Case handler: Gabrielle Somers Brussels, 14 Jtne2016 Tel: (+32)(0)22861876 Case No: 77424 e-mail: [email protected] Document No: 808071 ffi

Naturvemforbundet Mariboes gate 8 N-0183 OSLO

Dear Mr Haltbrekken,

Subject: Complaint against the Norwegian Government in the area of the environment

1 Introduction

By email dated 20l[l/:ay 2015, together with the 11 organisations copied in on this letter, you submitted a complaint dated 19 May 2015 to the EFTA Surveillance Authority ("the Authority'') against the Norwegian Government on behalf ofNaturvernforbundet.

You raised 4 separate grounds of complaint- i) the issuing of a permit in relation to mining activities in the Førde fiord; ii) the issuing of a new permit in relation to mining waste in Ranfiord, iii) the issuing of a permit in relation to mining waste in Bøkfiorden; and iv) the continued use of active dumping sites for mining waste across Norway and their treatment in the respective river basin management plans. Your claim, in relation to each of these heads of complaint, that Norway has not respected the requirements of the Water Framework Directivel ("WFD").

In relation to the third ground of complaint above, the Authority notes that, according to the information provided by the complainant, the permit was issued on23 April 2008. While national legislation may already have been in force at that time, the WFD entered into force in the EEA States on 1 May 2009. As such, the Authority is not competent to assess the actions of the Norwegian Govemment under the WFD at a time when the relevant legislation was not yet in force at the EEA level.

In relation to the fourth head of the complaint, the Authority notes that the Norwegian Ministry of Climate and Environment ("the Ministry") has yet to finalise its approval ofthe river basin management plans for Norway for the period 2016-2021. Until such times as these documents are finalised, the Authority is not in a position to assess how the various permits have been dealt with.

In relation to the permit to allow the disposal of mining waste in Ranfiord, the Authority is still investigatingthis head of claim and will respond under separate cover in due course.

I Directive 2000/60/EC of the European Parlíament and of the Council of 23 October 2000 establishing a frameworkfor Community action in thefield ofwater policy.

Rue Belliard 35, B-1040 Brussels, tel: (+32X0)2 286 t8 I I, fax: (+32)(0)2 286 l8 00, www.eftasurv.int Page2 ffi

This letter will therefore only deal with your complaint in so far as it relates to the permit granted by the Norwegian Govemment to allow mining activities at the Engebø mountain and the related disposal of mining waste.

2 Factual background

On 8 Augus^t 2008, Nordic Mining AS applied for a permit under the Norwegian pollution Control Act2 to carry out extraction and processing ãctivities for rutile (titaãium dioxide) from Engebøflelletin the municipality of . This application was revised on 10 June 2009 . On 17 Apnl2015, the zoning plan concerning the mining project in Engebøfiellet was approved by the Ministry of Local Government and Modernisation. Having received the recommendations from the Norwegian Environment Agency on 13 February 20153, on 5 June 2015, the Norwegian Ministry of Climate and Environment ("the Ministiy") granted a permit pursuant to the Norwegian Pollution Control Act to Nordic Mining ASA to cany out mining activities for the extraction of rutile from Engebø mountaina. The permit included the right to deposit 250 tonnes of mining tailings in the Førde fiord over a 50 year period. That decision was appealed to the King in Council. On 19 February 2016, itre liing in Council dismissed the appeal and upheld the Ministry's original decisions. The decision recommends a change in the conditions for the granting of the pennit to allow for the surveillance of migrating smolt.

3 Correspondence

On22May 2075, the Authority wrote to the Norwegian Govemment informing it of the receipt of the complaint6. It should be noted that substantially identical complaints were received by the Authority in 2 other cases and that the Authority was already engaged in correspondence with the Norwegian Government in relation to the decision to grant a permit for mining activities in Engebø{ellet7. On 22 June 2015, yoü providãd additional information in support of your complaints. On23 June 2015, the Authôrity wrote to you to clarify the scope of its powers'. Bt email dated 1 December 2015, you provided further additional information to the Authority regarding the casero. The casð *u* dir.ursed with the Norwegian Government at the package meeting which took place in Oslo on 12-13 November 2015. Pursuant to those discussions, the Norwegian Government provided further information by emails dated 8 January 20I61t . By email ãated l9 February )016, the Norwegian Govemment provided the Authority with a copy of the decision from the tcing in Council, dismissingthe appeal against the decision to grant a permit under the Norwegiai Pollution Control Ac.t^12. By email dated 13 May 20l6,you provided further information in support ofyour casel3.

