JUDGMENT OF THE COURT (Fifth Chamber)

21 September 1999 (1)

(Environment — Directive 85/337/EEC — Assessment of the effects of certainpublic or private projects — Setting of thresholds)

In Case C-392/96,

Commission of the European Communities, represented by Richard B. Wainwright,Principal Legal Adviser, acting as Agent, with an address for service in Luxembourgat the office of Carlos Gómez de la Cruz, of its Legal Service, Wagner Centre,Kirchberg,

applicant,

v

Ireland, represented by Michael A. Buckley, Chief State Solicitor, acting as Agent,Philip O'Sullivan SC and Niamh Hyland BL, with an address for service inLuxembourg at the Irish Embassy, 28 Route d'Arlon,

defendant,

APPLICATION for a declaration that, by failing to adopt all the necessarymeasures to ensure the correct transposition of Council Directive 85/337/EEC of27 June 1985 on the assessment of the effects of certain public and private projectson the environment (OJ 1985 L 175, p. 40), Ireland has failed to fulfil its

obligations under that directive, in particular Article 12 thereof, and under the ECTreaty,

THE COURT (Fifth Chamber),

composed of: J.-P. Puissochet, President of the Chamber, J.C. Moitinho deAlmeida, C. Gulmann, D.A.O. Edward and L. Sevón (Rapporteur), Judges,

Advocate General: A. La Pergola,

Registrar: L. Hewlett, Administrator,

having regard to the Report for the Hearing,

after hearing oral argument from the parties at the hearing on 24 September 1998,at which the Commission was represented by Richard B. Wainwright and the IrishGovernment by James Connolly SC and Niamh Hyland,

after hearing the Opinion of the Advocate General at the sitting on17 December 1998,

gives the following

Judgment

1.

    By application lodged at the Court Registry on 5 December 1996, the Commissionof the European Communities brought an action under Article 169 of the ECTreaty (now Article 226 EC) for a declaration that, by failing to adopt all thenecessary measures to ensure the correct transposition of Council Directive85/337/EEC of 27 June 1985 on the assessment of the effects of certain public andprivate projects on the environment (OJ 1985 L 175, p. 40, hereinafter 'theDirective‘), Ireland has failed to fulfil its obligations under the Directive, inparticular Article 12 thereof, and under the EC Treaty.

2.

    The Commission alleges that Ireland has incorrectly transposed Article 4(2) of theDirective and points 1(b) and (d) and 2(a) of Annex II thereto, as well asArticles 2(3), 5 and 7.

3.

    Article 2(1) of the Directive specifies the types of projects which are to be subjectto an assessment:

'Member States shall adopt all measures necessary to ensure that, before consentis given, projects likely to have significant effects on the environment by virtue inter

alia of their nature, size or location are made subject to an assessment with regardto their effects.

These projects are defined in Article 4.‘

4.

    An assessment is always required for certain projects, set out in Annex I to theDirective.

5.

    As regards other types of projects, Article 4(2) provides:

'Projects of the classes listed in Annex II shall be made subject to an assessment,in accordance with Articles 5 to 10, where Member States consider that theircharacteristics so require.

To this end Member States may inter alia specify certain types of projects as beingsubject to an assessment or may establish the criteria and/or thresholds necessaryto determine which of the projects of the classes listed in Annex II are to besubject to an assessment in accordance with Articles 5 to 10.‘

6.

    Annex II lists a number of projects, including:

'1.    Agriculture

...

(b)    Projects for the use of uncultivated land or semi-natural areas for intensiveagricultural purposes;

...

(d)    Initial afforestation where this may lead to adverse ecological changes andland reclamation for the purposes of conversion to another type of land use;

...

2.    Extractive industry

(a)    Extraction of peat

...‘

7.

    Article 2(3) of the Directive states:

'Member States may, in exceptional cases, exempt a specific project in whole orin part from the provisions laid down in this Directive.

In this event, the Member States shall:

(a)    consider whether another form of assessment would be appropriate andwhether the information thus collected should be made available to thepublic;

(b)    make available to the public concerned the information relating to theexemption and the reasons for granting it;

(c)    inform the Commission, prior to granting consent, of the reasons justifyingthe exemption granted, and provide it with the information made available,where appropriate, to their own nationals.

The Commission shall immediately forward the documents received to the otherMember States.

The Commission shall report annually to the Council on the application of thisparagraph.‘

8.

    Article 3 provides that an environmental impact assessment is to identify, describeand assess the direct and indirect effects of a project, in particular on humanbeings, fauna and flora, soil, water, air, climate, landscape, material assets andcultural heritage.

9.

    Article 5 states:

'1.    In the case of projects which, pursuant to Article 4, must be subjected to anenvironmental impact assessment in accordance with Articles 5 to 10, MemberStates shall adopt the necessary measures to ensure that the developer supplies inan appropriate form the information specified in Annex III inasmuch as:

(a)    the Member States consider that the information is relevant to a given stageof the consent procedure and to the specific characteristics of a particularproject or type of project and of the environmental features likely to beaffected;

(b)    the Member States consider that a developer may reasonably be requiredto compile this information having regard inter alia to current knowledgeand methods of assessment.

