Commission Regulation (EU) 2017/1902 of 18 October 2017 amending Commission Regulation (EU) No 1031/2010 to align the auctioning of allowances with Decision (EU) 2015/1814 of the European Parliament and of the Council and to list an auction platform to be appointed by the United Kingdom (Text with EEA relevance. )
Commission Regulation (EU) 2017/1902of 18 October 2017amending Commission Regulation (EU) No 1031/2010 to align the auctioning of allowances with Decision (EU) 2015/1814 of the European Parliament and of the Council and to list an auction platform to be appointed by the United Kingdom(Text with EEA relevance)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 scheme for greenhouse gas emission allowance trading within the Community and amending Council Directive 96/61/ECOJ L 275, 25.10.2003, p. 32., and in particular Articles 3d(3) and 10(4) thereof,Whereas:(1)Commission Regulation (EU) No 1031/2010Commission Regulation (EU) No 1031/2010 of 12 November 2010 on the timing, administration and other aspects of auctioning of greenhouse gas emission allowances pursuant to Directive 2003/87/EC of the European Parliament and of the Council establishing a scheme for greenhouse gas emission allowances trading within the Community (OJ L 302, 18.11.2010, p. 1). provides for rules on the timing, administration and other aspects of the auctioning of allowances under Directive 2003/87/EC. In particular, Regulation (EU) No 1031/2010 determines the volumes of allowances to be auctioned each year. Regulation (EU) No 1031/2010 thus ensures that the auctioning of allowances is a well functioning process. It is currently conducted by a common auction platform for 25 Member States and by a small number of opt-out platforms.(2)Pursuant to Decision (EU) 2015/1814 of the European Parliament and of the CouncilDecision (EU) 2015/1814 of the European Parliament and of the Council of 6 October 2015 concerning the establishment and operation of a market stability reserve for the Union greenhouse gas emission trading scheme and amending Directive 2003/87/EC (OJ L 264, 9.10.2015, p. 1)., a market stability reserve (the "reserve") is to be established in 2018 and is to start operating from 1 January 2019. In accordance with the pre-defined rules of this Decision volumes of allowances are to be placed in or released from the reserve adjusting the volumes of allowances to be auctioned over a period of 12 months beginning on 1 September of a given year. That rules for the functioning of the reserve are necessary to address situations where the total number of allowances in circulation for the previous year, published by the Commission on 15 May of the given year, is outside a predefined range. In the first year of the reserve's operation, the first adjustment to the auction volumes is to be made from 1 January to 1 September 2019.(3)Decision (EU) 2015/1814 also provides that 900 million allowances originally planned to be reintroduced in 2019 and 2020, as determined by Commission Regulation (EU) No 176/2014Commission Regulation (EU) No 176/2014 of 25 February 2014 amending Regulation (EU) No 1031/2010 in particular to determine the volumes of greenhouse gas emission allowances to be auctioned in 2013-20 (OJ L 56, 26.2.2014, p. 11)., are no longer to be auctioned but are to be placed in the reserve. Furthermore, Decision (EU) 2015/1814 provides that the allowances not allocated from the new entrant reserve, or those not allocated to installations because of their closure or partial cessation in accordance with Articles 10a(7), 10a(19) and 10a(20) of Directive 2003/87/EC, are to be placed in the reserve in 2020 rather than auctioned.(4)Pursuant to Decision (EU) 2015/1814, the auction calendars of the common auction platform and, where applicable, of opt-out auction platforms are to be adjusted to take account of the volume of allowances placed in or to be released from the reserve.(5)In view of providing clarity and certainty to market participants about the volumes of allowances to be auctioned within a period of at least 12 months, the changes to the auction calendar of a given year stemming from the application of Decision (EU) 2015/1814 should be made together with the determination and publication of theauction calendar of the subsequent year. Furthermore, in order to ensure a smooth implementation of the adjustments to the auction volumes, avoiding negative impacts on the auctions, market participants should be timely informed about the impact of Decision (EU) 2015/1814 on the auction volumes for the next 12 months. Accordingly, the relevant changes to the auction calendars of a given year and the auction calendars for the subsequent year should be published well in advance before 1 September of a given year when the relevant adjustments to the auction volumes will start to apply.