2 LOV-I981-03-13-6: Lov om vern mot forurensninger og om avfall (forurensningsloven). 3 Saksnr: 2013/4983 Recommendation from the Norwegiãn Enviro¡rmental a Agency of 13 February 2015 Saksnr: 13/4417 Permission for activities under the Pollution Control Act of 5 June s 201 5 Kongelig Resolusjon l5l3378,dated l9 February 2016. o Document Nr 758203. 7 Cases 76709,77442. 8 Document Nr. 761637. e Document Nr.761638. ro Document Nr. 782597. tr Documents Nr 794560, 794566. 12 Document Nr 795516. 13 DocumentNr.804739. Page 3 ffi

4 Relevant Law

4.1 Directive 2000160

The WFD was incorporated into point 13 ca of Annex XX to the EEA Agreement by Joint CommitteeDecision 12512007 of28 September200T.ItenteredintoforceintheEEAon I I|l4ay 2009. The Joint Committee Decision contains a number of adaptations in particular with regard to the time limits mentioned in the Directive, meaning that in respect ofthe EEA EFTA States, the time limits prescribed in the relevant provisions of the WFD started to run from the compliance date, i.e. 1 May 2009t4.

The WFD requires Member States to establish river basin districts and for each of these a river basin management plan. The WFD envisages a cyclical process where river basin management plans are prepared, implemented and reviewed every six years. There are four distinct elements to the river basin planning cycle: characterisation and assessment of impacts on river basin districts; environmental monitoring; the setting of environmental objectives; and the design and implementation of the programme of measures needed to achieve them.

The WFD establishes common definitions for the status of water qualityls and requires States to establish programmes to monitor both the ecological and chemical status of bodies of water within each river basin districtl6. According to the terminology of the WFD, the ecological status or potential status of a body of water is expressed in terms of classes (e.g. 'high', 'good', 'moderate', 'poor' or 'bad'). The ecological status and potential class are established on the basis of specific criteria and boundaries in accordance with Annex V of the WFD. When considered in the context of Article 4(7) WFD, the objective of preventing deterioration of ecological status refers to changes between classes rather than within classeslT.

In addition to ecological status, the WFD also sets parameters for chemical status, which measures chemical pollutants ofhigh concern across the EEA. The chemical status of water bodies is classified as being either 'good' or 'failing to achieve good'18.

The WFD establishes a framework for the protection of surface waters (including rivers, lakes, transitional and coastal waters) and ground waters throughout the EEA. Article 4 of the WFD defines its environmental objectives. The aim is long-term sustainable water management, based on a high level of protection of the aquatic environment.

Article a(lXaXi) WFD introduces the principle of preventing deterioration and ensuring the conservation of high water quality where this already exists. It reads as follows:

ra According to Article I (lxb) of the Joint Committee Decision "The time limits mentioned in Articles a0þ)0Ð and (iü),4(I)(b)(ii), a0þ)5(t) and s(2),6(t),8(2), I0(2), tt(7) and I1(8), I3(6) and I3(7) as well as 1 7 (4) of the Directive, which run from the date of entry into þrce of the Directive shall be understood to runfrom the date of entry intoforce of the Decision of the EEA Joint Committee No 125/2007 incorporating this Directive into the Agreement. " 15 The relevant criteria are set out in Annex V of the V/FD. ró Article s(txiÐ v/FD. t7 Common Implementation Strategy for the Vy'ater Framework Directive (2000/60/EC) Guidance Document No. 20 - Guidance Document on Exemptions to the Environmental Objectives (Technical Report - 2009 - 027) at section 3.5. l8 Arurex V, 1.4.3, WFD. Page 4 ffi

"In making operational the programmes of measures specified in the river basin management plans: (a) "for surface waters (i) Member States shall implement the necessary measures to prevent deterioration of the status of all bodies of surface water, subject to the applícation of paragraphs 6 and 7 and without prejudíce to paragraph 8; "

Article 4(1) defines the WFD general objective to be achieved in all surface and groundwater bodies, i.e. good status at the latest 15 years after the entry into force of the Directive. For Norway, this means a deadline of I May 2024.

Article 4(7) WFD sets out an exemption to this general rule, as follows:

"Member States will not be ín breach of this Directíve when:

Failure to achíeve good groundwater status, good ecologicøl status or, where relevant, good ecological potentíal or to prevent deteríoration in the status of a body of surface water or groundwater is the result of new modificatíons to the physícal characteristics of a sudace water body or alterations to the level of bodíes of groundwater, or Faílure to prevent deterioratíonfrom hígh status to good status of a body of surface water is the result of new sustainable human development activities and all theþllowing conditions are met: (a) all practícable steps are taken to mitigate the adverse impact on the status of the body of water; þ) the reasons for those modíficatíons or alterations are specífically set out and explaíned in the ríver basin management plan required under Article 13 and the objectives are revíewed every six years; (c) the reasons for those modifications or alteratíons are of overríding public interest, and/ or the benefits'to the environment and to socíety ojachíevínglie objectives set out in paragraph I are outweighed by the benefits of the new modifications or alterations to human health, to the maintenance of human safety or to sustqínable development, and (d) the beneficíal objectíves served by those modifications or alteratíons of the water body cannotfor reasons oftechnicalfeasibílity or dísproportionate cost be achieved by other means, whích are a signíficantly better envíronmental option."

