Court of Appeal dismisses Paris Agreement climate change judicial review challenge against Government export credit support of LNG project in Mozambique

The Court of Appeal (Sir Vos MR, Lord Justice Bean and Sir Lindblom SPT) has unanimously dismissed an appeal from the Divisional Court in respect of a judicial review challenge of the decision of the UK’s export credit agency, UK Export Finance (‘UKEF’), to provide financial support to a liquid natural gas development in Mozambique. The challenge had been dismissed at first instance by Lord Justice Stuart-Smith and Ms Justice Thornton.

The judicial review was brought by Friends of the Earth, who argued, inter alia, that the provision of financial support was inconsistent with the UK’s obligations under the Paris Agreement and that UKEF was obliged to calculate the emissions from consumption of the gas by end users (commonly referred to as Scope 3 emissions) before taking a decision to provide financial support to the project.

The Court of Appeal upheld the Divisional Court’s decision to dismiss the claim, but did not accept either of the competing interpretations of the Paris Agreement put forward by Stuart-Smith LJ and Thornton J. The Court of Appeal reaffirmed that the correct approach when assessing whether a decision maker has complied with an unincorporated treaty is to consider whether they have taken tenable view and held that UKEF’s view that the project was compatible with the Paris Agreement was tenable and rational. They concluded that UKEF was not required, by its Tameside duty, to calculate Scope 3 emissions in order to assess compatibility with the Paris Agreement.

Adam Heppinstall KC and Freya Foster acted for the Interested Parties instructed by Latham and Watkins.

The judgment is available to read in full here.