External netting via leasing? Not so easy…

Petra

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Many entrepreneurs know that if you want to carry out a project near Natura2000 sites, you will quickly run into an environmental permit for a Natura2000 activity. Previously, this was a permit based on the Nature Protection Act. This act was merged into the Environment Act on 1 January 2024.

But when does this constitute a Natura2000 activity? That is defined in the law. A Natura2000 activity is an activity ‘involving the realisation of a project that is not directly related to or necessary for the management of a Natura2000 site, but which, individually or in combination with other plans or projects, may have significant effects on a Natura2000 site.’

A study of the plans’ effects on the Natura2000 site will have to show whether there are ‘significant effects’. In addition, you will have to investigate whether you can exclude or prevent the adverse effects (specific duty of care). In other words, your project can only go ahead if there are no (more) significant consequences. To solve this problem, there are options for ‘netting out’.

We distinguish between internal netting and external netting. Internal netting occurs when solutions are found within the project that solve the nitrogen impact of an activity, so that there are no longer any ‘significant effects’. If the study shows this, no environmental permit is needed for a Natura2000 activity.

If internal offsetting does not work, we can see if external offsetting is possible. Whether it is possible depends on provincial policy. With external offsetting, you use the nitrogen space of another company (the company providing the balance) that terminates its nitrogen activities up to a maximum of 70%.

It is well known that, in practice, people look for ways to allow projects to go ahead without too much delay. Logically, one entrepreneur saw opportunities by making agreements with another company that it would temporarily not use its nitrogen space, so that a nature permit could be issued. But not everyone agreed, according to a Gelderland court ruling. What was at stake?

An agricultural entrepreneur had devised a construction for the expansion of his goat farm in which another private limited company (also a goat farm) would temporarily not use part of its nature permit. At least until air scrubbers were installed and the need for external offsetting was removed. The two farms concluded an agreement on taking over the nitrogen deposition balance of one in favour of the other. The mayor and aldermen agreed to this construction and granted a nature licence. A number of parties disagreed, arguing that the municipality could not simply agree to “temporarily decommission” as a change area to achieve external netting.

The court first mentioned the basic principles that have emerged in case law on external netting: if the nitrogen deposition of the new development may have a significant impact on relevant sites in a Natura2000 area, then, by limiting or terminating emissions from another, already existing activity, the deposition at those sites may result in the total deposition as a result of the desired development not leading, on balance, to an increase in deposition on the Natura2000 area.

So what needs to be assessed? According to the court, netting will always have to be determined per location of nitrogen-sensitive habitat types on the basis of the relevant emissions and spread. In other words, one should assess the increase and/or decrease in deposition on nitrogen-sensitive habitat types rather than the emissions from desired and to-be-terminated activities.

Next, previous case law of the Council of State shows that you can only offset externally if the permit for the balancing company is actually withdrawn. This may be evidenced by a revocation decision or by an agreement between the two companies on the takeover of the space released when the permit is revoked. In addition, the activities of the balance-issuing company must actually cease.

However, the court ruled that the construction devised by the entrepreneur in question (‘temporarily not using nitrogen space’) did not provide sufficient certainty. It could happen that activities could nevertheless be resumed in the interim.

Important for that judgement was that the mayor and aldermen had only included regulations in the nature permit for the balance-receiving company. If the balance-giving company did not cease its activities or restart them later, the college could not actually enforce them. This is because a civil law agreement between two companies can be terminated. Or be breached by one party. And so the college should thus have effectively revoked (whether partially or not) the nature licence of the balancing company to ensure that the conditions for external balancing were met.

You can read the ruling itself here.

As an entrepreneur, do you want to carry out projects where you encounter an environmental permit for a Natura 2000 activity and use external netting? Be well informed about the possibilities. Would you like advice and assistance in consultations with the competent authority? Then contact us.

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De Haij & van der Wende

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