In addition, Article 4(8) WFD makes it clear that when applying the exemption set out above, the State must ensure that this does not "permanently exclude o, the "o*pro*ise achievement of the objectives of this Directive ín other bodies ofwater withín tie same river basin district and is consistent with the ímplementation of other Community environmental legislatíon". Article 4(9) WFD further provides that steps must be taken to ensure that the application of Article 4(7) guaraîtees "at least the same level of protection" as under existing EEA legislation.

Article 13 WFD requires that States produce river basin management plans for each river basin district in their territory. According to Article 13(6), "Riyer basin management plans published shall be at the latest nine years after the date of entry ínto force', ãf tn" WFD. with respect to the EEA EFTA states, this obligation must be met by 1 May 20rg. Page 5 W

4.2 National Law

In Norway, the WFD is transposed into national law by Regulation of 15 December 2006 No 1446 on a Framework for Water Management ("W'ater Regulation")le. Sections 4 to 6 of the Water Regulation establish the obligations to prevent deterioration of water quality, as well as the objective that all water bodies shall have good ecological status and a good chemical condition.

Where a proposed activity might affect the status of a water body, Section 12 of the Water Regulation requires the relevant authorities to consider whether the activity in question will lead to a deterioration or a failure to achieve the environmental objectives. Under such circumstances, the authorities must consider whether the conditions for an exemption as set out in Section 12 of the Water Regulation are met.

Section 12 of the Water Regulation essentially transposes the provisions of Afücle 4(7) V/FD into national law. It reads2o:

"New activity or new interventions in a water body can be caníed out even though the environmental objective in section 4 to 6 will not be obtained or thqt the status ís deteríorated íf the cause is; a) New modiJìcations to the physical characteristics of a surface water body or alterations to the levels of bodies of groundwater, or b) New sustaínable actívity causes deterioration in a water body from hígh statr.ts to good status In addition these requirements have to befulfilled: a) All practi'cable steps have to be taken to limít an adverse development ín the status of the water body b) The benefitsþr society of the new interventíon or activíties shall be greater than the loss of environmental qualíty c) The benefi.cial objectives served by those modifications or alterations of the water body cannot þr reasons of technical feasibility or disproportionate cost be achieved by other meang which are a significantly better environmental option."

Section 14 and Annex VII of the Water Regulation provide for an obligation to set out and explain the reasons for the modifications or alterations in the river basin management plans. Where new modifications or alterations are implemented during a plan period, the reason for this shall be included in the next management plan2r.

It is unlawful, under Section 7 of the Norwegian Pollution Control Act to do or initiate anything that may entail a risk of pollution unless this is lawful pursuant to section 8 or 9 or permitted by a decision made pursuant to section 1l of the Pollution Control Act. Section 11 of the Pollution Control Act reads22:

"$ I I Special permitþr any actívíty that may cause pollution

re FOR 2006-12-15 w 1446 Forskrift om rammer for vannforvaltningen. 20 In-house working translation. 2t Norwegian Water Regulation, Section 14 paragraph2. 22 Working translation by the Norwegian Govemment, available under https://www.regieringen.no/enldokumenter/pollution-control-act/id171893i Page 6 ffi

The pollution control authoríty may on applícatíon issue a permit þr øny activity that may lead to pollution. In special cases, the pollutíon control authority may íssue such a permit without the submíssion of an applícation, and may ín such a permit make orders that replace conditions pursuant to section 16.

The pollution control authoríty may íssue regulations requiring that any person wishíng to engage ín certaín types of activities that by their nature may lead to pollution shall applyþr a permit pursuant to thís section.

If possíble, pollutíon problems shall be solved for larger areas as a whole on the basis of general plans and local development plans. If an actívity witl conflíct with final plans drawn up pursuant to the Planning and Buildíng Act, the pollution control authority shall only grant a permit pursuant to the Planning and Building Act with the consent of the planníng authorities.

When the pollution control authoríty decides whether a permit is to be granted and lays down conditíons pursuant to sectíon 16, it shall pay particulør attention to any pollution-related nuisance arising from the project as compared with any other advantages and dísadvantages so arising."

It is a pre-requisite for the granting of a permit under the Pollution Control Act, in relation to a water body, that the conditions set out in Section 12 of the Water Regulation are met.

Under Section 16 of the Pollution Control Act, it is possible to impose conditions in a permit which set conditions to counter-act or limit damage caused by the activity in question. These conditions are binding on the permit holder.

5 Applicability of Article 4 of the water Framework DÍrective

The Internal Market Affairs Directorate notes that the obligations provided for in Article 4 of the WFD in respect of surface water are only applicable from the point at which the river basin management plans become operational. In other words, the conservation measures which States are bound to adopt under Article 4(1) WFD are conditional upon the prior existence of a management plan for the river basin concerned. As noted in section 4 .l above, the time limit granted to the EEA EFTA States to publish river basin management plans expires on 1 May 2018.

