of the EC liability regime. 5

6 (3) Concrete illustrations (through the case studies of study objective 2.4) of the application of the methods under (1) and the criteria under (2) above, and of costbenefit tests. 678'<7($0 The study team will have to be multi-disciplinary and needs to provide of the following expertise and skills: Expertise with economic valuation techniques that are relevant for the valuation of natural resources, preferably including expertise of American legislation on liability for natural resource damage (including the US and Canada) and expertise based on the European situation Legal expertise and skills in the field of restoration of natural resource damage, a thorough knowledge of the relevant Community legislation and practice concerning nature conservation combined with relevant knowledge of valuation techniques Biological or other relevant technical expertise and thorough knowledge of the natural resources protected under Community legislation and expertise on restoration of damage to such natural resources. 5(3257,1* As part of the proposal, the consultant is requested to specify the number and nature of draft reports and their timing. The Commission will publish the final report. 678'</2*,67,&6 It is envisaged that the consultants would meet with the Commission staff at least 2-3 times: 1) kick off meeting, 2) after draft final report (for comments and discussion) and 3) for a workshop including stakeholders, where they present the report. In addition, communication through other means (e.g. video conferencing) will take place. The study should be completed as soon as possible. The consultant is requested to give the schedule however, taking into account that the final report should be available within 6 months from the date of signature of the contract. The Commission will set up an ad hoc steering group for this study. It will consist of staff of units concerned in DG Environment, of DG Economic and Financial Affairs, DG Enterprise, DG Internal Market, DG Agriculture and DG Research. '85$7,212)7+(&2175$&7 The study must be completed within 6 months from the date of signature of the contract. 6(/(&7,21$1'$:$5'352&(66 6HOHFWLRQFULWHULD 6

7 Tenderers should be individuals or legal entities, or a consortium of either, and provide evidence of this at the time of tender by way of registration documents or numbers from official registers or certificates. Evidence of the tenderers financial and economic standing must be furnished by - statement of banks - balance sheets or extracts from balance sheets - other substantiating documents if the tenderer cannot, for valid reasons, provide the foregoing documents. Evidence on technical competence by providing - educational and professional qualifications from the managerial staff and, in particular, persons providing the services - a list of the principal services provided in the last three years, with the sums, dates and recipients of the services provided $ZDUGFULWHULD Understanding: The degree to which the tender shows a clear understanding of the objectives and tasks of the study. Methodology: The degree to which the methodology shows the capacity to resolve the questions underlying the tender in a realistic and well-structured way in order to produce results that are as adequate as possible. Project management and composition of the team: The offers will be assessed as regards the organisational aspects, the quality-level of the team composition and the time share attributed to each of the members which should clearly be outlined in the tender. Points: a maximum of 20 points will be attributed to the criteria 'understanding', a maximum of 35 points goes to the criterion 'methodology', a maximum of 45 points goes to the criterion Project management and composition of the team. To be selected the companies will have to obtain a minimum of respectively 10, 25 and 30 points for each of these three criteria, which gives a total minimum of 65 points to be achieved. Price: The price of the proposal will be considered in the award decision to determine the best value for money when selecting between technically comparable bids. Budget: The overall project costs (including fees, travel expenses and other costs) have been estimated at around ¼ 7

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