Yesterday, on the 20 February 2020, the Supreme Court made a decision in
administrative case No 3-16-2267, and left partly unsatisfied the complaint of
AS Tallinna Vesi for compensation of damage caused by the Regulation No 99, of
29 November 2019 of the Government of the Estonian Republic, as well as the
related penalty fee for late payment. AS Tallinna Vesi submitted the claim on
the basis that the limits on zinc, copper and chrome established by the
government were unconstitutional.
On 13 November 2016, AS Tallinna Vesi filed a complaint with the Tallinn
Administrative Court under the State Liability Act for the compensation of
direct damage in the amount of EUR 1,136,191 (including excess pollution charge
of EUR 1,002,138 and the income tax paid in the amount of EUR 134,053) caused by
Article 8 (2) of the Regulation No 99 as well as corresponding penalty for late
payment. The damage occurred due to the unlawful limits being established since
1 January 2013. After the entry into force of Article 8 (2) of the Regulation No
99 it was stipulated that the wastewater should be as pure as the water in water
bodies. The established standards for wastewater are even stricter compared to
the standards stipulated for drinking water. As a result of this change, the
limit value for copper, zinc and total chromium in wastewater declined to the
extent that it was impossible for AS Tallinna Vesi to ensure the compliance of
wastewater discharged into water according to the environmental requirements.
Therefore, AS Tallinna Vesi was required to pay an increased environmental fee,
and lost the opportunity for reducing pollution charges under the Environmental
Charges Act. AS Tallinna Vesi found that the damage is caused by a significant
breach of the public authority's obligation as the Regulation No 99 was
established without any substantive analysis (including the ignorance of
investment needs of companies who are bound with nature and water). Explanatory
memorandum to the Regulation No 99 does not indicate how the established limit
values (which do not have a transitional period) are achievable, especially
considering that these values are not technologically achievable even to date.
Unjustifiably stricter requirements were set for discharging wastewater into the
sea compared to discharges into rivers and lakes. Unconstitutionality
(disproportionality) of the established limits is confirmed by the amendment of
the Regulation No 99, since 1 January 2017, when the previous limits were re-
established. If the relevant natural circumstances, technological possibilities,
economic effects and technological capabilities of the undertakings would have
been duly taken into account when establishing the Regulation No 99, the limits
would have been stipulated to the extent permitted by the law and the damage to
AS Tallinna Vesi would have never occurred.
The Supreme Court found in the 20 Febuary 2020 decision that the damage to AS
Tallinna Vesi was not caused by the state legislation, i.e Regulation No 99, but
was caused by the special water permit issued to the company, on the basis of
which also the obligation to pay environmental charges was determined. In
assessing the legality of the Regulation No 99, the Supreme Court did not deem
it necessary to take into account the fact that the company was granted an
environmental permit within the limits set by the Regulation No 99. Despite the
request of the Company, the Supreme Court also dismissed the constitutional
review proceedings of Regulation No 99 despite the fact that in 2017 the limits
for heavy metals were significantly reduced.
The costs of the proceedings were left to be paid by the Government of the
Estonian Republic.
Viive Ligi, a judge of the Supreme Court, expressed a dissenting opinion on the
Supreme Court decision, and did not agree with the majority opinion according to
which the damage claim was dismissed. Viive Ligi found that there was a
causational link between the Regulation No 99 adopted in 29 November 2019, and
the damages caused to AS Tallinna Vesi and the case should have been sent back
to the first instance.
Eliis Randver
Head of Customer Relations and Communication
Tallinna Vesi
(+372) 626 2275
Eliis.randver@tvesi.ee
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