EUROPEAN COMMISSION

Brussels, 27.9.2019

COM(2019) 438 final

2019/0205(NLE)

Proposal for a

COUNCIL DECISION

on the position to be adopted, on behalf of the European Union,
within the EEA Joint Committee concerning an amendment to Protocol 31 to the EEA Agreement, on cooperation in specific fields outside the four freedoms

[Extended Climate Cooperation EU – Iceland – Norway]

(Text with EEA relevance)

EXPLANATORY MEMORANDUM

1.CONTEXT OF THE PROPOSAL

•Reasons for and objectives of the proposal

•Consistency with existing policy provisions in the policy area

•Consistency with other Union policies

2.LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY

•Legal basis

The legislation to be incorporated into the EEA Agreement is based on Article 191 of the Treaty on the Functioning of the European Union in conjunction with Article 218(9) thereof.

•Subsidiarity (for non-exclusive competence)

•Proportionality

•Choice of the instrument

3.RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS

4.BUDGETARY IMPLICATIONS

5.OTHER ELEMENTS

Detailed explanation of the specific provisions of the proposal

5.1.Inclusion in Protocol 31

Directive 2003/87/EC has been incorporated into Annex XX of the EEA Agreement and the amending Directive 2018/410/EU will be incorporated into the Annex in a separate Joint Committee Decision.

Regulations (EU) 2018/841 and 2018/842 establish each State’s permitted emission levels. They also regulate their access to flexibility mechanisms with regard to compliance to their substantive obligations and determine how to account for emissions of greenhouse gases as well as removals from land use, land use change and forestry. They do not prescribe the means to achieve the targets set out therein, nor do they create any rights or obligations of economic actors.

Iceland and Norway intend to fulfil their respective greenhouse gas emission reduction targets for 2030 by applying and effectively implementing, within the framework of the EEA Agreement, Regulations (EU) 2018/841 and 2018/842 as well as Directive 2003/87. In accordance with Part VI of the EEA Agreement, including Article 78 of the EEA Agreement, Protocol 31 of the EEA Agreement provides the appropriate context for such cooperation between the Union and EEA countries outside the four freedoms.

Incorporation of Regulations (EU) 2018/841 and 2018/842 into the EEA acquis by means of amending Protocol 31 to the EEA Agreement creates the same type of legal obligations as the incorporation into an Annex to the EEA Agreement. Compliance with the acts and provisions included in Protocol 31 can be monitored and enforced by the EFTA Surveillance Authority and the EFTA Court to the same extent as if they were incorporated into an Annex, if the Contracting Parties so agree. It is therefore proposed to apply Part VII of the EEA Agreement, i.e. the ordinary procedures for surveillance and dispute settlement of the EEA Agreement.

It does, however, not create an obligation for incorporation of subsequent acts. This distinction is important to Iceland and Norway, since this decision to cooperate falls outside the areas that the Contracting Parties to the EEA Agreement are under an obligation to incorporate into the EEA acquis.

The acts and provisions included shall not apply to Liechtenstein.

5.2.Justifications and proposed solutions - Regulation 2018/841

Article 6(2) – conversion period:

Justification:

For Iceland, a 50-year conversion period has consistently been used for accounting for afforested land to the UNFCCC and duly justified and reviewed based on the IPCC Guidelines.

Article 8(7) - process and time-limits for National Forestry Accounting Plans (NFAP):

Justification:

As a consequence of the inclusion of Article 8(7)-(8) of the LULUCF Regulation and the general adaptations on the application of Part VII and Protocol 1 to the EEA Agreement, the EFTA States shall submit proposed reference levels and nominate experts to the EFTA Surveillance Authority, but only after the Joint Committee Decision enters into force. From this and the proposed general adaptation on expert consultations, it follows that the experts nominated shall be consulted by the European Commission and the EFTA Surveillance Authority in the same way as experts from the Member States of the European Union are consulted by the Commission.

The EFTA Surveillance Authority and the European Commission shall cooperate, exchange information and consult with each other in accordance with Article 109 and Protocol 1 of the EEA Agreement. Where necessary, based on the technical assessments and any technical recommendations resulting from this procedure, the EFTA States shall communicate their revised proposed forest reference levels to the EFTA Surveillance Authority. The forest reference levels of the EFTA States resulting from this procedure will be established by the EFTA Surveillance Authority and included into Protocol 31 to the EEA Agreement through a Joint Committee Decision as adaptations to the Commission delegated acts pursuant to Article 8(8) of the LULUCF Regulation. As this procedure will not formally start until this Joint Committee Decision enters into force, and as the procedure pursuant to Article 8(6)-(7) takes several months, the deadline in article 8(7) for revised proposed reference levels must be adapted to ensure sufficient time also for the EFTA States and the EFTA Surveillance Authority in close cooperation with the European Commission to finalize this procedure also with regard to the forest reference levels for the EFTA States.

The obligation of the EFTA Surveillance Authority to publish the proposed forest reference levels communicated by the EFTA States does not explicitly follow from the obligations pursuant to Article 109 and Protocol 1 to the EEA Agreement and is therefore explicitly stated in the proposed adaptation.

