Background to the complaint

1. The European Investment Bank (EIB) has in place a Transparency Policy[1] describing which information on its activities should be routinely and proactively published on its website. This includes general information about the projects considered for financing, such as summaries (including the name of the project, the promoter, a description of the project and its environmental and social aspects)[2] and EIB assessments in relation to the projects. The information is published at different stages in the project cycle (proposal submission, appraisal, approval, signature, etc.).

2. The ‘Environmental and Social Data Sheets’ (ESDSs) contain the EIB’s environmental and social appraisal of individual projects and proposed measures to manage any issues identified. The EIB Transparency Policy does not specify the timing for the proactive publication of ESDSs. It however specifies that environmental information should be provided as early as possible in the project cycle.[3] According to a separate guidance document by the EIB, ESDSs are published following the project’s approval by the EIB Board of Directors.[4]

3. Documents which are not proactively published may be obtained upon request, in line with the right of public access to documents. The provisions giving effect to this right are also set out in the Transparency Policy.[5]

4. In September 2022, the complainant, a network of environmental organisations, asked the EIB to disclose the ESDS concerning a project to finance a bus rapid transit line in Nairobi.[6] At that time, the project was under appraisal by the EIB.

5. The EIB refused access to the ESDS. It informed the complainant that its request had been handled in line with the EIB Transparency Policy. However, the EIB did not base its refusal on any of the exceptions to disclosure laid down in the Transparency Policy, but rather on the fact that the document was not finalised at the time of the request.

6. In October 2022, the complainant asked the EIB to review its decision to refuse access to the ESDS (by making a ‘confirmatory application’).

7. In its confirmatory decision of November 2022, the EIB said that the ESDS for the Nairobi project was still a draft and that its disclosure, at that stage, would seriously undermine the decision-making process related to the approval of the financing in question.[7]

8. In December 2022, the complainant turned to the Ombudsman, dissatisfied that the EIB had refused to disclose the document. More generally, the complainant took issue with the EIB’s practice of proactively publishing the ESDS for projects it funds only after loans have been approved.

9. In January 2023, the EIB published the ESDS in question on its website, after the loan for the project had been approved.[8]

The inquiry

10. The Ombudsman opened an inquiry into the following two aspects of the complaint:

a) the EIB’s refusal to disclose the ESDS for the Nairobi project in response to the complainant’s request for public access, at the time of the adoption of the confirmatory decision;

b) the EIB’s general practice of proactively publishing ESDSs for projects it funds only after loans have been approved, in line with its proactive transparency policy.

11. In the course of the inquiry, the Ombudsman inquiry team inspected the document in question, as it existed at the time of the EIB’s confirmatory decision. The Ombudsman inquiry team also met with the representatives of the EIB.[9] The report on the meeting was shared with the complainant, who commented on it.

The EIB’s refusal to disclose the Environmental and Social Data Sheet for the Nairobi project

Arguments presented to the Ombudsman

12. In its confirmatory decision, the EIB explained that, at the time of the complainant’s request, it did not hold a final version of the ESDS for the project.[10] It considered that disclosure of the draft version of the ESDS, before it had been reviewed and approved by the EIB decision-making bodies, would seriously undermine its decision-making process.

13. The EIB stated that the draft ESDS contained a provisional assessment of the environmental and social aspects of the project, but also conditions, including contractual conditions, that may be required to manage those aspects. The financing of the project, as well as any contractual conditions, had not yet been approved by the Board of Directors. At the time of the public access request, the ESDS was a draft and relevant for internal purposes only.

14. According to the EIB, disclosure of contractual conditions, before their finalisation and the ultimate decision on the financing of the project has been taken, “would pave the way to undue external pressure on the individual members of the EIB Management Committee and Board of Directors” and thus undermine their work and the EIB’s decision-making process. The EIB also stated that disclosure of the draft document would allow for a comparison between the draft and final version of the ESDS, “fully exposing the EIB’s internal discussions and deliberations on the project”.

