Game changing decision on Habitats Regulations Assessment – implications for planning and development

The European Court of Justice (CECJ) issued a ruling in April on a dispute concerning the impact on freshwater pearl mussel of a proposed electricity cable serving a wind farm in the Republic of Ireland.  The ECJ ruling on this seemingly esoteric case has caused a profound shift in how planning can now deal with any plan or project which could affect habitats protected by the European Union Habitats Directive.

In summary

The CJEU ruling disbars planning and other competent authorities when screening a plan or project for Habitats Regulations Assessment (HRA) from taking account of any measures intended to avoid or reduce the harmful effects on such a site.  This judgement, which overturns domestic UK case law, means that the majority of plans and projects which, previously, would not have been subject to full HRA are now likely to be forced to undertake an appropriate assessment.

The need to undertake full HRA of plans and projects which, when considered in retrospect, will be seen to be unnecessary, is already generating additional resource demand on planning and other competent authorities, and will almost certainly cause significant cost and programme delay for developers.

We have reviewed this important ruling and provide below our analysis of the implications of the judgement for the development sector.

For further information please contact Bernice Roberts or Gemma Melvill.

People Over Wind and Sweetman v Coillte Teoranta (Case C-323/17)

Background

The recent ruling by the European Court of Justice (ECJ) on the treatment of mitigation for development (People over Wind and Sweetman 12th April 2018) represents a very significant shift in the way in which competent authorities are allowed to deal with screening under the Habitats Regulations.  This shift has potentially profound implications for developers, competent authorities and planning caseloads as many more plans and projects become the subject of appropriate assessment under Habitats Regulations Assessment (HRA).

The UK Habitats Regulations flow from the Habitats Directive, the purpose of which is to conserve natural habitats and wild species across Europe by establishing a network of sites known as Natura 2000 sites. Special Areas of Conservation (SACs), candidate Special Areas of Conservation (cSACs) and Special Protection Areas (SPAs) are all protected under the Habitats Regulations.

Under Article 6(3) of the Habitats Directive, an appropriate assessment is required where a plan or project is likely to have a significant effect upon a European site, either individually or in combination with other projects. Habitats Regulations Assessment (HRA) is a sequential four step process to identify whether there are likely to be significant adverse effects on the integrity of a European site (or sites) (known as HRA screening), what those effects will be, what alternative solutions are available to avoid those effects and, if unavoidable, whether they must be accepted and compensation provided for the effect on the European site.

The entire four step HRA process is inevitably time and resource intensive, for the applicant in providing detailed information to inform that HRA, and the competent authority in interrogating it to inform its decision.  Historically full HRA has been relevant only to plans and projects for which the possibility of adverse effects has not been ruled out at the screening stage.

For most projects, however, if HRA screening finds that there will be no likely significant effects (alone or in-combination with other projects) the competent authority can make a ‘No Significant Effects Report’ and no further action is required.

The People over Wind and Sweetman ruling overturns this approach.

The ruling

The ruling does not change the level of protection for a site under Article 6(3). What it does is do is rule out from consideration at the HRA screening stage any measures embedded in a plan or project designed to avoid or mitigate potentially harmful impacts on the site.  The Court ruled that:

40. …. Article 6(3) of the Habitats Directive must be interpreted as meaning that, in order to determine whether it is necessary to carry out, subsequently, an appropriate assessment of the implications, for a site concerned, of a plan or project, it is not appropriate, at the screening stage, to take account of the measures intended to avoid or reduce the harmful effects of the plan or project on that site.’ (our emphasis)

The effect of this judgement is to dismiss the previously engaged common-sense approach, whereby those responsible for evolving plan making and development schemes identified potential adverse impacts at an early stage, and then eliminated them by embedding appropriate avoidance or mitigation measures in the plan or project.

Measures designed to avoid or mitigate adverse effect, which might include modification of site selection or boundaries to avoid the ‘zone of influence’ where effects on the European site cannot be discounted, design of the scheme, allocation of buffer zones, limiting of operation periods, and others, can no longer be considered in HRA screening.

