Air pollution, Prevention, Damages, Liability, Contract, Property, Causation, Cooperation, Environmental Impact Assessments, Standing

Zhenhua, a producer of plate glass, was sued by the All-China Environment Federation (ACEF) in public-interest litigation over air pollution.  ACEF requested that the court order Zhenhua to terminate emissions immediately, expand its prevention facilities, suspend operations until the prevention facilities are online, assume liability for damages caused by the excessive emissions, apologize to the public, and bear litigation expenses.  The court held Zhenhua liable for damages caused by excessive emissions to help restore air quality, ordered a public apology, an ordered Zhenhua to reimburse ACEF for the cost of an environmental assessment contracted pursuant to the litigation.  The court rejected the remaining claims.

Key environmental legal questions
  • Are ACEF and Zhenhua eligible entities in the litigation: ACEF, duly registered and specializing in environmental public interest protection for more than five years, has standing under the Environmental Protection Law of China.  Zhenhua, having harmed the public interest through excessive emissions, is an eligible defendant.
  • What liabilities shall Zhenhua bear: According to the Supreme People’s Court’s “environmental public interest litigation” Interpretation (EPIL Interpretation), a plaintiff may ask for a cessation of the tortious act, removal of the obstruction, elimination of the danger, restoration to the original state, compensation for injuries, and apology.  The court cannot support ACEF’s claims based on administrative penalty laws, nor their request for Zhenhua to expand its air pollution prevention facilities.  However, Zhenhua is liable for damages caused by excessive emissions, the assessment fee, and a public apology.
  • How should compensation be calculated: While the assessment, relying on the “virtual restoration cost method,” was unilateral, Zhenhua had the opportunity to cross-examine the assessment and did not present any evidence to overturn it.  It is therefore permissible.