15. The EIB considered that partial access was not possible as disclosure of information potentially subject to modifications could be misleading and not serve any particular public interest. It found that there was no overriding public interest in disclosure, also given that the finalised ESDS would be published on its website once the loan was approved. The EIB informed the complainant that it had published the project’s Environmental and Social Impact Assessment on its website[11] and that it remained open to engage with stakeholders regarding all aspects of the project at any stage.

16. In the meeting with the Ombudsman inquiry team, the EIB indicated that it had taken due consideration of the fact that the draft ESDS contained environmental information, and that the exceptions to public access needed to be interpreted in a restrictive manner in line with the EU Aarhus Regulation.[12] It still concluded that the refusal to disclose the draft was justified at the time of the request. As regards access to any parts of the draft, which were similar to publicly available information, more specifically from the Environmental and Social Impact Assessment, the EIB considered that it would not have been meaningful to disclose those parts. This was because requesters would still not have access to the EIB’s own assessment, which is the very essence of the ESDS.

17. The EIB indicated that documents in its public register,[13] and other project-related information published on its website, are designed to inform civil society about projects under appraisal. They should also enable interested parties to engage with the EIB before the approval of loans, by making observations, expressing opinions and asking questions on the information published.

18. In its complaint to the Ombudsman, the complainant claimed that the EIB’s decision to refuse access, at the time of the confirmatory decision, was not in line with the relevant transparency rules.[14] It challenged the EIB’s position that the ESDS is an internal document primarily meant to feed into its decision-making process by referring to the EIB’s Environmental and Social Handbook,[15] which states that the ESDS is a document written for the general public that records the EIB’s findings, conclusions and recommendations of its environmental and social assessment of projects.

19. The complainant noted that the ESDS contains environmental information of public interest, and claimed that the EIB had not provided compelling reasons to justify that disclosure of the draft, before the approval of the loan, would have undermined its decision-making process, which was complex and hard to follow. The complainant argued that disclosure of such information, before the approval of the loan, cannot always be considered to undermine the EIB’s decision-making process. On the contrary, disclosure could allow stakeholders to further inform the EIB’s assessment, and “help detect environmental and social risks, improve project categorization, and gather useful information on the promoter's history and capabilities, and ultimately help determine the appropriate loan conditions”.

20. The complainant also challenged the EIB’s position that disclosing the requested document before the approval of the loan could lead to external pressure or affect the independence of individual members of the EIB’s governing bodies. These bodies take decisions collectively and the EIB Statute guarantees their independence. Since changes to the economic and social assessment of projects, or to the proposed contractual measures, cannot be attributed to individual members, the EIB’s claim that disclosure of a draft could expose internal discussions and deliberations was not justified. The complainant also took issue with the EIB’s view that its decision-making process could be harmed because the public would be able to compare the draft with the final version of the ESDS.

The Ombudsman's assessment

21. The Ombudsman inquiry team compared the draft ESDS, as it existed at the time of the EIB’s confirmatory decision (in November 2022), with the version subsequently published on the EIB’s website (in January 2023). These versions are identical.

22. The question is whether the EIB was justified in refusing access to the draft ESDS at the time the decision was taken, and whether it provided convincing reasons for doing so.

23. In refusing access, the EIB invoked the exception for the protection of its decision-making process under Article 5.7 of its Transparency Policy. The Ombudsman understands from the context of the case that the EIB refers to the protection of the decision-making process where the decision has not been taken by the institution (under the first subparagraph of that article). To fall under this exception, the ongoing decision‑making process would have to be ‘seriously’ undermined. The exception can be set aside where there is an overriding public interest in disclosure.

24. The EIB argued that the decision-making process would be seriously undermined if its provisional assessment of the environmental and social aspects of the project, including unapproved contractual provisions, would be disclosed before the financing decision is taken. The EIB stated that the ESDS is a draft internal document up to the point of the adoption of the funding decision. Once that decision has been taken, it becomes a document intended to inform the public.

