“Ecocide” directive adopted by the EU Council
On March 26, 2024, the Council of the European Union adopted the so-called “Ecocide” Directive (Directive of the European Parliament and of the Council on the protection of the environment through criminal law and replacing Directives 2008/99/EC and 2009/123/EC, available here). Although the Directive does not use the term “ecocide”, it will introduce a number of environmental offenses into national criminal law that cause significant damage to nature and the environment “comparable to ecocide”. Negotiators from the Council and the EU Parliament had already reached an agreement on the draft directive presented by the Commission on December 7, 2023. The Parliament approved the draft on February 27, 2024 (see here). Now that the Council has given its approval, the directive can enter into force following publication in the Official Journal of the European Union. The member states then have two years to implement the directive (article 24).
Offenses listed in the Directive
The Directive creates a considerable number of new criminal offenses. Article. 3 para. 2 now provides for a total of 20 different criminal offenses to be punishable, including some that were already covered by the previous Directive (Directive 2008/99/EC), but also many new criminal offenses. What the offences have in common is that the result of the offence is always the death of or serious injury to persons or significant damage to an ecosystem, animals or plants caused by the conduct or that the conduct is likely to cause such damage. As before, the following types of conduct are to be punishable as criminal acts:
- Air, soil and water pollution
- Improper handling of waste
- Marine pollution by ships
- Construction, operation and dismantling of environmentally hazardous facilities
- Improper handling of radioactive material
- Significant impairment of protected plant and animal species
- Significant damage to protected areas
- Production, placing on the market, import, export, use or release of ozone-depleting substances
These requirements are already implemented in German law in Sections 324 et seq. of the German Criminal Code (StGB) and in ancillary criminal offenses, e.g. in Section 18a of the Waste Shipment Act (AbfVerbrG). In particular, the following acts must now be made punishable:
- Placing environmentally harmful products on the market
- Production, placing on the market, making available on the market, export or use of hazardous substances
- production, use, storage, import or export of mercury
- Carrying out certain projects without the required authorization
- Ship recycling
- Extraction of groundwater
- Placing illegally harvested timber on the market
- Killing, destroying, taking, possessing, selling or offering for sale certain wild animal or plant species or trading in these species
- Damaging the habitat of a specially protected animal species
- Introduction of invasive species
- Production, placing on the market, import, export, use or release of fluorinated greenhouse gases
Member States are also required to provide for qualifying offenses in the event that the actions destroy or cause irreversible or permanent large-scale and significant damage to an ecosystem of significant size or ecological value, a habitat within a protected area or the quality of air, soil or water. For most criminal offenses, including air, soil or water pollution and damage to the habitat of certain animal species, it is also planned to create criminal liability for gross negligence, which is generally referred to as recklessness in the German criminal law context.
Guidelines on the range of penalties
The directive also sets out very specific requirements for sanctions against natural persons, in particular the directive sets minimum maximum penalties of three, five, eight and ten years’ imprisonment. This system of penalties will not easily fit in with the maximum penalties currently provided for in German criminal law. German criminal law provides for sentences of one, two, three, five and ten years. The minimum maximum sentence of eight years will then presumably have to be implemented with a jump to the next higher level of ten years. Further legal consequences for natural persons, such as the obligation to restore the environment to its previous state within a certain period of time, the ban on holding a management position in legal entities and the temporary ban on running for public office, are optional.
Sanctions against legal entities
The same applies to legal consequences against legal entities. Here, the Directive provides for optional legal consequences such as the exclusion from subsidies and tenders, the temporary or permanent ban on business activities, the withdrawal of permits, the obligation to implement an environmental compliance management system or even the “death penalty” under company law (dissolution of the company). Mandatory legal consequences, on the other hand, are the imposition of fines or penalties. The maximum level of fines may not be less than 5% of the total worldwide turnover of the legal entity or an amount of EUR 40.0 million for certain serious offenses and 3% of the total worldwide turnover or an amount of EUR 24.0 million for certain less serious offenses.
The Directive expressly provides as a mitigating factor that the offender or the legal person to be sanctioned takes measures to limit or remedy the damage or helps the authorities to gather evidence or identify the offender before the criminal investigation begins. A form of self-reporting or reporting by the natural persons involved, even if not exempting them from punishment, is therefore necessary. Companies will also be forced to immediately investigate suspicions of environmental damage caused by them as part of internal investigations in order to benefit from such mitigating measures.
