Gabcikovo-nagyamaros Project Case

CASE STUDY

GABCIKOVO-NAGYAMAROS PROJECT CASE (HUNGARY V.SLOVAKIA) 1993 Official citation- I.C.J. reports 1997,p.7

TABLE OF CONTENTS

Chapter No. Topics

Chapter-1 Background of the case .............................................

Chapter-2 Facts of the case.........................................................

Chapter-3 Issues raised by both the parties................................

Chapter-4 Judgement..................................................................

Chapter-5 Contribution...............................................................

Chapter-6 Abstract......................................................................

Chapter-1

BACKGROUND OF THE CASE

The joint Hungarian-Czechoslovak project was agreed upon on 16 SEPTEMBER 1977 in

BUDAPEST TREATY concerning the construction and operation of the Gabcikovo-

Nagymaros ’System of Locks’ as a joint investment. It was a large barrage project on

Danube. The 1977 Treaty entered into force on 30 June 1978. According to its Preamble, the

system was designed to attain ‘the broad utilization of the natural resources of the Bratislava-

Budapest section of the Danube River for the development of water resources energy,

transport, agriculture and other sectors of the national economy of the Contracting Parties’.

The joint investment was thus essentially aimed at the production of hydroelectricity, the

improvement of navigation on the relevant section of the Danube and the protection of the

areas along the banks against flooding. At the same time, by the terms of the Treaty, the

contracting parties undertook to ensure that the quality of water in the Danube was not

impaired as a result of the Project, and that compliance with the obligations for the protection

of nature arising in connection with the construction and operation of the System of Locks

would be observed.

The 1977 Treaty describes the principal works to be constructed in pursuance of the Project.

It provided for the building of two series of locks, one at Gabcikovo (in Czechoslovak

territory) and the other at Nagymaros (in Hungarian territory), to constitute ‘a single arid

indivisible operational system of works’ to prevent floods, improve river navigability and

hydro-electricity production. The Treaty further provided that the technical specifications

concerning the system would be included in the ‘Joint Contractual Plan’ which was to be

drawn up in accordance with the Agreement signed by the two Governments for this purpose

on 6 May 1976. It also provided for the construction, financing and management of the works

on a joint basis in which the Parties participated in equal measure.

This case raise some significant questions for the first time that the parties to the dispute

raised a plea for orders of specific performance before the Court and this was the first ever

dispute in which the Court was directly asked to consider the consequences of the legal

developments in the field of environmental protection. Even though the relationship between

the law of treaties and the law of State responsibility had generated much general concern,

the Court in the past, had not been presented with an occasion to pronounce on these issues.

Chapter-2

FACTS OF THE CASE

This gabcikovo-nagyamaros project intiated by the Budapest treaty of 1977 between the

Hungarian people’s republic and czechoslavik socialist republic for the construction on

Danube river. The four main purpose of this project are electricity production, navigation,

flood protection and regional development. The project was to consist of a bypass canal on

the Slovak territory which was designed to produce peak flow electricity, and the downstream

step on the Hungarian territory which was designed to produce a constant flow of electricity.

In order to provide for the adverse impact that a project of this scale was likely to have on the

environment, the 1977 Treaty contained provisions specifically to limit the extent of the

possible adverse environmental impact. The Treaty had categorically provided that the

construction of the project should not in any way impair the quality of water in the Danube,

preservation of the natural environment was to be ensured and the fishing interests were to be

secured. The detailed implementation of the project was to be carried out in accordance with

a series of interrelated agreements, out of which the most crucial was the joint contractual

plan. The said plan contained provisions with regard to the technical details of the project as

also the financial responsibility for its construction. In fact, after the emergence of the

dispute, both the disputing parties commissioned various studies as to the scientific impact of

the project, however, it became abundantly clear from the pleadings of both the contesting

States that no serious environmental impact assessment had been carried out before the

conclusion of the Treaty.