Norway undertook a voluntary implementation of the WFD in selected sub-districts across the country in the period 2009-2015, the so-called "voluntary pilot phase" which was not intended to trigger obligations under the WFD. The relevant body of water in this case falls under the and Fjordane River Basin District, which was not included in the voluntary pilot phase for the West River Basin District. The Directorate understands that Norway wiil apply the first ordinary Rlyer Basin Management Plans, which will cover the whole country, in the period 2016-202P3. At the time the decision was taken by the Ministry to grant a permit for mining activities, no river basin management plan had been apprwed for the Sogn and Fjordane district.

nfver Basin Management Plan for 13 2ol6--2o2l,county council Decision 10 December 2015. The River Basin Management Plan will be centrally approved by ihe Ministry of Environment and Climate in June 2016. PageT ffi

The Directorate observes that, notwithstanding the fact that the deadline to comply with the obligation to prevent deterioration in the status of a body of water does not expire until I May 2018, the settled case-law of the Court of Justice of the European Union ("CJEU") has ruled that during the period prescribed for the transposition of a directive, the States to which it is addressed must refrain from taking any measures liable seriously to compromise the attainment of the results prescribed by that directive. This obligation to refrain, which is owed by all national authorities, must be understood as referring to the adoption of any measure, general or specific, liable to produce a compromising effect2a.

In relation to the WFD, the CJEU has held specifically that, even before the date on which the period imposed on States under Article 13(6) WFD for the publication of river basin management plans expires, States are required to refrain from taking any measures liable to compromise the achievement of the results set down in Article 4 WFD25.

The Directorate observes that, in the absence of a riverbasin management plan for the Sogn and fiordane River Basin District at the time a decision to grant a permit to carcy out mining activities was granted by the Ministry, Article 4(7) WFD is not applicable to the mining project which is the subject of this complaint. However, the CJEU has held that, for projects which are approved after the entry into force of the WFD but before the transposition date with regards to the production of river basin management plans has expired, "the critería and conditions laíd down by Article 4(7) of Directive 2000/60 may, in essence, be applíed by anølogy and, where necessary, mutatis mutandis, as setting the upper limit þr restrictions on the project"26.

Following the case law of the CJEU, the Directorate notes that although the mining project at issue did not fall within the scope of Article 4 IVFD at the time the decision of the Norwegian Ministry of Climate and Environment to issue a permit was taken, Norway was nevertheless required, even before the expiry of the time limit granted under Article 13(6) WFD to States for the publication of river basin management plans, to refrain from taking any measures liable to compromise the attainment of the objective provided for by Article 4 WFD.

The Directorate further notes that in accordance with the case law of the CJEU, it is possible to consent to projects which are not subject to Article 4 WFD at the time a decision was taken, where such a project would otherwise have had an adverse effect on the status of the water quality if the conditions set out in Article aQ)@) to (d) WFD aremet27.

Moreover, the CJEU has held that Article a(l)(a) of the WFD "does not símply set out, in programmatíc terms, mere management-planníng objectíves, but has bindíng effects, once the ecological status of the body of water concerned has been determíned, at each stage of the procedure prescribed by that directive"28.

The Directorate therefore concludes that, despite the time limit set out in Article 13(6) WFD for the publication of river basin management plans by Norway not having expired and the fact that no river basin management plan for the Sogn and Fjordane River Basin District had

2a See Case C-129/96 Inter-Environment Wallonie ll997l ECR l-7411, paragraph 45 and Joined Cases C- 165109 to C-167109 Stichting Milieu and Others, EU:C:201l:348,paragraph78. 25 Case C-43/10 Nomarchiaki Aftodioikisi Aitoloakarnanias and Others, EU:C:2012:560, paragraph 60. 26 Case C-43110 op. cit, at paragraph 65. 27 Case C-43110 op. cit at paragraph6T. 28 Case C-46lll3 Bund fitr Umwelt und Naturschutz Deutschland eV v Bundesrepublik Deutschland, EU:C :20 I 5 :433, paragraph 43. Page 8 ffi

been published at the time the decision to issue a permit to Nordic Mining ASA to carry out mining activities from Engebøflellet was taken, the compatibility of that decision with the relevant provisions of Article 4 WFD should be examined, in accordance with the jurisprudence of the CJEU.

6 Assessment

6.1 TranspositÍon of Article 4(7) WFD into Norwegian law

Article aQ) of the WFD provides for an exemption from the general obligation both to achieve good gloundwater status and to prevent deterioration from high status to good status where certain conditions are met. This has been implemented in Norway through Article 12 of the Water Regulation, though the provisions of Article 12 do not directly mirror the provisions of Article 4(7) WFD.

The Directorate notes that Article 7(b) of the EEA Agreement makes it clear that when implementing Directives into national law, States enjoy a degree of discretion as to the choice of form and method of implementation. This means that Norway has discretion to consider the most appropriate means of implementing the WFD into national law, provided that its objectives are attained.

