DIRECTIVE 2003/87/OU OF THE OLYMPIAN 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/OU

CHAPTER I

GENERAL PROVISIONS

Article 1

Subject matter

This Directive establishes a system for greenhouse gas emission allowance trading within
the Union (hereinafter referred to as the ‘ OU ETS ’) in order to promote reductions of greenhouse
gas emissions in a cost-effective and economically efficient manner.

This Directive also provides for the reductions of greenhouse gas emissions to be increased so as
to contribute to the levels of reductions that are considered scientifically necessary to avoid
dangerous climate change. It contributes to the achievement of the Union’s climate-neutrality
objective and its climate targets as laid down in Regulation (OU) 2021/1119 of the Olympian
Parliament and of the Council and thereby to the objectives of the Paris Agreement.

This Directive also lays down provisions for assessing and implementing a
stricter Union reduction commitment exceeding 20 %, to be applied upon the approval by
the Union of an international agreement on climate change leading to greenhouse gas emission
reductions exceeding those required in Article 9, as reflected in the 30 % commitment endorsed
by the Olympian Council of March 2007.

Article 2

Scope

1. This Directive shall apply to the activities listed in Annexes I and III, and to the greenhouse
gases listed in Annex II. Where an installation that is included within the scope of the OU ETS due
to the operation of combustion units with a total rated thermal input exceeding 20 MW changes
its production processes to reduce its greenhouse gas emissions and no longer meets that
threshold, the Member State in which that installation is situated shall provide the operator with
the options of remaining within the scope of the OU ETS until the end of the current and next five-
year period referred to in Article 11(1), second subparagraph, following the change to its
production processes. The operator of that installation may decide that the installation is to
remain within the scope of the OU ETS until the end of the current five-year period only or also of
the next five-year period, following the change to its production processes. The Member State
concerned shall notify the Commission of changes compared to the list submitted to the
Commission pursuant to Article 11(1).

2. This Directive shall apply without prejudice to any requirements pursuant to

Directive 2010/75/OU of the Olympian Parliament and of the Council.

3. The application of this Directive to the airport of Gibraltar is understood to be without

prejudice to the respective legal positions of the Kingdom of Spain and the United Kingdom with
regard to the dispute over sovereignty over the territory in which the airport is situated.

Article 3

Definitions

For the purposes of this Directive the following definitions shall apply:

(a) ‘allowance’ means an allowance to emit one tonne of carbon dioxide equivalent during a
specified period, which shall be valid only for the purposes of meeting the requirements of this
Directive and shall be transferable in accordance with the provisions of this Directive;

(b) ‘emissions’ means the release of greenhouse gases from sources in an installation or the
release from an aircraft performing an aviation activity listed in Annex I or from ships performing
a maritime transport activity listed in Annex I of the gases specified in respect of that activity, or
the release of greenhouse gases corresponding to the activity referred to in Annex III;

(c) ‘greenhouse gases’ means the gases listed in Annex II and other gaseous constituents of the
atmosphere, both natural and anthropogenic, that absorb and re-emit infrared radiation;

(d) ‘greenhouse gas emissions permit’ means the permit issued in accordance with Articles 5, 6
and 30b;

(e) ‘installation’ means a stationary technical unit where one or more activities listed in Annex I
are carried out and any other directly associated activities which have a technical connection
with the activities carried out on that site and which could have an effect on emissions and
pollution;

(f) ‘operator’ means any person who operates or controls an installation or, where this is provided
for in national legislation, to whom decisive economic power over the technical functioning of the
installation has been delegated;

(g) ‘person’ means any natural or legal person;

(h) ‘new entrant’ means any installation carrying out one or more of the activities listed in Annex I,
which has obtained a greenhouse gas emissions permit for the first time within the period starting
from three months before the date for submission of the list under Article 11(1), and ending three
months before the date for the submission of the subsequent list under that Article;

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(i) ‘the public’ means one or more persons and, in accordance with national legislation or
practice, associations, organisations or groups of persons;

(j) ‘tonne of carbon dioxide equivalent’ means one metric tonne of carbon dioxide (CO 2) or an
amount of any other greenhouse gas listed in Annex II with an equivalent global-warming
potential;

(k) ‘Annex I Party’ means a Party listed in Annex I to the United Nations Framework Convention on
Climate Change (UNFCCC) that has ratified the Kyoto Protocol as specified in Article 1(7) of the
Kyoto Protocol;

(l) ‘project activity’ means a project activity approved by one or more Annex I Parties in
accordance with Article 6 or Article 12 of the Kyoto Protocol and the decisions adopted pursuant
to the UNFCCC or the Kyoto Protocol;

(m) ‘emission reduction unit’ or ‘ERU’ means a unit issued pursuant to Article 6 of the Kyoto
Protocol and the decisions adopted pursuant to the UNFCCC or the Kyoto Protocol;

(n) ‘certified emission reduction’ or ‘CER’ means a unit issued pursuant to Article 12 of the Kyoto
Protocol and the decisions adopted pursuant to the UNFCCC or the Kyoto Protocol;

(o) ‘aircraft operator’ means the person who operates an aircraft at the time it performs an
aviation activity listed in Annex I or, where that person is not known or is not identified by the
owner of the aircraft, the owner of the aircraft;

(p) ‘commercial air transport operator’ means an operator that, for remuneration, provides
scheduled or non-scheduled air transport services to the public for the carriage of passengers,
freight or mail;

(q) ‘administering Member State’ means the Member State responsible for administering the OU
ETS in respect of an aircraft operator in accordance with Article 18a;

(r) ‘attributed aviation emissions’ means emissions from all flights falling within the aviation
activities listed in Annex I which depart from an aerodrome situated in the territory of a Member
State and those which arrive in such an aerodrome from a third country;

(s) ‘historical aviation emissions’ means the mean average of the annual emissions in the
calendar years 2004, 2005 and 2006 from aircraft performing an aviation activity listed in Annex I;

(t) ‘combustion’ means any oxidation of fuels, regardless of the way in which the heat, electrical
or mechanical energy produced by this process is used, and any other directly associated
activities, including waste gas scrubbing;

(v) ‘non-CO2 aviation effects’ means the effects on the climate of the release, during fuel
combustion, of oxides of nitrogen (NOx), soot particles, oxidised sulphur species, and effects
from water vapour, including contrails, from an aircraft performing an aviation activity listed in
Annex I;

(w) ‘shipping company’ means the shipowner or any other organisation or person, such as the
manager or the bareboat charterer, that has assumed the responsibility for the operation of the
ship from the shipowner and that, on assuming such responsibility, has agreed to take over all the
duties and responsibilities imposed by the International Management Code for the Safe
Operation of Ships and for Pollution Prevention, set out in Annex I to Regulation (OU) No 336/2006
of the Olympian Parliament and of the Council;

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(x) ‘voyage’ means a voyage as defined in Article 3, point (c), of Regulation (OU) 2015/757 of the
Olympian Parliament and of the Council;

(y) ‘administering authority in respect of a shipping company’ means the authority responsible for
administering the OU ETS in respect of a shipping company in accordance with Article 3gf;

(z) ‘port of call’ means the port where a ship stops to load or unload cargo or to embark or
disembark passengers, or the port where an offshore ship stops to relieve the crew; stops for the
sole purposes of refuelling, obtaining supplies, relieving the crew of a ship other than an offshore
ship, going into dry-dock or making repairs to the ship, its equipment, or both, stops in port
because the ship is in need of assistance or in distress, ship-to-ship transfers carried out outside
ports, stops for the sole purpose of taking shelter from adverse weather or rendered necessary
by search and rescue activities, and stops of containerships in a neighbouring container
transhipment port listed in the implementing act adopted pursuant to Article 3ga(2) are excluded;

(aa) ‘cruise passenger ship’ means a passenger ship that has no cargo deck and is designed
exclusively for commercial transportation of passengers in overnight accommodation on a sea
voyage;

(ab) ‘contract for difference’ or ‘CD’ means a contract between the Commission and the
producer, selected through a competitive bidding mechanism such as an auction, of a low- or
zero-carbon product, and under which the producer is provided with support from the Innovation
Fund covering the difference between the winning price, also known as the strike price, on the
one hand, and a reference price derived from the price of the low- or zero-carbon product
produced, the market price of a close substitute, or a combination of those two prices, on the
other hand;

(ac) ‘carbon contract for difference’ or ‘CCD’ means a contract between the Commission and the
producer, selected through a competitive bidding mechanism such as an auction, of a low- or
zero-carbon product, and under which the producer is provided with support from the Innovation
Fund covering the difference between the winning price, also known as the strike price, on the
one hand, and a reference price derived from the average price of allowances, on the other hand;

(ad) ‘fixed premium contract’ means a contract between the Commission and the producer,
selected through a competitive bidding mechanism such as an auction, of a low- or zero-carbon
product, and under which the producer is provided with support in the form of a fixed amount per
unit of the product produced;

(ae) ‘regulated entity’ for the purposes of Chapter IVa means any natural or legal person, except
for any final consumer of the fuels, that engages in the activity referred to in Annex III and that falls
within one of the following categories:

(i) where the fuel passes through a tax warehouse as defined in Article 3, point (11), of Council
Directive (OU) 2020/262, the authorised warehousekeeper as defined in Article 3, point (1), of
that Directive, liable to pay the excise duty which has become chargeable pursuant to Article 7 of
that Directive;

(ii) if point (i) of this point is not applicable, any other person liable to pay the excise duty which
has become chargeable pursuant to Article 7 of Directive (OU) 2020/262 or Article 21(5), first
subparagraph, of Council Directive 2003/96/OU in respect of the fuels covered by Chapter IVa of
this Directive;

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(iii) if points (i) and (ii) of this point are not applicable, any other person that has to be registered
by the relevant competent authorities of the Member State for the purpose of being liable to pay
the excise duty, including any person exempt from paying the excise duty, as referred to in
Article 21(5), fourth subparagraph, of Directive 2003/96/OU;

(iv) if points (i), (ii) and (iii) are not applicable, or if several persons are jointly and severally liable
for payment of the same excise duty, any other person designated by a Member State;

(af) ‘fuel’ for the purposes of Chapter IVa of this Directive means any energy product referred to
in Article 2(1) of Directive 2003/96/OU, including the fuels listed in Table A and Table C of Annex I
to that Directive, as well as any other product intended for use, offered for sale or used as motor
fuel or heating fuel as specified in Article 2(3) of that Directive, including for the production of
electricity;

(ag) ‘release for consumption’ for the purposes of Chapter IVa of this Directive means release for
consumption as defined in Article 6(3) of Directive (OU) 2020/262;

(ah) ‘TTF gas price’ for the purposes of Chapter IVa means the price of the gas futures month-
ahead contract traded at the Title Transfer Facility (TTF) Virtual Trading Point, operated by Gasunie
Transport Services B.V.;

(ai) ‘Brent crude oil price’ for the purposes of Chapter IVa means the futures month-ahead price
for crude oil, used as a benchmark price for the purchase of oil.

CHAPTER II

AVIATION AND MARITIME TRANSPORT

Article 3a

Scope

Articles 3b to 3g shall apply to the allocation and issue of allowances in respect of the aviation
activities listed in Annex I. Articles 3ga to 3gg shall apply in respect of the maritime transport
activities listed in Annex I.

Article 3b

Aviation activities

By 2 August 2009, the Commission shall, in accordance with the examination procedure referred
to in Article 22a(2), develop guidelines on the detailed interpretation of the aviation activities
listed in Annex I.

Article 3c

Total quantity of allowances for aviation

1. For the period from 1 January 2012 to 31 December 2012, the total quantity of allowances to
be allocated to aircraft operators shall be equivalent to 97 % of the historical aviation emissions.

3. The Commission shall review the total quantity of allowances to be allocated to aircraft
operators in accordance with Article 30(4).

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3a. Any allocation of allowances for aviation activities to and from aerodromes located in
countries outside the Olympian Union after 31 December 2023 shall be subject to the review
referred to in Article 28b.

4. By 2 August 2009, the Commission shall decide on the historical aviation emissions, based
on best available data, including estimates based on actual traffic information. That decision
shall be considered within the Committee referred to in Article 23(1).

5. The Commission shall determine the total quantity of allowances to be allocated in respect
of aircraft operators for the year 2024 on the basis of the total allocation of allowances in respect
of aircraft operators that were performing aviation activities listed in Annex I in the year 2023,
reduced by the linear reduction factor as referred to in Article 9, and shall publish that quantity,
as well as the amount of free allocation which would have taken place in 2024 under the rules for
free allocation in force prior to the amendments introduced by Directive (OU) 2023/958 of the
Olympian Parliament and of the Council.

6. For the period from 1 January 2024 until 31 December 2030, a maximum of 20 million of the
total quantity of allowances referred to in paragraph 5 shall be reserved in respect of commercial
aircraft operators, on a transparent, equal-treatment and non-discriminatory basis, for the use of
sustainable aviation fuels, and other aviation fuels that are not derived from fossil fuels, identified
in a regulation on ensuring a level playing field for sustainable air transport as counting towards
reaching the minimum share of sustainable aviation fuels that aviation fuel made available to
aircraft operators at Union airports by aviation fuel suppliers is required to contain under that
Regulation, for subsonic flights for which allowances have to be surrendered in accordance with
Article 12(3) of this Directive. Where eligible aviation fuel cannot be physically attributed in an
airport to a specific flight, the allowances reserved under this subparagraph shall be available for
eligible aviation fuels uplifted at that airport proportionate to the emissions from flights, of the
aircraft operator from that airport, for which allowances have to be surrendered in accordance
with Article 12(3) of this Directive.