2.    The information to be provided by the developer in accordance withparagraph 1 shall include at least:

—    a description of the project comprising information on the site, design andsize of the project,

—    a description of the measures envisaged in order to avoid, reduce and, ifpossible, remedy significant adverse effects,

—    the data required to identify and assess the main effects which the projectis likely to have on the environment,

—    a non-technical summary of the information mentioned in indents 1 to 3.

3.    Where they consider it necessary, Member States shall ensure that anyauthorities with relevant information in their possession make this informationavailable to the developer.‘

10.

    Article 7 provides:

'Where a Member State is aware that a project is likely to have significant effectson the environment in another Member State or where a Member State likely tobe significantly affected so requests, the Member State in whose territory theproject is intended to be carried out shall forward the information gatheredpursuant to Article 5 to the other Member State at the same time as it makes itavailable to its own nationals. Such information shall serve as a basis for anyconsultations necessary in the framework of the bilateral relations between twoMember States on a reciprocal and equivalent basis.‘

11.

    Under Article 12(1) of the Directive, the Member States had to take the measuresnecessary to comply with the Directive within three years of its notification. As theDirective was notified on 3 July 1985, that period expired on 3 July 1988.

12.

    Since the Commission considered that Ireland had not transposed the Directivecorrectly, on 13 October 1989 it sent a first letter of formal notice, in which italleged that Articles 2 and 4 of the Directive had been inadequately transposed,having regard to the projects listed in Annexes I and II, and that Articles 5 to 9 hadnot been transposed.

13.

    In reply to that letter, Ireland sent the text of two legislative measures:

—    the European Communities (Environmental Impact Assessment)Regulations, 1989 (S.I. No 349 of 1989) (hereinafter 'S.I. No 349 of 1989‘);and

—    the Local Government (Planning and Development) Regulations, 1990 (S.I.No 25 of 1990) (hereinafter 'S.I. No 25 of 1990‘).

14.

    However, since the Commission took the view that this new legislation still did notproduce a correct transposition of the Directive, it sent Ireland a further letter offormal notice on 7 November 1991.

15.

    By letter of 12 May 1992 Ireland replied that the provisions of the Directive were,in practice, complied with.

16.

    On 28 April 1993 the Commission, dissatisfied with that reply, sent Ireland areasoned opinion in which it alleged, in particular, that Ireland had failed:

—    to transpose properly Article 4(2) of the Directive and Annex II thereto;

—    to make proper provision for exemptions under Article 2(3) of theDirective;

—    to specify properly the information to be supplied by the developer inaccordance with Article 5 of the Directive; and

—    to make proper provision for the information to be supplied to otherMember States in accordance with Article 7 of the Directive.

17.

    By letter of 20 August 1993 Ireland disputed some of the objections formulated inits regard. It then sent, by letter of 7 December 1994, the text of the LocalGovernment (Planning and Development) Regulations 1994 and last, by letter of7 May 1996, the text of the European Communities (Environmental ImpactAssessment) (Amendment) Regulations, 1996 (S.I. No 101 of 1996) (hereinafter'S.I. No 101 of 1996‘).

18.

    In addition, after the reasoned opinion had been sent, correspondence wasexchanged regarding complaints related to classes of projects at issue in this action,namely Complaint No P 95/4724 concerning afforestation on Pettigo Plateau andComplaint No P 95/4219 concerning peat extraction, in particular from ClonfinaneBog.

Infringement of Article 4(2) of the Directive and points 1(b) and (d) and 2(a) ofAnnex II thereto

19.

    The Commission alleges that Ireland has transposed Article 4(2) of the Directiveincorrectly by setting absolute thresholds for the classes of projects covered bypoints 1(b) (use of uncultivated land or semi-natural areas for intensive agriculturalpurposes), 1(d) (initial afforestation/land reclamation) and 2(a) (extraction of peat)of Annex II to the Directive. The absolute nature of the thresholds means that itis not possible to ensure that every project likely to have significant effects on theenvironment is subject to an impact assessment, because the mere fact that aproject does not reach the threshold is sufficient for it not to subjected to suchassessment, regardless of its other characteristics. Under Article 4(2) of theDirective, however, account must be taken of all the characteristics of a project, notthe single factor of size or capacity. Furthermore, Article 2(1) refers also to aproject's nature and location as criteria for assessing whether it is likely to have

significant environmental effects. The Commission considers that this analysis isconsistent with the judgments of the Court in Case C-133/94 Commission v Belgium[1996] ECR I-2323 and in Case C-72/95 Kraaijeveld and Others v GedeputeerdeStaten van Zuid-Holland [1996] ECR I-5403.

20.

    According to the Commission, projects which do not exceed the thresholds set maynone the less have significant environmental effects. Two factors are important inthat regard.