Article 13(2)(a) – reference to Regulation (EU) No 525/2013:

Justification:

Article 13(2)(a) of Regulation (EU) 2018/841 requires the EU Member States to include ongoing or planned specific measures to ensure conservation or enhancement, as appropriate, of forest sinks and reservoirs in their strategy submitted in accordance with Article 4 of Regulation (EU) No 525/2013, in order for them to participate in the managed forest land flexibility pursuant to the same Article. As the Joint Committee Decision only relates to the emission reduction targets for 2030, Article 4 of Regulation (EU) No 525/2013 will not apply for the EFTA-states. To ensure that the EFTA States participate in the managed forest land flexibility on equal terms as Member States, the proposed adaptation introduces a requirement for the EFTA States to submit specified strategies for their land use, land use change and forestry sector.

Article 15(2) - Information to the EFTA Surveillance Authority from the Central Administrator:

Justification:

The proposed adaptation clarifies the role of the EFTA Surveillance Authority in relation to the Central Administrator in accordance with the Union Registry Regulation (Commission Regulation (EU) No 389/2013) as incorporated and adapted for EEA purposes in point 21ana of Annex XX to the EEA Agreement. It follows from these adaptations that when accounts under the jurisdiction of an EFTA State are concerned, the EFTA Surveillance Authority shall be involved. The proposed adaptation is also in accordance with the role of the EFTA Surveillance Authority pursuant to the general adaptations in this Joint Committee Decision on the application of Part VII and Protocol 1 to the EEA Agreement.

Annexes II, III, IV and VII – tables:

Justification:

Relevant information about Iceland and Norway should be included in Annexes II, III and VII.

Point (g) of section A of Annex IV requires consistency between forest reference levels and projections reported under the Regulation (EU) No 525/2013. As Regulation (EU) No 525/2013 is not incorporated into the EEA Agreement, Iceland and Norway have not been obliged to report projections in accordance with Regulation (EU) No 525/2013. Projections have however been reported to the European Environment Agency on a voluntary basis, and, as regards Iceland, also in accordance with the bilateral Agreement between Iceland and the European Union and its Member States concerning Iceland’s participation in the joint fulfilment of the commitments of the European Union, its Member States and Iceland for the second commitment period of the Kyoto Protocol to the United Nations Framework Convention on Climate Change 2 . This is clarified in the proposed adaptation to the Annex.

For the period 2026-2030, a similar adaptation is not needed, as Norway and Iceland will report projections according to Article 18 of Regulation (EU) 2018/1999.

5.3.Justifications and proposed solutions - Regulation 2018/842

Article 4(3) - determination of the 2005 base year to calculate the 2030 end point of the ESR trajectory in absolute emission allocations:

Justification:

The greenhouse gas (GHG) reduction for 2030 should be determined in relation to the level of its 2005 reviewed greenhouse gas emissions covered by Regulation 2018/842, excluding GHG from activities listed in Annex I of Directive 2003/87/EC (EU Emission Trading System, ETS), and verified emissions from installations that operated in 2005 and were only included in the EU ETS after 2005. According to ESR recital (18) the approach taken in Decision No. 406/2009/EC should be continued, which would require as one input the Annual Emission Allocation (AEA) for 2020. Norway and Iceland do not have this and therefore, their annual emission allocation (AEA) for 2030 cannot be calculated using the same methodology as for the EU Member States. Article 4(3) should therefore be adapted to clarify the methodology to be used to determine the 2005 base year emissions for Norway and Iceland, taking into account the ETS values already included in the Agreement. This will also simplify the incorporation of the implementing acts calculating and setting the AEAs for the years 2021-2030.

EEA Joint Committee Decision No 152/2012 on the EU ETS contains the EFTA States' values for 2005 stationary ETS emissions in the ETS scope as of 2013. These figures can be used to calculate the 2005 emissions from sectors covered by the ETS Directive in the scope relevant for the Effort Sharing Regulation.

In respect of the EFTA States, the 2005 ETS figures to be taken into account for the purpose of setting out the annual emission allocation for the year 2030 pursuant to Article 4(3) are set out in an Appendix which shall be added after Annex IV.

Article 6(1) – number of allowances to be cancelled for ESR compliance:

Justification:

Article 6(1) sets a maximum of cancellation of 100 million EU ETS allowances collectively to be taken into account for ESR compliance. The maximum figures for Iceland and Norway should be added, see proposed adaptation (vi).

Article 12(2) - Information to the EFTA Surveillance Authority from the Central Administrator:

Justification:

The proposed adaptation clarifies the role of the EFTA Surveillance Authority in relation to the Central Administrator in accordance with the Union Registry Regulation (Commission Regulation (EU) No 389/2013) as incorporated and adapted for EEA purposes in point 21ana of Annex XX to the EEA Agreement. It follows from these adaptations that when accounts under the jurisdiction of an EFTA State are concerned, the EFTA Surveillance Authority shall be involved. The proposed adaptation is also in accordance with the role of the EFTA Surveillance Authority pursuant to the general adaptations in this Joint Committee Decision on the application of Part VII and Protocol 1 to the EEA Agreement.

