International Law Committee Report

I. Climate Change and Emissions

A. The Green Deal Industrial Plan

In January 2023, the European Commission presented the Green Deal Industrial Plan to accelerate Europe's transition to climate neutrality by improving the competitiveness of its net-zero industry and increasing manufacturing capacity for net-zero technologies. This initiative responds to other major economies' investment surge in green innovation, aiming to establish a level playing field and support European industries such as hydrogen, chemicals, biotech, and nanotech. The plan has four key pillars: (1) predictable and simplified regulatory environment; (2) faster access to funding; (3) enhancing skills; and (4) open trade for resilient supply chains.

The “Predictable and Simplified Regulatory Environment” pillar creates a streamlined and predictable regulatory framework. It encompasses three initiatives: (1) the Net-Zero Industry Act, which sets goals for net-zero industrial capacity and facilitates rapid deployment; (2) the Critical Raw Materials Act, which ensures access to essential materials like rare earths for technology manufacturing; and (3) the reform of electricity market design to help consumers benefit from lower renewable energy costs.

The “Faster Access to Funding” pillar accelerates investment and financing for European clean-tech production. The European Commission has amended the Temporary State Aid Crisis and Transition Framework and revised the General Block Exemption Regulation to ensure a fair market and streamline aid. The Commission also aims to leverage existing EU funds for clean-tech projects and to establish the European Sovereignty Fund for mid-term investment needs.

The “Enhancing the Necessary Skills” pillar addresses the skill demands of new technologies for the green transition. The Commission plans to establish Net-Zero Industry Academies for up- and re-skilling in strategic industries, adopt a ‘skills-first’ approach alongside qualification-based methods, facilitate third-country nationals’ access to EU labor markets in priority sectors, and align public and private funding for skills development.

Finally, the “Facilitating Open and Fair Trade” pillar emphasizes global cooperation and aligning trade with the green transition, adhering to fair competition and open trade principles. The Commission plans to expand the EU’s Free Trade Agreements and cooperation with partners to support this transition. It will protect the Single Market from unfair trade practices, building on collaborations with the EU’s partners and the WTO.

B. EU Renewable Energy Directive

In March 2023, European leaders reached an agreement on the final revisions to the EU’s Renewable Energy Directive (RED) III, which was formally adopted in late 2023 as part of the “Fit for 55” package. RED III aims to increase renewable energy in the EU’s overall energy consumption to 42.5% by 2030—with an additional 2.5% indicative top-up to allow the target of 45% to be achieved. Member States will have 18 months to transpose the directive into national legislation, and RED III provides specific targets for renewable energy in various sectors, including transport, industry, buildings, and district heating and cooling. The revised directive also aims to strengthen sustainability criteria for the use of biomass for energy, providing new limitations for the use of forest biomass to count towards renewable energy targets and to qualify for subsidies. Notably, however, RED III’s new biomass policy has been met with criticism from forest advocates for its various loopholes and for maintaining the definition of woody biomass as a renewable energy source on par with zero-carbon wind and solar.

C. Carbon Markets and Carbon Border Adjustments

On October 1, 2023, the EU began the Carbon Border Adjustment Mechanism (CBAM) transitional period. The CBAM represents an innovative approach aimed at aligning the carbon pricing of imported goods with the carbon price of domestic production, thus addressing carbon leakage issues when companies opt to relocate carbon-intensive production to regions with less stringent climate policies. Importers are mandated to report the GHG emissions embedded in their products and surrender the corresponding number of CBAM certificates (carbon allowances), unless the importer can prove that a carbon price has already been paid on the imports under a different carbon pricing regime.

Importers’ first reporting period ends January 31, 2024. CBAM will initially target imports of sectors at the highest risk of carbon leakage (cement, iron and steel, aluminum, fertilizers, electricity, and hydrogen). Once fully phased in, CBAM will capture over 50% of emissions in ETS-covered sectors. The first stage will be phased in over three years, gradually including more sectors until the policy reaches its full force on January 1, 2026. Importers will not have to purchase any CBAM certificates until the start of 2026, but will still be required to make quarterly reports on the amount of both direct and indirect emissions embedded in their products.

D. CORSIA and Aviation Emissions

As of December 2023, eleven more States have announced their intention to participate in the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA)—bringing the total participants to 126 of the 193 International Civil Aviation Organization (ICAO) member states. As a global market-based measure (MBM) that caps the net CO₂ emissions of international flights at their 2019 emission level, CORSIA aims “to avoid a possible patchwork of duplicative State of regional MBMs, thus ensuring that international aviation CO₂ emissions should be accounted for only once.” In doing so, CORSIA does away with piecemeal international aviation emission regulatory initiatives and continues with the long-standing goal of the Chicago Convention to harmonize international civil aviation in order to avoid friction and to promote that cooperation between nations.

