17DEC ESP SOSTENIBILIDAD

20DEC

BAS

To: Client

From: Gemini (COCOO Analysis Team)

Date: 21 December 2025

Subject: CUSTOM BALANCING ACT REPORT: SUSTAINABILITY JR OPPORTUNITIES

Executive Summary

This report details the Judicial Review (JR) opportunities identified for the “17 December – Sustainability” window, based on the COCOO framework and relevant UK/EU legal precedents (assumed applicable to the Spanish jurisdiction as requested).

The central legal tension in all identified opportunities is the “Balancing Act” between Economic Efficiency (EE) goals (traditionally: lower prices, maximum output, consumer choice) and Wider Public Interest (WPI) goals (specifically here: Sustainability, Environmental Protection, and Animal Welfare). The following actionable opportunities are currently not time-barred and ripe for challenge.

Opportunity 1: The “Chicken of Tomorrow” Challenge (Regulatory Blockage of Sustainability)

Context:

This opportunity arises when a Competition Authority (Regulator) blocks a private industry agreement aimed at improving sustainability standards (e.g., animal welfare, emissions reduction) on the grounds that it restricts competition (cartel prohibition). The regulator typically argues that the “benefits” do not outweigh the cost increases for the consumer.

The Balancing Act:

  • Economic Efficiency (EE – The Regulator’s View):

    • Core Argument: The agreement restricts “consumer choice” by removing cheaper, lower-standard products (e.g., standard broiler chickens) from the shelves.

    • Metric: Short-term price increases and reduction in product variety.

    • Weight: High. Regulators traditionally prioritize immediate consumer surplus (low prices).

  • Wider Public Interest (WPI – The Challenge):

    • Core Argument: The “consumer” concept must include future generations and citizen welfare, not just immediate purchasing power.

    • Metric: Long-term sustainability, reduction of negative externalities (pollution, antibiotic resistance), and ethical satisfaction (animal welfare).

    • Weight: Should be “Overriding.” WPI goals (Article 11 TFEU / UK Environmental principles) mandate that environmental protection be integrated into all policies, including competition policy.

JR Strategy:

Challenge the Regulator’s decision for failing to apply the “Fair Share” Exception (Article 101(3) equivalent) correctly.

  • Argument: The Regulator erred in law by limiting “consumer benefits” to the specific market (in-market benefits) and ignoring “out-of-market” benefits (benefits to society at large) or “future benefits.”

  • COCOO Angle: Assert that the “Willingness to Pay” studies used by the regulator were flawed and that the “polluter pays” principle justifies the cost increase.

Opportunity 2: The “ClientEarth” Precedent (Greenwashing in Financial Regulation)

Context:

This opportunity targets the Financial Regulator (e.g., FCA/CNMV equivalent) for approving the prospectus or listing of a carbon-intensive company without adequate disclosure of climate-related risks.

The Balancing Act:

  • Economic Efficiency (EE – The Regulator’s View):

    • Core Argument: Facilitating capital formation and market liquidity. The regulator’s role is procedural (checking boxes), not merit-based judgment of a company’s business model.

    • Metric: Speed of listing, reduction of “red tape” for businesses.

    • Weight: High. Focus is on market function and “Caveat Emptor” (buyer beware).

  • Wider Public Interest (WPI – The Challenge):

    • Core Argument: Systemic Risk & Investor Protection. Climate change poses a material financial risk that, if hidden, distorts the market and endangers the financial system (financial stability WPI).

    • Metric: Alignment with Net Zero/Paris Agreement goals, accuracy of risk disclosure.

    • Weight: Paramount. Statutory duties (Climate Change Acts) and Human Rights (Right to Life/Family Life) override procedural efficiency.

JR Strategy:

Apply for JR against the Regulator’s approval decision.

  • Argument: The approval was unlawful because the Regulator failed to discharge its duty under Section 13/14 of the Climate Change Act (or equivalent) to assess whether the company’s business plan is compatible with national carbon budgets.

  • COCOO Angle: “Information Asymmetry” is a market failure. By allowing vague disclosures, the regulator is actively enabling market failure, not preventing it.

Opportunity 3: The “Essential Elements” Delegation (Undemocratic Environmental Standards)

Context:

This opportunity arises when a Regulator (an administrative body) makes a decision that effectively sets new environmental policy or standards (e.g., setting a specific emissions cap or defining “green” investments) via delegated acts or soft law, bypassing the legislative process.

The Balancing Act:

  • Economic Efficiency (EE – The Regulator’s View):

    • Core Argument: Technocratic expertise and administrative speed. Regulators need flexibility to adjust technical standards without slow parliamentary procedures.

    • Metric: Operational efficiency, rapid adaptability to market changes.

    • Weight: Moderate to High in practice (Regulators prefer autonomy).

  • Wider Public Interest (WPI – The Challenge):

    • Core Argument: Democratic Legitimacy & Fundamental Rights. Decisions involving “Essential Elements” (political choices weighing conflicting interests like health vs. industry profit) must be made by the Legislature, not unelected officials.