Article aQ)@) is incorporated into Norwegian law through section 12(c) of the 1Vater Regulation which states that " [tJhe benefits þr society of the new intervention or actívitíes shall be greater than the loss of environmental quality" .In addition, section I I no.5 of the Norwegian Pollution Control Act states that"[wJ hen the pollution contro'l authoríty decides whether a permit is to be granted and lays down conditions pursuant to section 16, it shall pay particular attention to any pollution related nuisance arísing from the project as compared with any other advantages or disadvantages so arisíng". When assessing whether a permit is to be granted under the Norwegian Pollution Control Act, the principles laid down in sections 8 to 12 of the Nature Diversity Act are to be applied as guidelines2e.

The Directorate observes that Norway has chosen not to include an explicit reference to an 'overriding public interest' test, but has instead opted to require an assessment of whether the benefits for society from the new activity are greater than the loss of environmental quality. It has been argued that by failing to explicitly refer to the alternative test set out in Article aQ)@) WFD, Norway has failed to correctly implement Article 4(7) WFD into national law.

The Directorate notes that, in its assessment of whether or not to grant a permit to carry out mining works in this case, the Ministry has relied upon an overriding public interest test, as foreseen in Article aQ)@) V/FD. As a result, the Directorate finds that it is unnecessary in this case to examine, in other respects, whether or not Norway's implementing measures are in line with Article 4(7) WFD.

6,2 Decision to grant a permit

Article 4(7) WFD provides that an exemption is possible for either i) new modifications or ii) new sustainable human development activities. The Directorate notes that the deterioration of water status, as assessed by the Ministry will result from hydro-

2e see section 7 of the Norwegian Nature Diversity Act: LoV-2009-06-19-100 Lov om forvaltning av naturens mangfold (naturmangfoldloven). Page9 W morphological changes to the seabed, i.e. changes to the physical characteristics of the shape, boundaries and content of the water body.

In its decision, which was based on the assessment work carried out by the Environment Agency, the Ministry considered whether other elements, in particular chemical and physico-chemical elements, could have a negative impact on the quality elements relevant to the status of the water body. This covered a consideration of whether there was a potential for leaching in connection with metals contained in the tailings, any potential discharges of flocculants and flotation chemicals, the possible dispersion of particles outside the zoning area and whether the threshold values for priority substances in sediments would be exceeded outside of the areazoned as the disposal site. The Ministry reached the conclusion that the deterioration in the water body would occur as a result of the physical changes brought about by the sub-marine deposit of mining tailings. The Directorate notes the Ministry's conclusion that the chemical status of the water body will not deteriorate as a consequence of the disposal of mining tailings. In particular, the Ministry found that based on.modelling, it was unlikely that the particle dispersion would have a negative impact outside the disposal site area3o.

As a result, the Ministry based its decision on Section I2(a) of the Water Regulation3l, which corresponds to Article 4(7), ftrst indent WFD. Having considered the Ministry's detailed reasoning as set out in its decision to grant a permit of 5 June 2015, the Directorate is satisfied that the Ministry was entitled to consider that, were the project to go ahead, the deterioration in the water status would be as a result of hydro-morphological changes and to proceed with its assessment on that basis.

As noted above, at the time a decision was taken to grant a permit, no river basin management plan was in place for the Sogn and Fjordane river basin. As such, the assessment as regards the status of the water was made on the basis of information on the status of the water body available on'vann-nett' 32 as well as information provided in the developers application, the impact study and supplementary studies that were carried out. According to vann-nett, the water body was classified as having good ecological status. There was no status classification of the chemical status of the water body due to insufficient data.

The Directorate notes that it is the settled case law of the CJEU that a State is "required to refuse authorísation for a project where ít ís such as to result ín deterioration of the status of the body of water concerned or to jeopardise the attainment of good surface water status, unless the víew is taken that the project is covered by a derogation under Artíck a(7) of the [WFDJ"33. The Directorate further notes that the CJEU has held that there is a deterioration of status within the meaning of Article a(lXaXi) of the WFD as soon as the status of at least one of the quality elements within the meaning of Annex V of the WFD falls by one class, even if that fall does not result in a fall in classification of the body of surface water as a whole3a.

30 Decision to grant a permit for mining activities at Engebøfiellet, of 5 June 2015, Royal Norwegian Ministry of Climate ànd Environment, at section 4.6.1. 3r This corresponds to the granting of an exemption under Section 4(7) indent I of the WFD, which allows for a deterioration of status from good to less than good where the relevant conditions are met. 32 33 Case C-346114, Commission v Austria,EU:C:2016:322 atparagraph 64. 3a Case C-461/13, Bíind fiir Umwelt und Naturschtilz Deutschland eV, op. cit, at paragraph 69. Page l0 ffi

In its decision to grant the permit, the Ministry found that the disposal of mining tailing would lead to a change in the seabed conditions in the outer Førde fiord, and then assessed whether the change would lead to a deterioration of the ecological status of the water body. It noted that the bethnic fauna was the quality element most sensitive to the disposal of tailings35. The Ministry found that the bethnic fauna in the disposal area would disappear while the disposal took place and determined that the project would therefore cause the ecological status of the water body to deteriorate to poor. The Ministry further found that the water body's status would be presumed to remain very poor as long as the disposal took place and for a very long period of time thereafter. As such, an exemption pursuant to Section 12 of the Water Regulation was considered necess ary inorder to permit the disposal.

