Chapter 13 - Environmental Damage Caused by Oil Exploitation in Brazil. The “Conduct Adjustment Agreement” (TAC) as a Means to Circumvent Civil Liability Ineffectiveness

Summary

ABSTRACT

Even though some Brazilian and foreign companies have been sued for environmental damage, due to oil spills which occurred under Brazilian jurisdiction, the system based on civil liability does not provide proper reparation for environmental damage. In this context, extrajudicial instruments, such as the Conduct Adjustment Agreement (TAC), can contribute to improving the prevention and reparation of environmental damage. This chapter will focus on the analysis of its contribution to circumventing civil liability ineffectiveness by taking the increasing importance in the use of TACs on environmental matters into account. Keywords: Civil liability, extrajudicial instruments, “Conduct Adjustment Agreement”, environmental damage, oil spill

INTRODUCTION

The exploitation of oil in Brazil has already caused serious environmental damage in States such as Rio de Janeiro, São Paulo, Paraná, Espírito Santo and Bahia. A great part of this damage is caused by oil spills related to the activities that occur on the offshore platforms. In these cases, civil liability has not sufficiently contributed to the prevention and to the reparation of environmental damage. Other public and private instruments should be used in order to achieve greater effectiveness in environmental protection. Extrajudicial instruments, such as the Conduct Adjustment Agreement (in Portuguese Termo de Ajustamento de Conduta – TAC), widely used in Brazilian Law, can help to improve environmental protection. Therefore, it is important to briefly highlight the context of oil exploitation in Brazil, the limits of the Brazilian environmental liability system to repair damage caused by oil spills and the role Conduct Adjustment Agreements may play in this scenario.

Oil exploitation is a central economic activity in Brazil, which started in the 1930s and represents, along with the gas sector, 13% of the Brazilian Gross Domestic Product (GDP). Actually, there are around 135 oil platforms fixed, floating and functioning in Brazilian maritime space. Furthermore, there are at least 52 ships transport oil or derivatives. In order to prevent environmental and social damage, the oil sector has to comply with Brazilian security norms. Simultaneously, it is expected that Brazilian State control be done efficiently, in a manner based on norms and on a precautionary approach.

However, since 1960, many oil spills have been reported in Brazil.