Nestlé Waters Canada is backing down from a fight with environmental groups and accepting drought restrictions on its permit to take water from its well in Hillsburgh, Ont.

The Environmental Review Tribunal of Ontario ruled today that it will be closing the file on Nestlé's appeal that centred on conditions the Ontario Ministry of the Environment put on the company's renewed permit to take water.

Yesterday, Wellington Water Watchers and the Council of Canadians, both represented by Ecojustice, broke the news that Nestlé was withdrawing its appeal to the tribunal.

"It’s a major win. Nestlé’s decision to back down is huge. For the first time in Ontario’s history, a company must adhere to mandatory restrictions on the water it pumps out of the ground during drought conditions," said Ecojustice lawyer Will Amos.

Nestlé said it withdrew the appeal because of the cost of the process to the company and the Ontario taxpayer. Timing was also a factor. There is only three years left in this current permit.

"We're very disappointed that we now sit in Ontario as the only industry that has this mandatory requirement during a drought. No other industry has this requirement and it's unfair but it is what it is," said Nestlé spokesperson John Challinor.

Conditions attached to permit

The saga began last year when the Swiss food giant went to renew its licence for the well it owns in Hillsburgh, a pretty little farm town in the hills north of the Niagara Escarpment near Guelph.

The Environment Ministry gave Nestlé a new five-year term but added two conditions that weren't in its earlier permit approvals. Basically, the water-bottling company would have to reduce its take of water during droughts. That made Nestlé the only permit holder in the watershed that would have mandatory reductions.

The company appealed the conditions to the Ontario Environmental Review Tribunal.

Before the tribunal could rule on the appeal, Nestlé and the Environment Ministry reached an agreement in February and the two conditions were removed from the company's permit to take water.

That's when the Council of Canadians and Wellington Water Watchers decided to intervene. The groups said they wanted to protect groundwater that makes its way into the Grand and Credit rivers.

In August, the tribunal ruled that the agreement reached between Nestlé and the Environment Ministry was not in the public interest and that the original appeal should proceed to a full hearing.

“Drought conditions are occurring more often due to climate change, and the ministry is not taking its responsibility to protect our groundwater seriously. Community groups shouldn’t have to put time and money into challenging the ministry to do its job,” said Mike Nagy, chair of the Wellington Water Watchers.