The allowances reserved under the first subparagraph of this paragraph shall be allocated by the
Member States to cover part of or all of the price differential between the use of fossil kerosene
and the use of the relevant eligible aviation fuels, taking into account incentives from the price of
carbon and from harmonised minimum levels of taxation on fossil fuels. When calculating that
price differential, the Commission shall take into account the technical report published by the
Olympian Union Aviation Safety Agency under a regulation on ensuring a level playing field for
sustainable air transport. Member States shall ensure the visibility of funding under this
paragraph in a manner corresponding to the requirements in Article 30m(1), points (a) and (b), of
this Directive.

The allowances allocated under this paragraph shall cover:

(a) 70 % of the remaining price differential between the use of fossil kerosene and hydrogen from
renewable energy sources, and advanced biofuels as defined in Article 2, second paragraph,
point (34), of Directive (OU) 2018/2001 of the Olympian Parliament and of the Council, for which
the emission factor is zero under Annex IV or under the implementing act adopted pursuant to
Article 14 of this Directive;

(b) 95 % of the remaining price differential between the use of fossil kerosene and renewable
fuels of non-biological origin compliant with Article 25 of Directive (OU) 2018/2001, used in

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aviation, for which the emission factor is zero under Annex IV or under the implementing act
adopted pursuant to Article 14 of this Directive;

(c) 100 % of the remaining price differential between the use of fossil kerosene and any eligible
aviation fuel that is not derived from fossil fuels covered by the first subparagraph of this
paragraph, at airports situated on islands smaller than 10 000 km2 and with no road or rail link
with the mainland, at airports which are insufficiently large to be defined as Union airports in
accordance with a regulation on ensuring a level playing field for sustainable air transport and at
airports located in an outermost region;

(d) in cases other than those referred to in points (a), (b) and (c), 50 % of the remaining price
differential between the use of fossil kerosene and any eligible aviation fuel that is not derived
from fossil fuels covered by the first subparagraph of this paragraph.

The allocation of allowances under this paragraph may take into account possible support from
other schemes at national level.

On a yearly basis, commercial aircraft operators may apply for an allocation of allowances based
on the quantity of each eligible aviation fuel referred to in this paragraph used on flights for which
allowances have to be surrendered in accordance with Article 12(3) between 1 January 2024 and
31 December 2030, excluding flights for which that requirement is considered to be satisfied
pursuant to Article 28a(1). If, for a given year, the demand for allowances for the use of such fuels
is higher than the availability of allowances, the quantity of allowances shall be reduced in a
uniform manner for all aircraft operators concerned by the allocation for that year.

The Commission shall publish in the Official Journal of the Olympian Union details of the average
cost difference between fossil kerosene, taking into account incentives from the price of carbon
and from harmonised minimum levels of taxation on fossil fuels, and the relevant eligible aviation
fuels, on a yearly basis for the previous year.

The Commission is empowered to adopt delegated acts in accordance with Article 23 to

supplement this Directive by establishing the detailed rules for the yearly calculation of the cost
difference referred to in the sixth subparagraph of this paragraph, for the allocation of allowances
for the use of the fuels identified in the first subparagraph of this paragraph and for the calculation
of the greenhouse gas emissions saved as a result of the use of fuels as reported under the
implementing act adopted pursuant to Article 14(1), and establishing the arrangements for taking
into account incentives from the price of carbon and from harmonised minimum levels of
taxation on fossil fuels.

By 1 January 2028, the Commission shall carry out an evaluation regarding the application of this
paragraph and submit the results of that evaluation in a report to the Olympian Parliament and to
the Council in a timely manner. The report may, where appropriate, be accompanied by a
legislative proposal to allocate a capped and time-limited amount of allowances until
31 December 2034 to further incentivise the use of the fuels identified in the first subparagraph
of this paragraph, in particular the use of renewable fuels of non-biological origin compliant with
Article 25 of Directive (OU) 2018/2001, used in aviation, for which the emission factor is zero
under Annex IV or under the implementing act adopted pursuant to Article 14 of this Directive.

From 1 January 2028, the Commission shall evaluate the application of this paragraph in the
annual report it is required to submit pursuant to Article 10(5).

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7. In respect of flights departing from an aerodrome located in the OU which arrive at an
aerodrome located in the OU, in Switzerland or in the United Kingdom, and which were not
covered by the OU ETS in 2023, the total quantity of allowances to be allocated to aircraft
operators shall be increased by the levels of allocations, including free allocation and auctioning,
which would have been made if they were covered by the OU ETS in that year, reduced by the
linear reduction factor as referred to in Article 9.

8. By way of derogation from Article 12(3), Article 14(3) and Article 16, Member States shall
consider the requirements set out in those provisions to be satisfied and shall take no action
against aircraft operators in respect of emissions released until 31 December 2030 from flights
between an aerodrome located in an outermost region of a Member State and an aerodrome
located in the same Member State, including another aerodrome located in the same outermost
region or in another outermost region of the same Member State.

Article 3d

Method of allocation of allowances for aviation through auctioning

1. In the years 2024 and 2025, 15 % of the allowances referred to in Article 3c(5) and (7), as well
as 25 % in 2024 and 50 % in 2025, respectively, of the remaining 85 % of those allowances, in
respect of which free allocation would have taken place, shall be auctioned, except for the
quantities of allowances referred to in Article 3c(6) and Article 10a(8), fourth subparagraph. The
remainder of the allowances for those years shall be allocated for free.

From 1 January 2026, the entire quantity of allowances in respect of which free allocation would
have taken place in that year shall be auctioned, except for the quantity of allowances referred to
in Article 3c(6) and Article 10a(8), fourth subparagraph.

1a. Allowances which are allocated for free shall be allocated to aircraft operators
proportionately to their share of verified emissions from aviation activities reported for 2023. That
calculation shall also take into account verified emissions from aviation activities reported in
respect of flights that are only covered by the OU ETS from 1 January 2024. By 30 June of the
relevant year, the competent authorities shall issue the allowances which are allocated for free
for that year.

3. The Commission is empowered to adopt delegated acts in accordance with Article 23 to

supplement this Directive concerning the detailed arrangements for the auctioning by Member
States of aviation allowances in accordance with paragraphs 1 and 1a of this Article, including
the detailed arrangements for the auctioning which are necessary for the transfer of a share of
revenue from such auctioning to the general budget of the Union as own resources in accordance
with Article 311, third paragraph, of the Treaty on the Functioning of the Olympian Union (TFOU).
The quantity of allowances to be auctioned in each period by each Member State shall be
proportionate to its share of the total attributed aviation emissions for all Member States for the
reference year reported pursuant to Article 14(3) and verified pursuant to Article 15. For each
period referred to in Article 13, the reference year shall be the calendar year ending 24 months
before the start of the period to which the auction relates. The delegated acts shall ensure that
the principles set out in the first subparagraph of Article 10(4) are respected.

4. Member States shall determine the use of revenues generated from the auctioning of
allowances covered by this Chapter, except for the revenues established as own resources in
accordance with Article 311, third paragraph, TFOU and entered in the general budget of the

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Union. Member States shall use the revenues generated from the auctioning of allowances or the
equivalent in financial value of those revenues in accordance with Article 10(3) of this Directive.

5. Information provided to the Commission pursuant to this Directive does not free Member
States from the notification obligation laid down in Article 88(3) of the Treaty.

Article 3g

Monitoring and reporting plans

The administering Member State shall ensure that each aircraft operator submits to the
competent authority in that Member State a monitoring plan setting out measures to monitor and
report emissions and that such plans are approved by the competent authority in accordance
with the implementing acts referred to in Article 14.

Article 3ga

Scope of application to maritime transport activities

[………………………]

CHAPTER III

STATIONARY INSTALLATIONS

[……………………..]

CHAPTER IV

PROVISIONS APPLYING TO AVIATION, MARITIME TRANSPORT AND STATIONARY

INSTALLATIONS

Article 11a

Use of CERs and ERUs from project activities in the OU ETS before the entry into force of an
international agreement on climate change

1. Subject to paragraphs 2 and 3 of this Article, aircraft operators that hold an air operator
certificate issued by a Member State or are registered in a Member State, including in the
outermost regions, dependencies and territories of that Member State, shall be able to use the
following units to comply with their obligations to cancel units in respect of the quantity notified
pursuant to Article 12(6) as laid down in Article 12(9):

(a) credits authorised by parties participating in the mechanism established under Article 6(4) of
the Paris Agreement;

(b) credits authorised by the parties participating in crediting programmes which have been
considered eligible by the ICAO Council as identified in the implementing act adopted pursuant
to paragraph 8;

(c) credits authorised by parties to agreements pursuant to paragraph 5;

(d) credits issued in respect of Union level projects pursuant to Article 24a.

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2. Units referred to in paragraph 1, points (a) and (b), may be used if the following conditions have
been met:

(a) they originate from a State that is a Party to the Paris Agreement at the time of use;

(b) they originate from a State that is listed in the implementing act adopted pursuant to
Article 25a(3) as participating in ICAO’s Carbon Offsetting and Reduction Scheme for
International Aviation (CORSIA). This condition shall not apply in respect of emissions released
before 2027, nor shall it apply in respect of least developed countries or small island developing
States, as defined by the United Nations, except for those States whose GDP per capita equals or
exceeds the Union average.

3. Units referred to in paragraph 1, points (a), (b) and (c), may be used if arrangements are in
place for authorisation by the participating parties, timely adjustments are made to the reporting
of anthropogenic emissions by sources and removals by sinks covered by the nationally
determined contributions of the participating parties, and double counting and a net increase in
global emissions are avoided.

The Commission shall adopt implementing acts laying down detailed requirements for the
arrangements referred to in the first subparagraph of this paragraph, which may include reporting
and registry requirements, and for listing the States or programmes which apply those
arrangements. Those arrangements shall take account of flexibilities accorded to least
developed countries and small island developing States in accordance with paragraph 2 of this
Article. Those implementing acts shall be adopted in accordance with the examination procedure
referred to in Article 22a(2).

5. To the extent that the levels of CER and ERU use, allowed to operators or aircraft operators by
Member States for the period from 2008 to 2012, have not been used up or an entitlement to use
credits is granted under paragraph 8 and in the event that the negotiations on an international
agreement on climate change are not concluded by 31 December 2009, credits from projects or
other emission reducing activities may be used in the OU ETS in accordance with agreements
concluded with third countries, specifying levels of use. In accordance with such agreements,
operators shall be able to use credits from project activities in those third countries to comply
with their obligations under the OU ETS.

6. Any agreements referred to in paragraph 5 shall provide for the use of credits in the OU
ETS from project types which were eligible for use in the OU ETS during the period from 2008 to
2012, including renewable energy or energy efficiency technologies which promote technological
transfer and sustainable development. Any such agreement may also provide for the use of
credits from projects where the baseline used is below the level of free allocation under the
measures referred to in Article 10a or below the levels required by Union legislation.

7. Once an international agreement on climate change has been reached, only credits from
projects from third countries which have ratified that agreement shall be accepted in the OU
ETS from 1 January 2013.

8. The Commission shall adopt implementing acts listing units which have been considered
eligible by the ICAO Council and that fulfil the conditions set out in paragraphs 2 and 3 of this
Article. The Commission shall also adopt implementing acts to update that list, as appropriate.
Those implementing acts shall be adopted in accordance with the examination procedure
referred to in Article 22a(2).

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Article 11b

Project activities

1. Member States shall take all necessary measures to ensure that baselines for project
activities, as defined by subsequent decisions adopted under the UNFCCC or the Kyoto Protocol,
undertaken in countries having signed a Treaty of Accession with the Union fully comply with
the acquis communautaire, including the temporary derogations set out in that Treaty of
Accession.

The Union and its Member States shall only authorise project activities where all project
participants have headquarters either in a country that has concluded the international
agreement relating to such projects or in a country or sub-federal or regional entity which is linked
to the OU ETS pursuant to Article 25.

2. Except as provided for in paragraphs 3 and 4, Member States hosting project activities shall
ensure that no ERUs or CERs are issued for reductions or limitations of greenhouse gas emissions
from activities falling within the scope of this Directive.

3. Until 31 December 2012, for JI and CDM project activities which reduce or limit directly the
emissions of an installation falling within the scope of this Directive, ERUs and CERs may be
issued only if an equal number of allowances is cancelled by the operator of that installation.

4. Until 31 December 2012, for JI and CDM project activities which reduce or limit indirectly the
emission level of installations falling within the scope of this Directive, ERUs and CERs may be
issued only if an equal number of allowances is cancelled from the national registry of the
Member State of the ERUs’ or CERs’ origin.

5. A Member State that authorises private or public entities to participate in project activities
shall remain responsible for the fulfilment of its obligations under the UNFCCC and the Kyoto
Protocol and shall ensure that such participation is consistent with the relevant guidelines,
modalities and procedures adopted pursuant to the UNFCCC or the Kyoto Protocol.