Annexes I, II and III:

Justification:

Relevant information about Iceland and Norway should be included in Annexes I, II and III. This is based on the principle of equal treatment with EU Member States and consistent with the Commission reasoning set out in in the ESR proposal (COM(2016) 482 final, p.3) and the underpinning impact assessment.

5.4.Justifications and proposed solutions - Regulation (EU) 2018/1999

Adaptations (i)-(ii) – Relevant Articles and their application:

Justification:

Regulation (EU) 2018/1999 establishes a Governance mechanism to ensure the achievement of the 2030 and long-term objectives and targets of the Energy Union in line with the Paris Agreement on climate change. Regulation (EU) 2018/1999 is part of the "Clean Energy for All Europeans" package. The EEA relevance of Regulation (EU) 2018/1999 will be assessed in accordance with standard EEA procedures. This will be done as part of the assessment of the whole Clean Energy for All Europeans package.

Regulation (EU) 2018/1999 includes planning and reporting requirements that cover the commitments in Regulation (EU) 2018/841 and Regulation (EU) 2018/842. These requirements replace amongst other Regulation (EU) No 525/2013, which has not been incorporated into the EEA Agreement.

The scope of the Joint Committee Decision is limited to the legislation relevant for the implementation of the respective 2030 emission reduction targets of Iceland and Norway. Regulation (EU) 2018/1999 includes provisions relating to integrated national energy and climate plans and integrated energy and climate progress reports. These provisions go beyond the scope of the Joint Committee Decision as they also include planning and reporting of the energy targets and other objectives in the five dimensions of the Energy Union. These provisions are therefore not included in the Joint Committee Decision.

However, Iceland and Norway voluntarily commit to develop national plans to set out the policies and measures to meet the obligations set out in Regulation (EU) 2018/841 and Regulation (EU) 2018/842 and included in Protocol 31 through the Joint Committee Decision. The plans will be shared with EU Member States, the Commission and the EFTA Surveillance Authority by 31.12.2019. This is stated in the declaration on national plans related to Decision on the EEA Joint Committee No [this decision] by Iceland and Norway.

To establish a system for transparent and consistent monitoring, reporting and compliance with the obligations undertaken through the Joint Committee Decision, it is proposed to include the provisions from Regulation (EU) 2018/1999 that are essential for the implementation of Regulations (EU) 2018/841 and 2018/842. This inclusion is without prejudice to the assessment of EEA relevance of Regulation (EU) 2018/1999. The essential provisions from Regulation (EU) 2018/1999 need to be included in an understandable and legally correct manner. It is proposed to do so in a manner similar to the one used for inclusion into Protocol 47 of the Agreement of provisions concerning trade in wine from EU Acts on a common organisation of the markets in agricultural products. This means listing those Articles from Regulation (EU) 2018/1999 that shall apply. Some provisions will need a few adaptations to fit the scope of the Joint Committee Decision while others will be included without any adaptations.

The articles included will ensure complete reporting on greenhouse gas inventories, greenhouse gas policies and measures and on projections.

In addition, essential articles to carry out comprehensive reviews in accordance with Regulations (EU) 2018/841 and 2018/842 are included to ensure compliance.

Article 2 includes a list of the definitions that shall apply for Regulation (EU) 2018/1999. The definitions included are those that are relevant for the implementation of Regulations (EU) 2018/841 and 2018/842. Some of the included definitions also refer to subjects that fall outside the scope of the decision. The adaptation restricts the application of the definitions to the scope of this Joint Committee Decision.

Article 26(4) – greenhouse gas inventory data:

Justification:

Article 26(4) establishes an obligation for Member States to submit a national inventory report to the UNFCCC. Submission of such reports are an obligation under the UNFCCC. Iceland and Norway are independent parties to the UNFCCC. Iceland and Norway will, in accordance with their respective commitments under the UNFCCC, submit national inventory reports.

As the final greenhouse gas inventory data reported to the UNFCCC by 15 April each year is essential for the compliance of Regulations (EU) 2018/841 and 2018/842, the adaptation ensures that Iceland and Norway provide a copy of the reported data to the EFTA Surveillance Authority on the same date as the Member States.

Article 41 – cooperation Member States – European Union:

Justification:

Article 41 regulates cooperation between Member States and the Union in relation to the full scope of the obligations covered by Regulation (EU) 2018/1999. The adaptation ensures that this cooperation is limited to the scope of the Joint Committee Decision.

Article 42 – assistance by the European Environment Agency:

Justification:

Article 42 provides that the European Environment Agency shall assist the Commission in its work as regards Articles 15-21, 26, 28-29, 37-39 and 41. The adaptation ensures that this assistance is limited to the scope of the Joint Committee Decision.

5.5.Justifications and proposed solutions - Regulation (EU) No 525/2013

Article 7 and Articles 19(1) and (3) – inventory data and comprehensive review:

Justification:

To carry out the comprehensive review according to Article 4(3) of Regulation (EU) 2018/842 in 2020, there is a need to include parts of two articles from Regulation (EU) No 525/2013. Regulation (EU) 2018/1999 will repeal Regulation (EU) No 525/2013 from 1 January 2021, hence the reporting obligations according to Regulation (EU) 2018/1999 will not apply for Iceland and Norway before 2021. It is therefore necessary to include parts of two articles from Regulation (EU) No 525/2013 in order to establish an obligation to provide necessary inventory data and to undergo the comprehensive review in 2020.

