No vehicles with combustion engines from 2030 onwards and no gas and oil field development after 2025. These are the main objectives of four recent lawsuits against German car manufacturers and a gas and oil producer brought before German courts. This is the first time in Germany that claims have been brought against private companies in an attempt to enforce concrete measures against corporate entities to reduce CO2 emissions.

Background

In light of the Federal Constitutional Court finding on 24 March 2021 that the German Climate Protection Act was partially unconstitutional due to insufficient emission targets beyond 2030 (see our blog post on that decision), as well as the ground-breaking decision of 26 May 2021, by which Royal Dutch Shell was ordered by the Hague District Court to reduce CO2 emissions by net 45% by the end of 2030, relative to 2019 levels (see our blog post on that decision), non-profit organisations Deutsche Umwelthilfe (DUH) and Greenpeace have taken action against corporates in Germany.

In early September 2021, Mercedes-Benz AG and BMW AG received cease and desist letters from DUH requesting the car manufacturers to:

  • stop marketing vehicles with internal combustion engines after 31 October 2030,
  • limit the marketing of vehicles with internal combustion engines between 1 January 2022 and 31 October 2030 to emissions totalling no more than 604 million tons of CO2.

Wintershall Dea AG was requested by DUH to limit future gas and oil production to 0.93 gigatons of CO2 and to cease development of new gas and oil fields after 31 December 2025.

Around the same time, Volkswagen AG received a similar letter from Greenpeace Germany, demanding that Volkswagen (including all of Volkswagen’s group companies and actual best efforts in joint ventures and shareholdings respectively):

  • reduce its CO2 emissions by at least 65 per cent by the end of 2029 compared to 2018,
  • limit marketing of vehicles with internal combustion engines to a maximum of 25 per cent between 2021 and the end of 2029,
  • discontinue the marketing of vehicles with internal combustion engines by the end of 2029 at the latest.

Since the companies rejected the above demands, representatives of DUH and Greenpeace filed the lawsuits at various German courts on 21 September, 4 October, and 8 November 2021 respectively.

Claimants’ reasoning 

All claims are based on general provisions of German nuisance and tort law (Sec. 1004, 823(1) German Civil Code) protecting inter alia the rights to health and property as well as the general right of personality/privacy (Allgemeines Persönlichkeitsrecht). In particular, the claimants argue as follows:

  • In order to achieve the targets of the Paris Agreement, i.e. to limit warming well below 2°C, preferably to 1.5°C, a certain global CO2 budget must not be exceeded. This budget could be allocated to individual states but also to the defendants based on their market/emission shares.
  • Germany only has a limited CO2 budget left as accepted by the German Federal Constitutional Court in its decision of 24 March 2021. The more CO2 emitted now, the lower the future budget would be, and thus more drastic measures would be needed to reduce future emissions, which would amount to a violation of the claimants’ rights.
  • Due to the predictability and the disproportionality of the potential consequences of climate change, there is an unwritten duty of care under tort law not to exceed the remaining CO2 budget. The fact that CO2 emissions are not prohibited under public/administrative law does not bar this duty of care.
  • The defendants’ emissions would contribute to global warming and consume significant portions of the remaining CO2 budget, by which they would violate their duty of care vis a vis the claimants. This duty of care includes subsidiaries as well as scope 3 emissions.
  • The claimants are not obliged to tolerate any future harm as such harm was objectively unlawful and not merely insignificant. Any (future) impairments that the claimants would suffer from would be unlawful as the claimants’ interests in protecting their rights outweighed the defendants’ interest in emitting CO2.

Comment & Outlook

The lawsuits against Mercedes-Benz, BMW, Volkswagen, and Wintershall Dea are breaking new legal ground in Germany with the aim of enforcing stricter emission targets on corporates. In the absence of any specific climate liability regime under German law, claimants can only rely on general provisions of civil law, if that. The enforceability of such claims is more than unclear yet and the claimants’ arguments face several major legal challenges.

While there is a common consensus on the possible future effects of climate change, it is nevertheless doubtful whether climate change establishes a defensible legal position for the claimants. It is unknown whether and when potential effects of climate change will specifically affect the claimants in the years or even decades to come. A statistical increase in the risk that climate change impacts could affect the claimants in the future is arguably not sufficient in this regard as there is no concept of probabilistic causation under German law.

It is further questionable whether specific emission targets can be derived from an unwritten duty of care. Whereas the Dutch court in the Shell case based such an unwritten duty of care on human rights and other soft law instruments, the German Federal Constitutional Court expressly acknowledged in its decision of 24 March 2021 that it was up to the legislator to establish adequate emission targets and to ensure a predictable legal framework. A predictable legal framework requires binding solutions at national and international level. As the Federal Constitutional Court further pointed out, it is generally not the task of courts to derive quantifiable limits to global warming and corresponding emission targets from constitutional provisions. A fortiori, such targets cannot follow from an unwritten duty of care, in particular because emissions are not illegal. However, it remains to be seen how the German courts will rule and any subsequent decision is likely to be appealed.

It is also possible that the lawsuits will be overtaken by political measures, at least in Europe. While Germany has so far been reluctant about concrete phase-out plans for internal combustion engines, the topic has come back on the political agenda after the parliamentary elections in September this year. Some countries are clearly ahead and have already announced concrete dates for a ban of petrol and diesel cars (e.g. 2025: the Netherlands, Norway; 2030: Sweden, Denmark, UK). As part of its “Fit for 55” package, the European Union has announced plans that all newly registered cars must be emission-free from 2035. The adoption of the proposed Directive on Corporate Due Diligence and Corporate Accountability in relation to human rights, environmental and governance risks by the Commission is expected for December.

In any event, the recent lawsuits show once again that climate-related litigation has arrived in Europe and the next lawsuit may just be on the horizon. Irrespective of the prospects of success, climate-related lawsuits aim to put corporates under pressure to improve their climate goals. The risk for private corporates of becoming the target of such a claim has increased significantly.