The Sixteenth Amendment of 10 July 2018 to the Atomic Energy Act has not entered into force; the legislator remains obligated to enact new provisions

Press Release No. 98/2020 of 12 November 2020

Order of 29 September 2020
1 BvR 1550/19

(16th AtG Amendment)

In an order published today, the First Senate of the Federal Constitutional Court held that the federal legislator has not yet fulfilled its obligation imposed by the Judgment of the Federal Constitutional Court of 6 December 2016 (BVerfGE 143, 246) to remedy certain violations of the Constitution arising from atomic energy law despite the fact that the time limit for such remedy has expired. In particular, the enactment of the Sixteenth Act Amending the Atomic Energy Act (16. Gesetz zur Änderung des Atomgesetzes – 16. AtG-Novelle, 16th AtG Amendment) did not fulfil the obligation.

In its judgment of 6 December 2016, the Federal Constitutional Court declared that, in parts, the provisions on the acceleration of the phase-out of the peaceful use of nuclear energy (13th AtG Amendment) were incompatible with the Basic Law (Grundgesetz – GG). This was because the fixed shut down dates set out in the 13th AtG Amendment did not ensure that the residual electricity volumes, allocated to each power plant by law in 2001 on the basis of the atomic energy consensus, could be almost completely used up for producing electricity and also because adequate compensation was not provided therefor. The Federal Constitutional Court set a time limit for the legislator to enact new provisions by 30 June 2018. By passing the 16th AtG Amendment, the legislator enacted new provisions. According to the order of the Federal Constitutional Court published today, this amendment is, however, not suited to remedy the violation of fundamental rights that the Court identified in its judgment of 6 December 2016. The 16th AtG Amendment already did not enter into force because the conditions for it set out by the legislator itself have not been fulfilled. However, also in substantive terms, the violation of the fundamental right to property under Art. 14 GG would not have been remedied by the new provision on compensation for unused residual electricity volumes (§ 7f of the Atomic Energy Act, Atomgesetz – AtG). Consequently, the legislator is still obligated to enact new provisions as soon as possible in order to remedy the violations of fundamental rights identified by the Court in its judgment of 6 December 2016.

Facts of the case:

The constitutional complaint challenges the Sixteenth Act Amending the Atomic Energy Act of 10 July 2018 (hereinafter: 16th AtG Amendment).

In 2001, the then Federal Government and energy suppliers reached a consensus on atomic energy. This agreement included a maximum electricity volume that each nuclear power plant was permitted to produce from 1 January 2000 onwards (residual electricity volume). The Act on the Controlled Termination of the Use of Nuclear Energy of 22 April 2002 (Nuclear Phase-Out Act) implemented this agreement. In response to the nuclear accident at the Japanese nuclear power plant in Fukushima in March 2011, the legislator statutorily laid down fixed shut down dates for each nuclear power plant in the 13th AtG Amendment. In its judgment of 6 December 2016, the Federal Constitutional Court held, among other things, that the fixed shut down dates set out in the 13th AtG Amendment were incompatible with Art. 14(1) GG insofar as the law neither ensured that the electricity volumes allocated to each nuclear power plant in 2002 would be almost completely used up nor did it provide adequate compensation therefor. The Federal Constitutional Court gave the legislator until 30 June 2018 to enact new provisions.

In order to implement the requirements set out in the judgment, the legislator enacted Art. 1 of the 16th AtG Amendment inserting into the Atomic Energy Act provisions on, for instance, the compensation for electricity volumes that were not used up for producing electricity (§ 7f AtG) and on the administrative procedure related thereto (§ 7g AtG). In respect of its entry into force, Art. 3 of the 16th AtG Amendment sets out that the law enters into force on the day the European Commission approves it under State aid law or communicates in a binding manner that such approval is not required. The German authorities informed the European Commission about the draft of the 16th AtG Amendment. There was no notification pursuant to Art. 108(3) of the Treaty on the Functioning of the European Union (TFEU). The Directorate-General for Competition of the European Commission stated that Commission services assume that a formal application pursuant to Art. 108(3) TFEU is not required in relation to the 16th AtG Amendment. Subsequently, the Federal Ministry for the Environment announced in the Federal Law Gazette that the European Commission had communicated in a binding manner that an approval under State aid law was not required and that the 16th AtG Amendment had entered into force effective from 4 July 2018.

The complainants challenge a violation of their fundamental right to property under Art. 14(1) GG arising from § 7f(1) and (2), § 7g(2) first sentence AtG that were inserted by the 16th AtG Amendment and arising from the fact that the legislator failed to enact new provisions that satisfied the requirements laid out by the Federal Constitutional Court. They claim that the 16th AtG Amendment has not entered into force given that the European Commission neither approved it under State aid law nor issued a binding communication that such an approval was not required.

Key considerations of the Senate:

The constitutional complaints are admissible and well-founded.