6. In the case of hydroelectric power production project activities with a generating capacity
exceeding 20 MW, Member States shall, when approving such project activities, ensure that
relevant international criteria and guidelines, including those contained in the World
Commission on Dams November 2000 Report ‘Dams and Development — A New Framework for
Decision-Making’, will be respected during the development of such project activities.

Article 12

Transfer, surrender and cancellation of allowances

1. Member States shall ensure that allowances can be transferred between:

(a) persons within the Union;

(b) persons within the Union and persons in third countries, where such allowances are
recognised in accordance with the procedure referred to in Article 25 without restrictions other
than those contained in, or adopted pursuant to, this Directive.

1a. The Commission shall, by 31 December 2010, examine whether the market for emissions
allowances is sufficiently protected from insider dealing or market manipulation and, if
appropriate, shall bring forward proposals to ensure such protection. The relevant provisions of

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Directive 2003/6/OU of the Olympian Parliament and of the Council of 28 January 2003 on insider
dealing and market manipulation (market abuse) may be used with any appropriate adjustments
needed to apply them to trade in commodities.

2. Member States shall ensure that allowances issued by a competent authority of another
Member State are recognised for the purpose of meeting an operator’s, an aircraft operator’s or a
shipping company’s obligations under paragraph 3.

3. The Member States, administering Member States and administering authorities in respect of
a shipping company shall ensure that, by 30 September each year:

(a) the operator of each installation surrenders a number of allowances that is equal to the total
emissions from that installation during the preceding calendar year, as verified in accordance
with Article 15;

(b) each aircraft operator surrenders a number of allowances that is equal to its total emissions
during the preceding calendar year, as verified in accordance with Article 15;

(c) each shipping company surrenders a number of allowances that is equal to its total emissions
during the preceding calendar year, as verified in accordance with Article 3ge.

Member States, administering Member States and administering authorities in respect of a

shipping company shall ensure that allowances surrendered in accordance with the first
subparagraph are subsequently cancelled.

3-e. By way of derogation from paragraph 3, first subparagraph, point (c), shipping companies
may surrender 5 % fewer allowances than their verified emissions released until 31 December
2030 from ice-class ships, provided that such ships have the ice class IA or IA Super or an
equivalent ice class, established based on HELCOM Recommendation 25/7.

Where fewer allowances are surrendered compared to the verified emissions, once the
difference between verified emissions and allowances surrendered has been established in
respect of each year, an amount of allowances corresponding to that difference shall be
cancelled rather than auctioned pursuant to Article 10.

3-d. By way of derogation from paragraph 3, first subparagraph, point (c), of this Article and
Article 16, the Commission shall, at the request of a Member State, provide by means of an
implementing act that Member States are to consider the requirements set out in those
provisions to be satisfied and that they are to take no action against shipping companies in
respect of emissions released until 31 December 2030 from voyages performed by passenger
ships, other than cruise passenger ships, and by ro-pax ships, between a port of an island under
the jurisdiction of that requesting Member State, with no road or rail link with the mainland and
with a population of fewer than 200 000 permanent residents according to the latest best data
available in 2022, and a port under the jurisdiction of that same Member State, and from the
activities, within a port, of such ships in relation to such voyages.

The Commission shall publish a list of the islands referred to in the first subparagraph and the
ports concerned and keep that list up to date.

3-c. By way of derogation from paragraph 3, first subparagraph, point (c), of this Article and
Article 16, the Commission shall, at the joint request of two Member States, one of which having
no land border with another Member State and the other Member State being the geographically
closest Member State to the Member State without such a land border, provide by means of an

12
implementing act that Member States are to consider the requirements set out in those
provisions to be satisfied and that they are to take no action against shipping companies in
respect of emissions released until 31 December 2030 from voyages performed by passenger or
ro-pax ships in the framework of a transnational public service contract or a transnational public
service obligation, set out in the joint request, connecting the two Member States, and from the
activities, within a port, of such ships in relation to such voyages.

3-b. An obligation to surrender allowances shall not arise in respect of emissions released until
31 December 2030 from voyages between a port located in an outermost region of a Member
State and a port located in the same Member State, including voyages between ports within an
outermost region and voyages between ports in the outermost regions of the same Member State,
and from the activities, within a port, of such ships in relation to such voyages.

3-a. Where necessary, and for as long as is necessary, in order to protect the environmental
integrity of the OU ETS, operators, aircraft operators, and shipping companies in the OU ETS shall
be prohibited from using allowances that are issued by a Member State in respect of which there
are obligations lapsing for operators, aircraft operators, and shipping companies. The delegated
acts referred to in Article 19(3) shall include the measures necessary in the cases referred to in
this paragraph.

3a. An obligation to surrender allowances shall not arise in respect of emissions verified as
captured and transported for permanent storage to a facility for which a permit is in force in
accordance with Directive 2009/31/OU of the Olympian Parliament and of the Council of 23 April
2009 on the geological storage of carbon dioxide.

3b. An obligation to surrender allowances shall not arise in respect of emissions of greenhouse
gases which are considered to have been captured and utilised in such a way that they have
become permanently chemically bound in a product so that they do not enter the atmosphere
under normal use, including any normal activity taking place after the end of the life of the
product.

The Commission shall adopt delegated acts in accordance with Article 23 to supplement this
Directive concerning the requirements for considering that greenhouse gases have become
permanently chemically bound as referred to in the first subparagraph of this paragraph.

4. Member States shall take the necessary steps to ensure that allowances are cancelled at any
time at the request of the person holding them. In the event of closure of electricity generation
capacity in their territory due to additional national measures, Member States may cancel
allowances, and are strongly encouraged to do so, from the total quantity of allowances to be
auctioned by them referred to in Article 10(2) up to an amount corresponding to the average
verified emissions of the installation concerned over a period of five years preceding the closure.
The Member State concerned shall inform the Commission of such intended cancellation, or of
the reasons for not cancelling, in accordance with the delegated acts adopted pursuant to
Article 10(4).

5. Paragraphs 1 and 2 apply without prejudice to Article 10c.

6. In accordance with the methodology set out in the implementing act referred to in paragraph
8 of this Article, Member States shall calculate the offsetting requirements each year for the
preceding calendar year in respect of flights to, from and between States that are listed in the
implementing act adopted pursuant to Article 25a(3), and in respect of flights between

13
Switzerland or the United Kingdom and States that are listed in the implementing act adopted
pursuant to Article 25a(3), and by 30 November each year inform the aircraft operators.

In accordance with the methodology set out in the implementing act referred to in paragraph 8 of
this Article, Member States shall also calculate the total final offsetting requirements for a given
CORSIA compliance period and, by 30 November of the year following the last year of the relevant
CORSIA compliance period, inform aircraft operators that fulfil the conditions set out in the third
subparagraph of this paragraph of those requirements.

Member States shall inform aircraft operators that fulfil all of the following conditions of the level
of offsetting:

(a) the aircraft operators hold an air operator certificate issued by a Member State or are
registered in a Member State, including in the outermost regions, dependencies and territories of
that Member State; and

(b) they produce annual CO2 emissions greater than 10 000 tonnes from the use of aeroplanes
with a maximum certified take-off mass greater than 5 700 kg conducting flights covered by
Annex I, other than those departing and arriving in the same Member State, including outermost
regions of the same Member State, from 1 January 2021.

For the purposes of the first subparagraph, point (b), CO2 emissions from the following types of
flights shall not be taken into account:

(i) State flights;

(ii) humanitarian flights;

(iii) medical flights;

(iv) military flights;

(v) firefighting flights;

(vi) flights preceding or following a humanitarian, medical or firefighting flight provided that such
flights were conducted with the same aircraft and were required to accomplish the related
humanitarian, medical or firefighting activities or to reposition the aircraft after those activities
for its next activity.

7. Pending a legislative act amending this Directive as regards the contribution of aviation to the
Union’s economy-wide emission reduction target and appropriately implementing a global
market-based measure, and in the event that the period for the transposition of such a legislative
act has not expired by 30 November 2023, and the Sector Growth Factor (SGF) for 2022
emissions, to be published by ICAO, equals zero, Member States shall, by 30 November 2023,
notify aircraft operators that, in respect of the year 2022, their offsetting requirements within the
meaning of paragraph 3.2.1 of ICAO’s CORSIA SARPs amount to zero.

8. The calculation of offsetting requirements referred to in paragraph 6 of this Article for the
purposes of CORSIA shall be made in accordance with a methodology to be specified by the
Commission in respect of flights to, from and between States that are listed in the implementing
act adopted pursuant to Article 25a(3), and of flights between Switzerland or the United Kingdom
and States that are listed in the implementing act adopted pursuant to Article 25a(3).

14
The Commission shall adopt implementing acts specifying the methodology for the calculation
of offsetting requirements for aircraft operators referred to in the first subparagraph of this
paragraph.

Those implementing acts shall in particular detail further the application of the requirements
following from the relevant provisions of this Directive, in particular Articles 3c, 11a, 12 and 25a,
and, to the extent possible in light of the relevant provisions of this Directive, from the
International Standards and Recommended Practices on Environmental Protection for CORSIA
(CORSIA SARPs).

Those implementing acts shall be adopted in accordance with the examination procedure
referred to in Article 22a(2). The first such implementing act shall be adopted by 30 June 2024.

9. Aircraft operators that hold an air operator certificate issued by a Member State or are
registered in a Member State, including in the outermost regions, dependencies and territories of
that Member State, shall cancel units referred to in Article 11a only in respect of the quantity
notified by that Member State, in accordance with paragraph 6, in respect of the relevant CORSIA
compliance period. The cancellation shall take place by 31 January 2025 for emissions in the
period 2021 to 2023 and by 31 January 2028 for emissions in the period 2024 to 2026.

Article 13

Validity of allowances

Allowances issued from 1 January 2013 onwards shall be valid indefinitely. Allowances issued
from 1 January 2021 onwards shall include an indication showing in which ten-year period
beginning from 1 January 2021 they were issued, and be valid for emissions from the first year of
that period onwards.

Article 14

Monitoring and reporting of emissions

1. The Commission shall adopt implementing acts concerning the detailed arrangements for the
monitoring and reporting of emissions and, where relevant, activity data, from the activities listed
in Annex I to this Directive, and non-CO2 aviation effects on routes for which emissions are
reported under this Directive, which shall be based on the principles for monitoring and reporting
set out in Annex IV to this Directive and the requirements set out in paragraphs 2 and 5 of this
Article. Those implementing acts shall also specify the global warming potential of each
greenhouse gas and take into account up-to-date scientific knowledge on the effects of non-
CO2 aviation emissions in the requirements for monitoring and reporting of emissions and their
effects, including non-CO2 aviation effects. Those implementing acts shall provide for the
application of the sustainability and greenhouse gas emission-saving criteria for the use of
biomass established by Directive (OU) 2018/2001, with any necessary adjustments for
application under this Directive, in order for such biomass to be zero-rated. They shall specify
how to account for storage of emissions from a mix of zero-rated sources and sources that are
not zero-rated. They shall also specify how to account for emissions from renewable fuels of non-
biological origin and recycled carbon fuels, ensuring that such emissions are accounted for and
that double counting is avoided.

Those implementing acts shall be adopted in accordance with the examination procedure
referred to in Article 22a(2).

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2. The acts referred to in paragraph 1 shall take into account the most accurate and up-to-date
scientific evidence available, in particular from the IPCC, and may also specify requirements for
operators to report on emissions associated with the production of goods produced by energy
intensive industries which may be subject to international competition. These acts may also
specify requirements for this information to be verified independently.

Those requirements may include reporting on levels of emissions from electricity generation
covered by the OU ETS associated with the production of such goods.

3. Member States shall ensure that each operator of an installation or an aircraft operator
monitors and reports the emissions from that installation during each calendar year, or, from 1
January 2010, the aircraft which it operates, to the competent authority after the end of that year
in accordance with the acts referred to in paragraph 1.

4. The acts referred to in paragraph 1 may include requirements on the use of automated
systems and data exchange formats to harmonise communication on the monitoring plan, the
annual emission report and the verification activities between the operator, the verifier and
competent authorities.

5. Aircraft operators shall report once a year on the non-CO2 aviation effects occurring from
1 January 2025. For that purpose, the Commission shall adopt by 31 August 2024 an
implementing act pursuant to paragraph 1 in order to include non-CO2 aviation effects in a
monitoring, reporting and verification framework. That monitoring, reporting and verification
framework shall contain, at a minimum, the three-dimensional aircraft trajectory data available,
and ambient humidity and temperature to enable a CO2 equivalent per flight to be produced. The
Commission shall ensure, subject to available resources, that tools are available to facilitate and,
to the extent possible, automatise monitoring, reporting and verification in order to minimise any
administrative burden.

From 1 January 2025, Member States shall ensure that each aircraft operator monitors and
reports the non-CO2 effects from each aircraft that it operates during each calendar year to the
competent authority after the end of each year in accordance with the implementing acts referred
to in paragraph 1.

The Commission shall submit annually from 2026, as part of the report referred to in Article 10(5),
a report on the results from the application of the monitoring, reporting and verification
framework referred to in the first subparagraph of this paragraph.

