Such severe rules pose obviously unavoidable risks to the account holders. The question arises how such events as mistakes, errors, but also misrepresentations in transactions would be treated on the ground of the Regulation and earlier effected transfers.
But it seems that the exposure of account holders to the above-mentioned risks was sacrificed to a greater value of legal certainty in emissions trading market.
Recital (12) in the preamble to the Regulation underlines that allowances and Kyoto units exist only in dematerialised form and are fungible, so their ownership should be established by their existence in the account of the Union Registry in which they are held. Moreover, to reduce the risks associated with the undoing of transactions entered in a registry, and the consequent disruption to the system and to the market that such undoing may cause, it is necessary to ensure that transactions cannot be reversed, revoked or unwound, other than as defined, after a moment set out by the rules of the registry. Regulation makes the reservation that it shouldn’t prevent an account holder or a third party from exercising any right or claim resulting from the underlying transaction that they may have in law to recovery or restitution in respect of a transaction that has entered a system, e.g. in case of fraud or technical error, as long as this does not lead to the reversal, revocation or unwinding of the transaction.
The introduction of the said rules to the Union legal order would be a crucial change that – as it seems – would help to restore confidence in European Union Emissions Trading Scheme, infringed so much by the recent thefts. As opposite to the modifications mentioned above in points 1-3 (which are of only technical character) the new rules on finality of transfers are of a fundamental significance, and will have an effect on many consequent legal issues.