Friends of the Earth v Secretary of State for International Trade/UK Export Finance

The appeal arose out of an application by the environmental charity, Friends of the Earth, for judicial review of the Government’s decision to approve export finance worth package $1.15bn in respect of a liquified natural gas (‘LNG’) project in Mozambique. Friends of the Earth argued that the Government had erred in law insofar as it proceeded upon the basis that its decision was aligned with its obligations under the Paris Agreement. In particular, it argued that the decision was inconsistent with Article 2(1)(c) of the Paris Agreement which provides that it “aims to strengthen the global responses to the threat of climate change, in the context of sustainable development and efforts to eradicate poverty, including by… (c) making finance flows consistent with a pathway towards low greenhouse gas emissions and climate-resilient development”.

Permission to appeal was granted by an evenly divided Divisional Court at first instance. In a single unanimous judgment, the Court of Appeal dismissed the claim.

The Court first considered the applicable standard of review where a domestic court is asked to judicially review a judgment formed by a decision-maker that their conduct is consistent with an unincorporated international treaty. The Court of Appeal determined that the appliable standard of review is one of ‘tenability’ rather than ‘correctness’ as a result of the constitutional principle of dualism. Accordingly, where a decision-maker decides to take into account unincorporated international law, the question for a domestic court is not whether the decision-maker’s view as to that law was correct but merely whether it was ‘tenable’.

On the facts of the case, the Court of Appeal considered that the Government’s view (namely, that Article 2(1)(c) of the Paris Agreement did not prohibit the provision of export finance to the project in question) was a tenable one. In so finding, the Court of Appeal considered that Article 2 of the Paris Agreement was declarative of the treaty’s purposes, which purposes related to obligations set down in its other articles.

Finally, the Court of Appeal dismissed the argument that a failure by the relevant decision-makers to obtain a quantitative rather than qualitative estimate of the ‘Scope 3’ emissions of the project was not a breach of their Tameside duties to make reasonable enquiries.

The full judgment is available here.

Gayatri Sarathy acted for the Appellant.

Sir James Eadie KC and Hollie Higgins acted for the First and Second Respondents.