25. The Ombudsman notes that the preliminary nature of documents cannot in itself justify the application of the exception. A serious risk of harm to the decision-making process, which is reasonably foreseeable and not purely hypothetical, has to be demonstrated.[16]

26. The EIB said that disclosure might lead to external pressure on the decision-making actors, without however explaining the source of that external pressure. It further stated that allowing the public to compare the draft with the final version of the ESDS would risk exposing the EIB’s internal discussions and deliberations, without however showing how this would seriously undermine its ability to take a decision. In view of this, the Ombudsman considers that the EIB did not provide evidence to establish the reality or certainty of such external pressure, nor did it demonstrate that there was a reasonably foreseeable risk that the decision-making would be substantially affected owing to that external pressure.[17]

27. Finally, the fact that the ESDS was meant to be published shortly after the adoption of the confirmatory decision should not have influenced the EIB’s decision to refuse its disclosure at the time of the complainant’s request. In a recent inquiry,[18] the Ombudsman found that the EIB should clearly distinguish between the ‘proactive’ publication of information and the handling of ‘reactive’ requests for access to documents and information, such as the complainant’s request in this case. Individual access requests should be assessed only on the basis of the exceptions contained in Section 5 of its Transparency Policy, leaving aside considerations as to whether the requested documents will subsequently be published proactively. While the EIB argued in reply to the Ombudsman’s findings that it already makes such a distinction, the complaints brought to the Ombudsman suggest that this is not always the case.

28. The Ombudsman thus finds that the EIB did not adequately justify its decision, at the time it was taken, to refuse access to the draft ESDS in question based on the exception concerning the protection of its ongoing decision-making process. Given this finding, there is no need for the Ombudsman to consider the existence of an overriding public interest.

29. The Ombudsman also notes that the EIB did not properly consider the possibility of granting partial access.[19] It is not for the institution to decide what is meaningful or not for the requester.[20] The ESDS contains environmental information which in general should be made available to the public to the largest extent possible and as early as possible..

30. In view of this, the Ombudsman finds maladministration on this aspect of the case. As the ESDS is now public, there is no need for the Ombudsman to issue a corresponding recommendation.

The EIB’s general practice of proactively publishing the Environmental and Social Data Sheets for projects it funds only after loans have been approved

Arguments presented to the Ombudsman

31. In the meeting with the Ombudsman inquiry team, the EIB said that it has thoroughly assessed at what moment in time environmental information, including ESDSs, could be published proactively. As regards ESDSs, it concluded that these could be published only after the approval of the respective loan. This is because an ESDS can be considered final only once the loan has been approved by the Board of Directors. Before that, the Board may request the EIB services to modify the content of the ESDSs or even decide not to finance the project.

32. According to the EIB, ESDSs serve different purposes at different stages of the approval process. Before EIB approval to finance a certain project, ESDSs are draft internal documents intended to inform the decision-making process. However, after approval of the loan, they are intended to inform the public about the environmental and social assessment of the project carried out by the EIB, including the contractual requirements approved by the Board of Directors for the financing of the respective project.

33. The EIB stated that it is aware of the practices of other financial institutions as regards proactive publication of similar information, and has examined this comparative aspect in each review of its Transparency Policy. The EIB said that it is part of a working group composed of international financial institutions, which focuses on transparency and engagement issues. However, according to the EIB, analyses conducted within this group on the proactive publication of environmental information have never been conclusive, as there are several factors influencing the practices of the various institutions.

34. The EIB argued that it complies with the EU Aarhus Regulation in that it makes environmental information available to the public and that this is reflected in its Transparency Policy. As for public participation concerning plans and programmes relating to the environment, the EIB referred to the definition of ‘plans and programmes’ under the EU Aarhus Regulation. It noted that ‘financial plans and programmes relating to the environment laying down how particular projects or activities should be financed’ are excluded from the scope.[21] It also referred to a finding of the Aarhus Convention Compliance Committee, which said that, in general, a decision of a financial institution to provide a loan or other financial support is legally not a decision to permit the activities being funded.[22]

35. In its complaint to the Ombudsman, the complainant acknowledged that disclosing a document that is very much incomplete or at a stage where it is uncertain whether the project would receive funding could undermine the EIB’s decision-making process and not be useful for the public. However, the EIB should determine the appropriate moment to disclose its environmental and social assessment, in order to comply with transparency requirements, promote good governance and ensure meaningful civil society participation. In this context, the complainant pointed out that another developmental investment bank, the European Bank for Reconstruction and Development (EBRD), publishes environmental and social documents, including documents with content equivalent to the EIB’s ESDSs, well in advance of Board approval. According to the complainant, the EBRD publishes relevant documents at least 60 calendar days prior to consideration of the project by the EBRD Board of Directors for private sector projects and at least 120 calendar days prior to consideration of the project for public sector projects.

