Template:M comp disc EUA Annex Suspension Event: Difference between revisions

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[[Suspension Event - Emissions Annex Provision|This]] a ''limited'' thing — some would say, arbitrarily limited — where regulatory/government fiat at the heart of the [[European Union]] stops the system functioning as it should, but not permanently. So, taking the {{euaprov|Union Registry}} offline, an {{euaprov|Administrator Event}} — but not some other regulatory driven externalities. It doesn’t include {{euaprov|Abandonment of Scheme}} or an executive decision (however unlikely) that {{euaprov|Phase 3}} {{euaprov|Allowances}} are no longer elibigle for surrender in {{euaprov|Phase 4}}.
[[Suspension Event - Emissions Annex Provision|This]] a ''limited'' thing — some would say, arbitrarily limited — where regulatory/government fiat at the heart of the [[European Union]] stops the system functioning as it should, but not permanently. So, taking the {{euaprov|Union Registry}} offline, an {{euaprov|Administrator Event}} — but not some other regulatory driven externalities. It doesn’t include {{euaprov|Abandonment of Scheme}} or an “[[Fungibility Event|executive decision]]” (however unlikely) that {{euaprov|Phase 3}} {{euaprov|Allowances}} are no longer elibigle for surrender in {{euaprov|Phase 4}}.
 
''Would'' {{euaprov|Phase 3}} {{euaprov|Allowances}} ever be ineligible for surrender in {{euaprov|Phase 4}}? Technically yes; practically no. Article [https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32003L0087 13 of the EU ETS Directive] requires Member States to issue replacement {{euaprov|Phase 4}} {{euaprov|Allowances}} to those poor souls stuck with stale {{euaprov|Phase 3}} {{euaprov|Allowances}} — they are generally valid for eight years from issue). The result, as the Michał Głowacki’s excellent site [https://emissions-euets.com/euas-validity remarks], is
 
{{quote|“Emission allowances will no more be replaced between periods, but will be valid indefinitely.”}}
 
Therefore elaborate provisions to provide what happens in an [[Allowance Option Transaction - Emissions Annex Provision|Allowance Option]] or [[Allowance Forward Transaction - Emissions Annex Provision|Allowance Forward]] should {{euaprov|Phase 3}} Allowances become ineligible, (we have seen this described, oddly, as a “{{euaprov|Fungibility Event}}” though clearly it is not that — the instruments are not and never have been “[[fungible]]”), feel the product of a surfeit of caution.
 
One — even the most [[chicken-licken]]ish [[legal eagle]] — generally does not cater in one’s contracts for future changes in ''law'', unless there is a real apprehension that the change is in contemplation and likely to come about — if legislation is before the house, or a case on appeal to the Supreme Court: that sort of thing.

Latest revision as of 13:44, 21 March 2023

This a limited thing — some would say, arbitrarily limited — where regulatory/government fiat at the heart of the European Union stops the system functioning as it should, but not permanently. So, taking the Union Registry offline, an Administrator Event — but not some other regulatory driven externalities. It doesn’t include Abandonment of Scheme or an “executive decision” (however unlikely) that Phase 3 Allowances are no longer elibigle for surrender in Phase 4.

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