Trusted account list, the differentiation between trading and holding accounts, 24-hour delay in effecting transfers, view-only access to the accounts enabling such services as “safe zone” as well as strict rules on finality of transactions entered into the registry are some of the measures that could contribute to the enhancement of the security of the registries and, consequently, of the assets of the account holders. Some of these new instruments are designed as mandatory, but other will require decisions to be made by the emissions market participants depending on the politics and strategies they pursue.
A Union Registry will be established for the trading period of the Union emissions trading scheme commencing on 1 January 2013 and subsequent periods. The draft Regulation at issue makes ,however, also relevant amendments to the Regulation No 920/2010 (which substitutes the Regulations No 2216/2004 and No 994/2008 with effect from 1 January 2012), so the most of the abovementioned, positive, it seems, modifications will probably be available for account holders soon.
The protection of the good faith acquirer of emission allowances and finality of transactions in the new Registry Regulation – do they cause traders feel more comfortable?
The surrender of allowances initiated in error - the only reversible transaction pursuant to the draft of the Commission Regulation establishing a Union Registry of emission allowances
Newly designed measures for enhancements of the security of accounts in the registries envisioned in the draft of the Commission Regulation establishing a Union Registry for the trading period commencing on 1 January 2013, and subsequent trading periods, of the Union emissions trading scheme pursuant to Directive 2003/87/EC of the European Parliament and of the Council and Decision 280/2004/EC of the European Parliament and of the Council and amending Regulations (EC) No 2216/2004 and (EU) No 920/2010 (hereinafter referred to as ‘Regulation’) should be carefully considered by the account holders. Beneath there are mentioned certain areas for possible considerations and, consequently, for decisions of account holders in the light of the possibilities offered by the new, upcoming provisions.
1. Trusted account list and trading accounts
The so-called ‘trusted account list’ conception is interlinked with the planned introduction of the separate type of the Registry account i.e. trading accounts (in addition to the existing so far holding accounts). As follows from Articles 60 and 61 of the Regulation, transfer of allowances or Kyoto units from holding account will only be possible to an account on the trusted account list of the account holder.
The said restriction will not apply to the trading accounts which will be available for carrying out transfers of allowances or Kyoto units to all holding as well as trading accounts in the Union Registry.
The Regulation states in Article 24 that both accounts: holding account and trading account may have a trusted account list in the Union Registry. It could be inferred, however, from the combination of the said provisions that setting a trusted list for a holding account will be mandatory to enable transfers, while for trading account only optional.
The second important feature of the ‘trusted list’ concept is in liaison with the functioning of additional authorised representatives. Generally, each account must have at least two authorised representatives (with the exception of the verifier account which is required to have at least one authorised representative). The authorised representatives shall initiate transactions and other processes on behalf of the account holder.
The new requirement is that an account must also have at least one additional authorised representative whose approval is required in addition to the approval of an authorised representative in order to initiate a transaction (the earlier Regulation No 920/2010 allowed for additional authorised representatives, but their establishment was only optional, in the new provisions it is mandatory).
The approval of an additional authorised representative shall not be required, however, for transfers to an account on the trusted account list of the account holder.
The Regulation envisions, furthermore, that accounts held by the same account holder shall be automatically included on the trusted account list. The national administrator shall approve changes to the trusted account list upon verification that the changes have legitimately been requested by the account holder.