The part of project which had generated in Hungary, the Hungarian Government suspended

the works in 1989 alleging grave risk to Hungarian’s environment and Budapest water

supply. The Slovak Republic/Slovakia, which succeeded Czechoslovakia as a party to the

Project, denied these allegations and undertook an alternate project wholly on Slovak

territory. Czechoslovakia decided to continue with the implementation of the project in a

limited form on its territory (which was referred to as the so-called “Variant C”). This

arrangement involved a unilateral diversion of the waters of the Danube and was forcefully

opposed by Hungary. Hungary finally terminated the 1977 treaty with effect from 25 May,

1992. Czechoslovakia proceeded with Variant C and dammed the Danube on 23 October,

1992. On 1 January 1993 Slovakia became an independent state. A series of negotiations

were carried under the aegis of the European Communities and in April 1994 the “Special

Agreement for Submission to the International Court of Justice of the Differences between

the Republic of Hungary and the Slovak Republic Concerning the Gabcikovo-Nagymaros

Project”. Under Article 2 of the special agreement, the Court was requested to decide the

dispute on the basis of the 1977 Treaty and the rules and principles of general international

law, as well as such other treaties as the Court might find applicable.

This unilateral operation, has allegedly had, and will continue to have, significant detrimental

effects on Hungary’s environment and access to the water of the River Danube. Despite

efforts at mediation by Commission of the European Committees, Hungary and Slovakia

were unable to resolve their differences, and in 1993 the dispute that referred to the

International Court of Justice for adjudication. At this point of time, it would also be

interesting to note that this case was noted internationally as the first environmental case to

be decided by the ICJ.

Chapter-3

ISSUES RAISED BY BOTH THE PARTIES

ISSUES PRESENTED

(1) Whether the environmental concerns expressed by Hungary created a ‘state of

necessity’ under customary international law;

(2) Whether Slovakia was legally entitled to unilaterally plan and operate an alternative

project; and;

(3) Whether Hungary’s notification of the termination of the treaty of 1977 was legal.

HUNGARIAN ARGUMENTS

The Danube River is capable of supplying approximately 60% of Hungary’s drinking

water. Water from the Danube River is of particularly high quality because of a bank-

filtering process in which water seeps from the Danube through a naturally filtering bio-

active pebble bed into an area aquifer hundreds of meters deep. The reservoir will

substantially reduce the rate of water flow, causing sediment to accumulate along both the

floor of the reservoir and river. Toxins such as iron, manganese, and other industrial

pollutants that would normally be transported downstream will settle along the floor of

the reservoir. The sediment will also provide a breeding ground for harmful bacteria.

Both the toxins and the bacteria will infiltrate the aquifer and enter drinking water

supplies, polluting the ground water reserves within ten years.

As the sediment accumulates, it will have to be dredged. Dredging of the reservoir and

riverbed will reintroduce the harmful pollutants into the surface water, while also

destroying the bioactive pebble bed responsible for the natural filtration of the river water.

Destruction of the pebble bed will permit additional organic micro pollutants and

microbes to enter and contaminate the aquifer. Leaching of hydrocarbon compounds from

the asphalt layer lining the power canal will further pollute the river water. The diversion

of the river channel will disconnect the main river from a complex system of tributaries

that play an essential role in the self-purification of the Danube River. The water table

upstream of the Dunakiliti Dam will rise, causing soil saturation and reducing the

productivity of farm land.

Below the dam, the water table will lower, reducing crop production and increasing

drought susceptibility. The corresponding fluctuation in the water table will affect the

forest habitat of the region and potentially result in the destruction of 50,000 acres of

floodplain. The loweringof the aquifer will also jeopardize the freshwater supply of local

inhabitants. The complex ecological nature of the river basin in the area of the G-N

Project means that the basin serves as a fertile ground for the development of an

extremely diverse collection of flora and fauna.The complex ecological nature of the area

also renders the flora and fauna highly susceptible to changes in the environment.

Extensive ecological disruption caused by diverting the river from its natural channel for

25 kilometers will likely destroy an estimated 80-90% of the 5000 animal species that

inhabit the area. The fish population alone is likely to fall by 25%. Commercial fish

yields will likely fall by a staggering 90%.