36. The complainant had already signalled to the EIB its concerns in relation to the timing of the proactive publication of ESDSs, in particular in the context of consultations on the last review of its Transparency Policy. The complainant argued that access to information is time sensitive and that some information is relevant only for a certain period of time, in particular if it relates to a specific decision-making process, such as the EIB’s decision to finance a project. According to the complainant, the Transparency Policy adopted by the EIB in 2021 did not bring about any changes in relation to the proactive publication of ESDSs, and therefore it did not ensure that all relevant social and environmental information is proactively disclosed in a timely manner, in compliance with the principle of openness.

37. In its comments on the meeting report, the complainant clarified that its request for disclosure of ESDSs does not concern the EIB’s financial plans and programmes laying down how the project should be financed, but rather documents containing environmental and social information.

38. The complainant referred to recent case-law[23] stating that a financing decision of the EIB Board of Directors is a measure adopted “under environmental law”. According to the complainant, when approving a loan, the Board takes a decision to finance a specific activity under environmental law. The courts recognised that such a decision is the EIB’s definite position on the eligibility of the project as regards the environmental and social aspects. After the approval of the Board of Directors, the funding decision creates binding legal effects for third parties and any subsequent decisions of the EIB’s governing bodies would no longer relate to those aspects of the project.[24] Therefore, the public has the right to request the EIB to review such decisions under the EU Aarhus Regulation.[25] In the complainant’s view, this implies that there should be greater transparency in relation to those decisions and their supporting documents, which contain environmental information, such as the ESDSs, before the approval of loans.

39. The complainant argued that, if ESDSs are published after the loan has been approved, civil society is unable to provide feedback on the EIB’s own environmental and social assessment before its final position on those aspects is taken.

40. The complainant referred to the growing role of the EIB in financing climate action, economic growth and development beyond the EU. For example, the Nairobi project was included in the EU’s Global Gateway initiative.[26] Such investments should adhere to high standards of democratic values, good governance and transparency. Urban transport projects are complex and affect many stakeholders. Yet, the EIB did not find that there was a public interest in sharing its assessment of the project’s compliance with EIB and EU environmental and social standards ahead of making a final decision on the financing of the project.

41. The complainant urged the EIB to reconsider the timing of the proactive publication of such environmental and social assessments, “to allow civil society, in particular people impacted by the project, to review this information and engage with the EIB meaningfully, before key social and environmental conditions are established in the Board of Directors’ decision”.

The Ombudsman's assessment

42. The EIB is increasingly involved in major international projects, funded under the EU’s Global Gateway initiative.[27] As such, the public is likely to be increasingly involved and interested in its decisions to finance projects and the rationale underpinning such decisions. This is notably to be expected when EIB financed projects have a significant impact on the environment.

43. The EU Aarhus Regulation sets out obligations for the EU administration in relation to environmental decision-making. According to the EU Aarhus Regulation, the public has the right to (i) access environmental information, (ii) participate in environmental decision-making, and (iii) access justice in environmental matters (‘the three pillars’).[28]

44. Although the individual rights afforded to the public are distinct in character, they are inter-related. In order for the public to be able to participate meaningfully in environmental decision-making, it needs to have timely access to environmental information in the first instance.