21.

    The first factor is that certain sites which are particularly sensitive or valuable maybe damaged by projects which do not exceed the thresholds set. That is the casewith areas identified as valuable and important for nature conservation and areasof particular archaeological or geomorphological interest.

22.

    The second factor is that the legislation fails to take account of the cumulativeeffect of projects. A number of separate projects, which individually do not exceedthe threshold set and therefore do not require an impact assessment may, takentogether, have significant environmental effects.

23.

    The Commission considers that the setting of absolute thresholds for the classes ofprojects covered by points 1(b) (use of uncultivated land or semi-natural areas forintensive agricultural purposes), 1(d) (initial afforestation/land reclamation) and2(a) (extraction of peat) of Annex II to the Directive infringes Article 4(2) becauseone or both factors apply. It gives a number of examples of projects which arelikely to have, or have had, significant environmental effects but which have notbeen the subject of any impact assessment because of the absolute nature of thethresholds.

24.

    As regards projects for the use of uncultivated land or semi-natural areas forintensive agricultural purposes, covered by point 1(b) of Annex II to the Directive,the Commission challenges the threshold of 100 ha set by Article 24 of S.I. No 349of 1989 and paragraph 1(a) of Part II of the First Schedule thereto, in conjunctionwith other provisions of the Irish legislation transposing the Directive. It states that60 000 ha of semi-natural terrain in the west of Ireland have come to be used forintensive sheep farming and are suffering from serious degradation. The increasein sheep numbers should, in its view, have been the subject of an impactassessment, in which the intensity of use could have been determined by referenceto a criterion of stocking density per hectare. Furthermore, 'project‘ is definedbroadly in the Directive and also covers an 'intervention‘ relating to open landsuch as sheep grazing. Projects of that type have significant environmental effectsin that they involve an alteration in uncultivated land or semi-natural areas throughovergrazing which leads to soil degradation and erosion.

25.

    So far as concerns initial afforestation covered by point 1(d) of Annex II to theDirective, the Commission contests in particular the threshold of 70 ha prescribed

by S.I. No 101 of 1996. According to that provision, an impact assessment is to becarried out in the case of initial afforestation only where the area involved, eitheron its own or taken together with any adjacent area planted by or on behalf of theapplicant within the previous three years, would result in a total area plantedexceeding 70 ha.

26.

    The Commission states that afforestation projects may have a significant effect onthe environment even where they fall below the 70 ha threshold.

27.

    In that regard, it refers to the acidification and eutrophication of waters caused byafforestation. It cites the report The Trophic Status of Lough Conn, An Investigationinto the Causes of Recent Accelerated Eutrophication (McGarrigle and others onbehalf of the Lough Conn Committee, published by Mayo County Council inassociation with the Environmental Protection Agency, Central Fisheries Board,North Western Fisheries Board, Teagasc, Bord na Mona, Department ofAgriculture and Department of Marine, December 1993) and A Study of the Effectsof Stream Hydrology and Water Quality in Forested Catchments on Fish andInvertebrates (known as the 'Aquafor Report‘).

28.

    It also points out the failure of the Irish legislation to take account of the significantenvironmental effects which afforestation projects may have in areas of activeblanket bog. Since afforestation entails ploughing, drainage, the use of fertilisersand a radical change in vegetation, it transforms the peatland ecosystem sofundamentally that it is effectively destroyed. The Commission refers in that regardto Birds, Bogs and Forestry, the Peatlands of Caithness and Sutherland (Strout, Reedsand Others, Nature Conservancy Council, United Kingdom), which analyses theeffects of afforestation on blanket bog.

29.

    The Commission cites, by way of example, the afforestation carried out at DunraghLoughs and Pettigo Plateau which was brought to its attention by Complaint No P95/4724. Those sites are included in the list of Natural Heritage Areas (hereinafter'NHAs‘) drawn up by the Irish authorities. Pettigo Plateau, in particular, is a vastintact blanket bog (approximately 2 097 ha) of great scientific interest and is oneof the sites covered by the contract entered into on 28 December 1995 between theCommission and the National Parks and Wildlife Service pursuant to CouncilRegulation (EEC) No 1973/92 of 21 May 1992 establishing a financial instrumentfor the environment (LIFE) (OJ 1992 L 206, p. 1). Part of the plateau (619.2 ha)has been classified as a special protection area under Council Directive 79/409/EECof 2 April 1979 on the conservation of wild birds (OJ 1979 L 103, p. 1). It is alsoa cross-border site in that the plateau extends into County Fermanagh in theUnited Kingdom, which proposes to classify the portion of the plateau in itsterritory as a special protection area under Directive 79/409 and as a special areaof conservation under Council Directive 92/43/EEC of 21 May 1992 on theconservation of natural habitats and of wild fauna and flora (OJ 1992 L 206, p. 7). There is a risk that the part of the plateau in the United Kingdom will be subjectedto the significant effects of the afforestation projects on the environment, since

planting is liable to affect adversely the hydrology of the peatlands on both sidesof the border. Notwithstanding the interest of that area, planting, some grant-aided, has been carried out there, without the threshold set being exceeded in anycase.