The necessary articles are included in the Joint Committee Decision through a list that states which Articles shall apply. Only the parts of the articles that relate to the implementation of Regulation (EU) 2018/842 will apply. Iceland and Norway will have an obligation to provide the relevant data for the comprehensive review referred to in Article 4(3) of Regulation (EU) 2018/842 for the year 2020. In addition, the inclusion of Article 19(1) and (3) will ensure that the comprehensive review will be carried out in accordance with the procedures stated in those paragraphs.

The provisions shall only apply to the extent they relate to the implementation of Regulation (EU) 2018/842.

5.6.Justifications and proposed solutions - Implementing Regulation 749/2014

Articles 3-5, 7-10, 12-14, 16, 29, 32-34, 36-37 and annexes I-VIII, Table 2 of Annex XVI:

Justification:

As Articles 7 and 19 (1) and (3) from Regulation (EU) No 525/2013 are included to carry out the comprehensive review in accordance with Article 4(3) of Regulation (EU) 2018/842, there is also a need to include the implementing articles from Implementing Regulation 749/2014 on structure, format, submission process and review of information reported by Member States pursuant to Regulation (EU) No 525/2013.

The provisions shall only apply to the extent they relate to the implementation of Regulation (EU) 2018/842.

5.7.Justification and proposed solutions - General adaptations (application of Part VII and Protocol 1 to the EEA Agreement, references to EU Acts, Committee participation, expert consultation, assistance by the European Environment Agency and non-application for Liechtenstein)

Justification:

As it follows from Article 79(3) that Part VII Institutional Provisions of the EEA Agreement only applies to Part VI and Protocol 31 of the EEA Agreement when specifically provided for, and as it is only the application of the decision making provisions that is specifically provided for (conf. Article 98), an adaptation (b) is proposed to ensure the application of Part VII and thus ensure monitoring and enforcement by the EFTA Surveillance Authority and the EFTA Court as explained above with regard to inclusion in Protocol 31.

As Protocol 1 on Horizontal Adaptations to the EEA Agreement at the outset only applies to the provisions of the Acts referred to in the Annexes to the EEA Agreement, an adaptation (c) is proposed to make it applicable also to the provisions of the Acts referred to in Protocol 31 by their inclusion through the Joint Committee Decision.

Provisions of the Acts included in Protocol 31 through the Joint Committee Decision also refer to European or Union legislation, acts, rules, policies and measures that are not part of the EEA Agreement. An adaptation (d) is proposed to make it clear that they only apply to the extent and in the form that they are incorporated into the Agreement.

Participation of the EFTA States in the Climate Change Committee and consultation of experts from the EFTA States on the same basis as experts from the EU Member States is necessary to make the cooperation provided for in the Joint Committee Decision work. For instance, as explained above with regard to the proposed adaptation to Article 8(7) of Regulation (EU) No. 2018/841 (LULUCF) as concerns the establishment of national forestry accounting plans and forest reference levels, consultation of experts from EFTA States is necessary to ensure necessary input, consultations and cooperation and by that uniform implementation and application of the provisions of the Acts included into Protocol 31 by this Joint Committee Decision. Proposed adaptations (e) and (f) ensure such participation and consultation also in this regard.

As the provisions of Part VII of the EEA Agreement will apply, the EFTA Surveillance Authority will monitor the fulfilment of Iceland and Norway of their obligations pursuant to the Joint Committee Decision. Proposed adaptation (g) ensures that the European Environment Agency shall assist the EFTA Surveillance Authority in its work to comply with the obligations pursuant to the decision, such as conducting the comprehensive review and performing quality assurance on the information reported by Iceland and Norway.

As only Iceland and Norway will participate in the extended cooperation provided for through the Joint Committee Decision, proposed adaptation (h) provides that it shall not apply to Liechtenstein.

2019/0205 (NLE)

Proposal for a

COUNCIL DECISION

on the position to be adopted, on behalf of the European Union,
within the EEA Joint Committee concerning an amendment to Protocol 31 to the EEA Agreement, on cooperation in specific fields outside the four freedoms

[Extended Climate Cooperation EU – Iceland – Norway]

(Text with EEA relevance)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article 191 in conjunction with Article 218(9) thereof,

Having regard to Council Regulation (EC) No 2894/94 of 28 November 1994 concerning arrangements for implementing the Agreement on the European Economic Area , and in particular Article 1(3) thereof,

Having regard to the proposal from the European Commission,

Whereas:

(1)The Agreement on the European Economic Area 3 ('the EEA Agreement') entered into force on 1 January 1994.

(2)Pursuant to Article 98 of the EEA Agreement, the EEA Joint Committee may decide to amend, inter alia, Protocol 31 to the EEA Agreement.

(3)Protocol 31 to the EEA Agreement contains specific provisions on cooperation in specific fields outside the four freedoms.

(4)It is appropriate to extend the cooperation of the Contracting Parties to the EEA Agreement in Union actions to include Regulation (EU) 2018/841 and Regulation (EU) 2018/842 and related provisions from Regulation (EU) 2018/1999, Regulation (EU) 525/2013 and Implementing Regulation (EU) 794/2014.