45. The EIB stated that it makes project-related environmental and social information publicly available through its public register and that it is committed to developing this register to disseminate more information progressively.[29] As for stakeholder engagement in relation to the projects, according to the EIB, this is primarily the responsibility of clients seeking funding. The EIB’s Environmental and Social Standards lay down the requirements for those clients.[30] Nevertheless, under its Transparency Policy, the EIB recognises the importance of and encourages relevant stakeholder engagement in projects also during its own decision-making processes.[31]

46. The Ombudsman acknowledges that the EIB publishes information about the projects it funds, or intends to fund, and concerning its various lending policies. However, this complaint suggests that the EIB does not disclose essential environmental information, namely its own assessment of the environmental and societal aspects of projects in the pipeline, in a timely manner to allow for meaningful public engagement. The Ombudsman has received contributions in response to a public consultation on transparency in environmental decision-making suggesting the same issue.[32]

47. In 2022, the EIB approved the financing of projects amounting to over 75 billion EUR.[33] The EIB’s decision whether to fund a project or not is important, since without its funding some of these projects might not happen at all. Once funded and implemented, the projects undoubtedly affect the environment and people’s lives. For those trying to participate in the EIB decision-making process, it is therefore important to understand what the EIB’s assessment of the environmental and societal aspects of such projects is. This assessment is contained in the ESDSs.

48. Currently, the EIB proactively publishes the respective ESDS after the loan for a project has been approved by its Board of Directors (after the third step in the info graph below). The question is whether this timing allows the public to participate meaningfully in the EIB’s assessment of environmental and social aspects of projects it considers for funding.

49. The findings of the EU courts in two recent judgments[34] suggest that it does not. While the judgments relate to access to justice, that is the third pillar under the EU Aarhus Regulation, they are relevant also for the other two pillars. According to the judgments, the decision of the EIB Board of Directors to approve the financing of a project is the final decision adopted by the EIB as regards determining any environmental and social conditions that will apply to a project.[35] Consequently, for the EIB to allow the public to engage meaningfully before it is too late, information underpinning its assessment of the proposed project’s environmental and social aspects needs to be proactively disclosed before the Board approval of a loan.

50. The question is then whether the proactive publication of ESDSs before Board approval of the loan would undermine the EIB’s ongoing decision-making process. When presented to the Board, the ESDSs are expected to contain a thorough assessment by the EIB services ensuring that the projects on the table comply with the EIB environmental and social principles, standards and requirements. The public could further feed into this assessment. When legitimate concerns are raised, it is essential that they reach the Board before it decides on the financing, thereby improving the decision-making process, rather than undermining it.  

51. In view of the above, the Ombudsman suggests that the EIB aim to disclose ESDSs proactively before the Board’s approval of loans, in order to allow the public to participate meaningfully in its assessment of the projects’ environmental and social aspects and impacts. This could be done in particular for those projects where such impacts are expected to be significant. The aim must be to ensure that the public is informed in a timely way of all relevant considerations before the EIB adopts its final decision.

Conclusions

Based on the inquiry, the Ombudsman closes this case with the following conclusions:

The Ombudsman finds that the EIB did not adequately justify its decision, at the time it was taken, to refuse public access to the draft Environmental and Social Data Sheet for the Nairobi project. This was maladministration.

As regards the second aspect of this complaint, which concerns the proactive publication of Environmental and Social Data Sheets, the Ombudsman makes a suggestion for improvement below.

The complainant and the European Investment Bank will be informed of this decision.

Suggestion for improvement

The EIB should aim to disclose Environmental and Social Data Sheets proactively in advance of its Board’s approval of loans, to allow the public to participate meaningfully in the EIB’s assessment of environmental and social aspects of projects it considers for funding.

 

Emily O'Reilly
European Ombudsman

Strasbourg, 20/11/2023

 

[1] The EIB Transparency Policy is available at: https://www.eib.org/attachments/strategies/eib_group_transparency_policy_2021_en.pdf.

[2] Section 4 of the EIB Transparency Policy.

[3] Article 4.8 of the EIB Transparency Policy.

[4] Section 4 of the EIB Guide to accessing environmental and social information/documents available at: https://www.eib.org/attachments/access_to_information_en.pdf, see also FAQ section on the EIB website: https://www.eib.org/en/registers/faq/index.htm.

[5] Section 5 of the EIB Transparency Policy.

[6] More information about the project is available at: https://www.eib.org/en/projects/all/20150460.