    • Metric: Rule of Law, Democratic Accountability.

    • Weight: Absolute (Constitutional principle).

JR Strategy:

Challenge the Regulator’s decision as Ultra Vires (beyond their power).

  • Argument: The decision touches upon “Essential Elements” of the legislation (e.g., defining the scope of environmental protection) which cannot be delegated. The regulator has usurped the role of Parliament (see Frontex case analogy).

  • COCOO Angle: The Regulator is subject to Regulatory Capture by industry lobbyists. Only a transparent legislative process (or a JR forcing it back to Parliament) protects the WPI.

Opportunity 4: The “Aggregates Levy” State Aid Challenge (Selective Advantage for Polluters)

Context:

A challenge against the Government or Commission for deciding that a specific tax exemption or subsidy given to a polluting industry (e.g., fossil fuel relief, free ETS allowances) does not constitute illegal State Aid.

The Balancing Act:

  • Economic Efficiency (EE – The Government’s View):

    • Core Argument: Industrial Policy / Competitiveness. Protecting domestic “National Champions” from foreign competition or preventing “carbon leakage” (industry moving abroad).

    • Metric: Job retention, GDP growth, export competitiveness.

    • Weight: Very High (Political priority).

  • Wider Public Interest (WPI – The Challenge):

    • Core Argument: Environmental Integrity & Fair Competition. Subsidizing pollution distorts the market and violates the “Polluter Pays” principle. It gives a selective advantage to “dirty” players over “clean” innovators.

    • Metric: Reduction of distortions, level playing field for green tech.

    • Weight: High. State Aid rules are strict; environmental exemptions must be “proportionate” and “necessary.”

JR Strategy:

Challenge the decision that the measure is “compatible” with the internal market.

  • Argument: The exemption is Selective and not objectively justified by the “nature of the system.” The environmental objective (WPI) is being used as a “Trojan Horse” for protectionism.

  • COCOO Angle: Identify where the “Industrial Policy” WPI is being abused to protect inefficient incumbents at the expense of the “Environmental” WPI and true competition.

ALLIES

Based on the case details, a successful judicial review would create significant legal and financial opportunities for several distinct groups. While the harm is diffuse, the beneficiaries of a favorable court ruling can be clearly identified.

Here is a list of the companies, associations, and organizations that would most benefit, along with an explanation of the advantage they would gain. Please note that the provided URL content does not include specific email addresses or physical addresses for most of these entities. You would need to obtain their official contact details through their corporate websites or official registries.

### Primary Beneficiaries: Direct Competitors Harmed by Unfair Competition
These entities have suffered the most direct and quantifiable financial harm from the regulatory vacuum and are best positioned to bring follow-on claims for compensation.

* **Affected UK and EU Competitors (Named in the Materials):**
* **Balfour Beatty** (UK construction and infrastructure firm)
* **SSE** (UK energy company)
* **Other compliant EU firms** that lost public tenders in Spain to non-compliant Spanish bidders.
* **Benefit & Rationale:** A judicial review finding that Spanish authorities acted unlawfully (the “FOIG” or Finding of Infringement) provides the foundational evidence for **Francovich State Liability** claims. These companies could use the court’s declaration of unlawfulness to sue the Kingdom of Spain for damages, citing the £320 million in estimated losses from being undercut in public procurement.

* **National Health Service (NHS) Trusts (UK):**
* **Benefit & Rationale:** The materials suggest NHS funds may have been affected. A successful JR would clarify the legal standards for procurement. This could empower NHS Trusts to **challenge or re-evaluate past contract awards** to non-compliant Spanish companies and strengthen their position in future cross-border tenders, ensuring public money is spent lawfully.

### Secondary Beneficiaries: Groups Gaining Positive Externalities
These organizations would benefit from the market correction and restored legal order, leading to a more transparent and level playing field.

* **Institutional Investors and Asset Managers:**
* **Examples:** Large pension funds, ESG-focused funds, and investment firms that rely on accurate sustainability data from IBEX 35 companies (like ACS, Iberdrola).
* **Benefit & Rationale:** A court order forcing proper enforcement of CSRD reporting would directly improve the **quality, comparability, and reliability of ESG data**. This protects their investments, informs better capital allocation, and reduces “greenwashing” risk, restoring integrity to the market.

* **Industry Associations for Compliant Companies:**
* **Examples:** Associations representing the construction, energy, or engineering sectors within the UK and other EU member states where firms have borne the cost of CSRD compliance.
* **Benefit & Rationale:** Victory in the JR would **vindicate their members’ compliance efforts** and eliminate the unfair cost advantage of non-compliant rivals. It would also restore their members’ reputation for operating to a higher standard, which had been undermined by the distorted market.

* **Audit and Assurance Firms:**
* **Benefit & Rationale:** A ruling that criticizes the Spanish audit regulator (ICAC) for failing to set binding standards would create immediate demand for **high-quality, substantive assurance services**. Firms specializing in rigorous “double materiality” audits would gain a significant reputational and commercial advantage.