30.

    The Commission acknowledges that S.I. No 101 of 1996 is an improvement on theprevious legislation inasmuch as it has lowered the threshold from 200 ha to 70 ha. Nevertheless, the protection remains inadequate because the whole of a proposedNHA could, in theory, be afforested without an impact assessment being requiredif the afforestation were carried out by different developers who all kept within thethreshold of 70 ha over three years. The Irish legislation fails to take sufficientaccount of the cumulative effect of projects.

31.

    As regards land reclamation for the purposes of conversion to another type of landuse, covered by point 1(d) of Annex II to the Directive, the Commission objects tothe threshold of 100 ha set by the Irish legislation (Article 24 of S.I. No 349 of 1989and paragraph 1(c)(ii) of Part II of the First Schedule thereto, in conjunction withother provisions of the Irish legislation transposing the Directive) and retained inthe more recent legislation (S.I. No 101 of 1996).

32.

    It considers that the Irish legislation fails to ensure that a prior assessment iscarried out with regard to the significant environmental effects of land reclamationprojects which, because of their size, do not have to be the subject of an impactassessment but, considered together, are nevertheless likely to have such effects.

33.

    It refers in that regard to the reclamation which has taken place in the Burren, anextensive area of limestone pavement in County Clare which is of exceptionalinterest for its fauna, flora and natural landscape and rich in archaeologicalremains. The cumulative effects of this reclamation drew the attention of theHeritage Council and a report in 1996 commissioned by it, entitled 'A survey ofrecent reclamation in the Burren‘, shows that there are 59 'new‘ reclamation sitestotalling 256 ha in that area, including 31 sites in proposed NHAs. Theinterventions involve the levelling of limestone pavement with bulldozers, theclearance of scrub (hazel bushes are a characteristic feature of that habitat) and theseeding and fertilisation of the cleared land. The report also records the loss ofnumerous archaeological and historical remains, such as holy wells and ancient fieldsystems.

34.

    As regards, finally, peat extraction projects, covered by point 2(a) of Annex II tothe Directive, the Commission objects to the threshold of 50 ha set by Article 24of S.I. No 349 of 1989 and paragraph 2(a) of Part II of the First Schedule thereto,in conjunction with other provisions of the Irish legislation transposing theDirective.

35.

    It explains that peat extraction entails drainage, which has a drying effect on theplants which form the peat. The vegetation changes from a sphagnum andpeatmoss-dominated community to a vegetation dominated by dry bog species, afterwhich the bog is colonised by trees. The lowering of the water table causes areduction in peat volume. The sloping of the bog increases water run-off, whichexacerbates the drying-out process. Peat extraction accordingly has significant andirreversible environmental effects.

36.

    The Commission cites the example of Ballyduff-Clonfinane Bog in CountyTipperary, which it examined specifically following Complaint No P 95/4219. Thatsite of approximately 312 ha comprises two bogs, Ballyduff and Clonfinane (187ha). Following a survey carried out by the National Parks and Wildlife Service in1983, the site was designated as an area of scientific interest (ASI). Under a reportprepared in 1990 for the Irish Minister of Finance the site was to become part ofa raised bog nature reserve network. In 1995 it became a proposed NHA. Thesite was also among those covered by the contract entered into on28 December 1995 between the Commission and the National Parks and WildlifeService pursuant to Regulation No 1973/92. In addition, it benefited fromCommission Decision C(96) 2113 of 29 July 1996 in respect of the Cohesion Fund,which approved the grant of ECU 344 000 for the preservation of the bogs. Nonethe less, a peat extraction project began in 1994 at Clonfinane without an impactassessment being required, as the area being developed was below the 50 hathreshold. When, in 1996, the question was raised as to whether an impactassessment was required, the development already covered more than 50 ha.

37.

    The Commission compares the threshold applicable to bogs (50 ha) with thatapplicable to the extraction of stone, gravel, sand or clay (5 ha) and notes that inthe latter case an impact assessment is required below an area of 5 ha where thecompetent local authority considers that significant effects on the environment arelikely (Article 24 of S.I. No 349 of 1989, paragraph 2 of Part II of the FirstSchedule thereto, and Articles 4(1) and 6(1) of S.I. No 25 of 1990). The absolutenature of the threshold applicable to bogs precludes any real assessment as towhether a project might have significant environmental effects.

38.

    The Commission notes that there are at least 49 peat-producing companies, thatthe economics of small-scale extraction have been transformed by the introductionof new peat-extraction equipment and that the quantity of peat extracted by smallproducers has therefore increased considerably since 1980. The fact that no peatextraction project has given rise to an assessment, despite continuing losses harmfulto nature conservation, shows that the Irish threshold is such that the Directive hasno impact with regard to bogs of conservation importance.

