The Senate applies to the Court of Justice of the European Union in a case regarding the refusal to pay compensation for the encumbrance of a micro-reserve on forest land to a company in difficulty
22 April, 2021
On April 22, the Department of Administrative Cases of the Senate decided to suspend the proceedings in the case regarding the refusal of the Rural Support Service to grant a compensation payment for the micro-reserve forest territories to a company in difficulty.
In the present case, the property owned by the applicant SIA Piltenes meži consists of a land plot in which a micro-reserve territory is located for a specially protected bird species – a capercaillie, for which a micro-reserve buffer zone of 59.5 ha has been established. A micro-reserve area is a forest area that is not part of a Natura 2000 area. The applicant applied to the Rural Support Service for a support payment, stating that compensatory payments for Natura 2000 forest areas can be received for micro-reserves located outside Natura 2000 areas. The Rural Support Service refused to grant support to the applicant for forest land areas in a micro-reserve, as it found an indication of the company in difficulty, i.e., the applicant's losses amount to more than 50% of the share capital.
Having examined the applicant's cassation complaint, the Senate had doubts about an unambiguous and comprehensible interpretation and application of the regulatory framework to the payment of disputed compensation.
Although the restriction on a company in difficulty to receive compensation for the encumbrance of restrictions on the use of its property has been adopted with the legitimate aim of sparing the European Union financial resources and ensuring optimal use of public funds, in the opinion of the Senate, a defect in the essence of the restriction is visible, because the restriction has been established without correlating it with the protection of the right to property.
The Senate agrees with the applicant's argument that persons whose property rights are restricted in the public interest should be compensated for the exercise of such rights without distinguishing between persons according to their legal form and their financial well-being.
In the opinion of the Senate, there is a non-compliance with the applied restriction for a company in difficulty with the essence of compensation for the preservation of biological diversity. Considering that both the restriction is determined in accordance with the mandatory provision of the European Union law and the compensation results from the fulfilment of the obligations provided for in the European Union law, moreover, considering that there are grounds for doubting the legitimacy of the restriction and noting that the compensation is to be paid from European Union funds, the Senate considers that the request for a preliminary ruling should be referred to the Court of Justice of the European Union.
The proceedings are suspended until the ruling of the Court of Justice of the European Union enters into force.
Case No SKA-14/2021 (A420284716)
Information prepared by Baiba Kataja, the Press Secretary of the Supreme Court
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