The effect of the ruling

The new ruling requires competent authorities to, at the HRA screening stage, distinguish clearly between impact mitigation measures specifically designed to avoid or reduce harmful impacts on the European site, and those which are not related to the integrity of the European site.  The authority should then ignore the former in its HRA screening process.

This means that many plans and projects which previously would have logically been screened out of appropriate assessment, will now be subject to full assessment.

In terms of process, it seems likely that, subject to the measures excluded at the screening stage being formulated and evidenced to genuinely avoid and or mitigate adverse effects, the plan or project will be found by the full HRA to be acceptable.  As such, it is absolutely essential that plan makers and project applicants continue to properly explore options and formulate avoidance and mitigation strategies that avoid impacts on European sites.

Meanwhile, however, the ruling is likely to generate considerable confusion, and additional cost and programme delay in the consenting process.

Preliminary guidance

We believe this ruling to be illogical.  It is counter to basic common sense that those involved in plan making or project evolution could, by this judgement, be discouraged from adopting an early, prudent and informed approach to avoiding adverse impacts on the conservation objectives of European sites.

The decision also runs counter to the parallel EIA Directive (2015/52/EU) which requires at Article 4(4) a developer to:

‘…provide information on the characteristics of the project and its likely significant effects on the environment…The developer may also provide a description of any features of the project and/or measures envisaged to avoid or prevent what might otherwise have been significant adverse effects on the environment.’; (our emphasis).

and at Article 5 (b) states:

where it is decided that an environmental impact assessment is not required, state the main reasons for not requiring such assessment with reference to the relevant criteria listed in Annex III, and, where proposed by the developer, state any features of the project and/or measures envisaged to avoid or prevent what might otherwise have been significant adverse effects on the environment.’  (our emphasis).

Frustratingly, pending further clarification which, if not given by the ECJ, is likely to be generated by case law, it is very likely that plans and projects which previously have been found at screening to not require appropriate assessment, will now be subject to HRA. Meanwhile, the inconsistency of the ruling is already causing major procedural problems for competent authorities in both development management and plan-making.

The ruling has already caused major procedural problems for competent authorities in both development management and plan-making. As just one example, Waverly Council in Surrey has taken the decision to temporarily suspended planning decisions on developments within 5km of the Thames Basin Heaths SPA, which includes areas of significant residential growth.  Others are likely to follow.

The Planning Inspectorate last month advised all Inspectors to ensure that HRA reports which inform the draft local plan are compliant with the decision.  If they are not the local planning authority should “confirm the extent to which they consider their HRA report is legally compliant in light of the judgment and ….re-visit the screening assessment in doing so”. Failure of a Plan to comply will almost certainly lead to programme delays and, potentially, main modifications to the Plan being required to satisfy the HRA.

What next?

From the above it is clear that clarity on this matter is unlikely in the short term. Whilst some competent authorities may continue to rely on established case law (both domestic and from the ECJ), risk of legal challenge will encourage most to adopt the precautionary principle of following the People over Wind and Sweetman ruling as the most recent expression of law.

Amidst this confusion the options available to developers and plan makers to tackle the impact of the ruling are limited.

In practical terms, there appear at this time to be two options to address the need for clarity:

  • Assume the need for full HRA of all proposed plans and projects and plan accordingly. Whilst unwelcome and resource intensive, this approach will aid the competent authority to process the matter with certainty.
  • Approach the plan or project in such a way that measures introduced to avoid or reduce an effect on a European site serve a dual purpose.  There is no authoritative definition in the ruling, or elsewhere, of what constitutes an embedded or additional avoidance or reduction measure. Thus, if a measure is proposed that provides plan or scheme benefit or operational function separate from the purpose of safeguarding the European site, it is possible that it will be interpreted as integral to the plan or project and therefore outside the remit of HRA.  We consider that such instances will, in practice, be few and far between.

Meanwhile, we recommend that those engaging with the planning system, either in proposing site allocations in emerging plans and/or for development permissions, should now ensure that they are thoroughly informed of the implications of the ruling and to take it into account when considering development programmes, plans and budgets.

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