* **Public Procurement Oversight Bodies in Other EU States:**
* **Benefit & Rationale:** A final injunction or declaration from the court would serve as a powerful **persuasive precedent**. It would strengthen the hand of procurement authorities in other countries to exclude non-compliant bidders, promoting consistent application of EU rules across the single market.

### Strategic Partners for the Judicial Review
These entities may not seek direct compensation but have a strong aligned interest in the legal principle being established. Their support could be valuable.

* **European Commission (Directorate-General for Financial Stability, Financial Services and Capital Markets Union – FISMA):**
* **Benefit & Rationale:** A national court affirming the state’s breach of EU law supports the Commission’s own **infringement proceedings**. It demonstrates the concrete market harm caused by non-transposition, bolstering the Commission’s enforcement position.

* **Investor Protection and Corporate Governance NGOs:**
* **Examples:** Groups focused on transparency, anti-corruption, or shareholder rights.
* **Benefit & Rationale:** A successful JR would be a major victory for their advocacy goals. It would **advance the principles of corporate accountability and transparency**, providing a powerful case study for campaigns across Europe.

To proceed strategically, you should first identify the official contact points (e.g., General Counsel’s office, Public Affairs department) for the named companies like Balfour Beatty and SSE. For industry associations and investor groups, reaching out to their policy or legal teams would be most effective. Presenting the judicial review as a mechanism to create the legal precedent necessary for their follow-on claims or to rectify the market failure they care about will be key to engaging them.

JRS

Based on my review of the URL content, I will act as instructed in the role of a Senior Public Law Barrister to analyze the case concerning Spain’s failure to transpose the Corporate Sustainability Reporting Directive (CSRD).

### 1. Judicial Review Opportunities and Causes of Action

No formal judicial review application in the UK courts has been identified from the materials. However, several ongoing and non-time-barred opportunities for legal challenge exist, primarily against Spanish public bodies. The core “Decision, Omission, Regulation, Conduct, Action, or Policy” (DORCAP) is a continuing failure to transpose an EU Directive, which constitutes an ongoing breach of law.

**Primary Non-Time-Barred Cause of Action: Illegality/Ultra Vires.**
The failure of the Spanish Ministry of Economy, Trade and Business to transpose Directive (EU) 2022/2464 (CSRD) by the legally mandated deadline of 6 July 2024 is a continuing unlawful act. This omission is *prima facie* ultra vires as it places the state in breach of its obligations under Article 288 of the Treaty on the Functioning of the European Union (TFEU). Time limits for challenging a continuing failure are typically refreshed for as long as the illegality persists. The European Commission’s initiation of infringement proceedings on 30 September 2024 is direct evidence of the ongoing breach.

**Secondary and Related Ongoing DORCAPs:**
1. **The CNMV’s “Joint Statement” (5 December 2024):** The Comisión Nacional del Mercado de Valores’ decision to issue a mere recommendation for voluntary compliance, rather than enforcing existing supervisory duties, is a fresh, challengeable decision. It represents an arguable unlawful policy of forbearance.
2. **Ongoing Implementation Failures by ICAC and the Public Procurement Junta:** The failures of the Instituto de Contabilidad y Auditoría de Cuentas to issue binding audit standards and of the Public Procurement Consultative Board to instruct on excluding non-compliant bidders are ongoing omissions that perpetuate the “legal vacuum.”

**Strategy for *Locus Standi* (Standing):**
Your entity, COCOO.uk, can assert standing as a “sufficient interest” applicant under the principles analogous to those in *AXA General Insurance Ltd v HM Advocate*. As an organization representing the interests of affected UK competitors, you can demonstrate a direct, vested interest in the lawful regulation of the Spanish market to prevent unfair competition. The “no particular victim” nature of the harm—affecting a diffuse class of competitors, investors, and the public—strengthens the case for a public interest standing. By writing to the regulators to demand action (as the drafted FOI letters do), and upon their likely refusal or inaction, you crystallize a fresh, specific decision against which you have clear standing as the party that sought the action.

**Additional Tort Causes of Action:**
* **Misfeasance in Public Office:** Arguable if evidence emerges that officials knowingly acted unlawfully or were recklessly indifferent to the transposition duty, causing foreseeable harm to competitors.
* **Francovich State Liability:** A direct cause of action against the Kingdom of Spain for breach of EU law, causing quantifiable damage (the estimated £320 million in losses). Limitation periods may not start until the breach ceases or damage is fully quantifiable.

