Commission continues legal action over emissions trading
The European Commission is continuing legal action against four Member States for not having fully transposed the Emissions Trading Directive into national law by 31 December 2003.Greece, Italy, Belgium and Finland are now being taken to the European Court of Justice.
The Emissions Trading Scheme, a major initiative to help the EU meet its emissions targets under the 1997 Kyoto Protocol, will ensure that greenhouse gas emissions in the energy and industry sectors are cut considerably (see related story).
In a separate case, the EU is also sending a final warning to Italy, following its submission of an incomplete National Allocation Plan (NAP), outlining the number of carbon emission allowances it plans to allocate nationally to industry.
Until Italy submits a complete plan, which is in turn approved by the Commission, industry in this country will not be issued allowances in the emissions trading scheme.
Although the Emissions Trading Scheme did start on the 1 January 2005 as previously planned, these and other legal cases have caused further global controversy about the trading scheme's effectiveness (see related story).
On top of the legal action being taken against member states, the European Accountants' association, FEE, has issued a new publication considering the financial reporting and auditing issues which will impact on companies' financial statements as a result of the scheme.
The publication calls for companies to develop a good relationship with third-parties responsible for verifying emissions data.
"The EU ETS foresees the use of third party verifiers who are engaged by the company to report on annual emissions data supplied to government. Early and effective liaison between the company, its verifier and its auditor is important to ensure that the verification and necessary assurance, required to audit the financial statements, are achieved in the most efficient and effective way," said Lars Olle-Larsson, Chairman of the FEE Sustainability Assurance Group.
By Jane Kettle