Although this Project was intended to increase the flood control level of the region, there

is concern that the quality of the reservoir embankments and the walls of the canal do not

meet international standards of structural stability. Concern also exists that the Project

lacks measures to prevent accidental flooding or to protect the surrounding area from

floodwaters. This Project facilities are constructed ‘in the area of a geologically young

fault.’ Geological and seismological characteristics of the region were little understood at

the time the Project was conceived. In fact, at the time of conception, no geological or

geophysical evaluations of the impact of the G-N Project had been conducted. The

complicated nature of the region has, however, become apparent during the course of

preliminary construction. Without further studies to determine the necessary

modifications to this Project, the parties would be risking ‘human and economic disaster’

with financial losses running ‘ten times the cost of the whole investment.’ The economic

costs of maintaining and operating this Project, coupled with the costs of measures to

moderate environmental damage and the value of lost agricultural production will dwarf

the value of energy produced over the life of the Project.

Diversion of the Danube into the power canal will physically isolate the villages of

Dobrohost, Vojca, and Bodiky from the rest of Slovakia. The physical separation, coupled

with the environmental devastation and the reduced agricultural production will cause a

rural exodus from these villages. The diversion into the power canal will also deprive

Hungary of access to the economic resources of 25 kilometers of the Danube River. This

access was one of the primary rationales for locating the international border along the

median of the Danube river.

SLOVAKIA ARGUMENTS

Slovakia asserts that Hungary has grossly exaggerated the environmental dangers of the

G-N Project. It contends that it is not only possible to mitigate much of the Project’s

feared environmental damage, but the Project will have significant environmental

benefits. Slovakiaasserts, for example, that the Dunakiliti reservoir will actually improve

water quality by slowing erosion and slowing the rate of the Danube, thereby permitting

larger quantities of water to pass through the bio-active pebble layer and dilute the

currently polluted aquifer.

According to Slovakia, the Hungarian projections of reduced water quality due to the

decrease in oxygen content of the river, the increasing silt of the reservoir, and the

infiltration of toxins are based on scant scientific research and are contrary to reports from

international experts. Slovakia also notes that the current water table in the Danube

Region may fluctuate by as much as seven meters, creating less than ideal conditions for

agricultural production.

The G-N Project will reduce the fluctuations in the aquifer level, raise the water table

where crops have been susceptible to drought, and lower the water table where crops have

been damaged by inundation. The harm caused by the change of the hydraulic regime will

most likely alter the wildlife habitat in the meadow-forests and fish habitat. Slovakia

argues that the impact on the meadow forest can be mitigated by timing discharge of

water from the Dunakiliti reservoir and the construction of ‘low stony barrages’ in the old

river bed. In fact, the Project will bring water to regions of the Danube meadow-forests in

Hungary that are currently drought-ridden throughout much of the year. The G-N Project

is also the most economically efficient means of controlling floods in this region of

theDanube. Further, Slovakia asserts that a number of comprehensive studies attest to the

geological stability ofthe region and the structural integrity of the Project facilities.

Chapter-4

JUDGEMENT

With respect to the first issue, the Court held that for the ‘state of necessity’ exception to

apply with respect to the Gabcikovo-Nagymaros project, the following factors would

have to be established by Hungary:

The environmental concerns constituted an ‘essential interest’ of Hungary.

Hungary’s environmental concerns were threatened by ‘grave and imminent peril’.

Suspension and abandonment of construction works was the only way Hungary could

have safeguarded its environmental concerns.

Hungary’s suspension and abandonment of construction works did not impair

the‘essential interests’ of Slovakia.

Hungary’s obligation under the 1977 treaty did not arise out a peremptory norm of

general international law.

The 1977 treaty did not, either explicitly or implicitly, exclude the possibility of

invoking the ‘state of necessity’ exception with respect to Hungary’s obligations

under it

Hungary not contributed to the occurrence of the ‘state of necessity’

However, the fifteen judge bench standard found it difficult to conclude that Hungary’s

environment was in fact threatened by ‘grave and imminent peril’; and held that a mere

apprehension of a possible peril is not sufficient to meet this, as it must simultaneously be

‘grave’ and ‘imminent’. The court also noted that the dangers Hungary outlined were mostly

of a long term nature and uncertain. Moreover, suspension and abandonment were not found

to be the only means available to Hungary to safeguard its environmental concerns. Thus, the

‘state of necessity exception was found to be inapplicable in the instant matter.