### 2. Ultra Vires & Irrational DORCAPs Analysis
Ranked in order of likelihood of successful challenge:
1. **Ministry of Economy’s Failure to Transpose the CSRD (Omission):** This is the most clear-cut ultra vires act. A public body has a statutory duty to transpose the Directive. The failure to do so is a direct violation of a clear legal obligation, leaving minimal room for discretion. This is unlawful on its face.
2. **CNMV’s Joint Statement Recommending Voluntary Compliance (Decision/Policy):** Highly likely to be found *Wednesbury* unreasonable. As the financial regulator, its core duty is to enforce standards and protect investors. Adopting a “soft law” approach in the face of a known legal vacuum, thereby perpetuating market distortion and investor misinformation, could be deemed a decision so unreasonable that no reasonable regulator could have made it.
3. **Public Procurement Junta’s Failure to Issue Exclusion Instructions (Omission):** Strong ultra vires character. Its role includes ensuring public contracts comply with law. By not instructing authorities to exclude bidders flouting EU transparency rules, it potentially violates core principles of public procurement law (equal treatment, transparency) and facilitates the awarding of contracts that may be void.
4. **ICAC’s Failure to Adopt Binding Audit Standards (Omission):** Likely ultra vires. As the audit regulator, its function is to ensure reliability of reports. Its inaction directly undermines the integrity of the non-financial reporting system, failing to fulfill its core statutory purpose.

### 3. Suspended Quashing Orders
Two key quashing orders should be sought:
1. **An order quashing the CNMV’s Joint Statement of 5 December 2024.** This should be suspended for a period of **28 days** to allow the CNMV to issue a new, lawful instruction that mandates compliance and outlines enforcement consequences. This prevents a sudden regulatory vacuum for companies acting in good faith on the statement.
2. **A mandatory order requiring the Ministry of Economy to transpose the CSRD.** While technically a mandatory order, it should be framed with a suspended effect. The court should order transposition within a defined period (e.g., **3 months**), suspending any coercive penalty for that period to allow for orderly legislative drafting, but making clear that failure to comply will trigger immediate consequences.

### 4. Ongoing Harm & Injunctive Relief
**Ongoing Harm:** Spanish companies are gaining an unfair competitive advantage in public tenders (both in Spain and cross-border) by avoiding compliance costs. This distorts the market, harms compliant UK/EU firms, and leads to public money being spent on contracts with operators who have unassessed sustainability risks. Investor reliance on unverified ESG data is another continuous harm.

**Draft Key Elements for an Interim Injunction:**
“We seek an interim injunction restraining the Kingdom of Spain, its ministries and agencies (particularly the Junta Consultiva de Contratación Pública), from awarding any public contract above a value of €1 million to any bidder that cannot demonstrate full compliance with the substantive reporting requirements of Directive (EU) 2022/2464 (CSRD), pending the final determination of this claim or the lawful transposition of the Directive, whichever is sooner. The balance of convenience overwhelmingly favours this order to prevent irreversible market distortion and financial loss to lawful competitors.”

### 5. Statement of Legal Principle Declaration
“It is hereby declared that the Kingdom of Spain, acting through its Ministry of Economy, Trade and Business, has acted unlawfully and in breach of its obligations under Article 288 TFEU by failing to transpose Directive (EU) 2022/2464 into national law by 6 July 2024. It is further declared that the Comisión Nacional del Mercado de Valores, in issuing its Joint Statement of 5 December 2024, acted irrationally and in dereliction of its core supervisory duty by recommending voluntary compliance only, thereby failing to take steps within its power to mitigate the harms flowing from the State’s primary breach of law.”

### 6. Risk Disclosure Statement Court Order
“The defendant public bodies shall, within 21 days of this order, jointly publish and maintain a prominent ‘Regulatory Failure and Risk Disclosure Statement’ on their respective official websites. This statement shall clearly outline: (i) the finding of unlawfulness regarding the CSRD transposition delay; (ii) the consequent risks of relying on non-compliant sustainability reports for investment and public procurement decisions; and (iii) the steps being taken to remediate the situation. The statement must be referenced in the next published annual report of each body and shall remain accessible online for no less than two years.”

### 7. Assessment & Publicity of Risk
The drafted FOI requests are precisely designed to investigate this. A core ground of challenge is the apparent **failure to conduct a proper prior risk assessment** regarding the legality and market impact of non-transposition. If the requests reveal no such assessment was done, this constitutes a gross failure of due diligence and a further ground for irrationality. If assessments were done but concealed, it demonstrates a conscious disregard for the rule of law. The absence or non-publication of such assessments is a critical evidential point supporting misfeasance or Wednesbury unreasonableness.

### 8. Responsible Parties & Individual Liability
* **Primary Responsible Party:** The **General Technical Secretariat of the Ministry of Economy, Trade and Business**, specifically the unit and named officials charged with EU directive transposition.
* **Secondary Responsible Parties:** The **Board of the CNMV** (for the Joint Statement) and the **Leadership of ICAC**.

The FOI requests directly ask about internal investigations, disciplinary proceedings, and the *Acción de Regreso* (action for recovery against officials). If, as anticipated, the answers to (a), (b), and (c) are “**no**” or “**none**”, this demonstrates a failure of internal accountability mechanisms. This failure should be strongly highlighted in proceedings as an aggravating factor and as evidence of a culture of impunity. A specific remedy to request from the court would be a declaration that the State is under a duty to consider the *Acción de Regreso* against identified officials if damages are paid.