Additionally, the Second Edition of Volume IV (CORSIA) of Annex 16 to the Convention on International Civil Aviation was adopted in March, became effective in July, and will start to apply on January 1, 2024. The Second Edition provides technical clarifications relating to monitoring and calculation offsetting requirements for new aircraft operators and includes guidance on offsetting thresholds for aircraft “operators with low levels of international aviation activity.”

2023 also brought significant developments to sustainable aviation fuel (SAF). On December 15, the Biden Administration issued guidance through the Treasury Department that approved the Department of Energy’s (DOE) Greenhouse Gases, Regulated Emissions and Energy Use in Technologies (GREET) model, enabling ethanol-based SAF to qualify for tax credits under the Inflation Reduction Act (IRA). The IRA requires lifecycle SAF emissions to be calculated under CORSIA “and any similar method that meets certain requirements of the Clean Air Act.” Notably, the ongoing debate in this area revolves around the use of corn- and soy-based ethanol, as the DOE’s GREET guidelines currently “attribute lower lifecycle emissions to ethanol-based SAF than the ICAO methodology.” The methodology will be updated again in early 2024 to satisfy the statutory requirements under the IRA and the Internal Revenue Code § 40B(e)(2).

E. COP28

In November 2023, this year’s climate summit in Dubai began with an unprecedented first-day decision to fund efforts related to address loss and damage from climate change—representing the culmination of many years of hard-fought negotiations celebrated by vulnerable countries. Despite a steady drumbeat of criticism for the oil-rich country’s selection as host of COP28, the UAE Presidency delivered another historic outcome with the conclusion of the first Global Stocktake under the Paris Agreement. The Global Stocktake is a periodic assessment of the world’s collective progress toward achieving the objectives of the Paris Agreement, taking place every five years to determine whether the nationally determined commitments of each country—and the tangible efforts to implement those commitments—are sufficient to achieve the Paris Agreement’s goals. Recognizing that this decade is “critical” to addressing climate change, COP28’s Global Stocktake is particularly significant because the next opportunity to test this progress will not come until the second Global Stocktake in 2028.

With perhaps the most ambitious multilateral commitments ever made regarding the transition from fossil fuels, 2023’s Global Stocktake tempered the grim backdrop of a narrowing window to keep global temperature rise within 1.5°C. The decision calls for, in part, “[t]ransitioning away from fossil fuels in energy systems, in a just, orderly and equitable manner, accelerating action in this critical decade, so as to achieve net zero by 2050 in keeping with the science.” Although the Global Stocktake decision did not include a call to “phase out” fossil fuels by the end of the decade as many had hoped, the Global Stocktake was still a landmark commitment by nearly 200 countries to “transition away” from fossil fuels—representing­ “the first time a COP final decision has singled out fossil fuels.”

The conference made uneven progress on other key priorities related to the objectives of the Paris Agreement. These included adopting the framework for a global goal on adaptation, making progress under the Sharm el-Sheikh mitigation work program, working toward establishing a new collective quantified goal for climate finance (after developed countries failed to deliver on the prior goal), and formalizing a process toward making finance flows consistent with a pathway toward low-emission and climate-resilient development. Negotiations related to international carbon markets under Article 6 of the Paris Agreement, however, broke down completely over EU objections to the draft texts. As a result, all work from the past year on this contentious and highly technical topic was scrapped, sending negotiators back to the drawing board. Similarly, no decisions were taken on other topics such as capacity building, a review of the functions of the standing committee on finance, and agriculture.

II. Human Rights and the Environment

A. Climate Change and the European Convention on Human Rights

In 2023, the European Court of Human Rights heard its first cases alleging that government inaction on climate change violates human rights. In two separate cases heard back-to-back on March 29, 2023, citizens of Switzerland and France respectively argued that the state’s failure to take action to cut carbon emissions breached their obligations under the European Convention of Human Rights (ECHR). In September, the panel heard a third case alleging that government inaction on climate change violated human rights, this time brought by six Portuguese youths.