With respect to the second issue, the court held that while Slovakia was entitled to

unilaterally plan and construct its alternative solution to the project, it did not have the right

to put that alternative solution into operation, because it violated the express purpose of the

1977 treaty, as well as Hungary’s territorial integrity and sovereign independence. Moreover,

Slovakia’s operation of the alternative solution did not constitute a lawful countermeasure

under international law, because the deprivation of Hungary’s right to an equitable share of

the use of the Danube River was in excess of the injury suffered by Slovakia.In light of the

arguments put forth by Hungary vis-à-vis the existence of state necessity,impossibility of

performance of the 1977 treaty, the occurrence of fundamental change of circumstances,

material breach of the 1977 treaty by Slovakia; the ICJ found that Hungary’s notification of

termination of the 1977 treaty was at best premature, and did not have the effect of

terminating the 1977 treaty under International law.

LEGAL CONSEQUENCES OF JUDGMENT

It is of cardinal importance that the Court has found that the 1977 Treaty is still in force

and consequently governs the relationship between the Parties. That relationship is also

determined by the piles of other relevant conventions to which the two States are party,

by the rules of general international law and, in this particular case, by the rules of State

responsibility; but it is governed, above all, by the applicable rules of the 1977 Treaty as a

lex specialis. The Court observes that it cannot, however, disregard the fact that the

Treaty has not been fully implemented by either party for years, and indeed that their acts

of commission and omission have contributed to creating the factual situation that now

exists. Nor can it overlook that factual situation - or fine practical possibilities and

impossibilities to which it gives rise - when deciding on the legal requirements for the

future conduct of the Parties.

What is essential, therefore, is that the factual situation as it has developed since 1989

shall be placed within the context of the preserved and developing treaty relationship, in

order to achieve its object and purpose insofar as that is feasible. For it is only then that

the irregular state of affairs which exists as the result of the failure of both Parties to

comply with their treaty obligations can be remedied. The Court pointed out that the 1977

Treaty is not only a joint investment project for the production of energy, but it was

designed to serve other objectives as well: the improvement of the navigability of the

Danube, flood control and regulation of ice-discharge, and the protection of the natural

environment. In order to achieve these objectives the parties accepted obligations of

conduct, obligations of performance, and obligations of result.

It is clear that the Project's impact upon, and its implications for, the environment are of

necessity a key issue. In order to evaluate the environmental risks, current standards must

be taken into consideration. This is not only allowed by the wording of Articles 15 and

19, but even prescribed, to the extent that these articles impose a continuing - and thus

necessarily evolving – obligation on the parties to maintain the quality of the water of the

Danube and to protect nature. The Court is mindful that, in the field of environmental

protection, vigilance and prevention are required on account of the often irreversible

character of damage to the environment and of the limitations inherent in the very

mechanism of reparation of this type of damage. New norms and standards have been

developed, set forth in a great number of instruments during the last two decades. Such

new norms have to be taken into consideration,and such new standards given proper

weight, not only when States contemplate new activities but also when continuing with

activities begun in the past. For the purposes of the presentcase, this means that the

Parties together should look afresh at the effects on the environment of the operation of

the Gabcikovo power plant. In particular they must find a satisfactory solution for the

volume of water to be released into the old bed of the Danube and into the side-arms on

both sides of the river.

In the Judgment, the Court concluded that both Parties committed internationally

wrongful acts, and it has noted that those acts gave rise to the damage sustained by the

Parties; consequently, Hungary and Slovakia are both under an obligation to pay

compensation and are both entitled to obtain compensation. The Court observed,

however, that given the fact, that there have been intersecting wrongs by both Parties, the

issue of compensation could satisfactorily be resolved in the framework of an overall

settlement if each of the Parties were to renounce or cancel all financial claims and

counterclaims. At the same time, the Court wishes to point out that the settlement of

accounts for the construction of the works is different from the issue of compensation,

and must be resolved in accordance with the 1977 Treaty and related instruments. If

Hungary is to share in the operation and benefits of the Cunovo complex, it must pay a

proportionate share of the building and running costs.