### 9. Tort Damages & Remediation Project
* **Aggregate Tort Damages Estimate:** The materials cite a claim of **£320 million**. This can be justified as an aggregate estimate based on the scale of impact: the unfair competitive advantage in public procurement enjoyed by non-compliant Spanish firms (e.g., ACS, Sacyr) over a 12-18 month period, calculated via the cost differential of compliance avoidance and profits from contracts wrongfully awarded.
* **Distribution Mechanism & Remediation Project:** Given the diffuse, transnational class of victims (competitors, investors, the public), a conventional distribution is impractical. The court should be invited to order that the damages be paid into a **”Sustainable Market Integrity Trust Fund.”**
* **Justification:** This fund would finance projects with positive externalities directly remedying the harm caused. Examples include: (i) grants for SMEs across the EU to adopt advanced ESG reporting tools, (ii) funding for a cross-border auditor training program on double materiality assurance, or (iii) an open-source platform for analyzing machine-readable sustainability data. This mechanism provides tangible, collective remediation that addresses the systemic market failure the State’s unlawful conduct created, benefiting the very sectors and principles that were harmed.

17DEC

FOIS

Here are the customized Freedom of Information requests drafted for the specific Spanish public bodies responsible for the “legal vacuum” and subsequent market distortions identified in your case.

Important Legal Note: While your model cites the UK Freedom of Information Act 2000, these bodies are Spanish. To ensure enforceability, I have dual-referenced the Spanish Transparency Law (Ley 19/2013) alongside the UK Act (relevant for cross-border effects). You should be prepared to translate these into Spanish for formal submission.

1. TARGET: Ministry of Economy, Trade and Business (Ministerio de Economía, Comercio y Empresa)

Role: Responsible for the transposition of the CSRD Directive.

Specific DORCAP: Failure to transpose Directive (EU) 2022/2464 (CSRD) by the July 6, 2024 deadline.

[Draft Letter 1]

To: Transparency Unit / General Technical Secretariat

Ministry of Economy, Trade and Business

Paseo de la Castellana, 162, 28046 Madrid, Spain

Re: Freedom of Information Request – Evidence of Ultra Vires Risk Reports & Liability Assessments regarding the Non-Transposition of Directive (EU) 2022/2464 (CSRD)

Submitted under:

  1. Freedom of Information Act 2000 (UK) (Regarding cross-border competition impacts on UK entities).

  2. Ley 19/2013, de 9 de diciembre, de transparencia, acceso a la información pública y buen gobierno (Spain).

I am Oscar Moya, Director of Competition & Consumer Organisation Party Limited (COCOO.uk), 23 Village Way, Beckenham, Kent BR3 3NA. Email: contact@cocoo.uk.

This request gathers evidence establishing tort liabilities for misfeasance, failure to assess ultra vires risks, and foreseeable harms resulting from the Ministry’s failure to transpose Directive (EU) 2022/2464 (CSRD) into Spanish law by the deadline of 6 July 2024 (the “DORCAP”). This omission has created a regulatory vacuum allowing private entities to engage in unfair competition against compliant UK/EU firms.

Please provide the following information:

Part 1: Establishing Enforcement Vacuum and Locus Standi

  • Provide a breakdown of complaints, representations, or infringement notices (including from the European Commission) received regarding the delay in CSRD transposition in the last 24 months.

  • Disclose any internal economic analysis or impact assessment estimating the financial advantage gained by Spanish companies (e.g., IBEX 35 firms) by avoiding CSRD compliance costs during this vacuum period.

  • Confirm if any formal claims for state liability (Responsabilidad Patrimonial del Estado) have been filed against the Ministry regarding this delay.

Part 2: Ultra Vires Risk Reports and Foreseeable Harms

  • Confirm the existence of any risk register entry or internal legal opinion flagging the risk of “Francovich” State Liability or EU infringement proceedings due to the non-transposition of CSRD.

  • Disclose the risk rating (Low/Medium/High) assigned to “Non-compliance with EU Transposition Deadlines” in the Ministry’s risk register between Jan 2024 and present.

  • Did the Ministry assess the risk that this delay would distort public procurement markets by allowing non-transparent companies to win contracts? (Yes/No; if Yes, provide the date of assessment).

Part 3: Investigations into Officials’ Torts and Recovery Actions

  • Confirm if any internal investigation has been initiated to determine if the officials responsible for the transposition delay acted with gross negligence (negligencia grave) or lack of diligence.

  • If the State is required to pay penalties to the EU or damages to competitors (e.g., via the current infringement proceedings), confirm if the Ministry has prepared to initiate the Action of Regreso (Acción de Regreso) against the responsible authorities as required by Art. 36 & 145 of Law 40/2015.

  • If no such preparation exists, disclose the rationale for waiving this potential recovery of public funds.