1. The fundamental rights of the complainants are violated because the 16th AtG Amendment has not entered into force and thus there is no statutory framework that remedies the violation of fundamental rights which the Federal Constitutional Court found to be objectionable in its judgment of 6 December 2016.

The violation of fundamental rights originally arose from the 13th AtG Amendment and the 16th AtG Amendment was aimed at remedying this. However, the 16th AtG Amendment has not entered into force given that neither condition set out in Art. 3 of the 16th AtG Amendment is fulfilled. The European Commission neither gave its approval nor could the letter of its Directorate-General for Competition of 4 July 2018 be classified as “binding communication” within the meaning of Art. 3 of the 16th AtG Amendment. Thus, the violation of fundamental rights persists, because no other remedial provision has been enacted.

From an EU law perspective, the letter of the Directorate-General for Competition of 4 July 2018 did not constitute a binding communication, but merely a non-binding assessment. It is an assessment in the course of pre-notification contacts that the European Commission describes as informal and non-binding in the Code of Best Practice for the conduct of State aid control procedures. This does not from the outset rule out a broader interpretation of “binding communication” in Art. 3 of the 16th AtG Amendment. However, in this case, constitutional considerations bar such an interpretation because it would not be compatible with specificity requirements arising from the rule of law that are specific to provisions on the entering into force of statutory law.

Art. 82(2) first sentence GG obligates the legislator to specify the date on which a law will take effect. Making entry into force subject to a certain condition without expressly specifying a date is not necessarily incompatible with this constitutional obligation. However, the legislator may not leave the fulfilment of the condition and the entry into force to others in an arbitrary manner and the condition must be phrased with such clarity that there is no uncertainty as to its meaning. In principle, it is compatible with Art. 82(2) first sentence GG to make the entry into force of a law conditional upon measures taken by the European Commission under State aid law. However, due to the far-reaching impact it may often have, the temporal ambit of a legal provision must be determined in a sufficiently precise manner for addressees of the provision to discern when their entitlement or obligation begins. That an expressly non-binding information by the Directorate-General for Competition should also be considered a “binding communication of the European Commission” within the meaning of Art. 3 of the 16th AtG Amendment is unforeseeable and would thus not be sufficiently clear.

2. In order to end the violation of Art. 14(1) GG that was already identified in the judgment of 6 December 2016, it will not be sufficient to enact the 16th AtG Amendment in its present form given that § 7f(1) AtG cannot remedy the violation.

In its judgment of 6 December 2016, the Federal Constitutional Court held that the 13th AtG Amendment interferes with the fundamental right to property given that fixed shut down dates for nuclear power plants limit the possibilities for the use of property. The interference is disproportionate because, for instance, it was foreseeable that some of the affected companies would not be able to almost completely use up residual electricity volumes allocated to them in 2002. The legislator must provide compensation for this in order to ensure proportionality.

The provisions of the newly inserted § 7f(1) AtG do also not ensure that an interference with the fundamental right to property would still be proportionate.

a) The way in which § 7f(1) third sentence AtG ties a compensation claim pursuant to § 7f(1) first sentence AtG to an obligation to make efforts to transfer compensable electricity volumes to other companies under adequate conditions is unreasonable (unzumutbar) and therefore does not amount to adequate compensation within the meaning of the Federal Constitutional Court’s judgment. Constitutionally, it is not objectionable that the state does not pay compensation where a reasonable (zumutbar) possibility of private sale is refused. However, it is unreasonable in this case that the complainants cannot, at the time they act, know the transfer conditions they must agree to and that the provision burdens them with either accepting inadequate conditions or risking no compensation at all.

b) The danger of having to bear a double reduction of their entitlement as described by the complainants in respect of the residual electricity volumes of two nuclear power plants cannot be dismissed from the outset given the provisions in § 7f(1) first and second sentence AtG. Whether limiting the compensation claim to two thirds or one half in quantitative terms, as set out in § 7f(1) first and second sentence AtG, leads to an unconstitutional reduction of compensation depends on how other requirements of § 7f(1) AtG are applied to the residual electricity volumes of the Brunsbüttel and Krümmel power plants. It is evident that the complainants, the Federal Government and PreussenElektra have fundamentally different ideas on how the issues resulting from the joint shareholdership of two corporations are to be resolved given that only one of them is entitled to compensation pursuant to the Federal Constitutional Court’s judgment of 6 December 2016. How this complex factual and legal situation is to be understood can be left undecided. Even if it were possible to understand the provisions in § 7f(1) first and second sentence AtG to the effect that particularly those problems arising from a double reduction in compensation were avoided, this would nevertheless not have been expressed in a sufficiently clear and applicable manner. Particularly because of the special constitutional background to the compensation, the legislator was not permitted to leave the specifying of the compensation – which is only rudimentarily outlined in the law – to the corporations concerned. Therefore, the provision would in any case be unconstitutional for lack of sufficient specificity.