(6)Articles 1(5) and 1(8) of Decision (EU) 2015/1814 contain derogations from the general rules for the functioning of the reserve concerning the 10 % of total quantity of allowances to be auctioned being distributed among some Member States for solidarity purposes pursuant to Article 10(2)(b) of Directive 2003/87/EC. Therefore, Member States' shares of allowances to be auctioned for any given year are to be established also in accordance with the provisions of the second subparagraph of Article 1(5) and of Article 1(8) of Decision (EU) 2015/1814 regarding the specific rules for determining Member States' shares contributing to the placement of allowances in the reserve until the end of 2025 and the subsequent release of allowances from the reserve.(7)Article 60(1) of Regulation (EU) No 1031/2010 provides a non-exhaustive list of non-confidential information to be published on the dedicated up-to-date auctioning web-site maintained by the auction platform concerned. The list of persons admitted to bid in the auctions should be deemed to constitute a non-confidential piece of information pertinent to the auctions on a given auction platform.(8)Regulation (EU) No 1031/2010 contains several inconsistencies stemming from previous amendments to that Regulation, which should be corrected. In particular, Article 10(3) should be amended to clarify that the calculation of the volume of allowances to be auctioned each year takes into account any adjustment pursuant to Articles 24 and 27 of Directive 2003/87/EC. Commission Regulation (EU) No 1143/2013Commission Regulation (EU) No 1143/2013 of 13 November 2013 amending Regulation (EU) No 1031/2010 on the timing, administration and other aspects of auctioning of greenhouse gas emission allowances pursuant to Directive 2003/87/EC of the European Parliament and of the Council establishing a scheme for greenhouse gas emission allowances trading within the Community in particular to list an auction platform to be appointed by Germany (OJ L 303, 14.11.2013, p. 10). introduced in Regulation (EU) No 1031/2010 the rule that an entity may only be appointed as auction platform if it is authorised as a regulated market whose operator organises a secondary market in allowances or allowances derivatives. In order to ensure consistency with that rule, it is necessary to amend Articles 19, 20 and 35 of Regulation (EU) No 1031/2010.(9)In accordance with Article 30(4) of Regulation (EU) No 1031/2010, on 18 February 2011 the United Kingdom informed the Commission of its decision not to participate in the joint action as provided in Article 26(1) and (2) of that Regulation, and to appoint its own auction platform.(10)On 30 April 2012, the United Kingdom notified the Commission of its intention to appoint ICE Futures Europe ("ICE") as an auction platform referred to in Article 30(1) of Regulation (EU) No 1031/2010. The terms of appointment and the applicable conditions for ICE as auction platform for the United Kingdom for the period from 10 November 2012 until 9 November 2017 were introduced in Annex III to Regulation (EU) No 1031/2010 by Commission Regulation (EU) No 1042/2012Commission Regulation (EU) No 1042/2012 of 7 November 2012 amending Regulation (EU) No 1031/2010 to list an auction platform to be appointed by the United Kingdom (OJ L 310, 9.11.2012, p. 19)..(11)On 16 November 2016, the United Kingdom notified the Commission of its intention to appoint ICE Futures Europe ("ICE") as its second auction platform pursuant to in Article 30(1) of Regulation (EU) No 1031/2010. Under the notification, the terms and requirements of ICE's appointment remain the same as those notified on 30 April 2012 and the exchange rules of ICE applicable to the auctions have been amended to ensure compliance with the conditions and obligations for its listing in Annex III to Regulation (EU) No 1031/2010, in accordance with point 6 of the row on obligations of the table for Auction platforms appointed by the United Kingdom set out in that Annex. In addition, following a request from the Commission, the United Kingdom has provided further information and clarification supplementing the notification accordingly.(12)In order to ensure that the proposed appointment of ICE as the second United Kingdom auction platform referred to in Article 30(1) of Regulation (EU) No 1031/2010 and in particular that the exchange rules of ICE satisfy the requirements of that Regulation and are in conformity with the second subparagraph of Article 10(4) of Directive 2003/87/EC, it is appropriate to extend the conditions and obligations on ICE set out in Annex III toRegulation (EU) No 1031/2010 to the listing of ICE as the second United Kingdom opt-out auction platform with the adaptations necessary to ensure that their objective is achieved taking into account the specific terms of implementation provided in the applicable exchange rules of ICE.(13)Regulation (EU) No 1031/2010 should therefore be amended accordingly.(14)The measures provided for in this Regulation are in accordance with the opinion of the Climate Change Committee,HAS ADOPTED THIS REGULATION: