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Bitter v. Germany - order

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Litigation

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Claimant challenged the European Union Emissions Trading Scheme's (EU ETS) excess emissions penalty, imposed on operators that have not surrendered sufficient emissions allowances.  The European Court of Justice upheld the penalty.

German company Ziegelwerk Höxter GmbH operated an installation releasing greenhouse gases until September 2011.  In November 2011 a German district court opened insolvency proceedings against the company, and Sandra Bitter was appointed insolvency administrator.  The German authorities requested that Bitter report and surrender emissions allowances for 2011 as required by the EU ETS, and Bitter responded that the company was not obligated to do so because it had ceased its business activity before the insolvency procedure began.  The government then imposed a fine of 100 euros per non-surrendered ton of carbon dioxide emissions equivalent, pursuant to Article 16(3) of Directive 2003/87/EC of the European Parliament.  Bitter challenged the decision in the Berlin administrative court, which in turn referred to the European Court of Justice the question of whether the 100-euro per ton fine violated the principle of proportionality under EU law.

The Court upheld the penalty, reasoning that the EU legislature must be allowed broad discretion when it is asked to intervene in an area that entails political, economic and social choices.  The Court relied on earlier decisions upholding a fine of 40 euros for non-surrendered allowances during the first phase of the EU ETS, in which the Court credited the legislature's determination that the fine was necessary to establish an efficient allowance trading system.  The Court further held that the fact that the instant penalty of 100 euros exceeded the one previously upheld was irrelevant, particularly because the first trading period of a "learning period for the scheme."

Bitter v. Germany

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An aim to achieve a quantifiable outcome within a given time-frame, set by an institution such as a national government.

Policy instruments are techniques or tools used by governing authorities to promote certain policies in order to achieve predetermined goals. Put simply, instruments are how a government tries to achieve its goals, with this taxonomy being focused on national policy instruments.

Risk is the potential for adverse consequences resulting from the dynamic interplay between (climate-related) hazards, exposure, and vulnerability of affected human or ecological systems.

Groups  of people who are adversely affected by climate change or the response to it

A set of principles, processes, and practices that build economic and political power to shift from an extractive economy to a regenerative economy.

Renewable energy means all forms of energy produced from renewable sources in a sustainable manner.

Fossil fuel is a generic term for non-renewable energy sources such as coal, fossil gas, and oil (including crude oil, and petroleum products), that can be used for electricity and heat generation. Fossil fuels are hydrocarbons formed from pressurised and heated organic material buried over millions of years.

Molecules in the atmosphere that play a key role in the greenhouse effect by trapping heat radiating from Earth’s surface.

Area of the economy in which actors engage in identical or related activities.

In human systems, the process of adjustment to actual or expected climate change and its effects, in order to moderate harm, increase resilience or exploit beneficial opportunities. In natural systems, the process of adjustment to actual climate change and its effects; human intervention may facilitate adjustment to expected climate change and its effects.

The management and allocation of funds, assets and investments to meet various objectives

A long-lived, colourless gas, chiefly emitted from fossil fuel combustion, deforestation and cement production.

A target to reduce the prevalence of a greenhouse gas over a specific time frame

Tradable permits are market-based tools that grant permission for specific activities, frequently used to regulate emissions. These permits can be issued within a trading system to manage environmental impacts.

Either money or something of monetary value is transferred between two or more organisations, people or countries.

The release of heat-trapping gases, primarily from human activities such as burning fossil fuels, agriculture and industry.

Bitter v. Germany - order

Target

Policy instrument

Greenhouse gas

Finance