In KlimaSeniorinnen v Switzerland, a group of senior Swiss women alleged that their right to life was being violated by the Swiss government’s failure to take greater action to combat climate change. Unsuccessful before the Swiss courts, the group escalated their case to the European Court of Human Rights. They claimed that, as elderly women, they are at an increased risk of illness and death from climate-induced heat waves, and the Swiss government’s climate inaction, therefore, violates their rights to life and health protected by Articles 2 and 8 of the ECHR. In addition, they argued that the Swiss courts violated their ECHR Article 6 right to a fair trial and Article 13 right to an effective remedy by arbitrarily rejecting their case and failing to deal with the content of their application. In response, Switzerland argued that its carbon emissions cannot be directly tied to the health of these women and that its existing climate targets are sufficient.

Heard the same day, Carême v. France was brought by a former mayor of a municipality on France’s northern coast. Arguing that he is personally vulnerable to climate change because his home is at risk of flooding, the former mayor alleged that the French government’s climate inaction threatens his right to life (ECHR, Article 2) and right to respect for private and family life (ECHR, Article 8).

In September, the panel again heard a case alleging that government inaction violated human rights. In Duarte Agostinho and Others v. Portugal and 32 Other States, the claimants were six Portuguese youths who claimed that 33 countries—including all EU member states, in addition to the United Kingdom, Switzerland, Norway, Russia, and Turkey—violated their rights under Articles 2 (right to life), 8 (right to privacy and family life), and 14 (right to be free from discrimination on grounds of age) of the ECHR. The youths seek an order requiring more ambitious climate action that will keep temperature rise to 1.5 degrees Celsius, as envisioned by the Paris Agreement.

The cases are currently pending before the European Court of Human Rights’ Grand Chamber, with decisions expected in 2024.

B. Nation-State Climate Change Obligations

In March 2023, the 77th Session of the United Nations General Assembly (UNGA) formally adopted a resolution that requests an advisory opinion from the world’s highest court: the International Court of Justice (ICJ). The resolution requests that the ICJ, as the primary judicial function of the United Nations, define the “obligations of States under international law to ensure the protection of the climate system and other parts of the environment from anthropogenic emissions of greenhouse gases for States and for present and future generations.” The resolution also requests that the ICJ identify the legal consequences if States cause significant harm to other States that are “particularly vulnerable” or “specially affected” by climate change, or to “[p]eoples and individuals of the present and future generations affected by the adverse effects of climate change.”

The resolution follows a similar request made in January 2023, where Columbia and Chile requested an advisory opinion of similar scope from the Inter-American Court of Human Rights. Taken together, these requests illustrate an international trend seeking to define governmental obligations and legal consequences relating to human rights and climate change. The advisory opinions are expected in late 2024 or 2025.

III. International Trade, Financial Institutions, and Corporate Social Responsibility

A. Environmental, Social, and Governance Factors in Investing

The Department of Labor’s (DOL) Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights rule became effective in January 2023. This new rule includes explicit language that risk-return factors may include environmental, social, and governance (ESG) factors, allowing ERISA fiduciaries to consider ESG factors. Such ESG factors include the economic effects of climate change when evaluating the risk-return of potential investments. The rule also modified the previously used “tiebreaker” test, which originally permitted fiduciaries to consider collateral benefits only when competing investments were “indistinguishable” if the competing investments “equally serve” the financial interests of the plan—a more flexible standard than the prior policy. Although these modifications may remove some barriers to considering ESG factors in plan investments, ERISA fiduciaries still may not sacrifice investment returns or assume greater investment risks as a means of promoting collateral social policy goals unrelated to the financial benefits owed to participants and beneficiaries under the plan.

Notably, though the rule survived through the end of 2023, it has faced significant challenges in both the courts and the U.S. Congress since implementation. In September 2023, plaintiffs in State of Utah v. Walsh alleged the rule was arbitrary and capricious in violation of the Administrative Procedure Act. The U.S. District Court for the Northern District of Texas disagreed and ruled in favor of the DOL; however, not without noting the validity of the concerns over ESG investing trends. The ruling is still subject to appeal, and another similar federal case, Braun v. Walsh, is currently pending in the Eastern District of Wisconsin. 2023 has also seen congressional pushback on the rule, including a resolution from the Senate to rescind the regulation. Although the resolution passed, it was ultimately struck down by a presidential veto from President Biden—the first of his presidency.

