The Finnish Supreme Administrative Court (SAC) has on 7 November 2014 requested the Court of Justice of the European Union (CJEU) for a preliminary ruling on the potential invalidity and/or contradiction of the Commission Decisions (i) 2013/448/EU concerning national implementation measures for the transitional free allocation of greenhouse gas emission allowances in accordance with Article 11(3) of the Emissions Trading Directive and (ii) 2011/278/EU determining transitional Union-wide rules for harmonised free allocation of emission allowances pursuant to Article 10a of the Emission Trading Directive with Directive 2003/87/EC (the Emissions Trading Directive).
Finnish companies Yara Suomi Oy, Borealis Polymers Oy, Neste Oil Oyj and Ruukki Metals Oy have brought a question before the SAC on whether a decision by the Finnish Ministry of Employment and the Economy (MEE) regarding amounts of installation-specific free emission allowances for the emissions trading period of 2013-2020 (decision 8.1.2014 No. TEM/1130/05.03.02/2011, MEE Decision) should be considered to be contrary to the Finnish Emissions Trading Act and the Emissions Trading Directive. The above companies had been issued installation-specific free emission allowances in accordance with the MEE Decision.
In the appeals it has, e.g., been stated that Decisions 2013/448/EU and 2011/278/EU applied by the MEE are invalid and that the MEE should, therefore, not have applied the cross-sectoral correction factor, as defined in Decision 2013/448/EU, to the appellants’ installations. According to the appellants, Decision 2013/448/EU has been issued in a procedure contrary to the Emissions Trading Directive. Further, the appellants contend that in the said Decision, the definition of “installation” provided in the Emissions Trading Directive has been incorrectly interpreted, the cap for the industrial emissions has been incorrectly determined by the Commission, meaning that also the cross-sectoral correction factor has been incorrectly determined especially in respect of industrial process gases and combined heat and power production, and that the cross-sectoral correction factor should not be applied to the carbon leakage sector.
In addition, according to one appellant, the benchmark (i.e. reference value) for hot metal has, in Decision 2011/278/EU, been determined contrary to the Emissions Trading Directive. Therefore, the appellants argue that the said Commission Decisions should not have been applied to the extent set forth in the appeals in the national decision on issuing of free emission allowances.
Should the CJEU consider Decisions 2013/448/EU and 2011/278/EU to be contrary to the Emissions Trading Directive, the MEE Decision must be repealed to such extent. From the SAC’s request for preliminary ruling it would appear that several other requests for preliminary ruling closely relating to the arguments presented in the above appeals are currently pending before the CJEU. Therefore, the CJEU’s future ruling is likely to include guidance in relation to the conditions for free allocation of emission allowances in the EU member states.
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