THE EU TENTATIVE TO HARMONISE NUCLEAR LIABILITY
AMONG THE EU MEMBER STATES
Marc Beyens1
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Marc Beyens is Deputy General Counsel – Head of Legal Generation, Renewable Energy, Procurement and General Affairs at GDF SUEZ
Energy Belgium – Luxembourg – Past President, Vice President and Member of the Board of INLA and President of the Brussels Nuclear Law
Association (BNLA).
ABSTRACT
The present contribution aims at providing you with an overview of initiatives that were taken by
the European Commission to foster reflection on the harmonization of nuclear liability regimes
among the EU Member States.
The Brussels Nuclear Law Association, the Brussels chapter of the International Nuclear Law
Association, has been a partner of the European Commission for a number of these exercises,
and notably co-organised a workshop in 2010 on the Prospects of a Civil Nuclear Liability
Regime in the framework of the European Union as well as a follow-up workshop in January of
this year entitled “Taking nuclear third party liability into the future/Fair compensation for citizens
and level playing field for operators”.
The purpose of the intervention is to present the main conclusions of the different initiatives of
the European Commission. Needless to say that this presentation engages the author and does
not reflect any official position by the European Commission.
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The “Legal Study for the accession of Euratom to the Paris Convention on third party
liability in the field of nuclear energy” produced by the law firm Gomez-Acebo & Pombo
for DG Energy and Transport
At a time when the so-called “nuclear renaissance” was discussed widely, the European
Commission advanced in its “Nuclear Illustrative Programme 2007” that the discussion on the
nuclear sector in the EU should, inter alia, notably focus on “developing a harmonized liability
scheme and mechanisms to ensure the availability of funds in the event of damage caused by a
nuclear accident.” It is in the implementation of this programme that the Commission launched
an “Impact Assessment on the Paris Convention on Nuclear Liability” in December 2007 with a
consultation of stakeholders.
The outcome of the impact assessment formed the basis of a legal study performed by the
law firm Gomez-Acebo & Pombo for DG Energy and Transport. When published, the study
contained a disclaimer according to which the study represented the law firm’s views on the
possible accession of the Euratom Community to the Paris Convention, which have not been
adopted or in any way approved by the Commission and should not be relied upon as a
statement of the Commission’s or DG Energy and Transport’s views.
The legal study starts from the observation that nuclear third party liability rules are
currently not harmonized in the EU, but form some kind of patchwork, with some states party to
the 1960 Paris Convention, others to the Paris and 1963 Brussels Supplementary Convention,
still others to the 1963 Vienna Convention or to the 1997 Amended Vienna Convention, one to
the Convention on Supplementary Compensation and five to no convention at all. Moreover, not
all Member States which are party to a convention have ratified the 1988 Joint Protocol relating
to the application of the Vienna Convention and the Paris Convention. In some regimes the
liability of operators is unlimited, whereas others have capped liability. The operator’s
insurances differ both as regards their coverage and payable fees. The obligation to
compensate victims of a nuclear accident differs both as regards the damages covered and the
payable amounts.
The legal study investigates whether the Community has the power to act in order to
harmonise the situation and, if so, which action would best fit the general objective of legal
coherence.
With respect to the question whether the Community has the power to act, the study
distinguishes three different angles, namely :
(1) Nuclear insurances, for which article 98 of the Euratom Treaty provides the basis for
harmonizing nuclear insurances throughout the EU with a qualified majority in the
Council on a proposal by the Commission
(2) Jurisdictional arrangements related to third party liability issues, which are exclusive
EC Community powers, although in 2004 the EU agreed in various Council decisions
that the Paris Convention EU Member States sign and ratify the 2004 Paris Protocol
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including its jurisdictional rules which deviate from Council Regulation (EC) 44/2001,
and
(3) All other issues that may arise under nuclear third party liability, for which the legal
study sees shared powers to act for the Community and the Member States pursuant
to Articles 2 and 203 of the Euratom Treaty (requiring unanimity in the Council).