39.

    In its defence, Ireland contests the admissibility of the objection relating to thecumulative effect of projects on the ground that it was not raised during the pre-litigation procedure and, in particular, in the reasoned opinion. It also maintainsthat the complaints to which the Commission refers cannot be used in evidence

because they were not mentioned in the reasoned opinion and are the subject ofseparate investigation.

40.

    Generally, Ireland submits that the Commission has failed to prove actual abuseof thresholds through cumulative projects. The theoretical possibility of such abusedoes not make the use of thresholds unlawful: their use is envisaged by theDirective and has been approved in the two cases considered by the Court(Commission v Belgium and Kraaijeveld, both cited above). It is only CouncilDirective 97/11/EC of 3 March 1997 amending Directive 85/337 (OJ 1997 L 73,p. 5) which has required account to be taken of the cumulation of projects.

41.

    As regards projects for the use of uncultivated land or semi-natural areas forintensive agricultural purposes, covered by point 1(b) of Annex II to the Directive,Ireland disputes that sheep grazing as practised in its territory comes underintensive agriculture and can be considered to be a project within the meaning ofArticle 1(2) of the Directive. It is not an intervention in the natural surroundingsand landscape within the meaning of that provision and it would be absurd tosuggest that a farmer is obliged to seek prior consent whenever he wants toincrease the number of sheep able to graze on a piece of land. That suggestion isparticularly impracticable because much of the land used for the grazing of sheepis commonage, shared between a number of farmers who all have the right to grazetheir sheep there.

42.

    Ireland considers that the Directive was never intended to cover certain types ofagriculture, such as sheep farming on vast areas of land, and is unsuited to suchpractices, in particular because of the cost of carrying out impact assessments inrelation to the farmers' income. On the other hand, environmental protection isthe object of the scheme established by Council Regulation (EEC) No 2078/92 of30 June 1992 on agricultural production methods compatible with the requirementsof the protection of the environment and the maintenance of the countryside (OJ1992 L 215, p. 85), implemented by Commission Regulation (EC) No 746/96 of24 April 1996 laying down detailed rules for the application of Regulation No2078/92 (OJ 1996 L 102, p. 19). More than 15% of Irish farmers alreadyparticipate in that Rural Environment Protection Scheme, which seeks to stopfarmers from farming their land intensively, and the Minister for Agriculturesubmitted proposals to the Commission pursuant to the Operational Programmefor Agriculture, Rural Development and Forestry under the Community SupportFramework for Ireland 1994-99 to the effect that, from 1 January 1998, farmers indegraded areas are entitled to sheep/ewe headage premium grants only if they areparticipating in the Rural Environment Protection Scheme.

43.

    As regards the objection relating to afforestation, Ireland submits that theCommission has adduced no objectively verifiable evidence that afforestation belowthe threshold has had significant effects on waters. It failed to annex to the

application the two reports which it cites (the report on Lough Conn and theAquafor Report), one of which, moreover, is not yet final.

44.

    Nor is there any evidence that afforestation on peatland has had significantenvironmental effects. Besides, little forestry development takes place on peatland,because of the minimum productivity requirements of the grant system and the factthat peatland has a lower forestry yield per hectare than other types of land.

45.

    Ireland contends, furthermore, that the Commission's presentation of the issuesrelating to Pettigo Plateau is inaccurate. The afforestation took place on a verysmall area only and therefore did not require consultation with the UnitedKingdom authorities under Article 7 of the Directive. Furthermore, the part ofPettigo classified as a special protection area under Directive 79/409 belongs to theNational Parks and Wildlife Service and was not affected by the afforestation. Finally, it was only after the afforestation grant was given that the National Parksand Wildlife Service decided to designate the area as a proposed NHA, withoutknowing that afforestation was to take place there. In any event, the allegationsmade in that complaint concern only the management of the regime and notIreland's implementation of Article 4(2) of the Directive or Annex II thereto.

46.

    As regards land reclamation, covered by point 1(d) of Annex II to the Directive,Ireland states that the only example given by the Commission is the unique areaof the Burren. The Commission relies on an unpublished and incomplete study andfails to identify the land reclamation which has taken place. Besides, the total areasurveyed in the report which the Commission cites (approximately 250 ha) is notsignificant given the size of the Burren as a whole (approximately 30 000 ha). Inthe light of those factors, the Commission has not carried out an overall assessmentof land reclamation projects in Ireland, as required by the judgment in Kraaijeveld,cited above.

47.

    Ireland puts forward the same argument in relation to peat extraction projects,referred to in point 2(a) of Annex II to the Directive, alleging that the Commissionhas provided just one example of an extraction project below the threshold whichhas supposedly had significant effects on the environment.

48.

