Analysis
14 July 2022

The challenges of environmental criminal law in the light of the deferred prosecution agreement in environmental matters

A new deferred prosecution agreement in environmental matters is an opportunity to review the creation of this new mechanism serving French environmental criminal law, but also to consider its future and prospects.

 

On September 26, 2019, the French automotive lubricants production site of the company Lubrizol caught fire near the city of Rouen. During that fire, “nearly 10,000 tonnes of chemicals were burnt, while a huge cloud of black smoke 22 km long was formed[1]”. Consequently, Lubrizol was prosecuted and investigated for charges of “spilling harmful substances into water and discharging into freshwater harmful substances for fishes[2]”.

This ecological catastrophe has brought environmental protection back to the heart of French legislator’s concerns. Indeed, in August 2021, the French environmental code was expanded with several new articles, one of which provides for the creation of an offence of ecocide.

This willingness to fight against environmental damage, to prosecute, and punish legal entities guilty of such acts has also been materialised by the introduction into the French criminal arsenal of a new deferred prosecution agreement (hereinafter “CJIP”), this time in environmental matters. This CJIP, largely inspired by the pre-existing model for the fight against corruption implemented by the “Sapin II” law, was used for the first time at the end of 2021.

 

I. The introduction of the environmental CJIP into the French criminal law landscape

In 2016, the CJIP was introduced into French law within the area of breach of probity by the “Sapin II” law [3]. It allows the public prosecutor to propose to a legal person accused of corruption, influence peddling or laundering certain tax fraud offences. The particularity of this alternative criminal procedure is that it can be set up before the public prosecution[4] is initiated or even when a judicial procedure has already been opened[5].

The CJIP creation is a reaction to the numerous financial scandals that have shaken up France in recent years, particularly the Cahuzac affair. The introduction of the environmental CJIP follows the same logic. Indeed, in view of the growing debate on the protection and preservation of the environment and the growing awareness of individuals and groups, even the Constitutional Council was keen to point out that “the environment protection, the common heritage of human beings, is an objective of constitutional value [6]”.

Although environmental regulations already exist, the public authorities must now ensure better punishment of environmental offences. The Ministry of Justice recently reminded the public prosecutor’s offices that “they must define a criminal policy adapted to local environmental issues and ensure coordinated judicial treatment of environmental offences[7]”.

In addition to the lack of an appropriate criminal policy, the Minister of Justice assessed the problems encountered in the area of environmental litigation. According to him, environmental offences are not prosecuted enough. Indeed, “about 20,000 cases are handled each year by the public prosecutor’s office, 75% of the judicial response is made up of alternatives to prosecution, and this area of litigation represents barely 1% of all the sentences handed down each year by the courts[8]”.

On the basis of these various observations, French criminal law finally welcomed the environmental CIJP thanks to Articles 15 to 25 of the 24 December 2020 Law on the European Public Prosecutor’s Office, environmental justice and specialised criminal justice, within the Code of Criminal Procedure[9].

The Ministry of Justice intends, through the CJIP, to “compensate for the lack of a transactional mechanism for efficient and rapid processing of proceedings initiated for serious environmental offences[10]”.

As regards its practical implementation, the public prosecutor may base his decision to propose a CJIP on several criteria, in particular on the background of the accused legal entity, the spontaneous nature of the facts’ disclosure, the degree of cooperation in order to regularise the situation as well as the reparation of the ecological damage[11].

As with the pre-existing model resulting from the “Sapin II” law, this new CJIP necessarily involves negotiation with the public prosecutor, particularly on the quantum of the public interest fine. The amount of the fine is calculated proportionally, in accordance with the benefits derived from the offending breaches, “up to a limit of 30% of the average annual turnover calculated on the last three known annual turnovers at the time of the breaches[12]”.

The text also provides, as in financial matters, for a potential obligation for the sanctioned company to regularise its situation through a compliance programme. This programme, which has a maximum duration of three years, is monitored by the competent department of the Minister for the Environment and the French Biodiversity[13].

Finally, the text places an obligation on the company to repair the ecological damage resulting from the infringements identified, within a period of three years, always under the control of the above-mentioned services[14].

As the CJIP is a public sanction, its validation order, the amount of the public interest fine, but also the text of the agreement itself, are made public. At national level, the publicity is made available on the websites of the Ministry of Justice and the Ministry of the Environment[15].

At local level, this information will also be published on the website of the municipality in whose territory the offence was committed or, in its absence, of the public establishment of inter-municipal cooperation to which the municipality belongs[16].

 

II. New environmental CJIP sanctions a company with a 60,000 Euros fine

Shortly after the first environmental CJIP, which resulted in a public interest fine of EUR 5,000 and the implementation of a compliance programme for a period of 30 months, the authorities validated a new environmental CJIP[17].

