Cross-border Impact Assessment 2019
Dossier 6: Nitrates Directive and manure quotas NL/DE
The entire dossier is available here in Dutch and English.
This dossier provides an ex post assessment of the European Nitrates Directive from 1991, which sets quotas for the use of nitrates and manure. The analysis focuses on the effects of that directive and manure quotas. Notably, it examines current practice regarding the cross-border trade of manure and possible fraud at the Dutch-German border. In terms of sustainable socio-economic development, no clear effect of the implementation of the Nitrates Directive could be observed. The available data does not show any significant, only small and regionally concentrated, improvements in soil or water quality over time. Contradictory to the aim of the directive, we found an increase in the nitrate concentration, to levels above the allowed EU norm, in the so called ‘problem zones’ in Germany, especially in regions close to the Dutch border.
Jurian van Beusekom
This studentdossier analyses ex post the effects of the European Nitrates Directive (91/676/ECC) on the Dutch-German border regions and the potential implications for manure fraud. The border region that was investigated, is the Euroregion Rhine-Meuse-North, encompassing the North of the Dutch Province of Limburg, the West of the German state of North Rhine-Westphalia, and – in deviation from the ‘real’ definition of the Euroregion Rhine- Meuse-North – the East of the Dutch Province of North-Brabant. The dossier focuses on the two main themes: European Integration and Sustainable & Socio-Economic Development. The Euregional cohesion theme has been omitted, mainly because it was hard to find useful data on which proper conclusions could be based. This is probably because of the sensitivity of the topic of fraud, due to which authorities and farmers are reluctant to give any information. The two themes that are discussed, have been investigated using certain legal and political benchmarks with which the current situation could be compared.
Firstly, the dossier provides a thorough analysis of the legal background of the situation was given, beginning with the EU Treaties (Treaty on the European Union (TEU), the Treaty on the Functioning of the EU (TFEU)) and the legislative framework in which the directive is functioning. Being a shared competence (see Article 4(2)(e) TFEU), Member States may regulate the field of environment, yet the EU may ‘take over’ if it deems this necessary to ensure Treaty compliance. The Nitrates Directive was thus adopted in the early 1990s because there were high levels of nitrogen pollution in the Member States’ waters and these waters are not restricted within national boundaries. These high nitrogen levels can have a negative impact on the biological life of water, as well as the health of animals and people using it for drinking purposes. Therefore, this EU Directive has the objective of  reducing water pollution caused or induced by nitrates from agricultural sources and  preventing further such pollution’ (Article 1).
Being part of a comprehensive framework of EU legislation to protect the environment and to further regulate environmental uses, the directive is a tool to fulfil – either directly or indirectly – the aims set out in Article 191(1) TFEU (preserve, protect and improve the quality of environment, protect human health, ensure rational utilisation of natural resources and promote measures at international level to deal with regional or worldwide environmental problems). The directive is also closely linked with EU policies concerning water, air, climate change and agriculture (e.g. the Water Framework Directive (2000/60/EC)). Its implementation yields benefit in all these areas, as well as the EU’s Common Agricultural Policy, which backs up the directive through direct support and rural development measures.
Member States have to come up with (national) legislation to transpose the directive into national law, since the directive’s provisions are not directly applicable. Both the Netherlands and Germany did so by spreading the provisions to be incorporated over several (already existing) pieces of legislation. The main legal instrument in the Netherlands is the Manure and Fertilizer Act (Meststoffenwet), in Germany it is the Fertilizers Ordinance (Düngeverordnung). However, the European Commission has brought an infringement procedure against both countries in the past because of non-compliance with the Nitrates Directive due to insufficient implementation. In view of persistent non-compliance with permitted nitrogen levels, assumptions about fraudulent practices does not seem far-fetched.
The European Court of Justice ruled in 2003 that the Dutch policy – of which MINAS (MINeral Accounting System) was the central instrument – was inconsistent with the obligations following from the directive. The system was mainly criticised for the way it set standards for the amounts of nitrogen allowed: either there were none, or they were unclear. After the ruling, the Netherlands strove to adapt its implementing legislation in consultation with the European Commission. Something similar applied to Germany: despite figures showing worsening nitrate pollution on groundwater and water surfaces, Germany apparently failed to take sufficient additional remedial measures. The Commission brought the German government to court in 2016 despite a revision of the Fertilizers Ordinance to render it more concise and make it compulsory. Recently, the CJEU ruled (in 2018) that the German revision in fact was not enough to ensure sufficient protection against nitrate pollution.
Next to the legal analysis, the environmental and economic impact of the EU Nitrates Directive is also investigated. Starting off with the environmental impact, the analysis focuses mainly on the impact on water pollution, since no usable soil pollution data were available. The effects on the water pollution were analysed using the official impact reports for the Netherlands (RIVM, 2017) and Germany (BMU, 2017). Country data was used, since no detailed data at the level of the Euroregion was available. The conclusions are therefore more general than that was hoped for. They can nonetheless be used to gain a general overview of the current practical implementation and enforcement problems of the Nitrates Directive.
Both, the Netherlands and Germany, did not show any significant changes in the nitrate’s pollution of their groundwaters between the last two implementation periods. Technically, a positive change was indirectly implied by the fact that more locations showed signs of decreasing rather than increasing water pollution. More concerning though seems the fact that, at least in Germany, a high share of zones, which were already classified as problem zones, are still showing signs of increasing water pollution. These findings suggest that especially in vulnerable areas, the directive shows no effect. What is particularly alarming about the current implementation of the Nitrates Directive is that a sizeable share of problem zones is close to the border in both countries. News reports point to the potentially excessive manure trade across the Dutch-German border, and thus provide an explanation for this finding.
Accordingly, the economic impact is analysed by using export and impact reports (RVO, 2019b), as well as data from EUROSTAT. In the latter case, the data show that there exists a large “surplus” of manure on the Dutch side of the Euroregion. This is also depicted in the enclosed figure (see figure above) where all the Dutch regions have a much higher per-land-area manure production than the German regions. This also explains the high amount of legal manure exports from the Netherlands to Germany. Germany receives about 50% of all legal manure exported from the Netherlands. At the same time, the team found many indications that a lot of fraud is committed in this context in the Euregion. Since legal disposal is costly for farmers and disposal regions are scarce, there likely exists an upward price pressure for manure exports. The actually increasing levels of nitrogen pollution in German problem zones that lie close to the border suggest as much, i.e. that the level of Dutch manure export in reality is not only high but illegally excessive. Increasing prices might make it less and less affordable for farmers to legally expose of manure and thus might make fraud more likely.
Since these border-regions are especially located in the above described Euroregion one should further investigate the effectiveness of the current implementation and enforcement of the Nitrates Directive in this cross-border region.