The Greenhouse Gas Emissions Trading Scheme Regulations 2005

PART 7 OFFENCES AND CIVIL PENALTIES

Offences

38.—(1) It is an offence for a person—

(a) to contravene regulation 7;

(b) to fail to comply with or to contravene a condition of a greenhouse gas emissions permit (except where regulation 39 or 40 apply to such failure to comply or contravention);

(c) to fail to comply with regulation 12(1), 13(2) or 16(1) or to fail to comply with a condition of a notice under regulation 22(13)(a) imposed pursuant to regulation 22(15)(b);

(d) to fail to comply with the requirements of an enforcement notice;

(e) to fail, without reasonable excuse, to comply with any requirement imposed by a notice under regulation 16(16) or 35(2);

(f) to make a statement which he knows to be false or misleading in a material particular, or recklessly to make a statement which is false or misleading in a material particular, where the statement is made—

(i) in purported compliance with a requirement imposed by a notice under regulation 8(5), 14(6), 15(10), 16(16), 22(9), 24(6) or 35(2);

(ii) for the purpose of obtaining the grant of a greenhouse gas emissions permit to himself or any other person, or the variation, transfer or surrender of a greenhouse gas emissions permit;

(iii) for the purpose of obtaining a certificate under regulation 11;

(iv) for the purpose of obtaining a notice authorising a pool under regulation 27;

(v) as part of the verification of a report required under a monitoring and reporting condition;

(vi) for the purpose of obtaining an allocation from a new entrant reserve provided for in the approved national allocation plan;

(vii) for the purpose of retaining the allocation or a proportion of the allocation of allowances in respect of an installation which ceases to carry out a Schedule 1 activity;

(g) intentionally to make a false entry in any record required to be kept under the condition of a greenhouse gas emissions permit;

(h) with intent to deceive, to forge or use a document issued or authorised to be issued under a condition of a greenhouse gas emissions permit or required for any purpose under a condition of such a permit or to make or to have in his possession a document so closely resembling any such document as to be likely to deceive;

(i) to fail to comply with Article 15(1), 15(3) or 19(3) of the Registries Regulation.

(2) A person guilty of an offence under paragraph (1) shall be liable—

(a) on summary conviction, to a fine not exceeding the statutory maximum or to imprisonment for a term not exceeding three months;

(b) on conviction on indictment, to a fine or to imprisonment for a term not exceeding two years or to both.

(3) Where an offence under this regulation is committed by—

(a) a body corporate (other than a limited liability partnership) and is proved to have been committed with the consent or connivance of, or to have been attributable to any neglect on the part of, any director, manager, secretary, or other similar officer of the body corporate or a person who was purporting to act in any such capacity;

(b) a limited liability partnership and is proved to have been committed with the consent or connivance of, or to have been attributable to any neglect on the part of, any member of the limited liability partnership or a person who was purporting to act as such; or

(c) a partnership in Scotland (other than a limited liability partnership) (a “Scottish partnership”) and is proved to have been committed with the consent or connivance of, or have been attributable to any neglect on the part of, any partner or a person who was purporting to act as such,

that person as well as the body corporate, the limited liability partnership or the Scottish partnership, as the case may be, shall be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

(4) Where the affairs of a body corporate (other than a limited liability partnership) are managed by its members, paragraph (3) shall apply in relation to the acts or defaults of a member in connection with his functions of management as if he were a director of the body corporate.

(5) Where the commission by any person of an offence under this regulation is due to the act or default of some other person, that other person may be charged with and convicted of the offence by virtue of this paragraph whether or not proceedings for the offence are taken against the first-mentioned person.

Civil penalties: excess emissions

39.—(1) Any operator who fails to comply with a condition imposed pursuant to regulation 10(3) in respect of an installation shall be liable to a penalty.

(2) The amount of the penalty to which the operator of an installation is liable under paragraph (1) shall be the excess emissions of the installation multiplied by the excess emissions penalty.

(3) For the purpose of paragraph (2)—

(a) “excess emissions” means, in respect of an installation, the amount in tonnes of carbon dioxide equivalent by which the annual reportable emissions from the installation exceeded the number of allowances surrendered for that installation;

(b) “excess emissions penalty” means—

(i) in respect of excess emissions which relate to reportable emissions which were released between 1st January 2005 and 31st December 2007, 40 Euro; and

(ii) in respect of excess emissions which relate to reportable emissions which were released on or after 1st January 2008, 100 Euro.

(4) In relation to paragraph (3)(b), the reference to an amount in Euro shall be taken to be a reference to the sterling equivalent of that number of Euro, converted by reference to the rate of conversion published in the C series of the Official Journal of the European Communities in September of the scheme year preceding that in which the liability for the penalty arose.

Civil penalties: understatement of reportable emissions

40.—(1) Subject to paragraph (2), where in relation to the application for surrender of a greenhouse gas emissions permit under regulation 16(1) or the revocation of a greenhouse gas emissions permit under regulation 17(1), the report submitted in accordance with the requirements included in a notice of surrender or a revocation notice pursuant to regulation 16(7)(a) or 17(5)(a) understates the reportable emissions from the installation to which the report relates, the operator shall be liable to a penalty equal to the amount of the understatement of reportable emissions multiplied by the excess emissions penalty under regulation 39(3)(b) which applied to excess emissions in the year in which the understatement was made.

(2) Conduct falling with paragraph (1) shall not give rise to liability to a penalty under this regulation if the person who made the understatement—

(a) surrenders allowances equal to the amount of the understatement; and

(b) satisfies the regulator, that he did not knowingly or recklessly understate the reportable emissions from the installation.

Civil penalties: general

41.—(1) In this regulation “civil penalty” means any penalty which—

(a) is imposed by or under these Regulations; and

(b) arises otherwise than in consequence of a person’s conviction for a criminal offence.

(2) Where a person is liable to a civil penalty, the regulator shall—

(a) assess the amount due by way of penalty; and

(b) notify the person liable to the penalty of that amount.

(3) Subject to regulation 32(10), a penalty shall be due on the day (the “due date”) following the expiry of a period of two months beginning on the date on which the person is notified by the regulator under paragraph (2)(b) and shall be paid to the regulator.

(4) Where a regulator makes an assessment under paragraph (2) of any penalty to which a person is liable the amount of that penalty shall carry interest for the period which—

(a) begins on the due date; and

(b) ends with the day before the day on which the assessed penalty is paid.

(5) Interest under this regulation shall be payable at a rate of one percentage point above LIBOR on a day to day basis.

(6) For the purposes of paragraph (5), “LIBOR” means the sterling three months London interbank offered rate in force during the period between the due date and the date on which the penalty is paid.

(7) Where an amount has been assessed and notified to any person under paragraph (2), the amount and any interest incurred under paragraph (4) shall be recoverable on demand.

(8) The regulator shall notify the appropriate authority of any penalty assessed under paragraph (2) and shall pass any civil penalties and any interest paid to it to the appropriate authority.