[7] Article 5.7 of the EIB Transparency Policy:

[8] Available at: https://www.eib.org/en/registers/all/63121396.

[9] The meeting report is available at: https://www.ombudsman.europa.eu/doc/inspection-report/177919.

[10] The EIB referred to Article 5.1(a) of its Transparency Policy.

[11] Available at: https://www.eib.org/en/registers/all/160031292.

[12] Regulation 1367/2006 of the European Parliament and of the Council on the application of the provisions of the Aarhus Convention on Access to Information, Public Participation in Decision-making and Access to Justice in Environmental Matters to Community institutions and bodies: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32006R1367.

[13] The EIB publishes environmental and social impact assessment reports and other associated studies related to environment, climate and social aspects before projects are approved by the Board in its public register: https://www.eib.org/en/registers/index.htm.

[14] The complainant referred to the EIB Transparency Policy, Regulation 1049/2001 regarding public access to European Parliament, Council and Commission documents, Regulation 1367/2006 of the European Parliament and of the Council on the application of the provisions of the Aarhus Convention on Access to Information, Public Participation in Decision-making and Access to Justice in Environmental Matters to Community institutions and bodies and Article 15 of the Treaty on the Functioning of the EU.

[15] The EIB’s Environmental and Social Handbook is available at: https://consult.eib.org/consultation/essf-2021-en/user_uploads/eib-environmental-and-social-handbook.pdf.

[16] See in that regard the Judgment of the General Court of 7 June 2011, case T-471/08, Toland v Parliament, paragraphs 29, 71-81: https://curia.europa.eu/juris/document/document.jsf?text=&docid=85119&pageIndex=0&doclang=EN&mode=lst&dir=&occ=first&part=1&cid=348206.

[17] See Judgment of the General Court of 9 September 2014, case T-516/11, MasterCard and Others v Commission, paragraphs 70-72: https://curia.europa.eu/juris/document/document.jsf?text=&docid=157442&pageIndex=0&doclang=EN&mode=lst&dir=&occ=first&part=1&cid=3346339

[18] See case 3/2023/OAM, available at: https://www.ombudsman.europa.eu/en/case/en/63066.

[19] Article 5.10 of the EIB Transparency Policy.

[20] See Judgment of the General Court of 5 December 2018, Falcon v Commission, T-875/16, paragraphs 98ff: https://curia.europa.eu/juris/document/document_print.jsf?mode=req&pageIndex=0&docid=208484&part=1&doclang=FR&text=&dir=&occ=first&cid=490743.

[21] Under Article 2(1)(e) third paragraph of the EU Aarhus Regulation.

[22] The EIB referred to findings of the Aarhus Convention Compliance Committee’s, available at: https://unece.org/env/pp/cc/accc.c.2007.21_european-community.

[23] Judgment of the Court of 6 July 2023, Case C-212/21 P, EIB v ClientEarth: https://curia.europa.eu/juris/liste.jsf?num=C-212/21&language=en and Judgment of the General Court of 27 January 2021, T-9/19 - ClientEarth v EIB: https://curia.europa.eu/juris/liste.jsf?language=en&num=t-9/19.

[24] T-9/19 - ClientEarth v EIB, paragraph 170.

[25] Article 10 of the EU Aarhus Regulation.

[26] https://ec.europa.eu/commission/presscorner/detail/en/IP_23_1928.

[27] See by way of example, https://www.eib.org/en/press/news/bangladesh-eur-395-million-eib-and-eu-backing-for-renewable-energy-projects and https://www.eib.org/en/press/news/eib-global-supports-vietnams-just-energy-transition

[28] More information is available at: https://environment.ec.europa.eu/law-and-governance/aarhus_en.

[29] Article 4.12 of the EIB’s Transparency Policy.

[30] https://www.eib.org/en/publications/eib-environmental-and-social-standards.

[31] Articles 7.6-7.10 of the EIB’s Transparency Policy.

[32] SI/5/2022/KR, available at: https://www.ombudsman.europa.eu/en/document/en/168767.

[33] https://www.eib.org/en/about/key-figures/data.htm.

[34] See footnote 23.

[35] See footnote 24.