B. Climate-Related Disclosures

In March 2022, the Securities and Exchange Commission (SEC) proposed a rule, The Enhancement and Standardization of Climate-Related Disclosures for Investors rule, that would require publicly traded companies to disclose certain climate-related information in their already requisite statements and reports. Though the SEC had originally considered that the rule would be finalized by December 2022, the Commission has continuously—and controversially—delayed final action on the rule through 2023. In December 2023, the SEC once again announced another delay, now anticipating final action in Spring 2024. Beyond the pattern of delays on a final action, rulemaking on this proposal has also been controversial because many critics are questioning whether the SEC has the statutory authority to promulgate a regulation that is arguably a piece of climate policy.

The SEC’s proposed rule seeks to protect investors through mandatory disclosure of climate-related information. The primary goal of the proposed rule is to create reliable and standardized data that will allow investors to make informed decisions when it comes to the intersection of investment and climate risk. Key proposed disclosures include: (i) climate-related risks and their actual or likely impacts on the registrant’s business; (ii) details about governance practices on climate-related risks; (iii) information regarding the registrant’s climate-related goals or transition plan; and, (iv) the amount of direct greenhouse gas (GHG) emissions, indirect GHG emissions, and, if applicable, indirect GHG emissions present in the registrant’s value chain.

C. EU Corporate Sustainability Due Diligence Directive

In December 2023, the European Council and European Parliament formed a provisional deal on the Corporate Sustainability Due Diligence Directive (CSDDD). The CSDDD is a significant article of legislation that intends to bolster environmental and human rights protections in the EU and globally by mandating human rights due diligence. The provisional deal imposes obligations on a variety of companies, including multinational U.S.-based companies, requiring them to address both actual and potential adverse impacts on the environment and human rights.

The directive applies to EU companies with over 500 employees and a net profit of €150 million. Non-EU companies are included if they generate €300 million of profit in the EU, with a three-year phase-in period. Additionally, EU companies with over 250 employees and profits surpassing €40 million are covered by the directive if a minimum of €20 million is generated in high-risk sectors such as textiles, agriculture, food, mineral resources, and construction. Several entities within the financial sector now face a limited due diligence obligation, with a review clause for potential future inclusion based on impact assessment.

The CSDDD mandates due diligence with regard to actual and potential adverse impacts on the environment and human rights, encompassing various activities within the supply chain. The directive outlines specific corporate aspects requiring due diligence, such as risk-management systems, complaint mechanisms, company policies, contractual assurances, and engagement with stakeholders. The impacts covered by the CSDDD include slavery, child labor, deforestation, pollution, and damage to ecosystems. The directive revamps legal recourse, allowing affected individuals, civil society organizations, and trade unions to bring damages claims within five years. Enforcement will be at the member state level, with penalties of up to 5% of net profits for non-compliant companies. Compliance with CSDDD may also be a factor in awarding public contracts and concessions. The final text of “the [d]irective is expected to be signed before EU elections” in June 2024, with transposition into national law and company obligations anticipated to commence in 2027.

D. Circular Economy Action Plan

This year saw various developments relating to the EU Commission’s Circular Economy Action Plan from 2020, which describes initiatives for the entire life cycle of products—from design and manufacturing to consumption, repair, reuse, recycling, and bringing resources back into the economy. In May 2023, the European Commission revised the circular economy monitoring framework to improve the progress to track the transition to a circular economy in the EU. The revisions add a fifth dimension on global sustainability and resilience to the previous monitoring framework, as well as new indicators such as material footprint, resource productivity, consumption footprint, greenhouse gas emissions from production activities and material dependency.

Relatedly, in March 2023, the European Commission adopted proposals on green claims and right to repair. The proposal on common rules promoting the repair of goods would require that sellers offer repair except when it is more expensive than replacement. In addition, the proposal would establish a new set of rights and tools will be available to consumers to make repair an easy and accessible option including 1) the obligation to inform consumers about the products that they are obliged to repair themselves and 2) creation of an online repair platform to connect consumers with repairers and sellers of refurbished goods in their area.

In addition to these proposals, in August 2023 the EU adopted the Ecodesign Regulation (EU) 2023/1670 and the Energy Label Regulation (EU) 2023/1669. The Ecodesign Regulation requirements apply to mobile phones and tablets starting on June 20, 2025 and would require these devices to be resistant to accidental drops or scratches and protection from dust and water, require producers to make critical spare parts for seven years after the end of sales of the product models on the EU market, and require non-discriminatory access for professional repairers to any software or firmware needed for the replacement. The Energy Label Regulation, which also becomes effective on June 20, 2025, requires smartphones and tablets to display an energy label that shows their energy efficiency class (from A to G) and other related information, such as battery performance, reliability, and repairability).

