Observatório do Clima vs. IBAMA and the National Department of Infrastructure and Transportation (Licensing of Highway BR-319)

On January 22, 2024, Observatório do Clima has filed a Public Civil Action (ACP) against the federal environmental agency IBAMA and the National Department of Infrastructure and Transport (DNIT), seeking the annulment of the Preliminary License for the reconstruction and paving of the “middle section” of the BR-319 highway. The plaintiff claims that paving the BR-319 would open new fronts for deforestation and land occupation in the Amazon. It says that in 2005, IBAMA began the licensing process for the paving of the middle section of the BR-319 highway, during which the environmental agency showed great concern about the increase in deforestation around the highway, the threat to biodiversity, and the potential for the grabbing of public land in the Amazon. However, according to Observatório do Clima, IBAMA's issuance of Preliminary License (LP) 672/2022 did not consider the environmental agency's previous concerns. It claims that the license was granted (i) without a climate impact study; (ii) without prior consultation with the traditional communities that the project would impact; (iii) despite the lack of minimum environmental governance to deal with the complexity of the environmental consequences of the project; and (iv) contrary to the guidelines of a Working Group formed by environmental agencies and an Inter Ministerial Committee, which indicated the need to adopt a series of measures associated with environmental governance before issuing the preliminary license. It highlights the importance of the Amazon rainforest for climate balance. It points out that deforestation in the biome would increase carbon dioxide emissions, exacerbate climate change, and that the absence of Free, Prior, and Informed Consultation would infringe on the rights of indigenous peoples. Observatório do Clima argues that the Brazilian legal system requires environmental licensing to assess the climate variable and failure to do so would render the preliminary license granted null and void. Based on the above, it requests a preliminary injunction to suspend the effectiveness of LP 672/2022, the reversal of the burden of proof, and, at the end of the trial, the annulment of the preliminary license, as well as any administrative acts arising from it. On May 16, 2024, DNIT presented its defense, arguing that it had no legal standing and that the chosen procedure was inappropriate, and requested that the injunction be rejected. It argued for the presumption of legitimacy of administrative acts and the impossibility of judicial interference in administrative merit under penalty of violating the principle of separation of powers. It argued that it could not guarantee the socio-environmental measures needed around the BR-319 project, which are the responsibility of environmental, indigenous, land, and other bodies and agencies. Thus, it stated that environmental licensing could not make up for the lack of structure of the various bodies and authorities involved in environmental inspection policies and the prevention and control of deforestation in the Amazon. As for the request for a climate impact study, it argued that such an impact would derive from the possible increase in illegal deforestation generated by insufficient environmental governance in the areas close to the highway and would not be related to the technological solution applied to the project. It claimed that there had been prior consultation with indigenous peoples. In this way, it argued that it had complied with the environmental licensing process determined by IBAMA. On May 17, 2024, IBAMA presented its defense, arguing the presumption of legitimacy of administrative acts and the impossibility of judicial review. It argued that DNIT, the project's proponent, lacked the administrative competence to carry out environmental policy measures, especially in the context of licensing. As for carrying out a climate impact study, it mentioned that the technical analyses assessed the issues directly related to the subject, such as deforestation, changes in land use, and adapting the project to climate events, and that the EIA/RIMA contained data for defining measures to control and mitigate these impacts. It argued that halting the licensing process would imply additional costs in preparing new assessments and studies and that there was no risk of damage to the useful outcome of the process, among other allegations. On July 24, 2024, an injunction was issued in favor of the plaintiff's claims. The decision stated that the presumption of legality of administrative acts is relative and that the judiciary can control their constitutionality and legality. It questioned the validity of the preliminary license given the potentially severe environmental damage, such as deforestation, loss of biodiversity, damage to the climate system, and impacts on indigenous and traditional communities, among others. In this sense, the judge stated that a balanced environment is a human right and essential for the enjoyment of other rights, such as life and health, and that the judiciary is responsible for guaranteeing its protection against harm. The decision recognized that the case aims to ensure that the licensing process is carried out responsibly and adequately, guided by the technique and the best science applicable to control risks and damages, to allow the BR-319 project to coexist without undermining the duty to protect the Amazon rainforest. To this end, the lawsuit seeks compliance with the legal procedures for conducting technical studies, including climate impact studies and prior consultation with indigenous peoples and traditional communities. The decision stated that environmental licensing must include a climate diagnosis to establish adequate and proportionate mitigation and compensation measures under Brazilian legislation and international commitments. It affirmed the importance of the dimensions of climate mitigation and adaptation. It considered that the insufficiency of public policies and the lack of adequate state structures to prevent the rehabilitation of the BR-319 highway from destroying the Amazon rainforest had been demonstrated, ruling that the project was environmentally unfeasible. It, therefore, granted the request for the immediate suspension of the preliminary license. IBAMA, the Federal Union, and DNIT appealed the decision, and on October 7th, 2024, the Reporting Judge of the Federal Regional Court of the 1st Region decided to suspend the effects of the preliminary injunction. According to the judge, the appealed decision had mistakenly concluded that the granting of a preliminary license was related to the execution stage of the project. In fact, this administrative act was merely evaluative in nature. It was argued that the permit issued fulfilled the objective of attesting to the environmental viability of the project. It argued that the EIA/RIMA adequately fulfilled its purpose of exposing the real and potential environmental damage resulting from the project. The decision also argued that there is no normative, jurisprudential, or doctrinal provision on the obligation to prepare a climate impact study. It concluded that the EIA/RIMA exhaustively identified the activities that generate GHG emissions, which would meet what the appealed decision qualified as a climate impact study. Finally, it understood that (i) the environmental licensing complied with the provisions of ILO Convention 169 regarding prior consultation, (ii) the EIA/RIMA recognized the need to implement public policies in the Amazon region, and (iii) stressed the importance of restructuring the BR-319 for the development of the region.