Europe is undergoing an unprecedented shift in the scale and ambition of climate policy following the announcement of the European Green Deal and the passage of the European Climate Law. European legislators are working on reforms referred to as the ‘Fit for 55’ package, which includes updates to existing regulatory mechanisms such as the European Union Emissions Trading System (EU ETS) and the Effort Sharing Regulation, and revised legislation regarding renewable energy, transport and land use.

It is crucial that stakeholders such as industry, policymakers and legislators, and civil society understand the likely impacts of the new legislation in Europe and beyond. This report presents the changing legislative landscape, putting developments on various individual issues into context and presenting an overview of key trends and themes in EU climate litigation and legislation. Its aim is to help readers develop an understanding of future directions in European climate law and the role the courts may play in shaping Europe’s transition to a low emission society.

Part 1 provides a brief look at the role that climate litigation has played in shaping Europe’s climate legislation to date. Part 2 provides an overview of the ‘Fit for 55’ package and Part 3 considers a broader programme of legal reforms associated with the EU’s climate ambitions, focusing on critical reforms that aim to integrate climate action into the real economy.

Main messages

  • There is a significant history in Europe of climate litigation being used as a lever to influence the outcomes and ambition of climate policy.
  • An increase in climate litigation cases is expected as a result of recent and ongoing legislative efforts at the EU level. In particular, significant litigation is likely following the introduction of the ‘Fit for 55’ package, the European Union’s flagship decarbonisation measures. Examples of possible forthcoming cases include:
    • Litigation focused on the extension of the European Union Emissions Trading System (EU ETS)‘Government framework’ litigation, which focuses on the overall ambition and implementation of new climate policies‘Just transition’ litigation over the distribution of benefits and burdens of climate action
    • Disputes over what constitutes ‘renewable energy’.
  • Measures aimed at ensuring that the EU’s climate goals translate into activities in the real economy may give rise to litigation against companies and financial institutions. Issues could include:
    • The governance of corporations and corporate value chains
    • The provision and use of sustainability information
    • Consumer protection legislation (which may be invoked in the context of a recent wave of ‘climate-washing’ litigation across Europe).
  • Governments and legislators should try to avoid legal controversy by bringing together key stakeholders in the development of further legislation and plans for implementation.
  • Businesses and their professional advisors should be aware of litigation risk and reform internal practices to avoid this.
  • Civil society groups should consider key issues for advocacy and engagement campaigns, with litigation pathways being available where these options are not successful.
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