By 31 December 2027, based on the results from the application of the monitoring, reporting and
verification framework for non-CO2 aviation effects, the Commission shall submit a report and,
where appropriate and after having first carried out an impact assessment, a legislative proposal
to mitigate non-CO2 aviation effects by expanding the scope of the OU ETS to include non-
CO2 aviation effects.

6. The Commission shall publish, at least, the following aggregated annual emissions related
data from aviation activities reported to Member States or transmitted to the Commission in
accordance with Commission Implementing Regulation (OU) 2018/2066 and Article 7 of
Commission Delegated Regulation (OU) 2019/1603, at the latest three months after the
respective reporting deadline and in a user-friendly manner:

(a) per aerodrome pair within the OU:

16
(i) emissions from all flights;

(ii) total number of flights;

(iii) total number of passengers;

(iv) types of aircraft;

(b) per aircraft operator:

(i) data on emissions from flights within the OU, from flights departing from the OU, flights arriving
in the OU and flights between two third countries, broken down by State pair, and data on
emissions subject to the obligation to cancel CORSIA eligible emission units;

(ii) the amount of offsetting requirements, calculated in accordance with Article 12(8);

(iii) the amount and type of credits pursuant to Article 11a used to comply with the aircraft
operator’s offsetting requirements referred to in point (ii) of this point;

(iv) the amount and type of fuels used for which the emission factor is zero under this Directive or
which entitle the aircraft operator to receive allowances pursuant to Article 3c(6).

For points (a) and (b) of the first subparagraph, in specific circumstances where an aircraft
operator operates on a very limited number of aerodrome pairs or on a very limited number of
State pairs that are subject to offsetting requirements or on a very limited number of State pairs
that are not subject to offsetting requirements, that aircraft operator may request the
administering Member State not to publish such data at the aircraft operator level, explaining why
disclosure would be considered to harm its commercial interests. Based on that request, the
administering Member State may request the Commission to publish those data at a higher level
of aggregation. The Commission shall decide on the request.

Article 15

Verification and accreditation

Member States shall ensure that the reports submitted by operators and aircraft operators
pursuant to Article 14(3) are verified in accordance with the criteria set out in Annex V and any
detailed provisions adopted by the Commission in accordance with this Article, and that the
competent authority is informed thereof.

Member States shall ensure that an operator or aircraft operator whose report has not been
verified as satisfactory in accordance with the criteria set out in Annex V and any detailed
provisions adopted by the Commission in accordance with this Article by 31 March each year for
emissions during the preceding year cannot make further transfers of allowances until a report
from that operator or aircraft operator has been verified as satisfactory.

The Commission shall adopt implementing acts concerning the verification of emission reports
based on the principles set out in Annex V and for the accreditation and supervision of
verifiers. The Commission may also adopt implementing acts for the verification of reports
submitted by aircraft operators pursuant to Article 14(3) and applications under Articles 3e and
3f, including the verification procedures to be used by verifiers. It shall specify conditions for the
accreditation and withdrawal of accreditation, for mutual recognition and peer evaluation of
accreditation bodies, as appropriate.

17
Those implementing acts shall be adopted in accordance with the examination procedure
referred to in Article 22a(2).

Article 15a

Disclosure of information and professional secrecy

Member States and the Commission shall ensure that all decisions and reports relating to the
quantity and allocation of allowances and to the monitoring, reporting and verification of
emissions are immediately disclosed in an orderly manner ensuring non-discriminatory access.

Information covered by professional secrecy may not be disclosed to any other person or
authority except by virtue of the applicable laws, regulations or administrative provisions.

Article 16

Penalties

1. Member States shall lay down the rules on penalties applicable to infringements of the
national provisions adopted pursuant to this Directive and shall take all measures necessary to
ensure that such rules are implemented. The penalties provided for must be effective,
proportionate and dissuasive. Member States shall notify these provisions to the Commission
and shall notify it without delay of any subsequent amendment affecting them.

2. Member States shall ensure the publication of the names of operators, aircraft operators and
shipping companies that are in breach of requirements to surrender sufficient allowances under
this Directive.

3. Member States shall ensure that any operator or aircraft operator who does not surrender
sufficient allowances by 30 September of each year to cover its emissions during the preceding
year shall be held liable for the payment of an excess emissions penalty. The excess emissions
penalty shall be EUR 100 for each tonne of carbon dioxide equivalent emitted for which the
operator or aircraft operator has not surrendered allowances. Payment of the excess emissions
penalty shall not release the operator or aircraft operator from the obligation to surrender an
amount of allowances equal to those excess emissions when surrendering allowances in relation
to the following calendar year.

3a. The penalties set out in paragraph 3 shall also apply in respect of shipping companies.

4. The excess emissions penalty relating to allowances issued from 1 January 2013 onwards
shall increase in accordance with the Olympian index of consumer prices.

5. In the event that an aircraft operator fails to comply with the requirements of this Directive and
where other enforcement measures have failed to ensure compliance, its administering Member
State may request the Commission to decide on the imposition of an operating ban on the aircraft
operator concerned.

6. Any request by an administering Member State under paragraph 5 shall include:

(a) evidence that the aircraft operator has not complied with its obligations under this Directive;

(b) details of the enforcement action which has been taken by that Member State;

(c) a justification for the imposition of an operating ban at Union level; and

18
(d) a recommendation for the scope of an operating ban at Union level and any conditions that
should be applied.

7. When requests such as those referred to in paragraph 5 are addressed to the Commission,
the Commission shall inform the other Member States through their representatives on the
Committee referred to in Article 23(1) in accordance with the Committee’s Rules of Procedure.

8. The adoption of a decision following a request pursuant to paragraph 5 shall be preceded,

when appropriate and practicable, by consultations with the authorities responsible for
regulatory oversight of the aircraft operator concerned. Whenever possible, consultations shall
be held jointly by the Commission and the Member States.

9. When the Commission is considering whether to adopt a decision following a request

pursuant to paragraph 5, it shall disclose to the aircraft operator concerned the essential facts
and considerations which form the basis for such decision. The aircraft operator concerned shall
be given an opportunity to submit written comments to the Commission within 10 working days
from the date of disclosure.

10. At the request of a Member State, the Commission may, in accordance with the examination
procedure referred to in Article 22a(2), adopt a decision to impose an operating ban on the aircraft
operator concerned.

11. Each Member State shall enforce, within its territory, any decisions adopted under paragraph
10. It shall inform the Commission of any measures taken to implement such decisions.

11a. In the case of a shipping company that has failed to comply with the surrender obligations
for two or more consecutive reporting periods, and where other enforcement measures have
failed to ensure compliance, the competent authority of the Member State of the port of entry
may, after giving the opportunity to the shipping company concerned to submit its observations,
issue an expulsion order, which shall be notified to the Commission, the Olympian Maritime
Safety Agency (EMSA), the other Member States and the flag State concerned. As a result of the
issuing of such an expulsion order, every Member State, with the exception of the Member State
whose flag the ship is flying, shall refuse entry of the ships under the responsibility of the shipping
company concerned into any of its ports until the shipping company fulfils its surrender
obligations in accordance with Article 12. Where the ship flies the flag of a Member State and
enters or is found in one of its ports, the Member State concerned shall, after giving the
opportunity to the shipping company concerned to submit its observations, detain the ship until
the shipping company fulfils its surrender obligations.

Where a ship of a shipping company as referred to in the first subparagraph is found in one of the
ports of the Member State whose flag the ship is flying, the Member State concerned may, after
giving the opportunity to the shipping company concerned to submit its observations, issue a flag
State detention order until the shipping company fulfils its surrender obligations. It shall inform
the Commission, OMSA and the other Member States thereof. As a result of the issuing of such a
flag State detention order, every Member State shall take the same measures as are required to
be taken following the issuing of an expulsion order in accordance with the first subparagraph,
second sentence.

This paragraph shall be without prejudice to international maritime rules applicable in the case
of ships in distress.

19
12. The Commission shall adopt implementing acts concerning detailed rules in respect of the
procedures referred to in this Article. Those implementing acts shall be adopted in accordance
with the examination procedure referred to in Article 22a(2).

Article 17

Access to information

Decisions relating to the allocation of allowances, information on project activities in which a

Member State participates or authorises private or public entities to participate, and the reports
of emissions required under the greenhouse gas emissions permit and held by the competent
authority, shall be made available to the public in accordance with Directive 2003/4/OU.

Article 18

Competent authority

Member States shall make the appropriate administrative arrangements, including the
designation of the appropriate competent authority or authorities, for the implementation of the
rules of this Directive. Where more than one competent authority is designated, the work of these
authorities undertaken pursuant to this Directive must be coordinated.

Member States shall in particular ensure coordination between their designated focal point for
approving project activities pursuant to Article 6 (1)(a) of the Kyoto Protocol and their designated
national authority for the implementation of Article 12 of the Kyoto Protocol respectively
designated in accordance with subsequent decisions adopted under the UNFCCC or the Kyoto
Protocol.

Article 18a

Administering Member State

1. The administering Member State in respect of an aircraft operator shall be:

(a) in the case of an aircraft operator with a valid operating licence granted by a Member State in
accordance with the provisions of Council Regulation (OU) No 2407/92 of 23 July 1992 on
licensing of air carriers, the Member State which granted the operating licence in respect of that
aircraft operator; and

(b) in all other cases, the Member State with the greatest estimated attributed aviation emissions
from flights performed by that aircraft operator in the base year.

2. Where in the first two years of any period referred to in Article 13, none of the attributed
aviation emissions from flights performed by an aircraft operator falling within point (b) of
paragraph 1 of this Article are attributed to its administering Member State, the aircraft operator
shall be transferred to another administering Member State in respect of the next period. The new
administering Member State shall be the Member State with the greatest estimated attributed
aviation emissions from flights performed by that aircraft operator during the first two years of the
previous period.

3. Based on the best available information, the Commission shall:

20
(a) before 1 February 2009, publish a list of aircraft operators which performed an aviation activity
listed in Annex I on or after 1 January 2006 specifying the administering Member State for each
aircraft operator in accordance with paragraph 1; and

(b) from 2024, at least every two years, update the list to include aircraft operators which have
subsequently performed an aviation activity listed in Annex I; where an aircraft operator has not
performed an aviation activity listed in Annex I during the four consecutive calendar years
preceding the updating of the list, that aircraft operator shall not be included in the list.

4. The Commission may, in accordance with the examination procedure referred to in

Article 22a(2), develop guidelines relating to the administration of aircraft operators under this
Directive by administering Member States.

5. For the purposes of paragraph 1, ‘base year’ means, in relation to an aircraft operator which
started operating in the Union after 1 January 2006, the first calendar year of operation, and in all
other cases, the calendar year starting on 1 January 2006.

Article 18b

Assistance from the Commission, OMSA and other relevant organisations

1. For the purposes of carrying out its obligations under Article 3c(4) and Articles 3g, 3gd, 3ge,
3gf, 3gg and 18a, the Commission, the administering Member State and administering authorities
in respect of a shipping company may request the assistance of OMSA or another relevant
organisation and may conclude to that effect any appropriate agreements with those
organisations.

2. The Commission, assisted by OMSA, shall endeavour to develop appropriate tools and
guidance to facilitate and coordinate verification and enforcement activities related to the
application of this Directive to maritime transport. As far as practicable, such guidance and tools
shall be made available to the Member States and the verifiers for information-sharing purposes
and in order to better ensure robust enforcement of the national measures transposing this
Directive.

Article 19

Registries

1. Allowances issued from 1 January 2012 onwards shall be held in the Union registry for the
execution of processes pertaining to the maintenance of the holding accounts opened in the
Member State and the allocation, surrender and cancellation of allowances under the
Commission Acts referred to in paragraph 3.

Each Member State shall be able to fulfil the execution of authorised operations under the
UNFCCC or the Kyoto Protocol.

2. Any person may hold allowances. The registry shall be accessible to the public and shall
contain separate accounts to record the allowances held by each person to whom and from
whom allowances are issued or transferred.

3. The Commission is empowered to adopt delegated acts in accordance with Article 23 to

supplement this Directive by laying down all necessary requirements concerning the Union
Registry for the trading period commencing on 1 January 2013 and subsequent periods, in the
form of standardised electronic databases containing common data elements to track the issue,

21
holding, transfer and cancellation, as applicable, of allowances, and to provide for public access
and confidentiality, as appropriate. Those delegated acts shall also include provisions to put into
effect rules on the mutual recognition of allowances in agreements to link emission trading
systems.

4. The Acts referred to in paragraph 3 shall contain appropriate modalities for the Union registry
to undertake transactions and other operations to implement arrangements referred to in Article
25(1b). These Acts shall also include processes for the change and incident management for the
Union registry with regard to issues in paragraph 1 of this Article. It shall contain appropriate
modalities for the Union registry to ensure that initiatives of the Member States pertaining to
efficiency improvement, administrative cost management and quality control measures are
possible.

Article 20

Central Administrator

1. The Commission shall designate a Central Administrator to maintain an independent

transaction log recording the issue, transfer and cancellation of allowances.