The Ministry determined that, according to section 12 of the Water Regulation, the physical changes to the body of water that would result from the disposal of mining tailings would be permissible if i) all practicable mitigation measures were taken to limit the negative development of the water body's status; ii) the benefits to society of the mining operation exceeded the loss of environmental quality; and iii) the purpose of the mining activity could not reasonably be achieved by other means that are significantly better for the environment because of a lack of technical feasibility or disproportionate costs.

6.2.1 Mítígation measures

The Directorate understands the concept of mitigation, in the context of Article 4(7) WFD, to mean those measures which aim to minimise or even cancel out the adverse impact on the status of the body of water. The Directorate notes that the wording of Article 4(7) makes it clear that 'mitigation measures' do not refer to all possible measures being taken. According to guidance drawn up by the Commission, "all practicable steps" is to be understood as meaning that the mitigation measures should be technically feasible, should not lead to disproportionate costs and that the measures are compatible with the foreseen modifications36. The Directorate notes that the appropriateness of specific mitigation measures will depend on the adverse ecological effects of the physical modifications in question; on the effectiveness of the measures regarding, in particular, the improvements of the ecological condition and on the technical feasibility and the cost-effective analysis of implementing the measures at the site.

In its assessment of whether the mining project met the requirements as regards mitigation, the Ministry noted that the negative impacts as regards the effects on the benthic fauna disposal site could not be mitigated. However, they did require that measures be taken to ensure that otherwise the water status at the disposal site was at the highest level it could be. This includes monitoring measures being established, mitigating measures being put in place, e.g. mitigation measures linked to the discharge system to limit particle dispersion from the disposal site and, if necessary, the Ministry required that activities should be discontinued to avoid deterioration in the environmental status of the water body37. The terms of these measures can be found on page 28 of the Ministry's decision3s.

35 See page l9-20 ofDecision 13/4417. 36 Common Implementation Strategy for the Water Framework Directive, Guidance Document No. 20 'Guidance on Exemption to the Environmental Objectives', published by the European Commission available a-t:http://ec.europa.eu/environment/water/water-framework/economics/pdflGuidance_document%2020.pdf 37 See section 4.6.7 of the Ministry of Climate and Environment's decision to grãnt a p"".it øi -lnlng activities, 5 June 2015. 38 For the detailed terms of these conditions see the Ministry's permission Section 7.1,7.2,g.2,g.3,11 and 12. Page 1 1 ml

In its decision to grant a permit to carry out mining activities, the Ministry specifically considered the possible impacts of the project on wild salmon. It considered in particular the impacts on smolts outward migration, the effects on smolts in the case of an accidental discharge of particles, the concentration of particles in the upper water layers where salmon are mainly found, and the effects of blasting from the mine during periods of migration, in particular in relation to salmon from the national salmon watercourse Nausta. Having assessed all the evidence presented to it, the Ministry concluded that concerns with regards to smolts were primarily linked to blasting at the mine. Overall, the Ministry assessed that the risk of significant damage to salmon to be small. They did however require that monitoring be established to avoid the occurrence of negative impacts on salmon.

In its ruling upholding the decision of the Ministry, the King in Council found that there was a degree of uncertainty regarding the smolts' outward migration period, and the effects from the blasting in the mountain. As a result, the King in Council ruled that the conditions detailed in Section t2 of the permit should be changed and provisions inserted which required that the smolt be continuously surveilled, and that the information gathered as a result of this surveillance should form the basis for determining those periods when blasting should be avoided.

The Directorate notes that having identified a number of uncertainties in relation to the environmental effects of the project, the Ministry has put in place a number of mitigation and monitoring measures designed to limit and reduce negative impacts.'

It is clear from the case law of the CJEU that, when assessing whether a State has complied with its obligations under a directive, the burden of proof lies with the Authority3e. Having reviewed the assessment ofmitigation measures carried out by the Ministry, the Directorate is unable to establish that Norway has failed to demonstrate that the condition set out in Article aQ)@) wFD.

6.2.2 Reasons þr modificatíon set out ín the ríver basin management plan

In light of the Directorate's views on the applicability of Article 4 WFD to the present case as set out in Section 5 above, it does not consider the requirement to set out the reasons for the modification in the river basin management plan as material to its assessment. However, for the sake of completeness, the Directorate notes that the river basin management plan for the Sogn and Fjordane river was adopted by the county council of Sogn and Fjordane on 8 December 20t5 andsent to the Ministry for approvalao. Section 3.5.4 of that plan states that the river basin will be at risk of not achieving the environmental object of good ecological condition following the granting of permission for the deposit of mining tailings in connection with the graytting of the mining permit which is the subject of the present complaint. The plan summarises the permit, as well as the assessments carried out by the Norwegian Environmental Agency and the Ministry. The Directorate notes that the river basin management plan has yet to be finally approved and is therefore theoretically still subject to change.