In a second part of the study, an analysis is made as to which action would best fit the
general objective of legal coherence in the medium run. The study distinguishes 5 policy
options :
(1) Non-action (option A);
(2) All 27 Member States are/become parties to the Paris Convention (option B);
(3) 22 Member States are/become parties to the Paris Convention with an opt-out for the 5
non-convention states (option C);
(4) Euratom accession to the Paris Convention (option D); and
(5) A Euratom Directive (option E).
Analyzing the results of a consultation questionnaire, the outcome shows that the majority
of stakeholders are in favour of harmonizing nuclear third party liability.
However, the majority of stakeholders do not want an EU-only solution which, in the view of
many, would add to the patchwork instead of resolving it. Only 2 out of 43 responses voted in
favour of a Euratom directive. Nevertheless, the legal study insists on a directive as a solution
for nuclear insurances because it sees an obligation of the Community under article 98 of the
Euratom Treaty to adopt a directive that harmonises nuclear insurances throughout the EU.
With respect to jurisdictional arrangements, the legal study does not see how the
Community could come back upon the Council decisions that allowed the signature and
ratification of the Protocol to the Paris Convention to switch to the ordinary rules of Regulation
(EC) 44/2001.
For all other issues that may arise under nuclear third party liability, the legal study
demonstrates that option B (27 to Paris) would be the most popular option, providing for a high
degree of harmonization if successfully implemented but with little legal efficiency to guarantee
a successful implementation, if it would only allow for a Community recommendation to the
Member States. Options A (status quo) and C (22 to Paris, 5 opt-out) closely follow option B but
provide for a lesser degree of harmonization if successful. Option C could only be fostered by
means of a recommendation and may therefore not be efficient. Option E (Euratom Directive)
would lack political support while a Euratom directive would according to the legal study require
unanimity. Option D (Euratom accession to Paris) is called both legally and pragmatically the
least viable option given the accumulation of both political and technical hurdles and its inability
to achieve harmonization.
An in-depth analysis of the conclusions of the legal study would lead us too far, but some
additional more or less controversial points can be highlighted :
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1. The legal study suggests that the Community considers to opt either for maintaining the
particularities of nuclear third party liability or, alternatively, considers doing away with
the basic principles of the nuclear third party liability conventions and choose for
unlimited liability made conditional upon a full switch to ordinary tort law.
2. The legal study seems to plead for operator pooling, i.e. a mutual mechanism by which
nuclear operators spread their risks amongst each other through a pool, to whom each
of them contributes in the event of a nuclear accident. It is suggested that some kind of
safety standardization at overall EU level would be necessary to enable successful
operator pooling.
3. The legal study is critical of accession to the CSC as a possible solution to solve the
problem of the current European nuclear liability patchwork. It says that mainly Western
European stakeholders insist on the historical importance of the Paris Convention and its
higher level of compensation. It highlights that nuclear states are reluctant to accept its
preferential treatment of victims outside the installation state, and adds that without
nuclear states, the CSC is neither capable of providing for a high compensation (since
more than 90% of its 2nd tier depends on contributions from nuclear states), rendering it
therefore also less attractive to non-nuclear states, nor capable of securing its entry into
force.
4. Some issues of compatibility of the nuclear third party liability regime with competition
law are raised.
5. The Legal Study pleads for a streamlined European claims-handling system.
6. The Legal Study suggests the creation of a Group of Experts on Nuclear Third Party
Liability.
The 2010 workshop “Prospects of a Civil Nuclear Liability Regime in the Framework of
the European Union” co-organised by the Brussels Nuclear Law Association and the
European Commission
During this conference reactions to the legal study were solicited from the depositaries of
the international third party liability conventions and by representatives of countries party to the
Paris Convention, the Vienna Convention and the CSC as well of a non-convention state. As to
the solutions to the situation of “legal patchwork” in the EU, the conference hosted both
speakers which were proponents of a wider adhesion to the Joint Protocol and speakers in
favour of a global nuclear third party liability regime under the CSC.