Finally, in December 2023, the Council reached an agreement on a proposal to revise the EU's packaging and packaging waste rules. The agreed proposal would:

• cover all packaging, regardless of the material used, and all packaging waste, regardless of its origin;
• require that packaging be considered recyclable when designed for material recycling, and when the waste packaging can be separately collected, sorted and recycled at scale;
• set overall headline targets for reducing packaging waste, based on 2018 quantities: 5% by 2030, 10% by 2035, and 15% by 2040;
• establish new re-use and re-fill targets for 2030 and 2040, including that economic operators making certain large household appliances available on the market for the first time within the territory of a Member State shall ensure that 90 % of those products are made available in reusable transport packaging within a system for re-use; and
• establish restrictions on certain packaging formats, including single-use plastic packaging for fruit and vegetables, for food and beverages, condiments and for small cosmetic and toiletry products used in the accommodation sector, such as shampoo or body lotion bottles.

IV. Biodiversity

A. Biodiversity Beyond National Jurisdiction Treaty

On June 19, 2023, the resumed fifth session of the Intergovernmental Conference (IGC) officially adopted the ‘Agreement under the United Nations Convention on the Law of the Sea on the Conservation and Sustainable Use of Marine Biological Diversity of Areas Beyond National Jurisdiction.’ Often known informally as the ‘Biodiversity Beyond National Jurisdiction’ (BBNJ) Treaty or the ‘High Seas Treaty,’ this agreement marks the culmination of twelve years of study on the growing threats to marine biodiversity and nearly five years of discussion and treaty text negotiation by the IGC.—tasked with developing an international legally binding instrument targeting “the conservation and sustainable use of marine biological diversity” in areas beyond national jurisdiction—were unable to reach an agreement on various crucial articles. Areas of disagreement included benefit-sharing, decision-making provisions, relationships with other bodies, the role of potential bodies to be established under the agreement, as well as general overarching provisions. However, when the fifth session resumed in February 2023, delegates were able to reach an agreement—though not without significant compromises—after working non-stop in multiple working streams through the night. Following technical edits and translation of the draft into the UN’s six official languages, the IGC reconvened three months later to formally adopt the new treaty.

Adopted by consensus, the BBNJ Treaty marks the third implementing agreement under the United Nations Convention on the Law of the Sea (UNCLOS) and comes at a critical juncture in the need for ocean protection. With 84 signatories counted to date, the agreement will remain open for signature until September 20, 2025. The agreement has yet to enter into force, and in accordance with article 68(1) of the agreement, will only do so “120 days after the date of deposit of the sixtieth instrument of ratification, approval, acceptance or accession.” For comparison, it took twelve years for the United Nations Convention on the Law of the Sea (UNCLOS) and six years for the UN Fish Stocks Agreement to enter into force, meaning that ratification of this new treaty may take some time. Proponents of the BBNJ Treaty confess that the real work begins now with campaigns for treaty ratification afoot. Once the treaty enters into force, guidance will still be necessary on the treaty’s interactions with existing global, regional, and subregional bodies; the interrelation between different international benefit-sharing systems; needs-assessments for capacity building and technology transfer; financing the treaty’s implementation; and other administrative and procedural matters. Guidance on these matters will remain outstanding for consideration at the first Conference of the Parties (CoP1) to the agreement.

B. Global Biodiversity Framework and Fund

In August 2023, the Global Biodiversity Framework Fund was launched to support the implementation of the Kunming-Montreal Global Biodiversity Framework (GBF). The GBF was adopted at COP15 in 2022 and sets forth four key biodiversity goals for 2050: (1) working to prevent species’ extinction; (2) promoting sustainable use and management of biodiversity; (3) achieving “fair sharing of the benefits from the utilization of genetic resources”; and (4) ensuring “that adequate means of implementing the GBF be accessible to all Parties, particularly Least Developed Countries and Small Island Developing States.” By substantially increasing the financial resources available to countries, the GBF Fund aims to facilitate the fulfillment of these four goals by 2050—as well as the fulfillment of the twenty-three narrower targets that the GBF identified for 2030.

Two countries, the United Kingdom and Canada, have already announced initial contributions to the fund. Future contributions are anticipated from public, private, and philanthropic sources alike to mobilize and accelerate investment in the conservation of the world’s biodiversity. As the GBF Fund continues to grow, priority will be given to support for Indigenous communities, Small Island Developing States, and Least Developed Countries.