Chapter-5

CONTRIBUTION

Gabcikovo-Nagymaros project prompted the constitution of a Special Environmental

Chamber of the ICJ. It also clarified the Court’s jurisprudence with respect to the state and

non-state components of environmental protection in as much the Court held that these were

grounded in general international law. The Court confirmed customary nature of at least part

of International Environmental Law, although without referring to any specific norm. The

following paragraph of the Court’s judgment confirms this contention:

The Court has no difficulty in acknowledging that the concerns expressed by Hungary for

its natural environment in the region affected by the Gabcikovo- Nagymaros project

related to an ‘essential interest’ of that State, within the meaning given to that expression

in Article 33 of the Draft of the International Law Commission.

Neither of the Parties contended that new peremptory norms of environmental law had

emerged since the conclusion of the 1977 Treaty, and the Court will consequently not be

required to examine the scope of Article 64 of the Vienna Convention on the Law of

Treaties. On the other hand, the Court wishes to point out that newly developed norms of

environmental law are relevant for the implementation of the Treaty and that the parties

could, by agreement, incorporate them through the application of Articles 15, 19 and 20

of the Treaty. These articles do not contain specific obligations of performance but

require the parties, in carrying out their obligations to ensure that the quality of water in

the Danube is not impaired and that nature is protected, to take new environmental norms

into consideration when agreeing upon the means to be specified in the Joint Contractual

Plan.

Thus, confirmation of the customary nature of at least part of International Environmental

Law was given in three ways. Firstly, it was acknowledged that environmental interests

may amount to “essential interests” in the meaning of the customary rule providing for

the state of necessity defense. While an interest is conceptually different from a norm, the

existence of a legally protected interest assumes that such interest has legal relevance

irrespective (in this case) of any treaty. Secondly, the Court talked of newly developed

norms of environmental law relevant for the implementation of the Treaty. This seems a

clear reference to norms belonging to international customary law. Thirdly, in order to

support its conclusion that environmental interests can in fact amount to “essential

interests”, the Court expressly referred to paragraph 29 of its Advisory Opinion on the

Legality of Nuclear Weapons, thus suggesting that the general obligation mentioned in

paragraph 29 had the same basis as the essential character of environmental protection.

Therefore it can possibly be inferred from these observations that a new dimension was

added to the Court’s jurisprudence vis-a-vis International Environmental Law.

Further, the case concerning Gabcikovo- Nagymaros project is an apt example of how the

International Court of Justice, tries to achieve a result that is acceptable to both litigants

and that, consequently, stands the best chance of being complied with by the two

sovereign litigants. The case highlighted the unique role that the ICJ may play when two

interdependent states have reached a deadlock after lengthy negotiations. Through their

special agreement, Hungary and Slovakia asked the Court to define and resolve the legal

aspects of their dispute. But the special agreement also provided that the parties shall

“immediately after the transmission of the Judgment enter into negotiations on the

modalities for its execution” and that, “if they were unable to reach agreement within six

months, either Party may request the Court to render an additional Judgment to determine

the modalities for executing its Judgment.” In this way, both parties were actively using

the principal judicial organ of the United Nations to assist them in defining the

fundamental legal parameters of a process of on-going negotiations that was directed

towards achieving a political result that was mutually acceptable.

Gabcikovo- Nagymaros Project prompted the constitution of a Special Environmental

Chamber of the ICJ. It also clarified the Court’s jurisprudence with respect to the state

and non-state components of environmental protection in as much the Court held that

these were grounded in general international law. The Court confirmed customary nature

of at least part of International Environmental Law, although without referring to any

specific norm. The following paragraph of the Court’s judgment confirms this contention:

The Court has no difficulty in acknowledging that the concerns expressed by Hungary for

its natural environment in the region affected by the Gabcikovo- Nagymaros Project

related to an ‘essential interest’ of that State, within the meaning given to that expression

in Article 33 of the Draft of the International Law Commission.

Neither of the Parties contended that new peremptory norms of environmental law had

emerged since the conclusion of the 1977 Treaty, and the Court will consequently not be

required to examine the scope of Article 64 of the Vienna Convention on the Law of

Treaties. On the other hand, the Court wishes to point out that newly developed norms of

environmental law are relevant for the implementation of the Treaty and that the parties

could, by agreement, incorporate them through the application of Articles 15, 19 and 20

of the Treaty. These articles do not contain specific obligations of performance but

require the parties, in carrying out their obligations to ensure that the quality of water in

the Danube is not impaired and that nature is protected, to take new environmental norms

into consideration when agreeing upon the means to be specified in the Joint Contractual

Plan.

