European Disputes
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Climate litigation on the rise

The 2021 Dutch ruling against Shell (discussed in this blog) lent significant legitimacy to climate activism through litigation – and the number of cases brought against companies to enforce climate protection measures has been rising ever since. In Germany, the Higher Regional Court of Hamm (5 U 15/17) recently held, albeit dismissing the specific claim, that CO₂ emitters may in principle face liability for concrete, site-specific climate-related property impairment risks, including preventive costs, if causation can be established, and further indicated that this may be the case wherever, including outside Germany, the relevant impairment occurs.

Most recently, a German environmental organisation initiated two sets of proceedings seeking to compel BMW and Mercedes-Benz to cease placing combustion engine vehicles on the market by the end of October 2030. On March 23, 2026, the German Federal Court of Justice (“BGH“) handed down its first rulings on private climate litigation (VI ZR 334/23 and VI ZR 365/23) – rejecting both claims on the grounds that German law has not yet established legally binding CO₂ emissions budgets for individual companies.

The rulings

The plaintiffs, a German environmental organization and members of its Federal Executive Board acting in their individual capacities, sought a court order compelling BMW and Mercedes-Benz (together “the Companies“) to cease sales of combustion engine vehicles by the end of October 2030. They argued that sales of combustion engines and their resulting CO₂ emissions would force the legislature – under its obligations from the Paris Climate Accords – to enact regulations in the future that will severely restrict individuals’ personal freedom. It was further contended that, with this future prospect in mind, the Companies would therefore be indirectly responsible for the upcoming restriction of individuals’ fundamental rights in all areas of public and private life. Thus, the plaintiffs argued, the Companies are already obligated to refrain from placing combustion engine vehicles on the market.

The BGH rejected this line of argument and held that no infringement of individuals’ rights had occurred, as there are currently no legal regulations limiting the CO₂ emissions of individuals or companies in Germany. For indirect liability on the part of the car manufacturers to arise, the legislature would first need to establish a specific emissions budget for companies. At present, a statutory carbon budget of this kind exists only theoretically for Germany as a whole.

Furthermore, the Court emphasised in several passages of the rulings that responsibility for climate protection rests solely with the legislature. Accordingly, the Companies cannot be held legally responsible for future restrictions on individual freedom enacted by the legislature:

1. Individual companies – including so-called Carbon Majors – are under no obligation to take measures beyond those imposed by the legislature to implement the Paris Climate Accords. Companies may be subject to civil law duties of care that go beyond compliance with public law regulations to prevent harm to others. However, if the legislature has already enacted regulations to address that specific risk, it is sufficient to comply with those regulations. Anything else would constitute a circumvention of the legal requirements. As there is a sales ban for combustion engine vehicles scheduled by German law to take effect in 2035, it suffices that the Companies comply with this law. Consequently, companies are also not required to develop their own reduction plans or similar measures to meet the targets of the Paris Climate Accords.
   
2. The argument that companies are indirect contributors does not give rise to claims, as the legislature alone is responsible for implementing the climate protection laws prescribed by the EU. Due to the separation of powers, the Court is not authorised to enforce this implementation through judicial means by imposing injunctions on individual companies.

Looking forward

The BGH has made clear that it regards the fulfilment of Germany’s climate protection targets as a matter for the legislature. The highest German civil court stated plainly that it does not consider it to be its role to advance Germany’s climate goals through judicial intervention.

However, the BGH remained cautious on a number of issues and left several questions unanswered, keeping the door open for future climate litigation. Most notably, the BGH indicated that companies’ CO₂ emissions may constitute infringements of personal rights, if legislation introduces specific emissions budgets for businesses. Developments in this area will therefore need to be monitored closely.

For the time being, the following conclusions can be drawn from this specific case:

• Insofar as the legislature has already taken specific action, complying with public law regulations should suffice to fulfil a company’s civil law duties of care.
• To adhere to the separation of powers, climate targets are to be realised through legislation, not through climate litigation. For now, litigation risks are thus limited, although climate litigation remains an evolving area.