V. Environmental Protection and Conservation

A. EU Nature Restoration Law

In November 2023, the European Union Parliament and the Council of the EU reached an agreement over the European Commission’s proposed Nature Restoration Law (NRL) as part of the Biodiversity Strategy in the European Green Deal. The NRL provides a number of meaningful targets, requiring Member States to develop national restoration plans by November 2025 and to begin implementing restoration measures by approximately 2026. Member States must analyze the specific conditions of their unique habitats, the most appropriate methods for nature restoration, financing needs for implementation and the socio-economic impact of the proposed restoration measures. The NRL encourages Member States to work collaboratively and in tandem with their neighboring countries to draft and develop their national restoration plans, especially when habitat areas cross borders.

The NRL builds on existing law, including Directive 92/43/EEC, which provides a framework to determine whether habitat types are in good condition and when those habitats have attained sufficient quality and quantity. With these goals in mind, the NRL sets forth both qualitative and quantitative targets for restoring ecosystems. Qualitatively, the NRL requires Member States to show “a continuous improvement in the condition of the habitat types . . . until good condition is reached.” “Good condition,” in turn, is defined as a habitat where “key characteristics . . . reflect the high level of ecological integrity, stability and resilience.” Though compliance with these qualitative requirements may be subjective and difficult to enforce, the NRL focuses on continuous improvement and preventing further deterioration as measured on a national level. For example, in urban ecosystems, Member States must ensure there is an “increasing trend” in the total national area of urban green space and must “ensure that there is no net loss . . . of urban green space” on a national level. Quantitatively, the NRL requires Member States to implement restoration measures over certain percentages of their degraded habitats. For example, in marine ecosystems that are not in “good condition,” Member States must put restoration plans in place for 30% of the total area by 2030. This requirement increases to 60% by 2040, and 90% by 2050. Notably, however, Member States have until 2040 to “know” the condition of all marine habitat types in their jurisdiction.

The NRL will be subject to review every two years beginning in 2030, at which time the Commission must assess the various impacts of the law, particularly on the agricultural sector and rural areas. Whether the NRL helps the EU meet its climate change, socio-economic, sustainability, and resilience objectives will depend largely on the quality of the national restoration plans submitted by Member States. The specific format of the plans has not yet been determined, but the plans must cover the period up to 2050 and must account for the various restoration measures and frameworks established in other EU Regulations and Directives. In a nod to environmental justice concerns, Member States are required to develop these plans using a transparent process that engages with the public and relies on the best available scientific evidence. Furthermore, the resulting plans must consider the social, economic, and cultural characteristics of the various regions or communities—particularly as they effect the outermost regions.

Most of the NRL’s provisions rely on each Member State’s good faith efforts to “endeavor” to meet the restoration targets. Notably, the NRL exempts Member States from compliance for a variety of different reasons, including force majeure or natural disasters; “unavoidable habitat transformations which are directly caused by climate change”; actions or inactions of other countries for which the Member State is not responsible; and, in exceptional circumstances, the realization or continuation of certain activities that are in the public interest. Similarly, areas sited for renewable energy developments or used solely for national defense activities may be exempt from the NRL’s provisions, and the NRL provides an “emergency brake” provision that allows restoration activities to be temporarily suspended if the impact on agriculture is placing food security or production at risk.

B. Arctic Region Protections

In 2023, the Biden Administration released its Implementation Plan for achieving the ten-year National Strategy for the Arctic Region issued in 2022. The Implementation Plan provides over 30 objectives and 200 actions that advance the prior strategy and address the impact of climate change in the Arctic region in collaboration with international partners. For example, Strategic Objective 2.2 assigns the Office of the Special Presidential Envoy for Climate and the U. S. State Department as the lead agencies responsible for working with the intergovernmental Arctic Council to mitigate emissions of carbon dioxide, methane, and black carbon through existing and new international initiatives. Other steps listed in the plan are assigned to various agencies and include (i) organizing an expanded U.S.-Canada Arctic dialogue, (ii) supporting a successful Norwegian chairmanship of the Arctic Council, (iii) continuing implementation of the Central Arctic Ocean (CAO) Fisheries Agreement, including the establishment of exploratory fishing measures, (iv) continuing to lead and support adoption, by 2023, and entry into force, by 2026, of Polar Code amendments at the International Maritime Organization’s (IMO) Maritime Safety Committee to address gaps in Polar Code implementation, and (v) initiating discussions among international funders of Arctic science, and with international science organizations, to identify high priority areas conducive to collaborative research.

