Lípidos Santiga v. Commission

Summary:

This case relates to the European Union’s directives on renewable sources of fuel. In 2018, the EU adopted Directive (EU) 2018/2001. The directive relates to the EU’s goal of 32% share of renewable energy by 2030. In the transport sector, Member States must require fuel suppliers to supply a minimum of 14% of the energy consumed as renewable energy by 2030. The Regulation (EU) 2019/807 of 13 March 2019 , adopted in 2019, defined, among other things, how to calculate high indirect land-use change-risk (high ILUC-risk) feedstock for biofuels, bioliquids and biomass fuels. In the appellant’s view, the regulation effectively excluded palm oil biofuels from the EU market.

On August 13, 2019, Lípidos Santiga brought an action questioning the criteria in question. On June 11, 2020, the General Court of the European Union dismissed its action for partial annulment of Regulation 2019/807 on the grounds that the company was not affected by the regulation (T 561/19). On August 24, 2020, Lípidos Santiga appealed.

On October 21, 2021, the European Court of Justice found that the General Court correctly found that the mere fact that the measure may exercise an influence on an applicant’s substantive situation is not sufficient ground to consider said applicant as directly concerned by the measure. The Court further found that the General Court was correct in interpreting the provisions not to regulate the importation, processing, or marketing of palm oil intended for the production of biofuels. The provisions are addressed to Member States, not companies, and do not directly entail a prohibition on the use of palm oil or biofuels produced from that material.

As a result of the adoption of the provisions at issue, Member States will in principle be prohibited, as from 1 January 2031, from including biofuels produced from palm oil for the purposes of the calculation of high ILUC-risk. Additionally, the minimum share concerns only 14% of final consumption of energy in the transport sector. As such, Member States have discretion as to the measures concerning renewable energy, including as regards high ILUC-risk feedstock such as palm oil. The Court found that the General Court correctly held that the practical consequences stem from the implementation of the measures and not from the provisions at issue. The Court therefore dismissed the appeal.

At Issue: Whether a EU regulation on renewable energy unlawfully excluded palm oil for biofuels from the EU market.