(5)Protocol 31 to the EEA Agreement should therefore be amended in order to allow for this extended cooperation.

(6)The position of the Union in the EEA Joint Committee should therefore be based on the attached draft decision,

HAS ADOPTED THIS DECISION:

Article 1

The position to be adopted, on behalf of the Union, within the EEA Joint Committee on the proposed amendment to Protocol 31 to the EEA Agreement, on cooperation in specific fields outside the four freedoms, shall be based on the draft decision of the EEA Joint Committee attached to this Decision.

Article 2

This Decision shall enter into force on the date of its adoption.

Done at Brussels,

(1)    OJ L 305, 30.11.1994, p. 6–8

(2)    OJ L 207, 4.8.2015, p. 1.

(3)    OJ L 1, 3.1.1994, p. 3.

EUROPEAN COMMISSION

Brussels, 27.9.2019

COM(2019) 438 final

ANNEX

to the

Proposal for a

COUNCIL DECISION

on the position to be adopted, on behalf of the European Union,

within the EEA Joint Committee concerning an amendment to Protocol 31 to the EEA Agreement, on cooperation in specific fields outside the four freedoms



[Extended Climate Cooperation EU - Iceland - Norway]

ANNEX

DECISION OF THE EEA JOINT COMMITTEE

No […]

of […]

amending Protocol 31 to the EEA Agreement, on cooperation in specific fields outside the four freedoms

THE EEA JOINT COMMITTEE,

Having regard to the Agreement on the European Economic Area (“the EEA Agreement”), and in particular Articles 86 and 98 thereof,

Whereas:

(1)The European Union, Iceland and Norway are committed to reduce their overall greenhouse gas emissions, in view of holding the increase in the global average temperature well below 2°C above pre-industrial levels, and to pursue efforts to limit the temperature increase to 1,5°C above pre-industrial levels.

(2)It is appropriate to extend the cooperation of the Contracting Parties to the EEA Agreement to Regulation (EU) 2018/841 of the European Parliament and of the Council of 30 May 2018 on the inclusion of greenhouse gas emissions and removals from land use, land use change and forestry in the 2030 climate and energy framework, and amending Regulation (EU) No 525/2013 and Decision No 529/2013/EU 1 .

(3)It is appropriate to extend the cooperation of the Contracting Parties to the EEA Agreement to Regulation (EU) 2018/842 of the European Parliament and of the Council of 30 May 2018 on binding annual greenhouse gas emission reductions by Member States from 2021 to 2030 contributing to climate action to meet commitments under the Paris Agreement and amending Regulation (EU) No 525/2013 2 .

(4)It is appropriate to extend the cooperation of the Contracting Parties to the EEA Agreement to certain provisions of Regulation (EU) 2018/1999 of the European Parliament and of the Council of 11 December 2018 on the Governance of the Energy Union and Climate Action, amending Regulations (EC) No 663/2009 and (EC) No 715/2009 of the European Parliament and of the Council, Directives 94/22/EC, 98/70/EC, 2009/31/EC, 2009/73/EC, 2010/31/EU, 2012/27/EU and 2013/30/EU of the European Parliament and of the Council, Council Directives 2009/119/EC and (EU) 2015/652 and repealing Regulation (EU) No 525/2013 of the European Parliament and of the Council 3 , which are essential for the implementation of Regulations (EU) 2018/841 and (EU) 2018/842.

(5)It is appropriate to extend the cooperation of the Contracting Parties to the EEA Agreement to certain provisions of Regulation (EU) No 525/2013 of the European Parliament and of the Council of 21 May 2013 on a mechanism for monitoring and reporting greenhouse gas emissions and for reporting other information at national and Union level relevant to climate change and repealing Decision No 280/2004/EC 4 , which are essential for the implementation of Regulation (EU) 2018/842.

(6)It is appropriate to extend the cooperation of the Contracting Parties to the EEA Agreement to certain provisions of Commission Implementing Regulation (EU) No 749/2014 of 30 June 2014 on structure, format, submission processes and review of information reported by Member States pursuant to Regulation (EU) No 525/2013 of the European Parliament and of the Council 5 , which are essential for the implementation of Regulation (EU) 2018/842.

(7)By this Decision, Iceland and Norway are taking action to fulfil their emissions reduction targets of an at least 40% reduction of greenhouse gas emissions by 2030 compared to 1990 levels.

(8)This Decision is without prejudice to how the EU, Iceland and Norway implement the Paris Agreement.

(9)Budgetary issues are not part of the EEA Agreement. The application of Article 5(6) of Regulation (EU) 2018/842 is therefore without prejudice to the scope of the EEA Agreement.

(10)The EFTA Surveillance Authority should coordinate closely with the Commission whenever it is called to undertake tasks relating to Iceland and Norway pursuant to this Decision.

(11)The competences of the EFTA Surveillance Authority and the EFTA Court pursuant to this Decision are limited to the obligations hereby undertaken.