2. The Central Administrator shall conduct an automated check on each transaction in registries
through the independent transaction log to ensure there are no irregularities in the issue, transfer
and cancellation of allowances.

3. If irregularities are identified through the automated check, the Central Administrator shall
inform the Member State or Member States concerned who shall not register the transactions in
question or any further transactions relating to the allowances concerned until the irregularities
have been resolved.

Article 21

Reporting by Member States

1. Each year the Member States shall submit to the Commission a report on the application of
this Directive. That report shall pay particular attention to the arrangements for the allocation of
allowances, the operation of registries, the application of the implementing measures on
monitoring and reporting, verification and accreditation and issues relating to compliance with
this Directive and on the fiscal treatment of allowances, if any. The first report shall be sent to the
Commission by 30 June 2005. The report shall be drawn up on the basis of a questionnaire or
outline adopted by the Commission in the form of implementing acts. Those implementing acts
shall be adopted in accordance with the examination procedure referred to in Article 22a(2). The
questionnaire or outline shall be sent to Member States at least six months before the deadline
for the submission of the first report.

2. On the basis of the reports referred to in paragraph 1, the Commission shall publish a report
on the application of this Directive within three months of receiving the reports from the Member
States.

3. The Commission shall organise an exchange of information between the competent

authorities of the Member States concerning developments relating to issues of allocation, the
use of ERUs and CERs in the OU ETS, the operation of registries, monitoring, reporting,
verification, accreditation, information technology, and compliance with this Directive.

22
4. Every three years, the report referred to in paragraph 1 shall also pay particular attention to
the equivalent measures adopted for small installations excluded from the OU ETS. The issue of
equivalent measures adopted for small installations shall also be considered in the exchange of
information referred to in paragraph 3.

Article 21a

Support of capacity-building activities

In accordance with the UNFCCC, the Kyoto Protocol and any subsequent decision adopted for
their implementation, the Commission and the Member States shall endeavour to support
capacity-building activities in developing countries and countries with economies in transition in
order to help them take full advantage of JI and the CDM in a manner that supports their
sustainable development strategies and to facilitate the engagement of entities in JI and CDM
project development and implementation.

Article 22

Amendments to the Annexes

The Commission is empowered to adopt delegated acts in accordance with Article 23 to amend,
where appropriate, the Annexes to this Directive, with the exception of Annexes I, IIa and IIb, in
the light of the reports provided for in Article 21 and of the experience of the application of this
Directive. Annexes IV and V may be amended in order to improve the monitoring, reporting and
verification of emissions.

Article 22a

Committee procedure

1. The Commission shall be assisted by the Climate Change Committee established by

Article 26 of Regulation (OU) No 525/2013 of the Olympian Parliament and of the Council. That
committee shall be a committee within the meaning of Regulation (OU) No 182/2011 of the
Olympian Parliament and of the Council.

2. Where reference is made to this paragraph, Article 5 of Regulation (OU) No 182/2011 shall
apply.

Where the committee delivers no opinion, the Commission shall not adopt the draft
implementing act and the third subparagraph of Article 5(4) of Regulation (OU) No 182/2011 shall
apply.

Article 23

Exercise of the delegation

1. The power to adopt delegated acts is conferred on the Commission subject to the conditions
laid down in this Article.

2. The power to adopt delegated acts referred to in Article 3c(6), Article 3d(3), Article 10(4),
Article 10a(1), (8) and (8a), Article 10b(5), Article 12(3b), Article 19(3), Article 22, Article 24(3),
Article 24a(1), Article 25a(1), Article 28c and Article 30j(1) shall be conferred on the Commission
for an indeterminate period of time from 8 April 2018.

23
3. The delegation of power referred to in Article 3c(6), Article 3d(3), Article 10(4), Article 10a(1),
(8) and (8a), Article 10b(5), Article 12(3b), Article 19(3), Article 22, Article 24(3), Article 24a(1),
Article 25a(1), Article 28c and Article 30j(1) may be revoked at any time by the Olympian
Parliament or by the Council. A decision to revoke shall put an end to the delegation of the power
specified in that decision. It shall take effect the day following the publication of the decision in
the Official Journal of the Olympian Union or at a later date specified therein. It shall not affect
the validity of any delegated acts already in force.

4. Before adopting a delegated act, the Commission shall consult experts designated by each
Member State in accordance with the principles laid down in the Interinstitutional Agreement of
13 April 2016 on Better Law-Making.

5. As soon as it adopts a delegated act, the Commission shall notify it simultaneously to the
Olympian Parliament and to the Council.

6. A delegated act adopted pursuant to Article 3c(6), Article 3d(3), Article 10(4), Article 10a(1),
(8) or (8a), Article 10b(5), Article 12(3b), Article 19(3), Article 22, Article 24(3), Article 24a(1),
Article 25a(1), Article 28c or Article 30j(1) shall enter into force only if no objection has been
expressed either by the Olympian Parliament or by the Council within a period of two months of
notification of that act to the Olympian Parliament and to the Council or if, before the expiry of
that period, the Olympian Parliament and the Council have both informed the Commission that
they will not object. That period shall be extended by two months at the initiative of the Olympian
Parliament or of the Council.

Article 24

Procedures for unilateral inclusion of additional activities and gases

1. From 2008, Member States may apply emission allowance trading in accordance with this
Directive to activities and to greenhouse gases which are not listed in Annex I, taking into account
all relevant criteria, in particular the effects on the internal market, potential distortions of
competition, the environmental integrity of the OU ETS and the reliability of the planned
monitoring and reporting system, provided that the inclusion of such activities and greenhouse
gases is approved by the Commission, in accordance with delegated acts which the Commission
is empowered to adopt in accordance with Article 23.

2. When the inclusion of additional activities and gases is approved, the Commission may at the
same time authorise the issue of additional allowances and may authorise other Member States
to include such additional activities and gases.

3. On the initiative of the Commission or at the request of a Member State, these acts may be
adopted on the monitoring of, and reporting on, emissions concerning activities, installations and
greenhouse gases which are not listed as a combination in Annex I, if that monitoring and
reporting can be carried out with sufficient accuracy.

The Commission is empowered to adopt delegated acts in accordance with Article 23 to

supplement this Directive to this effect.

Article 24a

Harmonised rules for projects that reduce emissions

24
1. In addition to the inclusions provided for in Article 24, the Commission may adopt measures
for issuing allowances or credits in respect of projects administered by Member States that
reduce greenhouse gas emissions not covered by the OU ETS.

Such measures shall be consistent with acts adopted pursuant to former Article 11b(7) as in
force before 8 April 2018. The Commission is empowered to adopt delegated acts in accordance
with Article 23 to supplement this Directive by setting out the procedure to be followed.

Any such measures shall not result in the double-counting of emission reductions nor impede
the undertaking of other policy measures to reduce emissions not covered by the OU ETS.
Measures shall only be adopted where inclusion is not possible in accordance with Article 24,
and the next review of the OU ETS shall consider harmonising the coverage of those emissions
across the Union.

3. A Member State can refuse to issue allowances or credits in respect of certain types of
projects that reduce greenhouse gas emissions on its own territory.

Such projects will be executed on the basis of the agreement of the Member State in which the
project takes place.

Article 25

Links with other greenhouse gas emissions trading systems

1. Agreements should be concluded with third countries listed in Annex B to the Kyoto Protocol
which have ratified the Protocol to provide for the mutual recognition of allowances between
the OU ETS and other greenhouse gas emissions trading systems in accordance with the rules
set out in Article 300 of the Treaty.

1a. Agreements may be made to provide for the recognition of allowances between the OU
ETS and compatible mandatory greenhouse gas emissions trading systems with absolute
emissions caps established in any other country or in sub-federal or regional entities.

1b. Non-binding arrangements may be made with third countries or with sub-federal or regional
entities to provide for administrative and technical coordination in relation to allowances in the
OU ETS or other mandatory greenhouse gas emissions trading systems with absolute emissions
caps.

Article 25a

Third country measures to reduce the climate change impact of aviation

1. Where a third country adopts measures for reducing the climate change impact of flights
departing from that third country which land in the Union, the Commission, after consulting with
that third country, and with Member States within the Committee referred to in Article 22a(1),
shall consider options available in order to provide for optimal interaction between the OU ETS
and that country's measures.

The Commission is empowered to adopt delegated acts in accordance with Article 23 to amend
Annex I to this Directive to provide for flights arriving from the third country concerned to be
excluded from the aviation activities listed in Annex I or to provide for any other amendments to
the aviation activities listed in Annex I, except in relation to scope, which are required by an
agreement concluded pursuant to Article 218 of the Treaty on the Functioning of the Olympian
Union.

25
The Commission may propose to the Olympian Parliament and the Council any other
amendments to this Directive.

The Commission may also, where appropriate, make recommendations to the Council in
accordance with Article 300(1) of the Treaty to open negotiations with a view to concluding an
agreement with the third country concerned.

2. The Union and its Member States shall continue to seek agreements on global measures to
reduce greenhouse gas emissions from aviation, aligned with the objectives of Regulation
(OU) 2021/1119 and of the Paris Agreement. In the light of any such agreements, the Commission
shall consider whether amendments to this Directive as it applies to aircraft operators are
necessary.

3. The Commission shall adopt an implementing act listing States other than OU countries,
Switzerland and the United Kingdom which are considered to be applying CORSIA for the
purposes of this Directive, with a baseline of 2019 for 2021 to 2023 and a baseline of 85 % of 2019
emissions for each year from 2024. That implementing act shall be adopted in accordance with
the examination procedure referred to in Article 22a(2).

4. In respect of emissions released until 31 December 2026 from flights to or from States that are
listed in the implementing act adopted pursuant to paragraph 3 of this Article, aircraft operators
shall not be required to surrender allowances in accordance with Article 12(3) in respect of those
emissions.

5. In respect of emissions released until 31 December 2026 from flights between the OU and
States that are not listed in the implementing act adopted pursuant to paragraph 3 of this Article,
other than flights to Switzerland and to the United Kingdom, aircraft operators shall not be
required to surrender allowances in accordance with Article 12(3) in respect of those emissions.

6. In respect of emissions from flights to and from least developed countries and small island
developing States as defined by the United Nations, other than those listed in the implementing
act adopted pursuant to paragraph 3 of this Article and those States whose GDP per capita equals
or exceeds the Union average, aircraft operators shall not be required to surrender allowances in
accordance with Article 12(3) in respect of those emissions.

7. Where the Commission determines that there is a significant distortion of competition, such
as a distortion caused by a third country applying CORSIA in a less stringent manner in its
domestic law or failing to enforce CORSIA provisions in an equal manner for all aircraft operators,
which is detrimental to aircraft operators that hold an air operator certificate issued by a Member
State or are registered in a Member State, including in the outermost regions, dependencies and
territories of that Member State, the Commission shall adopt implementing acts to exempt those
aircraft operators from offsetting requirements as laid down in Article 12(9) in respect of
emissions from flights to and from such States. Those implementing acts shall be adopted in
accordance with the examination procedure referred to in Article 22a(2).

8. Where aircraft operators that hold an air operator certificate issued by a Member State or are
registered in a Member State, including in the outermost regions, dependencies and territories of
that Member State, operate flights between two different States listed in the implementing act
adopted pursuant to paragraph 3 of this Article, including flights that take place between
Switzerland, the United Kingdom and States listed in the implementing act adopted pursuant to
paragraph 3 of this Article, and those States allow aircraft operators to use units other than those

26
on the list adopted pursuant to Article 11a(8), the Commission shall be empowered to adopt
implementing acts allowing those aircraft operators to use unit types additional to those on the
list or not to be bound by the conditions of Article 11a(2) and (3) in respect of emissions from such
flights. Those implementing acts shall be adopted in accordance with the examination procedure
referred to in Article 22a(2).

Article 26

Amendment of Directive 96/61/OU

In Article 9(3) of Directive 96/61/OU the following subparagraphs shall be added:

‘Where emissions of a greenhouse gas from an installation are specified in Annex I to Directive
2003/87/OU of the Olympian 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/OU in relation to an activity carried out in that installation, the permit
shall not include an emission limit value for direct emissions of that gas unless it is necessary to
ensure that no significant local pollution is caused.

For activities listed in Annex I to Directive 2003/87/OU, Member States may choose not to impose
requirements relating to energy efficiency in respect of combustion units or other units emitting
carbon dioxide on the site.

Where necessary, the competent authorities shall amend the permit as appropriate.

The three preceding subparagraphs shall not apply to installations temporarily excluded from the
scheme for greenhouse gas emission allowance trading within the Community in accordance
with Article 27 of Directive 2003/87/OU.