    Also, the Commission's objections relate only to peat extraction from bogs whichare of conservation interest. Legal and administrative measures exist to protectsuch bogs, namely the Habitats Regulations and the designation of areas as NHAs. The complaint concerning peat extraction from Ballyduff-Clonfinane Bog simplydemonstrates the need for conservation measures. Ireland accepts that differentthresholds could have been set but, given the adoption of special areas ofconservation under the Habitats Regulations, it had not considered that to benecessary.

49.

    As for bogs which are not subject to the Habitats Regulations, Ireland justifies thethreshold of 50 ha by stating that it is intended to distinguish between commercial

peat extraction, which may have significant effects on the environment, and thenon-commercial cutting of turf, which is a traditional activity in Irish rural life. TheDirective was not intended to be interpreted as requiring an impact assessment forsmall-scale non-commercial peat extraction. The effect of requiring impactassessments for very small areas of bog would be to prevent all extraction becauseof the cost of an assessment compared with the likely return. Such aninterpretation of the Directive would frustrate the traditional rights of landowningand tenant farmers to cut turf from the bog for their own needs.

Findings of the Court

50.

    It is necessary to consider first of all the plea raised by Ireland that the objectionrelating to the cumulative effect of projects is inadmissible on the ground that itwas not relied on during the pre-litigation procedure and, in particular, in thereasoned opinion.

51.

    It should be remembered that the purpose of the pre-litigation procedure is to givethe State concerned an opportunity, on the one hand, to comply with its obligationsunder Community law and, on the other, to avail itself of its right to defend itselfagainst the objections formulated by the Commission. The subject-matter of anaction brought under Article 169 of the Treaty is delimited by the pre-litigationprocedure provided for by that article. Consequently, the action cannot be foundedon any objections other than those set out in the reasoned opinion (see, inparticular, Case C-206/96 Commission v Luxembourg [1998] ECR I-3401,paragraph 13).

52.

    In the present case, it is apparent from an examination of the documentsexchanged in the course of the pre-litigation procedure that, while the Commissiondid not expressly use the words 'cumulative effect of projects‘, it was neverthelessaddressing this question as part of the more general problem of the setting ofthresholds and made the very point that a developer can avoid an impactassessment by splitting an initial project into a number of projects which do notexceed the threshold.

53.

    In those circumstances, it cannot be considered that the pre-litigation procedure didnot allow Ireland to avail itself of its right to defend itself against the objectionrelating to the cumulative effect of projects.

54.

    Ireland also defends itself by pleading that the Commission cannot use complaintsnot mentioned in the reasoned opinion as evidence of an infringement, becausethey were received subsequent to the reasoned opinion and are still the subject ofseparate investigation.

55.

    This plea is linked, however, to the question of proof of the infringement, whichshould be examined as a whole.

56.

    Ireland disputes that the Commission has demonstrated that thresholds haveactually been misused. In its view, such proof is necessary in order to establish thatit has failed to fulfil its obligations.

57.

    The Commission replies that it is the use of absolute thresholds which constitutesthe infringement and that all it had to do was put forward a body of evidencedemonstrating that use of such thresholds could mean that projects likely to havesignificant effects on the environment escaped an impact assessment because theydid not reach the threshold prescribed by law. It also maintains that it would becontrary to the objective of prevention pursued by the Directive if it were necessaryto establish serious and grave environmental harm in order to prove inadequatetransposition in Treaty infringement proceedings. Finally, it points out its difficulty in producing concrete evidence in the case of projects below the thresholds.

58.

    In that regard, it must be observed that the infringement alleged by theCommission is Ireland's incorrect transposition of Article 4(2) of the Directivethrough the use of thresholds which have the effect that all the characteristics ofa project are not taken into consideration when it comes to determining whetherthe project is to be subject to an impact assessment. Certain projects likely to havesignificant effects on the environment may thus escape the assessment requirementbecause they do not reach the thresholds set.

59.

    So, the alleged infringement has to do with the way in which the Directive has beentransposed into Irish law and not with the actual result of the application of thetransposing legislation.

60.

    In order to prove that the transposition of a directive is insufficient or inadequate,it is not necessary to establish the actual effects of the legislation transposing it intonational law: it is the wording of the legislation itself which harbours theinsufficiencies or defects of transposition.

61.

    There is, therefore, nothing to prevent the Commission from demonstrating thattransposition is defective or insufficient without waiting for the application of thetransposing legislation to produce harmful effects.

62.

    Since the Directive forms part of Community environmental policy, which, aspointed out in the first recital in the preamble to the Directive, consists inpreventing the creation of pollution or nuisances at source rather than subsequentlytrying to counteract their effects, the opposite conclusion would be even moreunjustified in this case.

63.

    It does not therefore matter that the evidence adduced by the Commission insupport of its action consists of mere complaints which have not yet beeninvestigated.

64.

    As far as the objection to thresholds is concerned, although the secondsubparagraph of Article 4(2) of the Directive confers on Member States a measureof discretion to specify certain types of projects which are to be subject to anassessment or to establish the criteria or thresholds applicable, the limits of thatdiscretion lie in the obligation set out in Article 2(1) that projects likely, by virtueinter alia of their nature, size or location, to have significant effects on theenvironment are to be subject to an impact assessment (Kraaijeveld, cited above,paragraph 50).