(12)Protocol 31 to the EEA Agreement should therefore be amended in order to allow for this extended cooperation to take place,

HAS ADOPTED THIS DECISION:

Article 1

The following paragraph shall be inserted after paragraph 7 of Article 3 (Environment) of Protocol 31 to the EEA Agreement:

‘8. (a) Iceland and Norway will fulfil their respective greenhouse gas emission reduction targets for the period from 1 January 2021 to 31 December 2030 in accordance with the following acts:

-32018 R 0841: Regulation (EU) 2018/841 of the European Parliament and of the Council of 30 May 2018 on the inclusion of greenhouse gas emissions and removals from land use, land use change and forestry in the 2030 climate and energy framework, and amending Regulation (EU) No 525/2013 and Decision No 529/2013/EU (OJ L 156, 19.06.2018, p. 1).

The Regulation shall, for the purposes of the present Agreement, be read with the following adaptations:

(i)In Article 6(2), the words “30 years” shall, for Iceland, be read as “50 years”.

(ii)The following shall be added to Article 8(7):

“The EFTA States shall communicate their revised proposed forest reference levels to the EFTA Surveillance Authority no later than nine months after the entry into force of Decision of the EEA Joint Committee No xx of xx/xxxx [this decision] for the period from 2021-2025. The EFTA Surveillance Authority shall publish the proposed forest reference levels communicated to it by the EFTA States.”

(iii)Article 13(2)(a) shall, for the EFTA States, read as follows:

“The EFTA State has submitted a strategy as set out below for the land use, land use change and forestry sector with a perspective of at least 30 years, including also ongoing or planned specific measures to ensure the conservation or enhancement, as appropriate, of forest sinks and reservoirs;

1. By 1 January 2020, each EFTA State shall prepare and submit to the EFTA Surveillance Authority its strategy for the land use, land use change and forestry sector with a perspective of at least 30 years. EFTA States should, where necessary, update these strategies by 1 January 2025.

2. The EFTA States' strategies shall contribute to:

(a) fulfilling the EFTA States' commitments under the UNFCCC and the Paris Agreement to reduce anthropogenic greenhouse gas emissions and enhance removals by sinks and to promote increased carbon sequestration;

(b) fulfilling the objective of the Paris Agreement of holding the increase in the global average temperature to well below 2 °C above pre-industrial levels and to pursue efforts to limit the temperature increase to 1,5 °C above pre-industrial levels;

(c) achieving long-term greenhouse gas emission reductions and enhancements of removals by sinks to the extent relevant for the LULUCF sector, in accordance with the objective, in the context of necessary reductions according to the Intergovernmental Panel on Climate Change (IPCC) to reduce EFTA states greenhouse gas emissions in a cost-effective manner and enhance removals by sinks in pursuit of the temperature goals in the Paris Agreement so as to achieve a balance between anthropogenic emissions by sources and removals by sinks of greenhouse gases in the second half of this century on the basis of equity, and in the context of sustainable development and efforts to eradicate poverty.

3. The EFTA States' strategies shall cover:

(a) emission reductions and enhancements of removals in land use, land-use change and forestry (LULUCF); taking into account bioenergy and biomaterials from this sector.

(b) To the extent it is relevant to land use, land use change and forestry, links to other national long-term objectives, planning and other policies and measures.

4. The EFTA States shall inform and make available to the public forthwith their respective strategies and any updates thereof.

5. The EFTA Surveillance Authority shall assess whether the EFTA States’ strategies are adequate for documenting fulfilment under this Article.

6. The EFTA States’ strategies for the land use, land use change and forestry sector should contain the elements set out below:

A. OVERVIEW AND PROCESS FOR DEVELOPING THE STRATEGIES

A.1. Executive summary

A.2. Legal and policy context, including where appropriate, indicative milestones for 2040 and 2050

B. CONTENT

B.1. LAND USE, LAND-USE CHANGE AND FORESTRY (LULUCF)

B.1.1. Projected emission reductions and enhancement of removals by 2050

B.1.2 To the extent feasible, expected emissions by sources and by individual GHGs

B.1.3. Emission reduction options and options for enhancement of sinks envisaged

B.1.4. To the extent it is relevant for the conservation or enhancement, as appropriate, of forest sinks and reservoirs; adaptation policies and measures

B.1.5 Aspects related to market demand for forest biomass and impact on harvest

B.1.6. As necessary, details on modelling (including assumptions) and/or analysis, indicators, etc.”

(iv)The following shall be added to Article 15(2):

“The Central Administrator shall be competent to perform the tasks referred to in this Article when EFTA States are concerned. The EFTA Surveillance Authority shall be informed if the Central Administrator blocks a transaction concerning or conducted by the EFTA States.”

(v)The following shall be added to the table in Annex II:

“Iceland 0,5102

Norway 0,110 5”

(vi)The following shall be added to the table in Annex III:

“Iceland1990

Norway1990”

(vii) The following shall be added to point (g) of section A of Annex IV:

6 “For the EFTA States, the reference level for the period 2021-2025 shall be consistent with projections reported to the European Environment Agency on a voluntary basis in accordance with Regulation (EU) No 525/2013 and, for Iceland, also in accordance with the bilateral Agreement between Iceland and the European Union and its Member States concerning Iceland’s participation in the joint fulfilment of the commitments of the European Union, its Member States and Iceland for the second commitment period of the Kyoto Protocol to the United Nations Framework Convention on Climate Change.”