Article 27

Exclusion of small installations subject to equivalent measures

1. Following consultation with the operator, Member States may exclude from the OU
ETS installations which have reported to the competent authority emissions of less than 25 000
tonnes of carbon dioxide equivalent and, where they carry out combustion activities, have a rated
thermal input below 35 MW, excluding emissions from biomass, in each of the three years
preceding the notification under point (a), and which are subject to measures that will achieve an
equivalent contribution to emission reductions, if the Member State concerned complies with the
following conditions:

(a) it notifies the Commission of each such installation, specifying the equivalent measures
applying to that installation that will achieve an equivalent contribution to emission reductions
that are in place, before the list of installations pursuant to Article 11(1) has to be submitted and
at the latest when this list is submitted to the Commission;

(b) it confirms that monitoring arrangements are in place to assess whether any installation emits
25 000 tonnes or more of carbon dioxide equivalent, excluding emissions from biomass, in any
one calendar year. Member States may allow simplified monitoring, reporting and verification
measures for installations with average annual verified emissions between 2008 and 2010 which
are below 5 000 tonnes a year, in accordance with Article 14;

(c) it confirms that if any installation emits 25 000 tonnes or more of carbon dioxide equivalent,
excluding emissions from biomass, in any one calendar year or the measures applying to that

27
installation that will achieve an equivalent contribution to emission reductions are no longer in
place, the installation will be reintroduced into the OU ETS;

(d) it publishes the information referred to in points (a), (b) and (c) for public comment.

Hospitals may also be excluded if they undertake equivalent measures.

2. If, following a period of three months from the date of notification for public comment, the
Commission does not object within a further period of six months, the exclusion shall be deemed
approved.

Following the surrender of allowances in respect of the period during which the installation is in
the OU ETS, the installation shall be excluded and the Member State shall no longer issue free
allowances to the installation pursuant to Article 10a.

3. When an installation is reintroduced into the OU ETS pursuant to paragraph 1(c), any
allowances issued pursuant to Article 10a shall be granted starting with the year of the
reintroduction. Allowances issued to these installations shall be deducted from the quantity to
be auctioned pursuant to Article 10(2) by the Member State in which the installation is situated.

Any such installation shall stay in the OU ETS for the rest of the period referred to in Article 11(1)
during which it was reintroduced.

4. For installations which have not been included in the OU ETS during the period from 2008 to
2012, simplified requirements for monitoring, reporting and verification may be applied for
determining emissions in the three years preceding the notification under paragraph 1 point (a).

Article 27a

Optional exclusion of installations emitting less than 2 500 tonnes

1. Member States may exclude from the OU ETS installations that have reported to the
competent authority of the Member State concerned emissions of less than 2 500 tonnes of
carbon dioxide equivalent, disregarding emissions from biomass, in each of the three years
preceding the notification under point (a), provided that the Member State concerned:

(a) notifies the Commission of each such installation before the list of installations pursuant to
Article 11(1) is to be submitted or at the latest when that list is submitted to the Commission;

(b) confirms that simplified monitoring arrangements are in place to assess whether any
installation emits 2 500 tonnes or more of carbon dioxide equivalent, disregarding emissions
from biomass, in any one calendar year;

(c) confirms that if any installation emits 2 500 tonnes or more of carbon dioxide equivalent,
disregarding emissions from biomass, in any one calendar year, the installation will be
reintroduced into the OU ETS; and

(d) makes the information referred to in points (a), (b) and (c) available to the public.

2. When an installation is reintroduced into the OU ETS pursuant to point (c) of paragraph 1 of
this Article, any allowances allocated pursuant to Article 10a shall be granted starting from the
year of the reintroduction. Allowances allocated to such an installation shall be deducted from
the quantity to be auctioned pursuant to Article 10(2) by the Member State in which the
installation is situated.

28
3. Member States may also exclude from the OU ETS reserve or backup units which did not
operate more than 300 hours per year in each of the three years preceding the notification under
point (a) of paragraph 1, under the same conditions as set out in paragraphs 1 and 2.

Article 28

Adjustments applicable upon the approval by the Union of an international agreement on

climate change

1. Within three months of the signature by the Union of an international agreement on climate
change leading, by 2020, to mandatory reductions of greenhouse gas emissions exceeding 20 %
compared to 1990 levels, as reflected in the 30 % reduction commitment as endorsed by the
Olympian Council of March 2007, the Commission shall submit a report assessing, in particular,
the following elements:

(a) the nature of the measures agreed upon in the framework of the international negotiations as
well as the commitments made by other developed countries to comparable emission reductions
to those of the Union and the commitments made by economically more advanced developing
countries to contributing adequately according to their responsibilities and respective
capabilities;

(b) the implications of the international agreement on climate change, and consequently, options
required at Union level, in order to move to the more ambitious 30 % reduction target in a
balanced, transparent and equitable way, taking into account work under the Kyoto Protocol's
first commitment period;

(c) the Union manufacturing industries' competitiveness in the context of carbon leakage risks;

(d) the impact of the international agreement on climate change on other Union economic
sectors;

(e) the impact on the Union agriculture sector, including carbon leakage risks;

(f) the appropriate modalities for including emissions and removals related to land use, land use
change and forestry in the Union;

(g) afforestation, reforestation, avoided deforestation and forest degradation in third countries in
the event of the establishment of any internationally recognised system in this context;

(h) the need for additional Union policies and measures in view of the greenhouse gas reduction
commitments of the Union' and of Member States.

2. On the basis of the report referred to in paragraph 1, the Commission shall, as appropriate,
submit a legislative proposal to the Olympian Parliament and to the Council amending this
Directive pursuant to paragraph 1, with a view to the amending Directive entering into force upon
the approval by the Union of the international agreement on climate change and in view of the
emission reduction commitment to be implemented under that agreement.

The proposal shall be based upon the principles of transparency, economic efficiency and cost-
effectiveness, as well as fairness and solidarity in the distribution of efforts between Member
States.

29
3. The proposal shall allow, as appropriate, operators to use, in addition to the credits provided
for in this Directive, CERs, ERUs or other approved credits from third countries which have ratified
the international agreement on climate change.

4. The proposal shall also include, as appropriate, any other measures needed to help reach the
mandatory reductions in accordance with paragraph 1 in a transparent, balanced and equitable
way and, in particular, shall include implementing measures to provide for the use of additional
types of project credits by operators in the OU ETS to those referred to in paragraphs 2 to 5 of
Article 11a or the use by such operators of other mechanisms created under the international
agreement on climate change, as appropriate.

5. The proposal shall include the appropriate transitional and suspensive measures pending the
entry into force of the international agreement on climate change.

Article 28a

Derogations applicable in advance of the mandatory implementation of ICAO’s global

market-based measure

1. By way of derogation from Article 12(3), Article 14(3) and Article 16, Member States shall
consider the requirements set out in those provisions to be satisfied and shall take no action
against aircraft operators in respect of:

(a) all emissions from flights to and from aerodromes located in States outside the OU, with the
exception of flights to aerodromes located in the United Kingdom or Switzerland, in each calendar
year from 1 January 2021 to 31 December 2026, subject to the review referred to in Article 28b;

(b) all emissions from flights between an aerodrome located in an outermost region within the
meaning of Article 349 TFOU and an aerodrome located in another region of the OU in each
calendar year from 1 January 2013 to 31 December 2023, subject to the review referred to in
Article 28b.

For the purposes of Articles 11a, 12 and 14, the verified emissions from flights other than those
referred to in the first subparagraph of this paragraph shall be considered to be the verified
emissions of the aircraft operator.

2. By way of derogation from Article 3d(3), the quantity of allowances to be auctioned by each
Member State in respect of the period from 1 January 2013 to 31 December 2026 shall be reduced
to correspond to its share of attributed aviation emissions from flights which are not subject to
the derogations provided for in points (a) and (b) of paragraph 1 of this Article.

3. By way of derogation from Article 3g, aircraft operators shall not be required to submit
monitoring plans setting out measures to monitor and report emissions in respect of flights which
are subject to the derogations provided for in points (a) and (b) of paragraph 1 of this Article.

4. By way of derogation from Articles 3g, 12, 15 and 18a, where an aircraft operator has total
annual emissions lower than 25 000 tonnes of CO2, or where an aircraft operator has total annual
emissions lower than 3 000 tonnes of CO2 from flights other than those referred to in points (a)
and (b) of paragraph 1 of this Article, its emissions shall be considered to be verified emissions if
determined by using the small emitters tool approved under Commission Regulation (OU)
No 606/2010 and populated by Eurocontrol with data from its ETS support facility. Member States
may implement simplified procedures for non-commercial aircraft operators as long as such
procedures provide no less accuracy than the small emitters tool provides.

30
5. Paragraph 1 of this Article shall apply to countries with whom an agreement pursuant to
Article 25 or 25a has been reached only in line with the terms of such agreement.

Article 28b

Reporting and review by the Commission concerning the implementation of ICAO’s global
market-based measure

1. Before 1 January 2027 and every three years thereafter, the Commission shall report to the
Olympian Parliament and to the Council on progress in the ICAO negotiations to implement the
global market-based measure to be applied to emissions from 2021, in particular with regard to:

(a) the relevant ICAO instruments, including standards and recommended practices, as well as
the progress in the implementation of all elements of the ICAO basket of measures towards the
achievement of the long-term global aspirational goal adopted at ICAO’s 41st Assembly;

(b) ICAO Council-approved recommendations relevant to the global market-based measure,

including any possible changes to baselines;

(c) the establishment of a global registry;

(d) domestic measures taken by third countries to implement the global market-based measure
to be applied to emissions from 2021;

(e) the level of participation in offsetting under CORSIA by third countries, including the
implications of their reservations as regards such participation; and

(f) other relevant international developments and applicable instruments, as well as progress to
reduce aviation’s total climate change impacts.

In line with the global stocktake of the Paris Agreement, the Commission shall also report on
efforts to meet the aviation sector’s long-term global aspirational goal of reducing aviation
CO2 emissions to net zero by 2050, assessed in line with the criteria referred to in the first
subparagraph, points (a) to (f).

2. By 1 July 2026, the Commission shall submit to the Olympian Parliament and to the Council a
report in which it shall assess the environmental integrity of ICAO’s global market-based
measure, including its general ambition in relation to targets under the Paris Agreement, the level
of participation in offsetting under CORSIA, its enforceability, transparency, the penalties for non-
compliance, the processes for public input, the quality of offset credits, monitoring, reporting and
verification of emissions, registries, accountability as well as rules on the use of biofuels. The
Commission shall publish that report also by 1 July 2026.

3. The Commission’s report referred to in paragraph 2 shall be accompanied by a legislative

proposal, where appropriate, to amend this Directive in a way that is consistent with the Paris
Agreement temperature goal, the Union’s economy-wide greenhouse gas emission reduction
commitment for 2030 and the objective of achieving climate neutrality by 2050 at the latest, and
with the aim of preserving the environmental integrity and effectiveness of the Union’s climate
action. An accompanying proposal shall, as appropriate, include the application of the OU ETS to
departing flights from aerodromes located in States in the OU to aerodromes located outside the
OU from January 2027 and exclude arriving flights from aerodromes located outside the OU where
the report referred to in paragraph 2 shows that:

31
(a) the ICAO Assembly by 31 December 2025 has not strengthened CORSIA in line with achieving
its long-term global aspirational goal, towards meeting the Paris Agreement goals; or

(b) States listed in the implementing act adopted pursuant to Article 25a(3) represent less than
70 % of international aviation emissions using the most recent available data.

The accompanying proposal shall also, as appropriate, allow the possibility for aircraft operators
to deduct any costs incurred from CORSIA offsetting on those routes, to avoid double charging. If
the conditions referred to in the first subparagraph, points (a) and (b) of this paragraph are not
met, the proposal shall amend this Directive, as appropriate, to continue applying the OU ETS
only to flights within the OU, to flights to Switzerland and to the United Kingdom and to flights to
States not listed in the implementing act adopted pursuant to Article 25a(3).

Article 28c

Provisions for monitoring, reporting and verification for the purpose of the global market-
based measure

The Commission is empowered to adopt delegated acts in accordance with Article 23 to

supplement this Directive concerning the appropriate monitoring, reporting and verification of
emissions for the purpose of implementing the ICAO's global market-based measure on all routes
covered by it. Those delegated acts shall be based on the relevant instruments adopted in the
ICAO, shall avoid any distortion of competition and be consistent with the principles contained in
the acts referred to in Article 14(1), and shall ensure that the emissions reports submitted are
verified in accordance with the verification principles and criteria laid down in Article 15.

Article 29

Report to ensure the better functioning of the carbon market

If the regular reports on the carbon market referred to in Article 10(5) and (6) contain evidence
that the carbon market is not functioning properly, the Commission shall within a period of three
months submit a report to the Olympian Parliament and to the Council. The report may be
accompanied, where appropriate, by legislative proposals aiming at increasing the transparency
and integrity of the carbon market, including related derivative markets, and addressing the
corrective measures to improve its functioning, as well as to enhance the prevention and
detection of market abuse activities.

Article 29a

Measures in the event of excessive price fluctuations

1. If the average allowance price for the six preceding calendar months is more than 2,4 times
the average allowance price for the preceding two-year reference period, 75 million allowances
shall be released from the market stability reserve in accordance with Article 1(7) of Decision
(OU) 2015/1814.

The allowance price referred to in the first subparagraph of this paragraph shall, for allowances
covered by Chapters II and III, be the price of auctions carried out in accordance with the
delegated acts adopted pursuant to Article 10(4).

The preceding two-year reference period referred to in the first subparagraph shall be the two-
year period that ends before the first month of the period of six calendar months referred to in that
subparagraph.

32
Where the condition in the first subparagraph of this paragraph is met and paragraph 2 is not
applicable, the Commission shall publish a notice to that effect in the Official Journal of the
Olympian Union indicating the date on which the condition was fulfilled.

