Commission Calls Upon Business to Reach Agreements to Protect the Environment

Brussels, 17 July 2002

The European Commission has adopted a Communication on environmental agreements at EU level. It explains how the framework set out in the Commission's recently adopted 'Action Plan on the Simplification and Improvement of the Regulatory Environment' can be applied to environmental agreements. "The environment is an area where self-regulation and co-regulation can deliver important benefits in complementing the instruments which we already have at our disposal", declared Environment Commissioner Margot Wallström. Mrs. Wallström continued: "Environmental agreements with business clearly hold out a number of potential benefits as an instrument in our policy mix. They can encourage a proactive approach by industry and offer the prospect of tailor-made solutions for the faster achievement of environmental benefits. Environmental agreements can complement traditional regulation so our intention is not to initiate a wholesale replacement of environmental legislation.". "The Commission wants to encourage business to engage in environmental agreements at Community level, not least in new areas where the institutions have not yet legislated or the Commission has not expressed its intention to legislate. Sustainable development requires action rather than simply reaction from stakeholders", Commissioner Wallström concluded.

What are "environmental agreements" and why use them?

"Environmental agreements" are typically unilateral commitments from business or industry designed to achieve pollution abatement or other environmental objectives. They can form a rapid and flexible response to environmental challenges from stakeholders who gave gained particular experience in the field. They should stimulate a proactive approach from industry and can offer cost-effective solutions for the faster achievement of environmental objectives.

Contents of the Communication

Today's Communication seeks to encourage environmental agreements at Community level, while safeguarding the Commission's right of initiative and the right of control of the European Parliament and the Council.

Environmental agreements can come from a variety of sources. Firstly, they can be purely spontaneous decisions initiated by stakeholders in a broad range of areas in which the Commission has neither proposed legislation nor expressed an intention to do so. The Commission encourages stakeholders to be proactive in developing such agreements. Secondly, they can be a response by stakeholders to an expressed intention of the Commission to legislate. Thirdly, they can be initiated by the Commission. The Communication sets out assessment criteria and procedural requirements for handling environmental agreements will depend in part on the source of the initiative.

In line with the 'Action Plan on the Simplification and Improvement of the Regulatory Environment' adopted by the Commission in June 2002⁽¹⁾, the Communication proposes that environmental agreements at Community level can be acknowledged in the framework of self-regulation or coregulation.

In the case of self-regulation, an agreement can be acknowledged by an exchange of letters or by a Commission Recommendation. In order to ensure that the agreement effectively contributes to the attainment of the environmental objective, proper monitoring and reporting mechanisms are crucial. The Recommendation could therefore be complemented by a Decision of the European Parliament and the Council establishing an appropriate monitoring system. Such a model has already been applied in the past when the Commission decided to acknowledge the commitments of the European, Korean and Japanese carmakers on the reduction of CO2 emissions from passenger cars.

In the case of coregulation, environmental agreements are integrated in a more binding and formal manner into a legislative act. The colegislators (Council and European Parliament) establish the essential aspects notably the environmental objective to achieve at a given deadline as well as monitoring requirements whereas the economic operators themselves commit to implementing the detailed modalities under an environmental agreement.

"The Commission is keen to welcome spontaneous agreements where industry takes the initiative", Commissioner Wallström confirmed. "In many cases, no Community action will be needed for these agreements. Where we have already expressed an intention to legislate, however, we must ensure that the colegislators have the opportunity to express an opinion on the Commission's analysis of a proposed environmental agreement".

NOTE FOR EDITORS

On 5^th June 2002 the European Commission adopted the Action Plan "Simplifying and Improving the Regulatory Environment" in accordance with the mandate issued by the European Council at Lisbon and confirmed at the Stockholm, Laeken and Barcelona summits. In accordance with the Conclusions of the Seville European Council, an inter-institutional agreement on this proposal is expected before the end of 2002. Today's Communication does not prejudge the dispositions to be defined by the European Commission, the Council and the European Parliament in the inter-institutional agreement.

^{(1) COM (2002) 278 final of 5.6.2002.}