(viii)The following shall be added to the table in Annex VII:

“Iceland-0,0224 -0,0045

Norway-29,6-35,5”

-32018 R 0842: Regulation (EU) 2018/842 of the European Parliament and of the Council of 30 May 2018 on binding annual greenhouse gas emission reductions by Member States from 2021 to 2030 contributing to climate action to meet commitments under the Paris Agreement and amending Regulation (EU) No 525/2013 (OJ L 156, 19.06.2018, p. 26).

The Regulation shall, for the purposes of the present Agreement, be read with the following adaptations:

(i)The following shall be added, for the EFTA States, to Article 4(3):

“In respect of the EFTA States, for the purpose of setting out the annual emission allocations for the years from 2021 to 2030 in terms of tonnes of CO2 equivalent as specified in paragraphs 1 and 2 of this Article, the 2005 base year for the emission allocation 2030 will be based on the difference between total greenhouse gas emissions in 2005 resulting from the comprehensive review, which treat CO2 emissions from aviation as zero, and the stationary EU ETS 2005 emissions in 2013 ETS scope as reported in Part B of the Appendix to the Decision of the EEA Joint Committee No 152/2012 of 26 July 2012 7 , adapted with the values for global warming potentials adopted in a delegated act referred to in Article 26(6)(b) of Regulation (EU) 2018/1999 or those identified by the Fourth Assessment Report (AR4) of the Intergovernmental Panel on Climate Change until the delegated act becomes applicable. The stationary EU ETS 2005 emissions figures as reported in the Decision of the EEA Joint Committee No 152/2012 (AR2) and the same figures with updated values for global warming potentials (AR4) to be taken into account for the purpose of setting out the annual emission allocations for the years from 2021 to 2030 pursuant to this Article are set out in the Appendix.”

(ii)The following shall be added after Annex IV:

“Appendix

EFTA States’ stationary EU ETS 2005 emissions figures as reported in the Decision of the EEA Joint Committee No 152/2012 (AR2) and the same figures with updated values for global warming potentials (AR4) to be taken into account for the purpose of setting out the annual emission allocations for the years from 2021 to 2030 pursuant to Article 4(3)

Table 1: 2005 ETS emissions for Norway:

Table 2: 2005 ETS emissions for Iceland:

(iii)In Article 6(1), the words “100 million EU ETS allowances” shall read “107 million EU ETS allowances”

(iv)The following shall be added to Article 12(2):

“The Central Administrator shall be competent to perform the tasks referred to in this Article when EFTA States are concerned. The EFTA Surveillance Authority shall be informed if the Central Administrator blocks a transaction concerning or conducted by the EFTA States.”

(v)The following shall be added to the table in Annex I:

“Iceland    - 29 %

Norway    - 40 %”

(vi)The following shall be added to the table in Annex II:

“Iceland        4 %

Norway        2 %”

(vii)The table in Annex III shall be amended as follows:

(a)The following shall be added to the table:

“Iceland        0,2

Norway        1,6”

(b)The number “280” for the maximum total shall read “281,8”

-32018 R 1999: Regulation (EU) 2018/1999 of the European Parliament and of the Council of 11 December 2018 on the Governance of the Energy Union and Climate Action, amending Regulations (EC) No 663/2009 and (EC) No 715/2009 of the European Parliament and of the Council, Directives 94/22/EC, 98/70/EC, 2009/31/EC, 2009/73/EC, 2010/31/EU, 2012/27/EU and 2013/30/EU of the European Parliament and of the Council, Council Directives 2009/119/EC and (EU) 2015/652 and repealing Regulation (EU) No 525/2013 of the European Parliament and of the Council (OJ L 328, 21.12.2018, p. 1).’

The applicable provisions of this Regulation are listed below and shall, for the purpose of the present Agreement, be read with the following adaptations:

(i)Only the following provisions of the Regulation shall apply:

Articles 2(1)-2(10), 2(12)-(13), 2(15)-2(17), 18, 26(2)-(7), 29(5)(b), 37-42, 44(1)(a), (2)-(3) and (6), 57-58, and Annexes V-VII and XII-XIII.

(ii)Article 2(1)-(10) and 2(12)-(13) and 2(15)-(17) shall, for the purposes of this paragraph only apply to the EFTA States to the extent they relate to the implementation of Regulations (EU) 2018/841 and (EU) 2018/842.

(iii)Article 26(4) shall, for the EFTA States, read as follows:

“Iceland and Norway shall, by 15 April each year, submit to the EFTA Surveillance Authority a copy of the final greenhouse gas inventory data reported to the UNFCCC in accordance with paragraph 3.”

(iv)Article 41 shall, for the EFTA States, only apply to the extent the provisions or parts thereof mentioned in the Article are referred to or set out in [this decision].

(v)The following sentence shall, for the EFTA States, be added after the first sentence of Article 42:

"The European Environment Agency shall only assist the EFTA Surveillance Authority in its work as regards Articles 18, 26(2)-(7), 29(5) (b), 37-39 and 41.”

