How does a hearing on phosphate go?

The above is a recurring argument on a typical hearing day of the Trade and Industry Appeals Board (CBb). Just as often, the Netherlands Enterprise Agency (RVO.nl) defends itself by pointing to earlier statements by the Board of Appeal for the business community about so-called 'foreseeability'.

Could livestock farmers who invested before 2015 have known that the phosphate rights system was coming? "If we had been able to see that, we would have done something differently. But we could not have come up with regulations, such as the introduction of the phosphate rights system," is the response of many livestock farmers. Various livestock farmers thought that by investing in land they would meet the strict requirements under the Land Tiedness Act. However, animal rights (instead of phosphate rights) were introduced per hectare, based on the numbers of animals present on July 2, 2015.

Primary and secondary issues
The judge regularly asks about the dates on which the obligations with banks, construction companies and landowners were entered into and to what extent these obligations were irreversible. "How many animals did you have before you started investing? How much exactly has been invested in expansion and/or new construction of stables and when did this start?'" The closer we get to the reference date of July 2, 2015, the less hope remains.

If there is also doubt as to whether all the necessary permits were received on time, then any hope for a favorable decision from the council will evaporate. Perhaps the assessment of whether there is an extraordinary, disproportionate burden still offers hope? To assess this, the damage report (which is part of the appeal) is discussed. Scenarios are outlined that should clarify the connection between the introduction of the phosphate rights system and the development of business income and business assets.

The reservation capacity in cents per liter of milk, where financing from banks is possible, is mentioned regularly. Sometimes the level of this capacity is used to make it clear that the need is not (yet) very great. However, the opposite also occurs of course; then, according to RVO.nl, the calculations show that the introduction of the phosphate rights system is not the reason why the livestock business is struggling, but that other factors also play a role. Both RVO.nl and the livestock farmers let financial specialists have their say. RVO.nl states more than once that insufficient financial evidence has been provided because documents are missing. "And the burden of proof lies with the person submitting the appeal," RVO.nl emphasizes.

To date, the CBb has also rarely ruled in favor of a livestock farmer with regard to the individual disproportionate burden (IDL). Things are different when it comes to the standard of 5% to qualify for the bottlenecks and the estimate of the milk production level, which determines the amount of phosphate rights granted on July 2, 2015. Sometimes RVO.nl has to agree that there are small or bigger mistakes have been made, such as deregistering cattle (exactly on July 2, 2015) and milk provided to calves that was not counted.

Very different emotions
At the end of each hearing, the judge informs the livestock farmers that they can expect a ruling 6 weeks after the hearing day. "You can return to The Hague, but I do not recommend that. You can hear the ruling in writing through your lawyer or via our website." It is not possible to discuss this statement again. Would the livestock farmer who did not show up for the hearing have had the foresight that everything would be settled in writing? Others do not think it is necessary to incur costs for a lawyer and others bring their entire family and make an impression by telling how much they have been in dire straits, sometimes overwhelmed by emotions.

Since the start of the hearings on the allocation of the phosphate rights, which were filed with the CBb in 2018, approximately half of all more than 800 cases have been handled. The year 2020 was completed in May 2018. A decision has yet to be made on how the remaining files, which were settled in 2019, and all cases involving the 2017 scheme, will be handled.