Prior to this development, in September 2023, the Biden Administration announced several actions it was taking to better protect the Arctic. This announcement included the Secretary of the Interior’s determination to cancel the remaining seven oil and gas leases in the Arctic National Wildlife Refuge, which the previous administration had issued. The Biden Administration also issued a draft supplemental environmental impact statement to reassess the environmental impacts on the Refuge. In addition, the Administration proposed new regulations for the National Petroleum Reserve in Alaska to provide additional protections as well as support subsistence activities for Alaska Native communities. “The draft rules… are expected to be finalized in the coming months.”

C. Forest Management Impacts of the Russian-Ukrainian Conflict

Russia’s invasion and continued occupation of Ukraine continues to exacerbate the existing challenges to sustainable forest management in Ukraine. “More than 10% of the Ukrainian forests are still occupied.” Contamination by mines and explosive objects has degraded forest area, exacerbated by the prioritization of demining efforts in regions other than forests. In de-occupied areas, the extent of damage to protected forest areas will only be able to be determined after demining these areas.

The National Parks are in critical condition. “Russian invaders still occupy 10 national parks, 8 nature reserves and 2 biosphere reserves across Ukraine.” Hundreds of hectares of valuable area have been devastated by war-caused forest fires. Movement of military equipment, destruction and theft of equipment, and other war activities continue to have tragic effects on the forest lands. Chernobyl radiation remains an issue due to lack of care from the Russian troops. The invaders raise radioactive dust with their vehicles, and they have destroyed the laboratory and looted the administrative office.

Despite the destruction, limited access to external financial sources, and plummeting numbers of forest staff members, the government has acted remarkably quickly to address the critical state of its forests. The Ukrainian government’s first national Recovery Plan, presented in July 2022, included various forest-related priorities­. Since then, the area of Forest Stewardship Council (FSC) certified forests has since increased in 2023, despite the suspension of Forest FSC certificates in the military conflict zones.

VI. International chemicals

A. EU Chemical Industry Transition Pathway

In January 2023, the European Commission published the Transition Pathways for the Chemical Industry (The Pathway). The Pathway, which supports the 2021 updated EU Industrial Strategy, was co-created by EU countries, chemical industry stakeholders, and NGOs. The Pathway contains over 150 actions aimed at transforming the chemical industry by building resilience, sustainability, and circularity in line with principles of a circular economy. These actions are organized into twenty-six groups and are designed to be co-implemented by stakeholders within an agreed timeline.

Following the Pathway’s publication, the Commission also published the first initiatives meant to support the “twin” green and digital transitions of the chemical sector in December 2023. These twin transitions are key to transforming the European economy and delivering on the European Green Deal and are particularly important to achieve in the chemical sector, which is the fourth largest industry sector in the EU and has a major influence on Europe’s manufactured goods. The eighty-three initiatives originally published were crowd-sourced from industry stakeholders and reviewed by the Commission, aiming to build a more resilient and climate-neutral economy through safe and sustainable chemicals. Additional initiatives will continue to be reviewed and published on an ongoing basis.

B. European Chemical Agency PFAS Proposal

In February 2023, the European Chemical Agency (ECHA), an agency of the European Union, published its proposal for restricting per- and polyfluoroalkyl substances (PFAS) in Europe. Representatives from Denmark, Germany, the Netherlands, Norway, and Sweden prepared the proposal over the last three years. The ECHA claims the proposal is the broadest ever prepared, as it covers over 10,000 PFAS substances. The proposal process involved a risk assessment and an impact analysis that considered both the benefits of the PFAS restrictions and the costs to the industry for transitioning to PFAS-free alternatives. The availability of alternatives for industry played a large part in the development of the proposal. The ECHA considered two restrictions: 1) a full ban on PFASs that would go into effect 18 months after the EU adopts the ban or 2) a ban with different effective dates depending on the availability of alternatives for the use of the PFAS.

The proposal bans the manufacture, sale, and use of PFASs above a concentration limit, including future uses in substances, mixtures, and equipment. The concentration limits are as follows: “1) 25 ppb for any PFAS (except polymeric PFASs), 2) 250 ppb for the sum of PFASs, optionally with prior degradation of precursors, and 3) 50 ppm for PFASs, including polymeric PFASs.”

The default under the proposal is to ban the use of PFASs eighteen months after the restriction goes into effect. This time frame applies to the use of PFAS, for which alternatives are already available and work, such as non-stick pans and cosmetics. Other uses of PFAS will have five years to transition to non-PFAS alternatives. These uses have alternatives that are under development but have yet to be added to the market, such as food contact materials for industrial food and feed production. Finally, additional uses will have twelve years to transition to non-PFAS alternatives. These uses still need to identify, develop, and certify alternatives, such as implantable medical devices like pacemakers.