The system for assessing fines will have to lead to a fundamental system change in German criminal law when it is implemented. To date, legal persons can only be fined under Section 30 OWiG. This can continue to be the case. The Directive expressly does not require a criminal penalty, but also permits a fine. However, the legal consequence of a fine in accordance with Section 30 OWIG is a fine of up to EUR 10.0 million. German criminal law only provides for this for individual administrative offenses in which this is expressly stipulated, e.g. Sections 81c (2) of German Antitrust law, 56 (3) sentence 4 of the German AML Act, 24 (3) sentence 1 of the German Supply Chain Due Diligence Act. This has not yet been provided for the imposition of a fine for a criminal offense as a connecting factor. This systematic friction can only be resolved by increasing the range of fines in Section 30 (2) of the Administrative Offences Act (OWiG) in order to be able to impose the maximum limits required by the Directive in absolute figures (EUR 40.0 million) in the sanctions section or by introducing a general addition to Section 30 OWiG, according to which a percentage fine can also be imposed for offenses that refer to this provision, comparable to Section 30 (2) sentence 3 OWiG. It also makes sense to provide for a mitigation option in the event of self-reporting or internal investigations and extradition of the natural persons involved, i.e. a de facto obligation to conduct internal investigations.
If such regulations are introduced, the way also appears to be paved for a more fundamental revision of the law on sanctions for legal entities and associations of persons, as already envisaged in the planned introduction of the Corporate Sanctions Act. It is therefore possible that a new attempt will be made to reorganize the law on sanctions for associations in Germany via the detour of environmental criminal law.
Administrative dependence of environmental criminal law
There are also special features in the administrative law system. For example, it was previously a characteristic of German environmental criminal law that the criminal offences were “administratively accessory”, i.e. criminal liability could not be considered if the persons acting acted within the scope of an official authorization. This accessoriness will be relaxed to some extent by the directive. Section 330d (1) no. 5 of the German Criminal Code (StGB) already stipulates that an authorization that is final and binding but was obtained by fraudulent misrepresentation or false information does not have the effect of excluding the offence. However, the directive goes beyond this and also provides that permits that clearly violate the relevant substantive legal requirements should also not have the effect of excluding the offense. To date, this has also been recognized for approvals in the form of a void administrative act pursuant to Section 44 of the German Admistrative Proceedings Act. However, its nullity requirements are stricter; they require that the administrative act suffers from a particularly serious error and that this is obvious. Therefore, not every obvious unlawfulness is sufficient.
Public participation in criminal proceedings
The provision in article 15 of the Directive is also new. It provides for the comprehensive participation of persons who “have a sufficient interest or claim a violation of the law, as well as non-governmental organizations working for environmental protection“. As the environment cannot represent itself, a very extensive participation of environmental associations is to be regulated here. This was still provided for in the Commission’s original proposal without exception. This was met with reservations, particularly from the Federal Council (BR-Drucks. 27/22, p. 10, see here in German), as German criminal law provides for the participation of the injured party as a joint plaintiff, but not the representative participation of associations. This would also contradict the state’s monopoly on the use of force and the sovereign nature of criminal proceedings. In the form now adopted, these persons and associations should therefore only be granted procedural rights to the extent that this is generally provided for in the respective criminal procedure codes of the member states. As such participation is not provided for in Germany, no changes to criminal procedural law are to be expected.
Conclusion
As a result, the Ecocide Directive will bring about some changes to German environmental criminal law and the associated administrative approval procedures. These are not limited to environmental criminal law but, with the percentage-based assessment of fines for legal entities based on turnover and the mandatory mitigation option for internal investigations, have the potential to lead to a fundamental change in the sanctioning of associations, including a new approach to the law on sanctions for associations.
Even if the directive has fallen short of many demands, in particular the demands for the introduction of a comprehensive ecocide offence or the general criminalization of excessive emissions of greenhouse gases, it will nevertheless lead to a considerable expansion of the responsibility of companies for the environmental damage they cause. This makes it all the more important for companies to establish meaningful environmental compliance measures now and to immediately investigate suspected environmental violations as part of internal investigations.