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French Administrative Supreme Court Rules in Favor of Limiting Hydrocarbon Permits for Climate Change Reasons

On December 18, 2019, the French Administrative Supreme Court ("Conseil d'Etat") ruled in favor of limiting a hydrocarbon mining permit for climate change reasons.

This decision was taken in the context of the implementation of Law n° 2017-1839 of December 30, 2017, putting a stop to the research and exploitation of hydrocarbons. This law provides that, in line with the commitments undertaken by France as part of the 2016 Paris Agreement, no new hydrocarbon research permit will be delivered on French territory. In addition, the renewal of existing hydrocarbon mining permits cannot extend beyond January 1, 2040.

IPC Petroleum France SA, a French oil company, requested and obtained through a Decree dated February 8, 2018, an extension of its hydrocarbon mining permit called "concession d'Amaltheus" located in Marne, France. Pursuant to Law n° 2017-1839, the Amaltheus concession was extended until January 1, 2040. The oil company brought an action against the French State, requesting the withdrawal of the Decree of February 8, 2018, due to the limitation in time of the mining permit. The firm mainly argued that such limitation violated its right to peaceful enjoyment of property as implied by article 1 of Protocol n°1 of the Convention for the Protection of Human Rights and Fundamental freedom, as well as Article L.111-12 of the French mining code, which provides that a mining permit may be renewed beyond the January 1, 2040, deadline for economic reasons.

However, the Conseil d'Etat found Article L.111-12 of the French mining code provided a precise definition of the limited concession balanced with general interest, and as a consequence, the right of peaceful enjoyment of property had not been violated. The Conseil d'Etat ruled that the setting of the January 1, 2040, deadline, more than 20 years after the adoption of the December 30, 2017, law, was a balanced decision that respected France's commitment under the Paris Agreement to limit climate change.

As a consequence, IPC Petroleum France's request was dismissed. This decision by the French Administrative Supreme Court confirms that combatting climate change is a public interest, which justifies, under French public law principles, certain limitations on private interests.

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