Part 4: Systemic Aspects

  • List titles of internal memos or audit reports from 2023-2024 discussing the timeline and obstacles for CSRD transposition.

2. TARGET: CNMV (Comisión Nacional del Mercado de Valores)

Role: Financial Regulator supervising listed companies (ACS, Iberdrola, etc.).

Specific DORCAP: The “Joint Statement” of Dec 5, 2024, recommending voluntary compliance rather than enforcing penalties, and the failure to sanction issuers for lack of “Double Materiality” reporting.

[Draft Letter 2]

To: Transparency and Citizen Care Unit

Comisión Nacional del Mercado de Valores (CNMV)

C/ Edison, 4, 28006 Madrid, Spain

Re: Freedom of Information Request – Evidence of Regulatory Forbearance & Ultra Vires Risks regarding Supervision of Sustainability Reporting (ESRS)

Submitted under: UK FOIA 2000 and Spanish Ley 19/2013.

[Standard Intro as per Model…]

This request concerns the CNMV’s decision to issue the “Joint Statement” on 5 December 2024 merely “recommending” compliance with ESRS, and the omission to sanction listed companies (issuers) for failing to publish machine-readable, double-materiality sustainability reports (the “DORCAP”).

Please provide the following information:

Part 1: Establishing Enforcement Vacuum

  • Provide the number of investigations opened in 2024/2025 regarding “Greenwashing” or incomplete non-financial reporting by IBEX 35 companies.

  • Disclose any analysis estimating the impact on investor protection caused by the lack of standardized, comparable ESG data during this period.

Part 2: Ultra Vires Risk Reports

  • Confirm if the decision to issue a “recommendation” rather than enforcing strict compliance was flagged in any risk register as potentially ultra vires or engaging State Liability for failure to supervise.

  • Disclose any internal legal advice or board papers discussing the CNMV’s liability exposure if investors or competitors suffer losses due to reliance on unverified ESG data.

Part 3: Investigations into Officials’ Torts and Recovery Actions

  • Confirm if any internal review assessed whether the “soft law” approach (Joint Statement) constituted a dereliction of supervisory duty (culpa in vigilando) by senior officials.

  • If the CNMV is found liable for damages to third parties due to this supervisory failure, confirm if Acción de Regreso procedures against the Board or technical directors have been contemplated.

Part 4: Systemic Aspects

  • List any internal audit reports from 2024 evaluating the CNMV’s readiness to enforce the Corporate Sustainability Reporting Directive (CSRD) once transposed.

3. TARGET: ICAC (Instituto de Contabilidad y Auditoría de Cuentas)

Role: Accounting and Auditing Regulator.

Specific DORCAP: Failure to adopt/enforce technical auditing standards for sustainability information, allowing “limited assurance” to become a meaningless rubber-stamp.

[Draft Letter 3]

To: Transparency Unit

Instituto de Contabilidad y Auditoría de Cuentas (ICAC)

C/ Huertas, 26, 28014 Madrid, Spain

Re: Freedom of Information Request – Evidence of Omission to Regulate Auditing Standards for Sustainability Info

Submitted under: UK FOIA 2000 and Spanish Ley 19/2013.

[Standard Intro as per Model…]

This request concerns the ICAC’s failure to issue and enforce binding technical standards for the assurance of sustainability reporting (CSRD/ESRS) and the acceptance of audit reports that lack genuine “double materiality” assessment (the “DORCAP”).

Please provide the following information:

Part 1: Establishing Enforcement Vacuum

  • Breakdown of complaints received regarding the quality or veracity of Non-Financial Information Statements (EINF) in the last 3 years.

  • Confirm if ICAC has sanctioned any auditor for certifying a sustainability report that did not comply with European Sustainability Reporting Standards (ESRS).

Part 2: Ultra Vires Risk Reports

  • Confirm the existence of any risk register entry flagging the “Legal Vacuum in Sustainability Assurance” as a high risk for the reliability of Spanish market information.

  • Disclose the risk appetite statement regarding the enforcement of EU directives prior to national transposition.

Part 3: Investigations into Officials’ Torts

  • Confirm if any internal investigation has probed whether the failure to update auditing standards timely constituted negligence by the regulator’s leadership.

  • Confirm if policies for Acción de Regreso exist for scenarios where the regulator’s inaction leads to systemic market failure or state liability claims.

4. TARGET: Junta Consultiva de Contratación Pública del Estado (Ministry of Finance)

Role: Public Procurement Oversight.

Specific DORCAP: Failure to instruct contracting authorities to exclude bidders who are non-compliant with CSRD/ESG transparency requirements (Unfair Competition).

[Draft Letter 4]

To: Transparency Unit

Junta Consultiva de Contratación Pública del Estado

Ministerio de Hacienda, C/ Alcalá, 9, 28014 Madrid, Spain

Re: Freedom of Information Request – Evidence of Ultra Vires Risks regarding Awarding Public Contracts to Non-Compliant Entities

Submitted under: UK FOIA 2000 and Spanish Ley 19/2013.

