The Operationalization of the Novel 'Do No Significant Harm' Principle Under the Recovery and Resilience Facility Framework: Unravelling its Multilevel Application

The 'Do No Significant Harm' (DNSH) principle represents a key development in the European Union's integration of environmental sustainability within its financial and regulatory frameworks. Initially introduced as a classification tool under the EU Taxonomy Regulation, the DNSH principle became a mandatory condition under the Recovery and Resilience Facility (RRF) Regulation, raising several questions as to its application and implications throughout the multi-level disbursement of EU funding. This paper explores how the operationalization of the DNSH principle within the RRF framework imposes substantive environmental obligations on Member States. It analyses the cascading application of the DNSH from the EU to the national level, emphasising its function in aligning financial support with the EU's environmental objectives. The mandatory prescription of the principle imposes environmental conditions that affect public procurement processes related to the National Recovery and Resilience Plans. National authorities responsible for the implementation of RRF projects must navigate these novel requirements, using their discretion to balance compliance with RRF's mandatory environmental objectives with other interests involved in domestic administrative procedures. This article further discusses the relationship of the DNSH principle with existing EU and domestic environmental legislation, highlighting the challenges of coordinating these frameworks under the RRF. Using the Italian National Recovery and Resilience Plan and related domestic case law as an example, the paper provides critical insights into the legal challenges and the transformative potential of the DNSH principle in environmental governance.