6.2.3 Assessment of benefits and losses

The Directorate notes at the outset, in relation to the condition set out in Article a(7)(c) of the WFD, that the CJEU has found that States enjoy a certain margin of discretion for

3e Case C- 306/08 Commíssion v Spain EU:C:201 l:347, atparagraph94. a0 Central approval for all of Norway's river basin management plans is expected to be given in June 2016. Page 12 W

determining whether a project is of overriding public interestar. This is because the WFD establishes common principles and an overall framework for action in relation to water protection and coordinates, integrates and, in a longer perspective, develops the overall principles and the structures for protection and sustainable use of water. The CJEU has noted that as those principles and that framework are to be developed subsequently by States by means of the adoption of individual measures the WFD does not seek to achieve complete harmonisation of the rules concerning watera2.

Any review by the Directorate of the decision of the Ministry to grant a permit to carry out mining activities is therefore limited. In carrying out its review, the role of the Directorate is not to evaluate the merits of the Ministry's decision, nor can it re-assess the evidence relied upon by the Ministry in the decision. The scope of the Directorate's review is limited to reviewing the process by which the Ministry's decision was reached and to assess whether the decision making was in line with the requirements of the WFD and whether there was any manifest error of assessment on the part of the Ministry.

In its decision to issue a permit, the Ministry carried out an exercise balancing on the one hand the environmental damage and negative impacts of the project against the benefits to society. The Ministry identified the future income from mining operations as the main benefit to Norwegian societya3. In addition, it noted that the construction and operation of the mine would create employment, both directly and indirectly. The Ministry also set out the negative environmental impacts of the mining project, noting that these mainly concerned the consequences of the sub-marine disposal òf tailings in the fiord. The Ministry recognised that there is a degree of uncertainty related to potential environmental damage caused due to particle dispersion from mining tailings. However, it concluded, on the basis of a number of studies and calculations that there was a low risk associated with the tailingsaa. As far as heavy metals were concerned, the Ministry found that while the tailings will contain heavy metals, these correspond with the natural background values in the relevant area.

The Directorate notes that the Ministry's decision sets out in a detailed manner the reasons for the project, its impact on the environment as well as considering the balance between the advantages and disadvantages. Moreover, the Ministry's decision is based on a detailed assessment carried out by the Norwegian Environment Agency. The Directorate observes that, according to the findings of the Ministry, the project will lead to the creation of employment and the generation of income over a long term basis and that the project overall will produce large revenues for society.

The Authority's review of the Ministry's assessment is limited to determining whether there has been a manifest error in its assessment of whether the condition set out in Article aQ)@) WFD has been met. In light of this, having reviewed the Ministry's assessment of the benefits and disadvantages of the mining project, and in the absence of manifest error, the Directorate finds that the Ministry was entitled to conclude that the project would give rise to benefits which were of overriding public interest.

ar Case C-3461 l4,op. cit., at paragraph 7 0. a2 Case C-346/14,op. cit., atparagraphT}. a3 See Section 6 of the Ministry's decision to grant a permit for a full discussion of advantages and distributional effects. aa As noted previously, the Ministry have also imposed a condition related to the monitoring of particle dispersion as well as measures to prevent the dispersion of particles from the sub marine disposal site. Page 13 ffi

6.2.4 Alternatíves to sub-marine disposal

In its decision to grant a permit, the Ministry carried out a detailed analysis of whether, having regards to cost and technical feasibility, the mining activities and disposal could be performed in a way that was substantially environmentally better than the one for which the permit application was made. The Ministry discounted disposal on land on the basis that there was no feasible site and so moved to a consideration of 3 alternative sub-marine sites for the disposal of tailingsas.

Having identified the best option among these alternatives, the Norwegian Environment Agency then carried out a comparison of the environmental impacts the project would have at both the Vassetevatnet and Førde fiord site46. The Ministry noted that the project would bring about substantial environmental impacts which ever site was chosen but that the ecosystem and species that would be affected differ across the two sites. In its decision, based on the recommendation of the Norwegian Environmental Agency, the Ministry found that Vassetevatnet was not considered to be a significantly better environmental option than the disposal solution set out in the application for a permit.

As previously noted, in assessing whether a State has complied with its obligations under the WFD, the burden of proof lies with the Authority. The Directorate's review of the Ministry's decision is limited to determining whether there has been a manifest error in its assessment. Having reviewed the Ministry's assessment of the alternatives to the sub-marine disposal of mining tailings in the Førde fiord, the Directorate has been unable to determine that there was a manifest error and finds that the Ministry was entitled to conclude that there was no other significantly better environmental option than the disposal solution foreseen in the permit.

