This article provides a summary of the EFTA Court’s advisory opinion in Case E-13/24, which clarifies the threshold for exemptions under Article 4(7)(c) of the Water Framework Directive (Directive 2000/60/EC). The Court ruled that economic considerations cannot constitute an “overriding public interest” under the Directive. Additionally, the Court found that the ordinary knock-on effects of such economic considerations are irrelevant. The judgment offers important guidance regarding the threshold for making exemptions to a fundamental provision of EU environmental law – the prohibition against the deterioration of water resources.
As such, this judgment is significant not only for the protection and restoration of water bodies in Norway but also for the broader legal framework governing water management across the EU/EEA. Its implications are far-reaching, particularly concerning the balance between economic development and ecological protection in water management and environmental law across the EU and EEA.
Introduction
On 5 March 2025, the EFTA Court issued its advisory opinion in Case E-13/24, Friends of the Earth Norway and Others v The Norwegian Government.[1] The case concerns the interpretation of the exemption “overriding public interest” under Article 4(7)(c) in the Water Framework Directive, 2000/60/EC (“WFD”).[2] In particular, the Court addresses the relevance of economic consideration, and knock-on effects of such considerations in the assessment of “overriding public interest”.
This is the first case for the EFTA Court that concerns environmental law and nature preservation. Furthermore, the concept of “overriding public interest” in Article 4(7)(c) has only been under the scrutiny of the Court of Justice of the European Union (“CJEU”) on a few occasions. These cases concerned hydropower plants and river diversions aimed at securing water supplies for urban areas, irrigation, and electricity production.[3] Such projects typically fall within the scope of the exemption but offer limited guidance on the interpretation of “overriding public interest”.
Background
In 2016, the Norwegian Government issued a pollution permit under Section 11 of the Pollution Control Act,[4] permitting a private mining company to deposit 170 million tonnes of mining waste into the Førdefjord. The deposit of mining waste will cause an irreversible deterioration in the fjord’s ecological status, changing it from “good” to “poor”.[5]
Under Article 4 of the WFD, deterioration in the ecological or chemical status of a water body is prohibited unless the conditions for an exemption under Article 4(7) are met, including the requirement that the project or activity serves an “overriding public interest”. The Norwegian Government justified the permit on the grounds that the projected future revenues from mining activities would provide significant benefits for Norwegian society as a whole. These revenues were expected to be distributed among employees, shareholders, and the public sector through tax revenues for municipalities and the state.
In 2022, two Norwegian environmental NGOs challenged the permit. In January 2024, the Oslo District Court ruled in favour of the Government, determining that the projected revenues from the mining project and employment effects in general were sufficiently important to constitute an “overriding public interest” under Article 4(7)(c) WFD. Following this ruling, the environmental organisations appealed to the Borgarting Court of Appeal, requesting that the case be referred to the EFTA Court. Given the case raised important questions about the interpretation of “overriding public interest”, the Borgarting Court of Appeal submitted the following questions to the EFTA Court:
2. Can the following economic considerations constitute an “overriding public interest” under Article 4(7)(c) of Directive 2000/60/EC, and if so, under what conditions?
a. Purely economic considerations (i.e. the expected gross income generated by planned mining operations)
b. That a private undertaking will generate income for shareholders
c. That a private undertaking will generate tax revenue for the state and municipality
d. That a private undertaking will provide wage income for employees
3. Can the following considerations constitute an “overriding public interest” under Article 4(7)(c) of Directive 2000/60/EC, and if so, under what conditions?
a. That a private undertaking will generate employment effects (increased local business activity, employment and settlement)
b. Global supply of rutile
c. Ensuring Norway and Europe access to critical minerals
The Assesment of the Efta Court
Economic Considerations
Regarding economic considerations, the EFTA Court held that for an economic consideration to qualify as an “overriding public interest”, it must serve the public interest rather than merely private interests.[6] Purely economic considerations, such as profits or income, cannot serve as justification for an exemption.[7] The Court further held that it is not sufficient for an economic consideration to serve the public interest; it must also be of such significance – either due to its context or other contributing factors – that it is sufficiently important to qualify as overriding. [8]
More importantly, the EFTA Court highlighted that any profit-making entity, either state or private owned, naturally generates income for shareholders, tax revenue for the state, and wages for employees.[9] If such factors were deemed sufficient, virtually any profitable industrial activity could be classified as serving an “overriding public interest” in the context of the WFD. Such an interpretation would undermine the general obligation in WFD to prevent deterioration and restore the environmental status of water bodies.
Based on this reasoning, the EFTA Court held that:[10]
On the basis of the foregoing, the reply to the second question of the referring court must be that income generated as a result of an economic activity, including for employees, shareholders, or the EEA State in question via taxes, cannot be considered to constitute an overriding public interest within the meaning of Article 4(7) of Directive 2000/60.
Employment Effects and Access to Critical Raw Materials
The EFTA Court extended its reasoning regarding the economic considerations in question 2 to employment effects. Employment generation, in itself, is a natural consequence of economic activity, and a knock-on effect of the economic considerations in question 2.
However, the EFTA Court did not entirely exclude employment effects as a justification. Employment effects may be relevant only where a measure is necessary to ensure settlement in regions experiencing significant depopulation and social deprivation.[11] Thus, employment effects are only relevant in exceptional circumstances.[12] In any case, a mere desire to generate or increase employment cannot, on its own, constitute an “overriding public interest”. [13]
The Court also assessed whether access to critical minerals could qualify as an ‘overriding public interest.’ While Regulation (EU) 2024/1252 (the Critical Raw Materials Act)[14] is not part of the EEA Agreement, the EFTA Court acknowledged its relevance in evaluating a mineral’s criticality.[15]
The EFTA Court clarified that classifying a mineral as ‘critical’ does not, by itself, justify an exemption. The Court highlighted that the relevance of mineral access must be assessed based on the suitability, scarcity, and potential uses of the mineral, as well as the purpose for which the mineral will be used.[16] If the mineral is primarily intended for export outside the EU/EEA, the exemption would not apply. Thus, ensuring global supply of such a mineral will not constitute an overriding public interest, as it lacks the necessary connection to the internal market.[17]
In light of these considerations, the Court concluded that:[18]
The reply to the third question of the referring court must be that certain considerations linked to the social and economic situation of a particular area, or the contribution of a project to the security of supply, or the supply, of critical raw materials within the EEA, may be considered to constitute an overriding public interest within the meaning of Article 4(7) of Directive 2000/60, provided that all the other conditions set out therein have been fulfilled.
