High Court refuses permission for climate change judicial review against the FCA for a second time

The High Court has refused environmental NGO ClientEarth’s application for permission for judicial review of the decision taken by the Financial Conduct Authority (FCA) to approve the prospectus of an oil and gas operator Ithaca Energy plc: R (on the application of ClientEarth) v Financial Conduct Authority [2023] EWHC 3301 (Admin).

Under s.87A of the Financial Services and Markets Act 2000, the FCA may not approve a prospectus unless satisfied that it contains the information required by the Prospectus Regulation (EU) 2017/1129.

The decision will be of interest to financial institutions as highlights the increased scrutiny on climate issues and growing pressure on a wider range of regulators and public authorities who are not traditionally seen as operating in the environmental sphere. In the present case, the court reiterated well established principles of judicial review in making it clear that it will afford regulators broad discretion when exercising their expert judgment, regardless of the climate change context. It will refuse to substitute its own views (or those of other interested parties) for those of the regulator. Instead, the court will only intervene where the regulator has misdirected itself on the law, failed to take relevant considerations into account, or made an irrational decision which is a “high hurdle” to overcome.

For more information, please see our Public Law blog post.