-32013 R 0525: Regulation (EU) No 525/2013 of the European Parliament and of the Council of 21 May 2013 on a mechanism for monitoring and reporting greenhouse gas emissions and for reporting other information at national and Union level relevant to climate change and repealing Decision No 280/2004/EC (OJ L 165, 18.6.2013, p. 13).

The applicable provisions of this Regulation are listed below and shall, for the purposes of the present Agreement, be read with the following adaptations:

(i)Only the following provisions of the Regulation shall apply:

Articles 7, 19(1) and (3).

(ii)Articles 7, 19(1) and (3) shall, for the purposes of this paragraph, only apply to the EFTA States to the extent they relate to the implementation of Regulation (EU) 2018/842.

-32014 R 0749: Commission Implementing Regulation (EU) No 749/2014 of 30 June 2014 on structure, format, submission processes and review of information reported by Member States pursuant to Regulation (EU) No 525/2013 of the European Parliament and of the Council (OJ L 203, 11.7.2014, p. 23).

The applicable provisions of this Regulation are listed below and shall, for the purposes of the present Agreement be read with the following adaptations:

(i)Only the following provisions of the Regulation shall apply:

Articles 3-5, 7-10, 12-14, 16, 29, 32-34, 36-37 and Annexes I-VIII and Table 2 of Annex XVI.

(ii)Articles 3-5, 7-10, 12-14, 16, 29, 32-34, 36-37 and Annexes I-VIII and Table 2 of Annex XVI shall, for the purposes of this paragraph, only apply to the EFTA States to the extent they relate to the implementation of Regulation (EU) 2018/842.

(b)By virtue of Article 79(3) of the EEA Agreement, Part VII (Institutional Provisions) of the Agreement shall apply to this paragraph.

(c)Protocol 1 to the EEA Agreement (Horizontal Adaptations) shall apply mutatis mutandis to this paragraph.

(d)References to Union legislation, acts, rules, policies and measures in the acts and provisions referred to or contained in this paragraph shall apply to the extent and in the form that the relevant legislation, acts, rules policies and measures are incorporated into this Agreement.

(e)Iceland and Norway shall participate fully in the work of the Climate Change Committee pursuant to the acts and provisions referred to or contained in this paragraph but shall not have the right to vote.

(f) When the Commission consults experts designated by the Member States pursuant to the acts and provisions referred to or contained in this paragraph, it shall consult experts designated by the EFTA States on the same basis.

(g)The European Environment Agency shall assist the EFTA Surveillance Authority in its work pursuant to Regulations (EU) 2018/841 and (EU) 2018/842.

(h)This paragraph shall not apply to Liechtenstein.’

Article 2

This Decision shall enter into force on […], provided that all the notifications under Article 103(1) of the EEA Agreement have been made 8*.

Article 3

This Decision shall be published in the EEA Section of, and in the EEA Supplement to, the Official Journal of the European Union.

Done at Brussels, […].

   For the EEA Joint Committee

   The President

   […]

   The Secretaries

   To the EEA Joint Committee

   […]

Declaration by Iceland and Norway

on national plans related to Decision of the EEA Joint Committee No [this Decision]

Iceland and Norway will, on a voluntary basis, develop national plans describing how Iceland and Norway intend to fulfil the commitments they have undertaken by including the following acts in Protocol 31 to the EEA Agreement:

-Regulation (EU) 2018/841 of the European Parliament and of the Council of 30 May 2018 on the inclusion of greenhouse gas emissions and removals from land use, land use change and forestry in the 2030 climate and energy framework, and amending Regulation (EU) No 525/2013 and Decision No 529/2013/EU (the LULUCF Regulation) and

-Regulation (EU) 2018/842 of the European Parliament and of the Council of 30 May 2018 on binding annual greenhouse gas emission reductions by Member States from 2021 to 2030 contributing to climate action to meet commitments under the Paris Agreement and amending Regulation (EU) No 525/2013 (the Effort Sharing Regulation – ESR).

Iceland and Norway will develop their respective national plans and make them available to the EU Member States, the European Commission, the EFTA Surveillance Authority and the public, by 31 December 2019.

The plans will contain the following main elements:

· An executive summary of the plan;

·An overview of current national climate policies;

·A description of the national Effort Sharing target and LULUCF commitment;

·A description of the main existing and planned policies and measures foreseen to achieve the Effort Sharing target and LULUCF commitment;

·A description of the current national greenhouse gas emissions and removals as well as projections of the Effort Sharing target and LULUCF commitment based on already existing policies and measures;

·An assessment of impacts of the planned national policies and measures to meet the Effort Sharing target and LULUCF commitment, comparing with the projections based on existing policies and measures and describing interactions between existing and planned policies and measures.

(1)    OJ L 156, 19.06.2018, p. 1.

(2)    OJ L 156, 19.06.2018, p. 26.

(3)    OJ L 328, 21.12.2018, p. 1.

(4)    OJ L 165, 18.6.2013, p. 13.

(5)    OJ L 203, 11.7.2014, p. 23.

(6)    OJ L 207, 4.8.2015, p. 1.

(7)    OJ L 309, 8.11.2012, p. 38.

(8) *    [No constitutional requirements indicated.] [Constitutional requirements indicated.]