1. Workshop on Transboundary Accidental Water Pollution, Liability and Compensation: Challenges and Opportunities 21-22. 05. 2007- Budapest Zsuzsanna Kocsis-Kupper : Environmental pollution cases and their legal consequences

2. Examined cases Name of the case Type of accident Total cost/ Damage claimed Legal procedures Amount paid Sandoz (Nov. 86) transboundary Ch, D, Fr, Nl River pollution: fire at the store of the Sandoz Company D: 31 M DEM FR: 16 M DEM N: 2,7 M DEM Quick settlement, mixed procedures, Rhine Commission, Action Plan Sandoz agreed to pay within 2 years D: 14 M DEM FR: 13 M DEM N: 1,8 M DEM Ch: 5,7 M DEM Summitville (Dec 92), inland USA Soil and river pollution, spills of cyanide and other contaminants EPA paid $155 M for the site Criminal proceedings ended in settlement The site is still operating In 2000 the operator after 5 years of criminal proceedings agreed to pay $27,7 M over 10 years (17%, 20 years) The Aznalcóllar tailing dam accident (April, 98), inland Sp a dam failure at a lead, zinc, copper mine Total cost of the disaster has been calculated at EUR 377.7 M Criminal procedures were unsuccesful. Civil claim was rejected. Admin. procedure: penalty of 45 M EUR fine was imposed. MIne was closed in 2001, company filed for insolvency. EUR 96 M spent by the operator for clean up, no additional compensatio n paid yet (25%, 8 years)

3. The Baia Mare tailing dam accident (January, 2000), transboundary, Ro-HU River pollution, dam failure: cyanide and heavy metal The Hungarian State claimed $ 143 M as total cost The criminal procedure was suspended. Civil procedure: temporary decision on 15% operation(2005), decision on operator’s responsibility (2006) Decisions are not enforced, the company did not pay anything. The case concerning the amount of damages are still ongoing. The company started an insolvency procedure in 2006. New env. licence was obtained in 2005. The site still operates. (7 years, 0%) The Songhua river pollution, (November, 2005) transboundary, Cn- Ru River pollution, chemical explosion Beijing adopted a plan that includes spending $ 1.7 billion on restoration Administrative procedure: $ 125,000 M fine in Jan 2007. The civil claim for compensation was rejected. 1,5 years after the accident there are no intentions on claiming state responsibility, no data on operation

4. What are the legal choices of action following an accident? Against the operator (national courts - national or private int. law) Administrative: sanctions are low, fines are ineffective, licences are not suspended Administrative: sanctions are low, fines are ineffective, licences are not suspended Criminal: usually penal responsibility is rejected, sanctions are low, ineffective, punishment is not preventive Criminal: usually penal responsibility is rejected, sanctions are low, ineffective, punishment is not preventive Civil: claims for compensation are many times rejected, if responsibility is established, usually there is another procedure concerning the amount of damage. The operators often become insolvent, and at the end compensations are not paid Civil: claims for compensation are many times rejected, if responsibility is established, usually there is another procedure concerning the amount of damage. The operators often become insolvent, and at the end compensations are not paid Against the state of origin (int. courts, special courts, arbitration - pub. int. law) International: claims for state responsibility are rarely submitted, not effective International: claims for state responsibility are rarely submitted, not effective

5. Other possibilities Outside court settlements: OK Tedi mining accident Papua New Guinea, 1984 (500 M USD); OK Tedi mining accident Papua New Guinea, 1984 (500 M USD); the Contara chemical tank accident, USA, 1991 (38 M USD); the Contara chemical tank accident, USA, 1991 (38 M USD); the Lower Fox PCP accident, USA, 1997 (10 M USD); the Lower Fox PCP accident, USA, 1997 (10 M USD); the Exxon Valdez, Gulf of Alaska, 1989 (150 M fine, 100 M restitution) the Exxon Valdez, Gulf of Alaska, 1989 (150 M fine, 100 M restitution)

6. What are the results? The actual amount of compensation paid to the victim’s remains bellow 10% of their claims, The actual amount of compensation paid to the victim’s remains bellow 10% of their claims, The clean up costs are mostly born by the state or municipality and only partially by the operator, The clean up costs are mostly born by the state or municipality and only partially by the operator, The restoration of the environment is not complete, The restoration of the environment is not complete, The future operation of the site is technically not secured. The future operation of the site is technically not secured.

7. Therefore the conclusion is that There is not yet an effective legal regime to make operators accountable after the accident: the procedures are time consuming and ineffective

8. Development of legislation –EC law: development of special environmental legislation (modification of the Seveso II directive, new mining directive, new BREF document, Liability directive, Proposal on Env. crimes) –General international law: ILC Articles on prevention of transboundary damage from hazardous activities –Special liability regimes: Lugano Convention, Basel Protocol, Kiev Protocol (various activities, operator’s liability) –Special regimes: Oil Funds, Nuclear Regimes, Transport regimes (special, limited schemes)

9. Among the previous regimes From the point of operator’s liability up till now only the special Oil Funds were really operational From the point of operator’s liability up till now only the special Oil Funds were really operational There are uncertainities with the implementation of the EC Liability Directive, problems with the issue of financial securities There are uncertainities with the implementation of the EC Liability Directive, problems with the issue of financial securities Problems with ratifying the special liability regimes Problems with ratifying the special liability regimes

10. Not surprising that After an accident everyone wants to act many new pieces of legislation is adopted, many new pieces of legislation is adopted, many states join to already existing treaties and regimes many states join to already existing treaties and regimes However, attention is mostly paid to prevention and the issue of liability is never settled effectively —even though it is in the interest of all states and inhabitants.

11. Pollution does not stop at the borders Attention is indeed to be paid to preventive measures, but follow- up actions are inevitable as well: Attention is indeed to be paid to preventive measures, but follow- up actions are inevitable as well: –Transboundary pollution needs to be tackled –The operator should be held liable whether the pollution is inland or transboundary

12. The past showed us that There is definitely a need for an effective liability regime in the international field just as much There is definitely a need for an effective liability regime in the international field just as much there is a need for establishing adequate insurance systems and/or other financial tools for rehabilitating the damaged sites and for compensating the victims of the accidents. there is a need for establishing adequate insurance systems and/or other financial tools for rehabilitating the damaged sites and for compensating the victims of the accidents. Beyond further inevitably necessary discussions, positive actions on behalf of the states are necessary: Beyond further inevitably necessary discussions, positive actions on behalf of the states are necessary: Let’s not wait for another accident to act !

13. Thank you for your attention and wish all of us fruitful discussions!