On 17 May 2022, a new environmental CJIP was validated by the Marseille judicial court. Prior to its validation, this agreement was the subject of a first agreement, on April 15, 2022, between the public prosecutor of Marseille and the company TUI CRUISES GMBH[18].

In this case, the public prosecutor accused TUI CRUISES GMBH of using fuel with a sulphur content higher than that required by European and French law[19]. The TUI CRUISES GMBH ship had fuel with a sulphur content of approximately 3.6%, which is above the legal maximum of 1.5%[20].

Consequently, the terms of this CJIP require the company to pay a public interest fine of EUR 60,000 to the Treasury within one month [21], which seems very low in view of the maximum potential amount of EUR 322,473,000[22]. Also, unlike other CJIPs, TUI CRUISES GMBH did not have to implement a compliance programme to prevent environmental disasters.

Indeed, this leniency seems to be explained by the company’s cooperation, which has already taken steps to ensure that its ships comply with environmental legislation [23]. In addition, the authorities have been lenient here as, since 2019, the company has paid out almost EUR 194,820 for environmental projects[24].

This alternative procedure by which legal persons can escape criminal prosecution allows for a transactional solution to the dispute under certain conditions. Therefore, in theory, if the company has already made good the damage caused and taken steps to prevent bad behaviour, then the penalties will not be excessive in order to encourage polluting companies to adopt new behaviour.

 

III. Although the environmental CJIP seems to be an interesting way of punishing environmental offences, the implementation of such a mechanism raises questions

While the CJIP seems to be an effective means of holding companies accountable for their environmental protection responsibilities, doubts remain as to its effectiveness in practice. Indeed, while the model initiated by the “Sapin II” law for corruption or tax fraud laundering seems relevant, it would seem delicate to make the same observation for environmental crime. In fact, for the moment, “there is nothing to say that what works for the fight against corruption and tax fraud will work for environmental criminal law[25]”.

And for good reason, financial offences are very different from environmental offences, since the latter are much more difficult to characterise. Indeed, “the factual elements are rarely established with precision, the penal qualification of the offence is often difficult because the matter is very standardised and, above all, the amount of the fines incurred and, even more so, those imposed is rarely high[26]”. For example, the fine of the first company sanctioned for environmental pollution amounts to 5,000 euros. It is worth considering the dissuasive effect of such penalties on companies committing environmental offences, especially as the CJIP does not entail a criminal conviction.

However, prior to the adoption of the “Sapin II” law, French law was considered insufficiently effective in the fight against corruption [27]. It should be recalled that “the CJIP was introduced in France in the field of anti-corruption at a time when there were hardly any proceedings opened in our country against this type of offence, particularly when the facts concerned several states. They were replaced by US extraterritorial procedures imposed on France[28]”.

In addition, environmental regulations are constantly being developed. Indeed, Law No. 2021-1104 of 22 August 2021 on fighting climate change and strengthening resilience to its effects[29] tightened criminal penalties for environmental offences, in particular by creating three new offences.

The law of August 22, 2021, inserts a new article L.173-3-1 into the Environmental Code, creating an offence of endangering the environment when fauna, flora or water quality have been exposed to an immediate risk of serious and long-lasting damage[30]. Damage considered long-lasting is that which is likely to last for at least seven years[31]. This new regulation provides for a penalty of three years’ imprisonment and a fine of EUR 250 000[32]. This amount may be increased up to three times the benefit derived from the commission of the offence[33].

The text also incorporates a new general offence of environmental pollution which concerns the intentional violation of a particular duty of care or safety to release into the air or water substances which have serious and lasting harmful effects on health, flora or fauna[34].The text punishes these acts with five years’ imprisonment and a fine of one million euros, which may also be increased to five times the benefit derived from the commission of the offence[35].

The text also includes an offence of ecocide for the most serious cases, which is inserted in Article L.231-3 of the Environmental Code. The latter is characterised when the offences provided for in Article L.231-1 (relating to the general offence of environmental pollution) and L.231-2 (relating to the management and abandonment of waste) of the Environmental Code are committed intentionally[36]. The penalties are relatively substantial, since the text punishes these acts with ten years’ imprisonment and a fine of 4.5 million euros, which can, indeed, be increased up to ten times the benefit derived from the commission of the offence[37].

The CJIP is potentially a real advantage for legal entities accountable for environmental offences, provided that the enforcement of environmental offences is sufficiently dissuasive to make the implementation of the CJIP attractive for companies.

It appears that the CJIP and the possibility it gives to legal persons to cooperate and negotiate with the public prosecutor while allowing the establishment of environmental compliance systems, will eventually become an effective tool for the preservation and protection of the environment.

 

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