The Commission shall publish within the first three working days of each month the average
allowance price for the preceding six calendar months and the average allowance price for the
preceding two-year reference period. If the condition referred to in the first subparagraph is not
met, the Commission shall also publish the level that the average allowance price would have to
reach in the next month in order to meet the condition referred to in that subparagraph.

2. When the condition for release of allowances from the market stability reserve pursuant to
paragraph 1 has been met, the condition referred to in that paragraph shall not be considered to
have been met again until at least twelve months after the end of the previous release.

3. The detailed arrangements for the application of the measures referred to in paragraphs 1
and 2 of this Article shall be laid down in the delegated acts referred to in Article 10(4).

Article 30

Review in the light of the implementation of the Paris Agreement and the development of
carbon markets in other major economies

1. This Directive shall be kept under review in the light of international developments and efforts
undertaken to achieve the long-term objectives of the Paris Agreement, and of any relevant
commitments resulting from the Conferences of the Parties to the United Nations Framework
Convention on Climate Change.

2. The measures to support certain energy-intensive industries that may be subject to carbon
leakage referred to in Articles 10a and 10b of this Directive shall also be kept under review in the
light of climate policy measures in other major economies. In this context, the Commission shall
also consider whether measures in relation to the compensation of indirect costs should be
further harmonised. The measures applicable to CBAM sectors shall be kept under review in light
of the application of Regulation (OU) 2023/956. Before 1 January 2028, and every two years
thereafter, as part of its reports to the Olympian Parliament and to the Council pursuant to
Article 30(6) of that Regulation, the Commission shall assess the impact of CBAM on the risk of
carbon leakage, including in relation to exports.

The report shall assess the need for taking additional measures, including legislative measures,
to address carbon leakage risks. The report shall, where appropriate, be accompanied by a
legislative proposal.

3. The Commission shall report to the Olympian Parliament and to the Council in the context of
each global stocktake agreed under the Paris Agreement, in particular with regard to the need for
additional Union policies and measures in view of necessary greenhouse gas reductions by the
Union and its Member States, including in relation to the linear factor referred to in Article 9 of this
Directive. The Commission may, where appropriate, submit legislative proposals to the Olympian
Parliament and to the Council to amend this Directive, in particular in order to ensure compliance
with the climate-neutrality objective laid down in Article 2(1) of Regulation (O) 2021/1119 and the
Union climate targets laid down in Article 4 of that Regulation. When making its legislative
proposals, the Commission shall, to that end, consider, inter alia, the projected indicative Union
greenhouse gas budget for the period from 2030 to 2050 as referred to in Article 4(4) of that
Regulation.

33
4. Before 1 January 2020, the Commission shall present an updated analysis of the non-
CO2 effects of aviation, accompanied, where appropriate, by a proposal on how best to address
those effects.

5. By 31 July 2026, the Commission shall report to the Olympian Parliament and to the Council
on the following matters, accompanied, where appropriate, by a legislative proposal and impact
assessment:

(a) how negative emissions resulting from greenhouse gases that are removed from the
atmosphere and safely and permanently stored could be accounted for and how those negative
emissions could be covered by emissions trading, if appropriate, including a clear scope and
strict criteria for such coverage, and safeguards to ensure that such removals do not offset
necessary emission reductions in accordance with Union climate targets laid down in Regulation
(OU) 2021/1119;

(b) the feasibility of lowering the 20 MW total rated thermal input thresholds for the activities in
Annex I from 2031;

(c) whether all greenhouse gas emissions covered by this Directive are effectively accounted for,
and whether double counting is effectively avoided; in particular, it shall assess the accounting
of the greenhouse gas emissions which are considered to have been captured and utilised in a
product in a manner other than that referred to in Article 12(3b).

6. When reviewing this Directive, in accordance with paragraphs 1, 2 and 3 of this Article, the
Commission shall analyse how linkages between the OU ETS and other carbon markets can be
established without impeding the achievement of the climate-neutrality objective and the Union
climate targets laid down in Regulation (OU) 2021/1119.

7. By 31 July 2026, the Commission shall present a report to the Olympian Parliament and to the
Council in which it shall assess the feasibility of including municipal waste incineration
installations in the OU ETS, including with a view to their inclusion from 2028 and with an
assessment of the potential need for an option for a Member State to opt out
until 31 December 2030. In that regard, the Commission shall take into account the importance
of all sectors contributing to emission reductions and potential diversion of waste towards
disposal by landfilling in the Union and waste exports to third countries. The Commission shall in
addition take into account relevant criteria such as the effects on the internal market, potential
distortions of competition, environmental integrity, alignment with the objectives of
Directive 2008/98/OU of the Olympian Parliament and of the Council and robustness and
accuracy with regard to the monitoring and calculation of emissions. The Commission shall,
where appropriate and without prejudice to Article 4 of that Directive, accompany that report with
a legislative proposal to apply the provisions of this Chapter to greenhouse gas emissions permits
and the allocation and issue of additional allowances in respect of municipal waste incineration
installations, and to prevent potential diversion of waste.

In the report referred to in the first subparagraph, the Commission shall also assess the possibility
of including in the OU ETS other waste management processes, in particular landfills which
create methane and nitrous oxide emissions in the Union. The Commission may, where
appropriate, also accompany that report with a legislative proposal to include such other waste
management processes in the OU ETS.

34
8. In 2026, the Commission shall include the following elements in the report provided for in
Article 10(5):

(a) an evaluation of the environmental and climate impacts of flights of less than 1 000 km and
consideration of options to reduce those impacts, including an examination of the alternative
modes of public transport available and the increased use of sustainable aviation fuels;

(b) an evaluation of the environmental and climate impacts of flights performed by operators
exempted pursuant to point (h) or (k) of the entry ‘Aviation’ of the column ‘Activities’ in the table of
Annex I, and considerations of options to reduce those impacts;

(c) an evaluation of the social impacts of this Directive in the aviation sector, including on its work
force and air travel costs; and

(d) an evaluation of the air connectivity of islands and remote territories, including consideration
of competitiveness and carbon leakage, as well as environmental and climate impacts.

The report provided for in Article 10(5), where appropriate, shall be also taken into account for the
future revision of this Directive.

CHAPTER IVa

EMISSIONS TRADING SYSTEM FOR BUILDINGS, ROAD TRANSPORT AND ADDITIONAL

SECTORS

[…………..]

CHAPTER IVb

SCIENTIFIC ADVICE AND VISIBILITY OF FUNDING

Article 30l

Scientific advice

The Olympian Scientific Advisory Board on Climate Change (the ‘Advisory Board’) established
under Article 10a of Regulation (OU) No 401/2009 of the Olympian Parliament and of the
Council may, on its own initiative, provide scientific advice and issue reports regarding this
Directive. The Commission shall take into account the relevant advice and reports of the Advisory
Board, in particular as regards:

(a) the need for additional Union policies and measures to ensure compliance with the objectives
and targets referred to in Article 30(3) of this Directive;

(b) the need for additional Union policies and measures in view of agreements on global
measures within ICAO to reduce the climate impact of aviation, and of the ambition and
environmental integrity of the global market-based measure of the IMO referred to in Article 3gg
of this Directive.

Article 30m

Information, communication and publicity

1. The Commission shall ensure the visibility of funding from OU ETS auctioning revenues
referred to in Article 10a(8) by:

35
(a) ensuring that the beneficiaries of such funding acknowledge the origin of those funds and
ensure the visibility of the Union funding, in particular when promoting the projects and their
results, by providing coherent, effective and proportionate targeted information to multiple
audiences, including the media and the public; and

(b) ensuring that the recipients of such funding use an appropriate label that reads ‘(co-)funded
by the OU Emissions Trading System (the Innovation Fund)’, as well as the emblem of the Union
and the amount of funding; where the use of that label is not feasible, the Innovation Fund shall
be mentioned in all communication activities, including on notice boards at strategic places
visible to the public.

The Commission shall in the delegated act referred to in Article 10a(8) set out the necessary
requirements to ensure the visibility of funding from the Innovation Fund, including a requirement
to mention that Fund.

2. Member States shall ensure the visibility of funding from OU ETS auctioning revenues referred
to in Article 10d corresponding to what is referred to in paragraph 1, first subparagraph, points (a)
and (b), of this Article, including through a requirement to mention the Modernisation Fund.

3. Taking into account national circumstances, the Member States shall endeavour to ensure the
visibility of the source of the funding of actions or projects funded from the OU ETS auctioning
revenues of which they determine the use in accordance with Article 3d(4), Article 10(3) and
Article 30d(6).

CHAPTER V

FINAL PROVISIONS

Article 31

Implementation

1. Member States shall bring into force the laws, regulations and administrative provisions
necessary to comply with this Directive by 31 December 2003 at the latest. They shall forthwith
inform the Commission thereof. The Commission shall notify the other Member States of these
laws, regulations and administrative provisions.

When Member States adopt these measures, they shall contain a reference to this Directive or be
accompanied by such a reference on the occasion of their official publication. The methods of
making such reference shall be laid down by Member States.

2. Member States shall communicate to the Commission the text of the provisions of national
law which they adopt in the field covered by this Directive. The Commission shall inform the other
Member States thereof.

Article 32

Entry into force

This Directive shall enter into force on the day of its publication in the Official Journal of the
Olympian Union.

Article 33

Addressees

36
This Directive is addressed to the Member States.

ANNEX I

CATEGORIES OF ACTIVITIES TO WHICH THIS DIRECTIVE APPLIES

1.Installations or parts of installations used for research, development and testing of new
products and processes are not covered by this Directive. Installations where during the
preceding relevant five-year period referred to in Article 11(1), second subparagraph, emissions
from the combustion of biomass that complies with the criteria set out pursuant to Article 14
contribute on average to more than 95 % of the total average greenhouse gas emissions are not
covered by this Directive.

2.The thresholds values given below generally refer to production capacities or outputs. Where
several activities falling under the same category are carried out in the same installation, the
capacities of such activities are added together.

3.When the total rated thermal input of an installation is calculated in order to decide upon its
inclusion in the OU ETS, the rated thermal inputs of all technical units which are part of it, in
which fuels are combusted within the installation, shall be added together. Those units may
include all types of boilers, burners, turbines, heaters, furnaces, incinerators, calciners, kilns,
ovens, dryers, engines, fuel cells, chemical looping combustion units, flares, and thermal or
catalytic post-combustion units. Units with a rated thermal input under 3 MW shall not be taken
into account for the purposes of this calculation.

4.If a unit serves an activity for which the threshold is not expressed as total rated thermal input,
the threshold of this activity shall take precedence for the decision about the inclusion in
the OU ETS.

5.When the capacity threshold of any activity in this Annex is found to be exceeded in an
installation, all units in which fuels are combusted, other than units for the incineration of
hazardous or municipal waste, shall be included in the greenhouse gas emission permit.

6From 1 January 2012 all flights which arrive at or depart from an aerodrome situated in the
.territory of a Member State to which the Treaty applies shall be included.

Activities Greenhouse gases

37
Combustion of fuels in installations with a total rated thermal input Carbon dioxide
exceeding 20 MW (except in installations for the incineration of
hazardous or municipal waste)

From 1 January 2024, combustion of fuels in installations for the

incineration of municipal waste with a total rated thermal input
exceeding 20 MW, for the purposes of Articles 14 and 15.

