Commission Delegated Regulation (EU) 2023/2904 of 25 October 2023 amending Delegated Regulation (EU) 2019/1122 supplementing Directive 2003/87/EC of the European Parliament and of the Council as regards the functioning of the Union Registry

THE EUROPEAN COMMISSION,

Having regard to the Treaty on the Functioning of the European Union,

Having regard to Directive 2003/87/EC of the European Parliament and of the Council of 13 October 2003 establishing a system for greenhouse gas emission allowance trading within the Union and amending Council Directive 96/61/EC (1), and in particular Article 19(3) thereof, Whereas:

(1) Commission Delegated Regulation (EU) 2019/1122 (2) lays down general, operational and maintenance requirements concerning the Union Registry provided for in Directive 2003/87/EC and applies to allowances created for the purposes of the European Union Emissions Trading System (EU ETS).

(2) Directive 2003/87/EC has been amended to include as of 2024 emissions from maritime transport in the EU ETS. Shipping companies will thus be subject to a requirement to surrender emission allowances corresponding to a certain share of its greenhouse gas emissions, which will gradually increase until 2026. It is therefore appropriate to establish specific rules for the opening and closure of maritime operator holding accounts by shipping companies. Several derogations from the surrender requirement have been introduced that apply to maritime transport emissions. They should be reflected in the calculation of the compliance status figure for shipping companies.

(3) Directive 2003/87/EC has also been amended to include as of 2027 a separate but parallel emissions trading system to be applied to fuels used for combustion in the buildings and road transport sectors as well as in additional sectors of industrial activities not covered by Annex I to that Directive. Therefore, specific rules should be established for holding accounts and for surrender of allowances in respect of regulated entities carrying out an activity referred to in Annex III of Directive 2003/87/EC. Since the new emissions trading system remains separate from the existing system for stationary installations and aviation, this distinction should be reflected with regard to allowances issued for the sectors concerned in the Union Registry.

(4) The new compliance dates for operators to surrender allowances set out in Directive 2003/87/EC should be reflected. The compliance date for stationary installations and aircraft operators should therefore be changed to 30 September. The compliance dates for maritime operators and regulated entities should also be changed to 30 September and 31 May respectively.

(5) It is also necessary to delete references to legal provisions that have been removed from Directive 2003/87/EC and to address certain needs for simplification that have emerged from past experience. The rules on the return of excess allocation should be updated in order to allow such transaction from blocked accounts. The information on parent and subsidiary company should be at account holder level and not at company level.

(6) A new account type should be established for third-country governments that have entered into a non-binding arrangement with the Union in accordance with Directive 2003/87/EC. This new account type should enable those third country governments to delete allowances acquired on the Union market.

(7) A provision has been introduced in Directive 2003/87/EC giving the competent authority of a Member State the possibility to exempt a regulated entity that is subject to national carbon tax from the obligation to surrender allowances. A new account type should be established for Member States that decide to make use of that possibility. A Member State should thus be allowed to delete allowances relating to fuels used for combustion in the buildings and road transport sectors and in additional sectors, where its auction volumes are below the amount of allowances that have to be cancelled.

(8) As of 1 January 2025, general allowances are to be issued also for the aviation sector, by means of free allocation and auctioning, thus covering emissions from the stationary, maritime and aviation sectors. However, in order to ensure a smooth transition and legal certainty for the users, aviation allowances issued before the end of 2024 should remain in the accounts and in circulation.

(9) In order to enhance transparency, and improve market monitoring, of purely bilateral over-the-counter transactions of emission allowances, such transactions should be systematically marked in the Union Registry. To avoid data inconsistencies, the term bilateral transactions shall have the same meaning as in the relevant financial reporting frameworks. Moreover, in order to improve the quality of data available to market regulators for the so-called spot market of emission allowances, market regulators should be allowed to request access to data in the Union Registry with regular intervals depending on their monitoring needs.

(10) Delegated Regulation (EU) 2019/1122 should therefore be amended accordingly.

(11) In order to allow market participants time to adapt to the merging of general and aviation allowances and to prevent legal uncertainty regarding the use and the validity of allowances in the year 2024, the application of the provisions on the merging of general allowances and aviation allowances should be deferred.

(12) In order to ensure the timely application of the EU ETS for maritime operators as of 1 January 2024, this Regulation should enter into force as a matter of urgency on the day following that of its publication in the Official Journal of the European Union.

(13) The European Data Protection Supervisor was consulted in accordance with Article 42 of Regulation (EU) 2018/1725 of the European Parliament and of the Council (3) and delivered an opinion on 25 September 2023,

HAS ADOPTED THIS REGULATION:

Article 1

Delegated Regulation (EU) 2019/1122 is amended as follows:

(3) Article 14 is replaced by the following: ‘Article 14 Opening stationary installation holding accounts in the Union Registry

(5) the following Articles are inserted: ‘Article 15a Opening maritime operator holding accounts in the Union Registry

Article 15b

Opening regulated entity holding accounts in the Union Registry

Article 15c

Opening third country government deletion accounts in the Union Registry

Article 15d

Opening tax derogation deletion accounts in the Union Registry

(6) In Article 19(3), the first sentence is replaced by the following: ‘Where the national administrator refuses to open an operator account in accordance with paragraph 2, the account may be opened upon instruction from the competent authority.’;

(8) the following Article is inserted: ‘Article 24a Closure of third country government deletion accounts The central administrator shall close a third country government deletion account within 10 working days of the end of the time period set out in the non-binding arrangement referred to in Article 25(1b) of Directive 2003/87/EC.’

