In the climate space, attention turned to the legal world in late July after the United Nations’ highest court made a ruling on climate liabilities.
The International Court of Justice (ICJ) in The Hague gave a landmark legal opinion stating that nations can be held legally accountable for their greenhouse gas (GHG) emissions.
The ruling was based on the application of existing law, and is expected to provide a more solid legal footing for future lawsuits against governments for taking inadequate action to address GHG emissions.
“Failure of a State to take appropriate action to protect the climate system from greenhouse gas emissions – including through fossil fuel production, fossil fuel consumption, the granting of fossil fuel exploration licences or the provision of fossil fuel subsidies – may constitute an internationally wrongful act which is attributable to that State,” the court said in a statement.
While the court’s opinion is not legally binding on governments in itself, it could have significance as governments come under more intense pressure to take climate action, including the use of carbon pricing mechanisms.
The court said the wrongful act in question is not the emissions of GHGs per se, but the breach of conventional and customary obligations involved – meaning the failure to ensure protection of the climate system.
“Thus, a state may be responsible where, for example, it has failed to exercise due diligence by not taking the necessary regulatory and legislative measures to limit the quantity of emissions caused by private actors under its jurisdiction,” the ICJ said in the ruling.
One interpretation of the ICJ’s ruling is that it is likely to heap more pressure on governments who have not taken adequate climate action who may now be more exposed to legal action as a result.
Moreover, other courts worldwide may now be able to rely on a stronger legal position taken by the ICJ when assessing the validity of plaintiffs’ requests for compensation for climate harms.
Record participation
Serving to highlight the strength of the ICJ’s legal ruling, a total of 96 States and 11 international organisations presented oral statements during public hearings as part of the case. This was the highest level of participation in a proceeding in the history of not just the ICJ but also its predecessor, the Permanent Court of International Justice.
The ICJ’s 15 judges also adopted the advisory opinion unanimously – only the fifth time in the court’s nearly 80-year history that it has done so.
Reactions
The ICJ’s ruling prompted a buzz among legal and environmental organisations in July and August, as dozens of experts gave their assessment of its implications.
“For the first time, the world’s highest court has made clear that states have a legal duty not only to prevent climate harm — but to fully repair it,” said Joana Setzer, Associate Professorial Research Fellow at the Grantham Research Institute on Climate Change and the Environment at the London School of Economics and Political Science.
“The ICJ’s advisory opinion affirms that states responsible for climate harm must provide full reparation to injured states, reinforcing the legal basis for climate justice. This paves the way for more concrete demands around loss and damage, historical responsibility, and the rights of communities facing existential threats. It adds decisive weight to calls for fair and effective climate reparations,” she said.
UK-based independent international think tank Chatham House said the court’s opinion is “consequential” and could shape the contours of debate at the upcoming COP30 climate summit in Brazil in November.
“Governments’ failure to act on climate change can now be argued to be a breach of law – with potential legal, financial and diplomatic consequences,” it said.
“That could have significant implications. The threat of exposure to litigation in national courts may help force governments to more urgently reduce emissions and demonstrate their compliance with treaty negotiations. The opinion is also likely to be used as legal precedent in international negotiations and in crafting future treaties. Coming in the lead-up to COP30, scheduled for November in Brazil, it will provide smaller countries with important new leverage,” Chatham House said.
Laura Clarke OBE, CEO at environmental law charity Client Earth, said the world’s highest court had published a once-in-a-generation legal decision that will shape climate litigation for decades to come.
“If governments and parliaments fail to curb the production and consumption of fossil fuels, approve fossil fuel projects and roll out public money for fossil fuels, they could be in breach of international law. And now – for the first time in legal history – judges across the world are equipped with definitive legal guidance for any climate case that crosses their desks,” she said.
While there is no direct read-across from the ICJ’s ruling for carbon markets, it does create a more supportive legal backdrop for more ambitious climate action by governments. This can include carbon markets and taxes, along with subsidy regimes and a host of other policies that can be effective in reducing GHG emissions from the carbon-intensive industries.
To find out more about proposed legislative changes to the EU’s climate framework, and their implications for carbon markets, read this recent article from Carbonwise: EU includes carbon credits in amended 2040 climate law – Carbonwise
