An Introduction to the Kyoto Protocol Compliance  Mechanism

The Kyoto Protocol compliance mechanism is designed to strengthen the Protocol’s environmental integrity, support the carbon market’s credibility and ensure transparency of accounting by Parties.  Its objective is to facilitate, promote and enforce compliance with the commitments under the Protocol.  It is among the most comprehensive and rigorous systems of compliance for a multilateral environmental agreement.  A strong and effective compliance mechanism is key to the success of the implementation of the Protocol.

The Compliance Committee is made up of two branches: a facilitative branch and an enforcement branch.  As their names suggest, the facilitative branch aims to provide advice and assistance to Parties in order to promote compliance, whereas the enforcement branch has the responsibility to determine consequences for Parties not meeting their commitments.  Both branches are composed of 10 members, including one representative from each of the five official UN regions (Africa, Asia, Latin America and the Caribbean, Central and Eastern Europe, and Western Europe and Others), one from the small island developing States, and two each from Annex I and non-Annex I Parties.  The Committee also meets in a plenary composed of members of both branches, and a bureau, made up of the chairperson and vice-chairperson of each branch, supports its work.  Decisions of the plenary and the facilitative branch may be taken by a three-quarters majority, while decisions of the enforcement branch require, in addition, a double majority of both Annex I and non-Annex I Parties.

Through its branches, the Committee considers questions of implementation which can be raised by expert review teams under Article 8 of the Protocol, any Party with respect to itself, or a Party with respect to another Party (supported by corroborating information).  Each Party designates an agent who signs submissions containing such questions, as well as comments.  The bureau of the Committee allocates a question of implementation to the appropriate branch, based on their mandates.  In addition, at any time during its consideration of a question of implementation, the enforcement branch may refer a question of implementation to the facilitative branch. 

The enforcement branch is responsible for determining whether a Party included in Annex I (Annex I Party) is not in compliance with its emissions targets, the methodological and reporting requirements for greenhouse gas inventories, and the eligibility requirements under the mechanisms.  In case of disagreements between a Party and an expert review team, the enforcement branch shall determine whether to apply adjustments to greenhouse gas inventories or to correct the compilation and accounting database for the accounting of assigned amounts.

The mandate of the facilitative branch is to provide advice and facilitation to Parties in implementing the Protocol, and to promote compliance by Parties with their Kyoto commitments.  It is responsible for addressing questions of implementation by Annex I Parties of response measures aimed at mitigating climate change in a way that minimizes their adverse impacts on developing countries and the use by Annex I Parties of the mechanisms as “supplemental” to domestic action.  Furthermore, the facilitative branch may provide “early warning” of potential non-compliance with emissions targets, methodological and reporting commitments relating to greenhouse gas inventories, and commitments on reporting supplementary information in a Party’s annual inventory.

The Committee must take into account any degree of flexibility allowed by the CMP for Annex I Parties undergoing the process of transition to a market economy.  In addition, the facilitative branch is to take into consideration the common but differentiated responsibilities of the Parties, and the circumstances pertaining to questions before it.

In the case of the enforcement branch, each type of non-compliance requires a specific course of action.  For instance, where the enforcement branch has determined that the emissions of a Party have exceeded its assigned amount, it must declare that that Party is in non-compliance and require the Party to make up the difference between its emissions and its assigned amount during the second commitment period, plus an additional deduction of 30%.  In addition, it shall require the Party to submit a compliance action plan and suspend the eligibility of the Party to make transfers under emissions trading until the Party is reinstated.

No such correspondence exists in the case of the facilitative branch, which can decide to provide advice and facilitation of assistance to individual Parties regarding the implementation of the Protocol, facilitate financial and technical assistance to any Party concerned, including technology transfer and capacity building and/or formulate recommendations to the Party concerned.

In the enforcement branch, questions of implementation will be resolved within approximately 35 weeks from receipt by the branch of the question of implementation.  In time-sensitive requests, including those relating to eligibility to participate in the mechanisms, the expedited procedures involving shorter periods will apply.  The enforcement branch is to decide on disagreements on whether to apply adjustments to inventories under Article 5, paragraph 2, of the Kyoto Protocol, or to correct the compilation and accounting database for the accounting of assigned amounts under Article 7, paragraph 4, of the Kyoto Protocol within 12 weeks of being informed in writing of such disagreement.  Apart from the three-week deadline given to complete its preliminary examination, no fixed deadlines are provided for the facilitative branch.

The branches of the Compliance Committee will base their deliberations on reports from expert review teams, the subsidiary bodies, Parties and other official sources.  Competent intergovernmental and non-governmental organizations may submit relevant factual and technical information to the relevant branch after the preliminary examination.

There are detailed procedures with specific timeframes for the enforcement branch, including the opportunity for a Party facing the Compliance Committee to make formal written submissions and request a hearing where it can present its views and call on expert testimony.

Any Party not complying with reporting requirements must develop a compliance action plan as well, and Parties that are found not to meet the criteria for participating in the mechanisms will have their eligibility withdrawn.  In all cases, the enforcement branch will make a public declaration that the Party is in non-compliance and will also make public the consequences to be applied. 

If a Party’s eligibility is withdrawn or suspended, it may request, either through an expert review team or directly to the enforcement branch, to have its eligibility restored if it believes it has rectified the problem and is again meeting the relevant criteria.

In the case of compliance with emission targets, Annex I Parties have 100 days after the expert review of their final annual emissions inventory has finished to make up any shortfall in compliance (e.g. by acquiring AAUs, CERs, ERUs or RMUs through emissions trading).  If, at the end of this period, a Party’s emissions are still greater than its assigned amount, the enforcement branch will declare the Party to be in non-compliance and apply the consequences outlined above.

As a general rule, decisions taken by the two branches of the Committee cannot be appealed.  The exception is a decision of the enforcement branch relating to emissions targets.  Even then, a Party can only appeal if it believes it has been denied due process.