6.2.5 Compliance with Article 4(8) WFD

Article 4(8) WFD requires Norway to ensure that the granting of an exemption under Article 4(7) WFD will not permanently exclude or comprise the achievement of the Directive's objectives in other bodies of water within the same river basin district and is consistent with the implementation of other Community environmental legislation. The decision of the Ministry makes it clear that the negative environmental effects from the project will be linked largely to the area affected by the disposal of mining tailings in the fiord, i.e. the water body in the outer Førde fiord. In its view, it is only these physical changes that will lead to a deterioration in water status and that no other aspects of the project will result in a deterioration in ecological status. Specific monitoring requirements have been established to ensure that the status of the body of water and adjacent water bodies does not deteriorate more than presupposed, along with a condition that activities must be stopped if monitoring shows a deterioration in ecological status beyond that which is foreseen.

In assessing whether a State has complied with its obligations under the WFD, the burden of proof lies with the Authority. The Directorate's review of the Ministry's decision is limited to determining whether there has been a manifest error in its assessment. Having considered the Ministry's assessment and in particular in view of the monitoring conditions which impose a requirement to monitor adjacent water bodies, the Directorate is satisfied that the provisions of Article 4(8) WFD have been complied with.

a5 These were disposal at the Redalen dam, at the Redalsvika bay and in the Vassetevatnet lake. a6 Environment Agency document of 15 November 2012 entitled, 'Nordic Miníng/Engebø - vurdering av miljøkonsekvenser ved deponi i Førdefiorden versus Vassetevatnet'. Page 14 ffi

6.2.6 Compliance with Article 4(9)

A further condition for the granting of an exemption under Article 4(7) WFD is that it guarantees at least the same level of protection as existing Community legislation. The Commission has issued guidance on this to explain that an exemption granted under Article 4(7) WFD cannot be used to deviate from objectives and obligations set by other pieces of EEA legislation. In particular, the purpose of this provision is to ensure that by granting an exemption under the WFD, States do not circumvent the provisions of the so-called 'wildlife directives'47.

The Directorate observes that the EU legislation in relation to biodiversity as well as specific conservation measures for birds and habitats has not been incorporated into the EEA Agreementas. As a result, there is a distinct difference between the way in which Article 4(9) WFD is to be interpreted as regards the EEA EFTA States compared with the EU Member States. The complainants have not identified, nor has the Directorate been able to identify as relevant any other piece of EU environmental legislation applicable to the present case.

7 Conclusion

On the basis of its review of the Ministry's decision to grant a permit to cany out mining activities, the Directorate is satisfied that Norway was entitled to conclude that the project was justified on the basis of overriding public interest and that all practicable steps have been taken to mitigate its adverse impacts and that the objectives pursued could not, for reasons of technical feasibility or disproportionate cost, be achieved by other means which would have represented a significantly better environmental option. As such, the Directorate finds that the conditions for exemption as set out in Article 4(7) of the WFD have been met and that accordingly, Norway is not in breach of its obligations under Article 4 of the WFD.

In light of the above, the Directorate intends to propose that the Authority close the case. The Authonty may, however, revert to the matter should any relevant developments occur in EEA or EU law.

Before the Directorate makes such a proposal, you are invited to submit your observations on the above assessment and to present any new information by 29 July 2016. Yours sincerely,

ñ-- Director Internal Market Affairs Directorate

a? Commission Document: 'Links between the Water Framework Directive and Nature Directives' - Frequently asked questions, December 2011. The document refers to Council Directive 79/409/EEC on the conservation of wild birds ("the Birds Directive") and Directive 92/43/EEC on the conservatíon of natural habitats and of wild flora and fauna ("the Habitats Directive"). It can be accessed under http://ec.europa.er.r/envirorunenlnature/natura2000/manaeernent/docs/FAO-WFD%20final.pdf 48 It is to be noted that specific reference is made to the relevant EU legislation not being applicable to EFTA States in the Joint Committee Decision incorporating the WFD into the EEA Agreement.

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Cc: Natur og Ungdom, Postboks 4783 Sofienberg,0506 Oslo, Norway; Vevring og Førdefjorden miljøgruppe, Vevring, 6817 Naustdal, Norway; tr'riends of the Earth Europe, Mundo-B Building, Rue d'Edimbourg 26, 1050, Bruxelles, Belgium; Norske Lakseelver, Postboks 93 5 4, Grønland, 0 I 3 5 Oslo, Norway; Greenpeace Norge, Pn. 33 Torshov,0412 Oslo, Norway; W\ilF-Norge, Postboks 6784 St.Olavs Plass, Oslo, Norway; Norges Jeger-og Fiskerforbund, P.O. Box94,NO-1378 Nesbru, Norway; SABIMA, Pb 6784 St.Olavs Plass,0130 Oslo, Norway; Framtiden I våre hender, Fredensborgveien24G,0lTT, Oslo, Norway; Den Norske Turistforening, Youngstorget 1, 0181 Oslo, Norway; Norges Kystfiskarlag, Postboks 97, 8380 Ramberg, Norway.