(12) in Article 30, paragraph 10 is replaced by the following: ‘10.   Where the holder of an operator account is prevented from surrendering in the 10 working days preceding the surrender time-limit laid down in Article 12(3) and Article 30e(2), respectively, of Directive 2003/87/EC due to suspension in accordance with this Article, the national administrator shall, if so requested by the account holder, surrender the number of allowances specified by the account holder.’

(14) Article 32 is replaced by the following: ‘Article 32 Blocking of accounts due to a failure to submit verified emissions

(16) the following Article is inserted: ‘Article 33a Calculation of compliance status figures for regulated entities

(17) in Article 36, the following paragraph is added: ‘5.   Allowances falling within the scope of Chapter IVa of Directive 2003/87/EC shall not be fungible with allowances falling within the scope of Chapters II and III of that Directive. Allowances falling within the scope of Chapter IVa of Directive 2003/87/EC shall not be held on stationary installation holding accounts, aircraft operator holding accounts, maritime operator holding accounts or third country government deletion accounts.’

(20) Article 39 is replaced by the following: ‘Article 39 Transfer of general allowances for stationary installations to be allocated free of charge The central administrator shall, in a timely manner, transfer general allowances for stationary installations from the EU Total Quantity Account into the EU Allocation Account in a quantity corresponding to the sum of the allowances allocated free of charge according to the national allocation table of each Member State.’

(21) Article 40 is replaced by the following: ‘Article 40 Transfer of general allowances for aviation to be auctioned

(22) Article 41 is replaced by the following: ‘Article 41 Transfer of general allowances to be allocated free of charge to aircraft operators The central administrator shall, in a timely manner, transfer general allowances from the EU Aviation Total Quantity Account into the EU Aviation Allocation Account in a quantity corresponding to the sum of the allowances allocated free of charge according to the national aviation allocation table of each Member State.’

(23) Article 42 is deleted;

(24) the following Article is inserted: ‘Article 42a Transfer of regulated entity allowances to be auctioned

(25) Articles 44 and 45 are deleted;

(26) Article 48 is replaced by the following: ‘Article 48 Free allocation of general allowances

(27) in Article 49, paragraph 2 is replaced by the following: ‘2.   The Commission shall instruct the central administrator to make the corresponding changes to the national aviation allocation tables in the Union Registry if it considers that the change to the national aviation allocation table is in accordance with Directive 2003/87/EC. It shall otherwise reject the changes within a reasonable period of time and inform the Member State without delay, stating its reasons and setting out criteria to be fulfilled for a subsequent notification to be accepted.’

(29) in Article 51, the title is replaced by the following: ‘ Return of allowances from aircraft operators ’;

(32) in Article 55, paragraphs 2, 3 and 4 are replaced by the following: ‘2.   Operator accounts may only transfer allowances to an account on the trusted account list set up pursuant to Article 23.

(*5)  Regulation (EU) No 600/2014 of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Regulation (EU) No 648/2012 (OJ L 173, 12.6.2014, p. 84.’;"

(35) the following Article is inserted: ‘Article 59-a Authorised transactions for third country government deletion accounts Allowances held in third country government deletion accounts shall be deleted. Allowances shall not be transferred from third country government deletion accounts. No other transactions shall be possible from those accounts.’

(37) in Article 80, the following paragraph is inserted: ‘4a.   The competent authorities referred to in Article 22 of Regulation (EU) No 596/2014 shall receive, upon request to the central administrator if and as long as such requests are justified and necessary for the purposes referred to in paragraph 4, first subparagraph, data stored in the Union Registry at regular intervals determined in consultation with the central administrator.’

(38) Annex I is replaced by the text in Annex I to this Regulation;

(39) Annex III is amended in accordance with Annex II to this Regulation;

(40) Annex VI is amended in accordance with Annex III to this Regulation;

(41) a new Annex VIIa, as set out in Annex IV to this Regulation, is inserted;

(42) a new Annex VIIb, as set out in Annex V to this Regulation, is inserted;

(43) Annex IX is amended in accordance with Annex VI to this Regulation;

(44) Annex XIII is amended in accordance with Annex VII to this Regulation.

Article 2

Entry into force and application

This Regulation shall enter into force on the day following that of its publication in the Official Journal of the European Union.

Article 1 , points (21), (22), (25) and (28)(c), shall apply from 1 January 2025 and Article 1, point (30)(b), shall apply from 1 January 2027.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels, 25 October 2023.

For the Commission The President Ursula VON DER LEYEN

(1) OJ L 275, 25.10.2003, p. 32.

(2) Commission Delegated Regulation (EU) 2019/1122 of 12 March 2019 supplementing Directive 2003/87/EC of the European Parliament and of the Council as regards the functioning of the Union Registry (OJ L 177, 2.7.2019, p. 3).

(3) Regulation (EU) 2018/1725 of the European Parliament and of the Council of 23 October 2018 on the protection of natural persons with regard to the processing of personal data by the Union institutions, bodies, offices and agencies and on the free movement of such data, and repealing Regulation (EC) No 45/2001 and Decision No 1247/2002/EC (OJ L 295, 21.11.2018, p. 39).