The ECHA received over 5,600 comments on the proposal over the six-month consultation period from March-September 2023. ECHA’s scientific committees for Risk Assessment (RAC) and Socio-Economic Analysis (SEAC) will now consider the comments and the proposal as a whole. It is anticipated that they will deliver their opinions to the ECHA in 2024. ECHA anticipates that it will adopt those opinions in 2025 and send them to the European Commission, which will decide on the potential restriction with the EU Member States. ECHA is anticipating that the restriction will go into effect in 2026 or 2027.

VII. Global Litigation Efforts

A. United States

1. Juliana v. United States

After years of litigation since their original filing in 2015, twenty-one plaintiffs in Juliana v. United States filed their second amended complaint on June 8, 2023. The U.S. District Court Judge Ann Aiken granted the plaintiffs’ motion to amend their complaint on June 1, 2023, allowing the case to proceed to trial. In their second amended complaint, the plaintiffs claimed the U.S. government violated the plaintiffs’ rights to life, liberty, and property by substantially causing and contributing to the concentration of CO₂ in the atmosphere. The plaintiffs also claimed that the U.S. government failed to protect public trust resources. The plaintiffs outlined how the U.S. government knew about the effects of the fossil fuel industry, yet continued to allow for the exploitation of fossil fuels.

This complaint was similar to the original complaint filed in 2015; however, it made a narrower claim for declaratory relief in response to the Ninth Circuit’s dismissal of the case in 2020. The Ninth Circuit had found the plaintiffs’ case compelling, but ultimately held that it was unable to provide the relief requested. Judge Ann Aiken stated that the relief sought in the second amended complaint would address the concerns made by the Ninth Circuit, as well as partially relieve the plaintiffs’ injuries and guide the actions of the other branches of government.

As the case has proceeded since 2015, it has garnered national and international media attention—leading to increased awareness, support, and opposition to the case from various communities. For example, in March 2023, Judge Ann Aiken denied 18 Republican Attorney General’s requests to intervene as defendants in the case. Similarly, in June 2023, a coalition of different organizations delivered the Department of Justice a petition requesting that the Attorney General end its aggressive opposition to the case proceeding to trial via various attempts to dismiss or delay the case. In December 2023, Judge Ann Aiken dismissed many of these attempts and ruled in favor of the Juliana plaintiffs, allowing the case to proceed to trial and scheduling a pretrial conference. The growing interest and developments in this landmark case will likely proceed even further next year as the case progresses.

B. United Kingdom

2. ClientEarth v. Shell

In February 2023, ClientEarth filed a derivative action against Shell’s Board of Directors for their alleged breach of duty to protect shareholders from long-term risks related to climate change. The case was the first of its kind which attempted to hold corporate directors personally liable for failing to shift away from fossil fuels quickly enough. ClientEarth, a non-profit environmental law organization and UK-registered charity, brought suit in an attempt to compel Shell’s board to continue its promised move toward an alternative business model to remain competitive in the energy markets of the future. Failure to do so, argued ClientEarth, would cause the company’s stock to plummet and significantly devalue shareholders’ investments. Shell countered that its strategy remained consistent with the goals of the 2015 Paris Agreement. The case was filed after Shell’s CEO Wael Sawan announced plans to scale back investments in renewable energy and low-carbon business as part of its strategy to boost returns. The company boasted record profits in 2022 – more than $42 billion, double its 2021 profits. ClientEarth sought declaratory and injunctive relief to require that Shell properly manage its climate risk. However, the UK High Court dismissed the case without considering its merits, holding that ClientEarth “failed to demonstrate it had a prima facie case; and that the case was not brought in good faith” within the meaning of the UK Companies Act 2006.
In a derivative action, the claimant bears the burden of proving that the claim is brought in good faith, and not for an ulterior motive. It may be challenging for a non-profit to meet this burden and may prove even more difficult when the claimant is a de minimis shareholder. While ClientEarth had the support of institutional investors, who collectively hold over 12 million shares, the organization itself only holds a small number of shares. ClientEarth was ordered to pay the costs of the proceedings, which may serve as a deterrent to non-profits and other organizations seeking to bring such claims. The judgment handed down in ClientEarth v. Shell Plc leaves open the question of whether litigation is a suitable tool for enforcing corporate compliance with ESG-related obligations.