| European Community — Environment — Waste — Waste lubricating oil reprocessed for burning as fuel — Whether ceased to be waste on completion of process of preparation for use as fuel or when actually burnt as fuel — Council Directive 2006/12/EC, art 1
R (OSS Group Ltd) v Environment Agency and others, Department of the Environment, Food and Rural Affairs intervening [2007] EWCA Civ 611
CA: (Sir Anthony Clarke MR, Carnwath and Maurice Kay LJJ): 28 June 2007
A lubricating oil which was collected after use and processed into fuel oil for burning, could as a matter of law cease to be waste before it was burnt as fuel for the purposes of Council Directive 2006/12/EC (“the Waste Framework Directive”.
The Court of Appeal so held, allowing an appeal by the claimant, OSS Group Ltd, against the refusal of Burton J on 30 November 2006 to grant judicial review of the decision of the defendant, the Environment Agency, that waste lubricating oil reprocessed as fuel did not cease to be waste until it was burnt.
CARNWATH LJ said that the claimant’s business was the collection of waste lubricating oil and its conversion into marketable fuel oil. The issue was whether the material ceased to be “waste” for the purposes of the Waste Framework Directive when the process of preparing it for use as fuel was completed (as the claimant argued) or when it was actually burnt (as the Agency argued). The judge agreed with the Agency. The answer was of considerable economic significance. If the judgment was upheld, a power station using the claimant’s fuel was subject to more costly controls applying to a waste incinerator, which would not apply if it were burning virgin fuel oil. The question for the judge, and the Court of Appeal, was whether a lubricating oil, not originally used as fuel, which became waste could thereafter be burnt other than as waste. The judge’s answer was “no”. In ARCO Chemie Nederland v Minister van Volkshuisvesting [2002] QB 646 the European Court of Justice impliedly accepted that a waste substance might cease to be waste, even if it was destined for use as fuel. The court did not, however, go on to identify the other factors to be taken into account and the test to be applied in deciding whether the material had ceased to be waste. It simply asserted that the decision had to be taken in the light of all the circumstances and by comparison with the definition of “the discarding of the substance, or the intention or requirement to discard it” in article 1(a) of the Directive. A fundamental problem was the court’s professed adherence to the article 1(a) definition, even where of no practical relevance. Understandably the court had held that a material did not cease to be waste merely because it had come to someone who intended to put it to a new use. But that should not be because it still met the article 1(a) “discarding” definition; but rather because, in accordance with the Directive’s aims, material which was originally waste needed to continue to be so treated until acceptable recovery or disposal had been achieved. Unfortunately the court had consistently declined to develop workable criteria to determine that question. Instead it continued to insist that the “discarding” test remained applicable, even where the “holder” was an end-user whose only subjective intention was to use, not to get rid of, the materials in issue. Although the court continued to pay lip-service to the “discarding” test, in practice it subordinated the subjective question implicit in that definition, to a series of objective indicators derived from the Directive’s policy. What was required from a national court was a value judgment on the acts of the particular case in the light of those indicators: see Scottish Power Generation Ltd v Scottish Environment Protection Agency 2005 SLT 98. It should be enough that the holder had converted the waste material into a distinct, marketable product, which could be used in exactly the same way as a ordinary fuel, and with no worse environmental effects. It could not be said that such a material was being “discarded” in any ordinary sense of the term. The Agency’s test was too narrow. It did not accord with the ARCO case. Any difficulties in applying a wider test were inherent in the imprecise nature of the article 1(a) definition.
SIR ANTHONY CLARKE MR and MAURICE KAY LJ agreed.
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Appearances: Robert McCracken QC and Stephen Tromans (Sharpe Pritchard, for Semple Fraser LLP, Glasgow) for the claimant. John Howell QC and Dinah Rose QC (Environment Agency Legal Services) for the Agency. Derrick Wyatt QC and Kassie Smith (Legal Department, DEFRA) for DEFRA, the intervener.
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