65.

    Thus, a Member State which established criteria or thresholds taking account onlyof the size of projects, without also taking their nature and location intoconsideration, would exceed the limits of its discretion under Articles 2(1) and 4(2)of the Directive.

66.

    Even a small-scale project can have significant effects on the environment if it isin a location where the environmental factors set out in Article 3 of the Directive,such as fauna and flora, soil, water, climate or cultural heritage, are sensitive to theslightest alteration.

67.

    Similarly, a project is likely to have significant effects where, by reason of its nature,there is a risk that it will cause a substantial or irreversible change in thoseenvironmental factors, irrespective of its size.

68.

    In order to demonstrate that Ireland has failed to fulfil its obligations in this regard,the Commission has put forward several convincing examples of projects which,whilst considered solely in relation to their size, may none the less have significanteffects on the environment by reason of their nature or location.

69.

    The most significant example is afforestation because, when carried out in areas ofactive blanket bog, it entails, by its nature and location, the destruction of the bogecosystem and the irreversible loss of biotopes that are original, rare and of greatscientific interest. In itself, it may also cause the acidification or eutrophication ofwaters.

70.

    It was however necessary, and possible, to take account of factors such as thenature or location of projects, for example by setting a number of thresholdscorresponding to varying project sizes and applicable by reference to the nature orlocation of the project.

71.

    Ireland's explanation that other environmental protection legislation, such as theHabitats Regulations, made it unnecessary to assess afforestation, land reclamation

or peat extraction projects carried out in environmentally sensitive locations mustbe dismissed. Nothing in the Directive excludes from its scope regions or areaswhich are protected under other Community provisions from other aspects.

72.

    It follows that, by setting, for the classes of projects covered by points 1(d) and 2(a)of Annex II to the Directive, thresholds which take account only of the size ofprojects, to the exclusion of their nature and location, Ireland has exceeded thelimits of its discretion under Articles 2(1) and 4(2) of the Directive.

73.

    As regards the cumulative effect of projects, it is to be remembered that thecriteria and/or thresholds mentioned in Article 4(2) are designed to facilitate theexamination of the actual characteristics exhibited by a given project in order todetermine whether it is subject to the requirement to carry out an assessment, andnot to exempt in advance from that obligation certain whole classes of projectslisted in Annex II which may be envisaged on the territory of a Member State(Commission v Belgium, cited above, paragraph 42, Kraaijeveld, cited above,paragraph 51, and Case C-301/95 Commission v Germany [1998] ECR I-6135,paragraph 45).

74.

    The question whether, in laying down such criteria and/or thresholds, a MemberState goes beyond the limits of its discretion cannot be determined in relation tothe characteristics of a single project, but depends on an overall assessment of thecharacteristics of projects of that nature which could be envisaged in the MemberState concerned (Kraaijeveld, paragraph 52).

75.

    So, a Member State which established criteria and/or thresholds at a level suchthat, in practice, all projects of a certain type would be exempted in advance fromthe requirement of an impact assessment would exceed the limits of its discretionunder Articles 2(1) and 4(2) of the Directive unless all the projects excluded could,when viewed as a whole, be regarded as not being likely to have significant effectson the environment (see, to that effect, Kraaijeveld, paragraph 53).

76.

    That would be the case where a Member State merely set a criterion of project sizeand did not also ensure that the objective of the legislation would not becircumvented by the splitting of projects. Not taking account of the cumulativeeffect of projects means in practice that all projects of a certain type may escapethe obligation to carry out an assessment when, taken together, they are likely tohave significant effects on the environment within the meaning of Article 2(1) ofthe Directive.

77.

    In order to demonstrate that Ireland has failed to fulfil its obligations in this regard,the Commission has also provided various examples of the effects of the Irishlegislation as drafted.

78.

    Ireland has not denied that no project for the extraction of peat, covered bypoint 2(a) of Annex II to the Directive, has been the subject of an impact

assessment, although small-scale peat extraction has been mechanised, industrialisedand considerably intensified, resulting in the unremitting loss of areas of bog ofnature conservation importance.

79.

    As regards initial afforestation, covered by point 1(d) of Annex II to the Directive,such projects, encouraged by the grant of aid, may be implemented in proximity toone another without any impact assessment at all being carried out, if they areconducted by different developers who all keep within the threshold of 70 ha overthree years.

80.

    The Commission has also cited the example of land reclamation projects, coveredby point 1(d) of Annex II to the Directive, whose cumulative effect is not takeninto account by the Irish legislation. Nor has it been disputed that much landclearance has taken place in the Burren without a single impact assessment beingcarried out, although it is an area of unquestionable interest. Limestone pavement,which is characteristic of the area, has been destroyed, as have vegetation andarchaeological remains, giving way to pasture. Considered together, thoseinterventions were likely to have significant environmental effects.