The Joint Protocol has as objective to ensure a mutual recognition and extension of
benefits between Paris and Vienna countries of the regime established by either Convention
and thus creates a high degree of unification among the parties to those instruments. The
advantage of a wider adhesion to the Joint Protocol is that it is could be achieved relatively
quickly. However, the Joint Protocol did not foresee the participation of States not party to the
Paris or Vienna regime, which renders it unattractive to some states. Moreover, it does not
address questions connected to nuclear accidents occurring in the course of transport of
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nuclear material between States belonging to the two different regimes. Also, parties to the
Paris regime have raised issues of reciprocity which leave further open questions regarding the
actual levels of protection afforded by the Joint Protocol.
Proponents of the CSC claim that the CSC can achieve the objective of uniting the present
fragmented international situation by allowing States party to either the Paris or the Vienna
regime, as well as States not party to either of the two, to join. It could establish a global regime,
not excluding the non-EU Member States. However, as pointed out in the legal study, nuclear
states are reluctant to accept its preferential treatment of victims outside the installation state
and this treaty has not yet entered into force (although progress seems currently to be made in
this field).
Probably the most remarkable intervention during the conference co-organised by the
European Commission and the Brussels Nuclear Law Association was the contribution by
Melchior Wathelet, former judge at the European Court of Justice and former Vice-Prime
Minister of Belgium, on the legal basis for an intervention by the European Union in the field of
nuclear liability. He defended an extensive interpretation of article 98 of the Euratom Treaty, that
could constitute a sufficient basis for harmonization of the legislation of the member states in
the field of insurance as well as of liability for the nuclear risks. He is of the opinion that it is not
necessary to have recourse to article 203 of the Euratom Treaty that requires unanimity in the
Council.
In the concluding remarks on the Conference, the European Commission announced the
establishment of an expert group on nuclear liability, the conclusions of which group we shall
now examine further.
The Nuclear Liability Expert Group created by the European Commission
The Nuclear Liability Expert group convened by the European Commission proceeded to
work in three working groups that first met on April 5th, 2011:
1.
2.
3.
Claims handling and related matters
Insurance amounts and capacity
The international conventions
Before coming to their conclusions, the working groups stated that their proposals were
subject to the community competence in this field, to the subsidiarity and proportionality
principles and to their compatibility with the 1997 Vienna Convention and the 2004 Paris
Convention.
The first working group came up with the following recommendations:
1.
The Member States should have a claims management system
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2.
3.
4.
5.
6.
7.
The Member States are to establish a “one stop shop” for claims registration and
record
Establishment of criteria for EU-wide claims handling communication in the case of
an accident
Establishment of “one single desk” for claims handling (i.e. coordination between
stakeholders, centralization of proceedings and recording of payments and follow-up
of the availability of the funds)
Allowance for the assessment of insurers abilities by national authorities
Setting up of rules for advance payments on compensation
Clarification on how claims management costs are born
The recommendations of the second working group on insurance were the following :
1.
2.
3.
4.
The Member States must work jointly with nuclear operators and nuclear insurance
providers, to put in place cover that fulfills the revised Convention requirements and
ratify the Protocols to the applicable Convention as soon as possible.
The European Commission is to clarify and communicate the acceptable conditions
under which EU states are allowed to act, directly or indirectly, to cover nuclear third
party liability risks.
Ensure that all financial security provided is sufficiently secure, stable and solvent to
guarantee maximum protection for nuclear accident victims; also ensure that a
robust and effective claims handling system is put in place.
In the longer term the operators and financial security providers are to continue
working together to investigate any additional nuclear liability capacity that might
become available in the future.
Working group 3 recommended one or more EU decisions and a EU Directive. The EU
decisions recommended are the following :
1.
All EU members are required to join the Vienna Convention or the Paris Convention
as amended respectively in 1997 and 2004, OR
2.
EU members wishing to join the Vienna Convention or the Paris Convention should
ratify exclusively the Vienna Convention or the Paris Convention as amended
respectively in 1997 and 2004.
3.
