FINANCIAL SECURITY INSTRUMENTS COVERING ENVIRONMENTAL LIABILITY IN PURSUANCE OF DIRECTIVE 2004/35/EC
FINANCIAL SECURITY INSTRUMENTS COVERING ENVIRONMENTAL LIABILITY IN PURSUANCE OF DIRECTIVE 2004/35/EC

Summary/Abstract: The need to establish suitable financial guarantees has become a fundamental task that each member state of the EU must undergo in order to adequately implement the polluter pays principle within national legislations and to provide operators with a means of covering the environmental risks incurred by dangerous occupational activities. As a result of ongoing debate among the major shareholders of this endeavour, three guidelines have been proposed in order to ease the transition towards a more coherent financial security system for each member state: the gradual approach, setting ceilings for financial guarantees and excluding low-risk activities. Consequently, the financial sector has managed to adapt to the particularities of environmental liability, offering a wide range of options, ranging from insurance and re-insurance schemes, to bank guarantees and other market-based instruments. The purpose of this article is to offer an overview of the most important types of financial security instruments currently employed in the context of environmental liability and analyse the relevance of these measures from an international point of view.

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