81.

    As regards sheep farming in particular, the Commission has proved that, againencouraged by the grant of aid, this has grown in an unrestrained fashion, whichis a development which may have adverse environmental consequences. However,it has not demonstrated that sheep farming as practised in Ireland constitutes aproject within the meaning of Article 1(2) of the Directive.

82.

    It follows from all of the foregoing that, by setting thresholds for the classes ofprojects covered by points 1(d) and 2(a) of Annex II to the Directive without alsoensuring that the objective of the legislation will not be circumvented by thesplitting of projects, Ireland has exceeded the limits of its discretion underArticles 2(1) and 4(2) of the Directive.

83.

    Consequently, the objection relating to infringement of Article 4(2) of the Directivein respect of the classes of projects covered by points 1(d) and 2(a) of Annex II tothe Directive is well founded.

Infringement of Article 2(3) of the Directive

84.

    The Commission explains that S.I. No 349 of 1989 provides for an exemptionformula enabling the competent Minister to dispense with an impact assessment fora project where he considers this to be warranted by exceptional circumstances. It points out that this provision is inconsistent with the Directive inasmuch as, first,the Minister is not required to consider whether another form of assessment wouldbe appropriate and whether the information collected should be made available tothe public and, second, he is not required to inform the Commission.

85.

    Ireland stated at the hearing that amending legislation had just been adopted.

86.

    However, it is settled case-law that amendments to national legislation areirrelevant for the purposes of giving judgment on the subject-matter of an actionfor failure to fulfil obligations if they have not been implemented before the expiryof the period set by the reasoned opinion (see, in particular, Case C-123/94Commission v Greece [1995] ECR I-1457, paragraph 7).

87.

    It must accordingly be held that the objection relating to the infringement ofArticle 2(3) of the Directive is well founded.

Infringement of Article 5 of the Directive

88.

    The Commission considers that the Irish legislation does not properly transposeArticle 5 since it makes no provision for considering the relevance orreasonableness of asking a developer for the information specified in Annex III. Article 2(5) of S.I. No 349 of 1989 merely provides that an impact assessment mayinclude that information.

89.

    Ireland indicated at the hearing that amending legislation had just been adopted.

90.

    For the reason referred to in paragraph 86 above, it must be held that theobjection relating to the infringement of Article 5 of the Directive is well founded.

Infringement of Article 7 of the Directive

91.

    The Commission states that Article 17 of S.I. No 25 of 1990 appears to be thetransposition of Article 7 in respect of projects requiring consent under the IrishLocal Government (Planning and Development) Acts 1963-1983. Article 17provides a mechanism whereby local authorities are to notify the Irish Minister forthe Environment of any application likely to have significant effects on theenvironment of another Member State. The Minister may then ask the localauthority to provide him with the information and documents which he considersnecessary.

92.

    The Commission considers, however, that that provision does not properlytranspose Article 7 of the Directive since the Minister is not expressly required totransmit the information to the other Member State. Nor does the Minister havethe power to require information from local authorities when it is the otherMember State which has asked to be consulted.

93.

    Ireland stated in the course of the written procedure that it intended to clarify itslegislation and that the amending legislation was in the process of being drafted.

It added at the hearing that the Northern Ireland Agreements would enable bettercommunication with the United Kingdom in the future.

94.

    For the reason given in paragraph 86 above, it must be held that the objectionrelating to the infringement of Article 7 of the Directive is well founded.

95.

    It follows from all of the foregoing that, by not adopting, for the classes of projectscovered by points 1(d) and 2(a) of Annex II to the Directive, the measuresnecessary to transpose Article 4(2) of the Directive correctly, and by nottransposing Articles 2(3), 5 and 7 of the Directive, Ireland has failed to fulfil itsobligations under the Directive. The remainder of the action is to be dismissed.

Costs

96.

    Under Article 69(2) of the Rules of Procedure, the unsuccessful party is to beordered to pay the costs if they have been applied for in the successful party'spleadings. The Commission has applied for an order of costs against Ireland. Since the latter has been essentially unsuccessful in its defence, it must be orderedto pay the costs.

On those grounds,

THE COURT (Fifth Chamber)

hereby:

1.    Declares that, by not adopting, for the classes of projects covered by points1(d) and 2(a) of Annex II to Council Directive 85/337/EEC of 27 June 1985on the assessment of the effects of certain public and private projects onthe environment, the measures necessary to transpose Article 4(2) of thatdirective correctly, and by not transposing Articles 2(3), 5 and 7 thereof,Ireland has failed to fulfil its obligations under that directive;

2.    Dismisses the remainder of the application;

3.    Orders Ireland to pay the costs.

Puissochet Moitinho de Almeida Gulmann             Edward                        Sevón

Delivered in open court in Luxembourg on 21 September 1999.

R. Grass

J.-P. Puissochet

Registrar

President of the Fifth Chamber

1: Language of the case: English.