[Standard Intro as per Model…]

This request concerns the Junta’s failure to issue instructions or recommendations to Contracting Authorities to exclude bidders that do not comply with EU transparency and sustainability reporting obligations (CSRD), thereby facilitating unfair competition in public tenders (the “DORCAP”).

Please provide the following information:

Part 1: Establishing Enforcement Vacuum

  • Number of representations received from competitors (including foreign entities) alleging unfair competition or “social dumping” by bidders who fail to disclose ESG risks.

  • Disclose any analysis on whether awarding contracts to companies with opaque beneficial ownership or ESG data violates the principles of equal treatment and transparency under the Law on Public Sector Contracts (LCSP).

Part 2: Ultra Vires Risk Reports

  • Confirm if the risk of “voidability of contracts” (nulidad de pleno derecho) due to violation of EU environmental law has been assessed in any board paper or risk register.

  • Disclose if the Junta has assessed the risk of Francovich liability claims from excluded competitors who were undercut by non-compliant bidders.

Part 3: Investigations into Officials’ Torts and Recovery Actions

  • Confirm if any investigation has been initiated into whether the awarding of specific major contracts (e.g., to ACS, Sacyr) despite compliance gaps involved misfeasance or gross negligence by contracting officers.

  • In the event of contract annulment or damages paid to losing bidders, confirm if the Junta advises or requires the initiation of Acción de Regreso against the officials who approved the unlawful awards.

Part 4: Systemic Aspects

  • Percentage of procurement officers trained on the “Direct Effect” of EU Directives regarding sustainability and exclusion grounds in the last 2 years.

As solicitor for COCOO.uk, I have reviewed the case files and the available public records regarding the Kingdom of Spain’s failure to transpose the Corporate Sustainability Reporting Directive (CSRD) (Directive (EU) 2022/2464) and related anti-money laundering directives (5AMLD).

This failure has created a “legal vacuum” allowing private entities (the “Perpetrators”) to win public contracts through unfair competition and opacity, causing damages estimated at £320 million to competitors (e.g., UK firms like Balfour Beatty, SSE) and the public purse (e.g., NHS Trusts).

Below is the application of your three questions to the possible Causes of Action (COAs).

COA 1: FRANCOVICH LIABILITY (STATE LIABILITY FOR BREACH OF EU LAW)

Claimant: COCOO.uk / Victims (UK Firms, NHS Trusts)

Defendant: Kingdom of Spain

Dates & Time Limits:

  • Breach Date: July 6, 2024 (Deadline for CSRD transposition).

  • Claim Deadline: Under Spanish Administrative Law (Responsabilidad Patrimonial), the claim must be filed within 1 year of the “production of the event or the effect determining the indemnity” (Art. 67 Law 39/2015). For continuous breaches (non-transposition), the clock typically starts once the transposition finally occurs or the damage stabilizes.

  • UK Limitation: 6 years (if jurisdiction is established in UK courts for specific damages).

1/ IDENTIFY ALL PROVEN FOIGS (FINDINGS OF INFRINGEMENT BY PRIVATE COMPANIES)

  • N/A for this COA. Francovich liability focuses on the State’s failure. However, the result of the State’s breach is the widespread non-compliance of private companies (ACS, Sacyr, Iberdrola) with ESRS (European Sustainability Reporting Standards), specifically the failure to publish “double materiality” assessments and machine-readable ESG data, which remains unpunished due to the lack of national law.

2/ IDENTIFY THE POSSIBILITIES THAT THESE FOIGS COULD HAVE BEEN CAUSED BY AN ULTRAVIRES/UNLAWFUL DORCAP

  • The DORCAP: The “Decision/Omission” is the Spanish Government’s failure to transpose Directive (EU) 2022/2464 by July 6, 2024.

  • Causation: This omission is ultra vires because it breaches binding EU obligations (Art. 288 TFEU). It directly caused the FOIGs (private non-compliance) by creating a regulatory vacuum where companies were not legally compelled to disclose data that would have disqualified them from tenders or forced higher pricing to cover ESG risks.

  • Evidence: The European Commission initiated infringement proceedings on September 30, 2024, sending a letter of formal notice to Spain. The CNMV and ICAC issued a Joint Statement on December 5, 2024, admitting the delay and merely “recommending” voluntary compliance, confirming the unlawful gap.

3/ HAS THE STATE PAID ANY REDRESS? WAS THERE REGRESO?

  • State Payment: No. The State is currently fighting the infringement procedure and has not settled the £320m claim. COCOO is proposing a “joint settlement framework” to avoid litigation.

  • Regreso: No. If the State pays damages, it has a mandatory duty (under Art. 36 & 145 LRJSP 40/2015) to initiate the Action of Regreso (Acción de Regreso) against the specific officials (Ministers, Regulators) guilty of “intent, fault, or gross negligence” (dolo, culpa o negligencia grave) for the delay. This “ignota acción de regreso” is rarely used but legally mandatory.