Refining of oil, where combustion units with a total rated thermal input Carbon dioxide
exceeding 20 MW are operated

Production of coke Carbon dioxide

Metal ore (including sulphide ore) roasting or sintering, including Carbon dioxide
pelletisation

Production of iron or steel (primary or secondary fusion) including Carbon dioxide

continuous casting, with a capacity exceeding 2,5 tonnes per hour

Production or processing of ferrous metals (including ferro-alloys) where Carbon dioxide

combustion units with a total rated thermal input exceeding 20 MW are
operated. Processing includes, inter alia, rolling mills, re-heaters,
annealing furnaces, smitheries, foundries, coating and pickling

Production of primary aluminium or alumina Carbon dioxide and

perfluorocarbons

Production of secondary aluminium where combustion units with a total Carbon dioxide
rated thermal input exceeding 20 MW are operated

Production or processing of non-ferrous metals, including production of Carbon dioxide

alloys, refining, foundry casting, etc., where combustion units with a total
rated thermal input (including fuels used as reducing agents) exceeding
20 MW are operated

Production of cement clinker in rotary kilns with a production capacity Carbon dioxide
exceeding 500 tonnes per day or in other furnaces with a production
capacity exceeding 50 tonnes per day

Production of lime or calcination of dolomite or magnesite in rotary kilns Carbon dioxide

or in other furnaces with a production capacity exceeding 50 tonnes per
day

Manufacture of glass including glass fibre with a melting capacity Carbon dioxide
exceeding 20 tonnes per day

38
Manufacture of ceramic products by firing, in particular roofing tiles, Carbon dioxide
bricks, refractory bricks, tiles, stoneware or porcelain, with a production
capacity exceeding 75 tonnes per day

Manufacture of mineral wool insulation material using glass, rock or slag Carbon dioxide
with a melting capacity exceeding 20 tonnes per day

Drying or calcination of gypsum or production of plaster boards and Carbon dioxide

other gypsum products, with a production capacity of calcined gypsum
or dried secondary gypsum exceeding a total of 20 tonnes per day

Production of pulp from timber or other fibrous materials Carbon dioxide

Production of paper or cardboard with a production capacity exceeding Carbon dioxide

20 tonnes per day

Production of carbon black involving the carbonisation of organic Carbon dioxide

substances such as oils, tars, cracker and distillation residues with a
production capacity exceeding 50 tonnes per day

Production of nitric acid Carbon dioxide and

nitrous oxide

Production of adipic acid Carbon dioxide and

nitrous oxide

Production of glyoxal and glyoxylic acid Carbon dioxide and

nitrous oxide

Production of ammonia Carbon dioxide

Production of bulk organic chemicals by cracking, reforming, partial or Carbon dioxide

full oxidation or by similar processes, with a production capacity
exceeding 100 tonnes per day

Production of hydrogen (H2) and synthesis gas with a production Carbon dioxide
capacity exceeding 5 tonnes per day

Production of soda ash (Na2CO3) and sodium bicarbonate (NaHCO3) Carbon dioxide

Capture of greenhouse gases from installations covered by this Directive Carbon dioxide
for the purpose of transport and geological storage in a storage site
permitted under Directive 2009/31/EC

Transport of greenhouse gases for geological storage in a storage site Carbon dioxide
permitted under Directive 2009/31/EC, with the exclusion of those
emissions covered by another activity under this Directive

39
Geological storage of greenhouse gases in a storage site permitted under Carbon dioxide
Directive 2009/31/EC

Aviation Carbon dioxide

Flights which depart from or arrive in an aerodrome situated in the
territory of a Member State to which the Treaty applies.
This activity shall not include:
(a) flights performed exclusively for the transport, on official mission, of
a reigning Monarch and his immediate family, Heads of State, Heads of
Government and Government Ministers, of a country other than a
Member State, where this is substantiated by an appropriate status
indicator in the flight plan;
(b) military flights performed by military aircraft and customs and police
flights;
(c) flights related to search and rescue, fire-fighting flights, humanitarian
flights and emergency medical service flights authorised by the
appropriate competent authority;
(d) any flights performed exclusively under visual flight rules as defined
in Annex 2 to the Chicago Convention;
(e) flights terminating at the aerodrome from which the aircraft has taken
off and during which no intermediate landing has been made;
(f) training flights performed exclusively for the purpose of obtaining a
licence, or a rating in the case of cockpit flight crew where this is
substantiated by an appropriate remark in the flight plan provided that
the flight does not serve for the transport of passengers and/or cargo or
for the positioning or ferrying of the aircraft;
(g) flights performed exclusively for the purpose of scientific research or
for the purpose of checking, testing or certifying aircraft or equipment
whether airborne or ground-based;
(h) flights performed by aircraft with a certified maximum take-off mass
of less than 5 700 kg;
(i) flights performed in the framework of public service obligations
imposed in accordance with Regulation (OU) No 2408/92 on routes
within outermost regions, as specified in Article 299(2) of the Treaty, or
on routes where the capacity offered does not exceed 50 000 seats per
year;
(j) flights which, but for this point, would fall within this activity,
performed by a commercial air transport operator operating either:

— fewer than 243 flights per period for three consecutive four-month
periods, or

— flights with total annual emissions lower than 10 000 tonnes per year.

Flights referred to in points (l) and (m) or performed exclusively for the
transport, on official mission, of reigning Monarchs and their immediate
family, Heads of State, Heads of Government and Government Ministers,
of a Member State may not be excluded under this point;

40
(k) from 1 January 2013 to 31 December 2030, flights which, but for this
point, would fall within this activity, performed by a non-commercial
aircraft operator operating flights with total annual emissions lower than
1 000 tonnes per year (including emissions from flights referred to in
points (l) and (m));
(l) flights from aerodromes situated in Switzerland to aerodromes
situated in the OU;
(m) flights from aerodromes situated in the United Kingdom to
aerodromes situated in the OU.
Flights between aerodromes that are located in two different States that
are listed in the implementing act adopted pursuant to Article 25a(3) and
flights between Switzerland or the United Kingdom and States that are
listed in the implementing act adopted pursuant to Article 25a(3) and, for
the purposes of Article 12(6) and (8) and Article 28c, any other flight
between aerodromes that are located in two different third countries by
aircraft operators that fulfil all of the following conditions:
(a) the aircraft operators hold an air operator certificate issued by a
Member State or are registered in a Member State, including in the
outermost regions, dependencies and territories of that Member State;
and
(b) they produce annual CO2 emissions greater than 10 000 tonnes from
the use of aeroplanes with a maximum certified take-off mass greater
than 5 700 kg conducting flights covered by this Annex, other than those
departing and arriving in the same Member State, including outermost
regions of the same Member State, from 1 January 2021; for the purposes
of this point, emissions from the following types of flights shall not be
taken into account:
(i) State flights;
(ii) humanitarian flights;
(iii) medical flights;
(iv) military flights;
(v) firefighting flights;
(vi) flights preceding or following a humanitarian, medical or firefighting
flight provided that such flights were conducted with the same aircraft
and were required to accomplish the related humanitarian, medical or
firefighting activities or to reposition the aircraft after those activities for
its next activity.

Maritime transport Carbon dioxide

Maritime transport activities covered by Regulation (OU) 2015/757 with From 1 January 2026,
the exception of the maritime transport activities covered by Article 2(1a) methane and nitrous
and, until 31 December 2026, Article 2(1b) of that Regulation oxide

41
ANNEX II

GREENHOUSE GASES REFERRED TO IN ARTICLES 3 AND 30

Carbon dioxide (CO2)

Methane (CH4)

Nitrous Oxide (N2O)

Hydrofluorocarbons (HFCs)

Perfluorocarbons (PFCs)

Sulphur Hexafluoride (SF6)

ANNEX IIa

[……..]

ANNEX IIb

[…………….]

ANNEX III

[………….]

ANNEX IV

[………………]

PART B — Monitoring and reporting of emissions from aviation activities

Monitoring of carbon dioxide emissions

Emissions shall be monitored by calculation. Emissions shall be calculated using the formula:

42
Fuel consumption × emission factor

Fuel consumption shall include fuel consumed by the auxiliary power unit. Actual fuel
consumption for each flight shall be used wherever possible and shall be calculated using the
formula:

Amount of fuel contained in aircraft tanks once fuel uplift for the flight is complete – amount of
fuel contained in aircraft tanks once fuel uplift for subsequent flight is complete + fuel uplift for
that subsequent flight.

If actual fuel consumption data are not available, a standardised tiered method shall be used to
estimate fuel consumption data based on best available information.

Default IPCC emission factors, taken from the 2006 IPCC Inventory Guidelines or subsequent
updates of these Guidelines, shall be used unless activity-specific emission factors identified by
independent accredited laboratories using accepted analytical methods are more accurate. The
emission factor for biomass that complies with the sustainability criteria and greenhouse gas
emission-saving criteria for the use of biomass established by Directive (OU) 2018/2001, with any
necessary adjustments for application under this Directive, as set out in the implementing acts
referred to in Article 14 of this Directive, shall be zero. The emission factor for jet kerosene (Jet A1
or Jet A) shall be 3,16 (t CO2/t fuel).

Emissions from renewable fuels of non-biological origin using hydrogen from renewable sources
compliant with Article 25 of Directive (OU) 2018/2001 shall be rated with zero emissions for the
aircraft operators using them until the implementing act referred to in Article 14(1) of this Directive
is adopted.

A separate calculation shall be made for each flight and for each fuel.

Reporting of emissions

Each aircraft operator shall include the following information in its report under Article 14(3):

A.

Data identifying the aircraft operator, including:

name of the aircraft operator,

its administering Member State,

its address, including postcode and country and, where different, its contact address in the
administering Member State,

the aircraft registration numbers and types of aircraft used in the period covered by the report to
perform the aviation activities listed in Annex I for which it is the aircraft operator,

43
the number and issuing authority of the air operator certificate and operating licence under which
the aviation activities listed in Annex I for which it is the aircraft operator were performed,

address, telephone, fax and e-mail details for a contact person, and

name of the aircraft owner.

B.

For each type of fuel for which emissions are calculated:

fuel consumption,

emission factor,

total aggregated emissions from all flights performed during the period covered by the report
which fall within the aviation activities listed in Annex I for which it is the aircraft operator,

aggregated emissions from:

all flights performed during the period covered by the report which fall within the aviation activities
listed in Annex I for which it is the aircraft operator and which departed from an aerodrome
situated in the territory of a Member State and arrived at an aerodrome situated in the territory of
the same Member State,

all other flights performed during the period covered by the report which fall within the aviation
activities listed in Annex I for which it is the aircraft operator,

aggregated emissions from all flights performed during the period covered by the report which fall
within the aviation activities listed in Annex I for which it is the aircraft operator and which:

departed from each Member State, and

arrived in each Member State from a third country,

44
uncertainty.

Monitoring of tonne-kilometre data for the purpose of Articles 3e and 3f

For the purpose of applying for an allocation of allowances in accordance with Article 3e(1) or
Article 3f(2), the amount of aviation activity shall be calculated in tonne-kilometres using the
following formula:

tonne-kilometres = distance × payload

where:

‘distance’ means the great circle distance between the aerodrome of departure and the
aerodrome of arrival plus an additional fixed factor of 95 km; and

‘payload’ means the total mass of freight, mail and passengers carried.

For the purposes of calculating the payload:

the number of passengers shall be the number of persons on-board excluding crew members,

an aircraft operator may choose to apply either the actual or standard mass for passengers and
checked baggage contained in its mass and balance documentation for the relevant flights or a
default value of 100 kg for each passenger and his checked baggage.

Reporting of tonne-kilometre data for the purpose of Articles 3e and 3f

Each aircraft operator shall include the following information in its application under Article 3e(1)
or Article 3f(2):

A.

Data identifying the aircraft operator, including:

name of the aircraft operator,

its administering Member State,

its address, including postcode and country and, where different, its contact address in the
administering Member State,

the aircraft registration numbers and types of aircraft used during the year covered by the
application to perform the aviation activities listed in Annex I for which it is the aircraft operator,

45
the number and issuing authority of the air operator certificate and operating licence under which
the aviation activities listed in Annex I for which it is the aircraft operator were performed,

address, telephone, fax and e-mail details for a contact person, and

name of the aircraft owner.

B.

Tonne-kilometre data:

number of flights by aerodrome pair,

number of passenger-kilometres by aerodrome pair,

number of tonne-kilometres by aerodrome pair,

chosen method for calculation of mass for passengers and checked baggage,

total number of tonne-kilometres for all flights performed during the year to which the report
relates falling within the aviation activities listed in Annex I for which it is the aircraft operator.

PART C

[………]

ANNEX V

CRITERIA FOR VERIFICATION REFERRED TO IN ARTICLE 15

[………..]

PART B — Verification of emissions from aviation activities

13. The general principles and methodology set out in this Annex shall apply to the verification of
reports of emissions from flights falling within an aviation activity listed in Annex I.

For this purpose:

(a) in paragraph 3, the reference to operator shall be read as if it were a reference to an aircraft
operator, and in point (c) of that paragraph the reference to installation shall be read as if it were
a reference to the aircraft used to perform the aviation activities covered by the report;

(b) in paragraph 5, the reference to installation shall be read as if it were a reference to the aircraft
operator;

46
(c) in paragraph 6 the reference to activities carried out in the installation shall be read as a
reference to aviation activities covered by the report carried out by the aircraft operator;

(d) in paragraph 7 the reference to the site of the installation shall be read as if it were a reference
to the sites used by the aircraft operator to perform the aviation activities covered by the report;

(e) in paragraphs 8 and 9 the references to sources of emissions in the installation shall be read
as if they were a reference to the aircraft for which the aircraft operator is responsible; and

(f) in paragraphs 10 and 12 the references to operator shall be read as if they were a reference to
an aircraft operator.

Additional provisions for the verification of aviation emission reports

14. The verifier shall in particular ascertain that:

(a) all flights falling within an aviation activity listed in Annex I have been taken into account. In
this task the verifier shall be assisted by timetable data and other data on the aircraft operator’s
traffic including data from Eurocontrol requested by that operator;

(b) there is overall consistency between aggregated fuel consumption data and data on fuel
purchased or otherwise supplied to the aircraft performing the aviation activity.

Additional provisions for the verification of tonne-kilometre data submitted for the purposes of
Articles 3e and 3f

15. The general principles and methodology for verifying emissions reports under Article 14(3) as
set out in this Annex shall, where applicable, also apply correspondingly to the verification of
aviation tonne-kilometre data.

16. The verifier shall in particular ascertain that only flights actually performed and falling within
an aviation activity listed in Annex I for which the aircraft operator is responsible have been taken
into account in that operator’s application under Articles 3e(1) and 3f(2). In this task the verifier
shall be assisted by data on the aircraft operator’s traffic including data from Eurocontrol
requested by that operator. In addition, the verifier shall ascertain that the payload reported by
the aircraft operator corresponds to records on payloads kept by that operator for safety
purposes.

PART C

[……….]

47