Running Away: Plans for Heathrow’s third runway will no longer go ahead

March 27, 2020

2 min read

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What's going on here?

The Court of Appeal has ruled that government plans to build a third runway at Heathrow Airport are unlawful.

What does this mean?

The court ruled that the plans for a third runway were unlawful on the basis that the government did not adequately consider its international commitment to combat climate change under the Paris Agreement 2016, which is an agreement between 196 states to decrease global warming via public policies. Just to put the environmental impact of a third runway into perspective, the runway, which would have been completed by 2028, would add an additional 700 planes per day. This would lead to a large increase in carbon emissions, which would be contrary to the Paris Agreement (to which the UK is a party), which requires all parties to “put forward their best efforts” in cutting carbon emissions.

What's the big picture effect?

Going forward, the government will be forced to either withdraw the plan or heavily amend it to suit the requirements of the Paris Agreement. A third runway could hypothetically bring a much-needed boost to international business post-Brexit. The Federation of Small Businesses has stated that the ruling has adversely impacted the global connectivity to smaller firms. However, the Prime Minister has always been opposed to the runway, and therefore the plan is likely to be withdrawn. This could be due to the fact that expanding Heathrow would further exacerbate the lack of growth in smaller regional airports, going against the boost of regional connectivity that Boris Johnson pledged to achieve in his manifesto. Indeed, the resources could be diverted towards completing the £106bn-cost HS2 railway, which the government has favoured and confirmed will be going ahead.

This ruling is crucial because it is the first major ruling based on the Paris Agreement globally. Large transport deals will have to consider the environmental impact in the initial drafting, and their compliance with the Paris Agreement. It has yet to be seen whether this will have an effect on the number of construction and transportation deals in the market, but companies will also have to consider the UK’s target to reach net-zero carbon emissions by 2050. This means that both the government and the courts will have tougher crackdowns on projects that create detrimental environmental impacts. Broadly speaking, the general trend is the emergence of a “green economy”, that is to say, economic choices that are sustainable for the environment. 

This trend also affects law firms. The large oil company Shell has set out a list of sustainability requirements that have to be fulfilled if law firms want to be part of their next legal panel. Law firms’ internal governance guidelines and external certifications for sustainability are reviewed by Shell, whose own goals are to lower 2% of their carbon emission in line with the Paris Agreement. 

Such requirements show that the demand for sustainability is not only aimed at politicians but also increasingly for businesses and their lawyers.

Report written by Jacqueline Lee

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