All EU members Parties to either the Vienna Convention or the Paris Convention are
urged:
-
to adhere as soon as possible to “their” respective amending Protocols of 1997
and 2004
-
if they have not already done so, to adhere to the Joint Protocol
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As to the recommended EU Directive, this should in its recitals recognize the relevance and
robustness of the basic principles of the international conventions and the importance of the
Joint Protocol. The provisions of the Directive would
-
-
Establish amounts for nuclear third party liability and compulsory financial security op to
these amounts in line with the 2004 Paris Convention provisions; Member States would
have a reasonable timeframe to implement such requirements (e.g. 10 years);
Require Member States to ensure that compensation available under their legislation
shall indemnify victims in all EU Member States without discrimination based upon
nationality, domicile or residence.
It is to be noted that the recommendations of the third working group were not made
unanimously. Participants with a Vienna Convention background thought they were going too
far. Others pleaded for unlimited liability or wanted a tabula rasa approach and wanted to return
to common tort law principles for the law of nuclear third party liability.
The European Commission’s Public Consultation on Nuclear Liability
Between 30 July 2013 and 22 October 2014, the European Commission published an
online questionnaire on nuclear liability. The outcome of this public consultation was presented
by the DG Energy of the European Commission at the occasion of a second conference coorganised by the European Commission and the Brussels Nuclear Law Association in January
of this year.
It concluded that there was a strong request for common rules, although there was some
reluctance observed on the part of operators and public authorities, who also favored soft
legislation over binding legislation.
With respect to claims management, the Commission observed a strong request for
strengthening of all aspects, including registration, handling and settlement of claims, although
the insurers considered there was no need for change. No clear request for change was
perceived for the question of whether priority should be given to particular heads of damages.
With respect to insurance amounts, there was a clear overall response that current levels
are insufficient, although the operators were of the opinion that current amounts are sufficient.
Those who consider the amounts insufficient give a strong support for higher levels of financial
security, while imposing unlimited liability alone is not seen as a complete solution.
The respondents of the questionnaire did not give a clear support for Euratom accession to
the existing international conventions. Operators, public authorities and insurance companies
are in support of maintaining the principle of channeling of liability as embodied in the
conventions, while there is a significant interest for economic channeling primarily from citizens
who replied to the public consultation.
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Workshop “Taking nuclear third party liability into the future/Fair compensation for
citizens and level playing field for operators co-organised in January 2014 by the
European Commission and the Brussels Nuclear Law Association
Again, it would lead us too far to give a complete overview of all interventions of this
conference. One of them, as seen before, was the presentation by the Commission of the
outcome of the Public Consultation.
Another remarked intervention was that of a representative of Munich Re, from the German
insurance world, who claimed it was possible, if all operators were obliged to take out this
insurance, to create liability cover for catastrophic accidents for an amount of 10 billion Euros. A
catastrophic accident as viewed in this scheme is an accident comparable with INES scale 5-7.
There would be no intervention for nuclear accidents below this level on the INES Scale. The
amount of 10 billion Euros would also be in excess of 2,5 billion Euros. This means that the
catastrophe insurance would intervene only to the extent that other sources have already paid
2,5 billion Euros to the victims of the accident. However, most Paris Convention countries have
only financial security available up to maximum 1,5 billion Euros, so that additional financial
security would need to be found. In Vienna Convention countries the available financial security
may even be less.
Conclusion
The European Commission has obviously gone through an important thinking process as to
the measures it may envisage to harmonise the law of nuclear third party liability in the EU
countries. The main conclusion is that there is no easy way to achieve this. Whether this
thinking process will result in some form of community action remains, for the time being, to be
seen. At the outcome of the 2014 Workshop co-organised by the European Commission and
the Brussels Nuclear Law Association, commissioner Oettinger suggested that the European
Commission might issue a communication on the subject of, inter alia, nuclear third party
liability. However, after the European elections in May, a newly composed European
Commission is in the process of taking charge and it remains to be seen what the thinking of
this newly composed European Commission on the subject of nuclear third part liability will be.
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