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Emissions trading: Legality of fee charging confirmed
Administrative court of appeals comments on key issues in emissions trading finance
Year of issue
Date 09/12/2005
Date 09/12/2005
The administrative court of appeals of Berlin-Brandenburg has confirmed that fees charged as per the German Emissions Trading Cost Ordinance (EHKostV 2007) is legitimate. This marks the first court decision made regarding fees levied as per EHKostV 2007. The court confirmed the federal government opinion that EHKostV does not exist to do more than cover administrative costs. The market price of the emission allowances allocated free of charge are currently around 20 euros, whereas the tiered emissions trading fee is a mere 1.5 to 3.5 cents per certificate. The fees charged to installation operators are therefore in the lower one tenth of a percent range of the value of emission certificates.
The operators of a glass smelting plant had expressed misgivings in summary proceedings against the fees notification issued by the German Emission Allowance Trading Authority (DEHSt) at the Federal Environment Agency, demanding reimbursement of fees collected. This emergency application was rejected and claims to have collected fees reimbursed were dismissed.
The administrative court of appeals has reached the conclusion that there is no doubt as concerns the legitimacy of the established fee in EHKostV. The court judges it admissible that the work of the German Emissions Allowance Trading Authority be refinanced by means of fees, thereby confirming that said financing is also the intent of lawmakers. The court had no serious objections to the federal government’s embodiment of the fee structures as being in line with the ruling by which emissions allowances are allocated. The administrative court of appeals of Berlin-Brandenburg did not deem it inappropriate that the cost-covering fees are tied to the legal act which accounts for the main focus of DEHSt activities.
According to the administrative court of appeals, the objections raised by the operator in question did not suffice to justify a discontinuation of fee charging.
The decision by the administrative court of appeals of Berlin-Brandenburg already states its position on key issues of emission trading financing.
(OVG Berlin-Brandenburg, decision of 28.11.2005, Az: OVG 12 S 9.05)