The European Court of Justice branded Ireland's domestic waste-water legislation as inadequate at a hearing on Friday October 30th.
Ireland was accused of failing to fully implement a 1975 EU directive on waste, which the European Commission (EC) claimed had caused "serious damage to the environment".
The EC brought the case against the Irish government over the installation and maintenance of private waste-water systems in rural areas of the country.
Due to the number of remote villages across Ireland, the country has a higher than average number of septic tanks compared to other EU member states.
It is leaks from these tanks that triggered the initial case by the EC.
Speaking to the Irish Times after the judgement, John Gormley, Ireland's minister for the environment, said: "The absence of a licensing and inspection system is a major weakness in our overall environmental management structures and this needs to be addressed."
Ireland has been ordered to pay its own costs in addition to three-quarters of the costs incurred by the Commission of the European Communities.
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