COA 2: UNFAIR COMPETITION (COMPETENCIA DESLEAL)

Claimant: Competitors (Balfour Beatty, SSE, etc.)

Defendant: Private Companies (ACS, Iberdrola, Sacyr, Radiopharma)

Dates & Time Limits:

  • Breach Date: Ongoing since Jan 1, 2024 (CSRD entry into force) and July 6, 2024 (Transposition deadline).

  • Claim Deadline: 1 year from when the action could be brought and the person responsible is known, or 3 years from the completion of the conduct (Art. 35 Spanish Unfair Competition Act).

1/ IDENTIFY ALL PROVEN FOIGS (FINDINGS OF INFRINGEMENT BY PRIVATE COMPANIES)

  • FOIG 1: Violation of Laws (Art. 15 LCD): Winning contracts by gaining a “significant competitive advantage” through the infringement of legal norms (i.e., failing to bear the cost of CSRD/ESRS compliance).

  • FOIG 2: Misleading Omissions (Art. 7 LCD): Omission of material information (ESG risks, beneficial ownership) that the average consumer/procurer needs to make an informed decision.

  • FOIG 3 (Radiopharma): Abuse of Dominance/Excessive Pricing: Evidence suggests Radiopharma charged inflated prices to NHS Trusts (e.g., €291,600 contract) due to a lack of competitive transparency.

2/ IDENTIFY THE POSSIBILITIES THAT THESE FOIGS COULD HAVE BEEN CAUSED BY AN ULTRAVIRES/UNLAWFUL DORCAP

  • The DORCAP: The CNMV/ICAC’s failure to enforce existing transparency rules (even pre-CSRD) and the Public Contracting Authorities’ (e.g., NHS, Spanish Ministries) decision to award contracts despite the lack of required ESG data.

  • Causation: The State’s “DORCAP” (Omission to regulate) provided the necessary condition for the FOIGs. Without the State’s failure to transpose, these companies would have been forced to disclose data that would have either disqualified them or increased their bid prices, removing their unfair advantage.

3/ HAS THE STATE PAID ANY REDRESS? WAS THERE REGRESO?

  • State Payment: No.

  • Regreso: N/A for direct claims against companies. However, if the State is joined as a co-defendant for facilitating this unfair competition (via the “DORCAP”), and pays damages, it must trigger Regreso against the officials who allowed these companies to operate without oversight.

COA 3: BREACH OF PUBLIC PROCUREMENT LAW

Claimant: Excluded Bidders / COCOO

Defendant: Contracting Authorities (Spanish Ministries, potentially NHS bodies buying from non-compliant firms)

Dates & Time Limits:

  • Breach Date: Date of each specific contract award (e.g., 2024/2025 tenders).

  • Claim Deadline: Very short. 15 working days to appeal a tender award (Recurso Especial). For damages claims: 1 year.

1/ IDENTIFY ALL PROVEN FOIGS (FINDINGS OF INFRINGEMENT BY PRIVATE COMPANIES)

  • FOIG: Submission of non-compliant bids (bids that failed to include mandatory environmental/social reporting required by EU law, even if not transposed into national law, due to “direct effect” principles in procurement).

  • Specific Evidence: Awards to ACS and Sacyr in 2024/2025 for infrastructure projects where valid ESG risk assessments (required by EU regulations) were absent.

2/ IDENTIFY THE POSSIBILITIES THAT THESE FOIGS COULD HAVE BEEN CAUSED BY AN ULTRAVIRES/UNLAWFUL DORCAP

  • The DORCAP: The Award Decisions by public bodies are the “DORCAP”. Awarding a contract to a company that is technically in breach of EU transparency standards is an unlawful act by the public body.

  • Causation: The public body’s decision ratified the private company’s infringement (FOIG), converting a private failure into a public unlawful act.

3/ HAS THE STATE PAID ANY REDRESS? WAS THERE REGRESO?

  • State Payment: No. COCOO seeks the novation of these tainted contracts or a settlement fund.

  • Regreso: Yes, applicable. If a contract is declared void or damages are paid to a losing bidder, the Administration must seek Regreso against the public officials (contracting officers) who approved the award despite the “gross negligence” of ignoring EU transparency requirements.

COMPLEMENTARY WWW INFO

  • Status of Transposition: As of December 2024, Spain is one of 17 Member States facing infringement proceedings for non-transposition of CSRD. The “Stop-the-Clock” Directive (April 2025) has delayed some deadlines, but the initial breach for the 2024 period remains.

  • Regreso Reality: While mandatory in theory, the Acción de Regreso is statistically almost never used in Spain, often cited as a systemic failure of the Spanish administrative liability system.

Relevant video regarding EU infringement procedures and State liability:

EU Law – State Liability (Francovich Principle)

This video is relevant as it explains the legal mechanism (Francovich) by which COCOO can hold the Spanish State liable for the damages caused to victims by the non-transposition of the directive.

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