Thus, confirmation of the customary nature of at least part of International Environmental

Law was given in three ways. Firstly, it was acknowledged that environmental interests

may amount to “essential interests” in the meaning of the customary rule providing for

the state of necessity defense. While an interest is conceptually different from a norm, the

existence of a legally protected interest assumes that such interest has legal relevance

irrespective (in this case) of any treaty. Secondly, the Court talked of newly developed

norms of environmental law relevant for the implementation of the Treaty. This seems a

clear reference to norms belonging to international customary law. Thirdly, in order to

support its conclusion that environmental interests can in fact amount to “essential

interests”, the Court expressly referred to paragraph 29 of its Advisory Opinion on the

Legality of Nuclear Weapons, thus suggesting that the general obligation mentioned in

paragraph 29 had the same basis as the essential character of environmental protection.

Therefore it can possibly be inferred from these observations that a new dimension was

added to the Court’s jurisprudence vis-a-vis International Environmental Law.

Further, the case concerning Gabcikovo- Nagymaros Project is an apt example of how the

International Court of Justice, tries to achieve a result that is acceptable to both litigants

and that, consequently, stands the best chance of being complied with by the two

sovereign litigants. The case highlighted the unique role that the ICJ may play when two

interdependent states have reached a deadlock after lengthy negotiations. Through their

special agreement, Hungary and Slovakia asked the Court to define and resolve the legal

aspects of their dispute. But the special agreement also provided that the parties shall

“immediately after the transmission of the Judgment enter into negotiations on the

modalities for its execution” and that, “if they were unable to reach agreement within six

months, either Party may request the Court to render an additional Judgment to determine

the modalities for executing its Judgment.” In this way, both parties were actively using

the principal judicial organ of the United Nations to assist them in defining the

fundamental legal parameters of a process of on-going negotiations that was directed

towards achieving a political result that was mutually acceptable.

Chapter-6

ABSTRACT

In the case of gabcikovo-nagyamaros, hungary and Czechoslovakia entered into Budapest

treaty on 16 september 1977 by which there would be created on Danube between two

states a barrage system, a dam, a reservoir, hydro-electric power stations and a 25-

kilometre canal for diverting the Danube from its original course through a system of

locks. A dispute developed in the light of hungary’s growing environment environment

concerns and result of this hungary suspended the work on project in 1989 while

Czechoslovakia proceeded with a ‘provisional solutions’ as from 1991 which involved

damming the Danube at a point on Czechoslovakian territory. In 1992, hungary

announced the termination of treaty of 1997 and related instruments. The case came

before international court ultimately by way of special agreement in 1993 between

hungary and Slovakia. This case essentially revolved around the relationship between the

treaty and subsequent environmental concerns.

The court emphasized that newly developed norms of environmental law were relevant

for the implementation of the treaty , while the awareness of vulnerability of the

environment and the recognition that environment risks have to be assessed on the

continuous basis have become much stronger in the years since the treaty’s conclusions.

However, the court found that the treaty was still in force and hungary was not entitled to

terminate it.

Therefore, it can be concluded in the Gabcikovo- Nagymaros Project case the Court

upheld the parties to a bargain which both regarded as at an end, and no longer wanted

applied in its original terms. Principle would suggest that a contract repudiated by both

parties was a dead letter, and the Court should have been concerned only with delineating

the legal consequences of its termination. The decision can only be defended as a

pragmatic one. The Court seems to have been influenced by the serious financial and

political implications of a finding that the contractual regime had been frustrated.

Slovakia had already expended huge sums of money on the project and did not want it

abandoned. On the other hand, completion of the project in its original form was

absolutely unacceptable to Hungary and also posed serious environmental threats. Yet by

asking the parties to negotiate a solution, possibly with the help of a third party, it was

arguable that the Court was abdicating the very responsibility that the parties had

assigned to it. However, it seems that the Court applied the Rule of pacta sunt servanda,

as reflected in Article 26 of the Vienna Convention of 1969 in letter and spirit.