Subject
Adoption of EU-ETS for shipping sector and amendments
to EU-MRV

TechnicalInformation
No.
DateTEC-1299
24 May 2023

To whom it may concern

Amendments to extend the scope of the EU Directive for EU Emissions Trading System to the shipping
sector (hereinafter EU-ETS Directive) were adopted, with effect from 1 January 2024. Under theseamendments, ships of 5,000 Gross tonnage and above, arriving at or departing from ports within thejurisdiction of any EEA member state1, regardless of the Flag state, will be required to purchase andsurrender2 allowances equivalent to EU ETS applicable GHG emissions on an annual basis. Failure to
do so will result in penalties such as fines and a ban on entry into ports within the EEA territories.
In connection with the application of the EU-ETS Directive, amendments to the EU-MRV Regulations
have also been adopted.
The following is the summary of the EU-ETS Directive on the shipping sector and the amendments tothe EU-MRV Regulations.
1.

Summary of the EU-ETS Directive on the shipping sector(1) Name of the Regulation
Directive (EU) 2023/959 of the European Parliament and of the Council of 10 May 2023 amendingDirective 2003/87/EC establishing a system for greenhouse gas emission allowance trading within
the Union and Decision (EU) 2015/1814 concerning the establishment and operation of a market
stability reserve for the Union greenhouse gas emission trading system (Reference URL 1)(2) Scope of application(i) EU-ETS Directive applies to ships of 5,000 GT or above, arriving at or departing from ports
within the jurisdiction of any EEA member state, regardless of the Flag state(ii) EU-ETS Directive applies to total GHG emissions from the following activities:･ Voyages between an EEA port of call3 and a non-EEA port of call: 50% of the emissions･ Voyages within EEA ports:
100% of the emissions･ Emissions in EEA ports:
100% of the emissions
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3EEA(European Economic Area) Member States: 30 States consist of 27 EU Member States and 3
EEA States, Norway, Iceland and Lichtenstein.
"surrender" roughly means reporting allowances purchased to Administering Authority
electronically.
"port of call" means the port where a ship stops to load or unload cargo or to embark or disembark
passengers, or the port where an offshore ship stops to relieve the crew.
(To be continued)

NOTES:


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ClassNK Technical Information No. TEC-1299(iii) For target GHG emissions, carbon dioxide (CO2) is covered until 2025, and from 2026 onwards
CO2, methane (CH4) and nitrous oxide (N2O) are covered.
(iv) As a phase-in approach, for the first two years after the introduction of this Directive, the CO2
emissions subject to surrender are reduced as follows:･ Emissions in 2024(surrendered in 2025): 40% of the total CO2 emissions in the scope･ Emissions in 2025(surrendered in 2026): 70% of the total CO2 emissions in the scope(v) GHG emissions subject to the EU-ETS Directive are verified in accordance with the EU-MRVregulations. As the EU-ETS requires shipping companies to monitor and report theiraggregated emissions data at company level, EU-MRV regulations are therefore amended tohandle verification of emissions data at company level.
(3) Obligations of shipping companies
Starting from 2024, shipping companies shall purchase allowances equal to the annual GHG
emissions during the preceding year, described in (2) above, and surrender them by September 30of each year. After surrendering the required allowances, if the company is having surplus
allowances, those allowances can be sold or carried over to the following year.
(4) Administering Authority
Under the EU-ETS for shipping, shipping companies are registered in one of the EEA memberstates (Administering Authority), which conducts regulatory compliance checks, etc. The criteria
for registration in Administering Authority are as follows:(i) For a shipping company that is registered in an EEA Member State:
The EEA Member State shall be the Administering Authority.
(ii) For a shipping company not registered in an EEA Member State:･ The Member State with the greatest estimated number of port calls from voyages
performed by that shipping company in the preceding four monitoring years and fallingwithin the scope of EU-ETS for shipping shall be the Administering Authority.
･ If the shipping company did not carry out such voyages in the preceding four monitoring
years, the EEA Member State where a ship of the shipping company has started or ended
its first voyage falling within the scope shall be the Administering Authority.
By 1 February 2024, a list of the Administering Authority where shipping companies are registered will
be published.
(5) Exception of port of call
Under the EU-ETS for shipping, "stops of containerships in a neighbouring container transhipment
port" are excluded from the port of call, and the neighbouring container transhipment ports mean
"neighbouring container transhipment ports where the share of transhipment of containers,
measured in twenty-foot equivalent unit, exceeds 65% of the total container traffic of that port
during the most recent twelve-month period for which relevant data are available located outside
the Union but less than 300 nautical miles of a port under the jurisdiction of a Member State." Itmeans that the voyages preceding and following such ports are considered as consecutive voyages.
By 31 December 2023, a list of such container transhipment ports will be established by theEuropean Commission.
(To be continued)2

ClassNK Technical Information No. TEC-1299(6) Penalties
The excess emissions penalty shall be EUR 100 for each tonne of carbon dioxide equivalent emitted
for which the shipping company has not surrendered allowances. Payment of the excess emissions
penalty shall not release the shipping company from the obligation to surrender an amount ofallowances equal to those excess emissions when surrendering allowances in relation to thefollowing calendar; and in the case of a shipping company that has failed to comply with thesurrender requirements for two or more consecutive reporting periods and where other enforcement
measures have failed to ensure compliance, the competent authority of the Member State of the portof entry may issue an expulsion order.
2.

Summary of the amendments to EU-MRV(1) Name of the Regulation
Regulation (EU) 2023/957 of the European Parliament and of the Council of 10 May 2023
amending Regulation (EU) 2015/757 in order to provide for the inclusion of maritime transport
activities in the EU Emissions Trading System and for the monitoring, reporting and verification ofemissions of additional greenhouse gases and emissions from additional ship types (Reference URL2)(2) Expanding and changing the scope of application(i) Addition of GHGs emissions to monitor
Until emissions for 2023: Carbon dioxide (CO2)
From emissions for 2024: Carbon dioxide (CO2), methane (CH4) and nitrous oxide (N2O)(ii) Addition of applicable ship types and sizes:
From 1 January 2025, the application will be extended to general cargo ships of between 400
gross tonnage and 5,000 gross tonnage, and offshore ships of 400 gross tonnage and above.
(iii) Change of reporting period
From 1 January 2024, "reporting period" means from 1 January until 31 December of any given
year; for voyages starting and ending in two different years, the respective data shall beaccounted under the year concerned.
(iv) In the case of a change of company
The previous company shall submit to the administering authority responsible, to theauthorities of the flag States concerned for ships flying the flag of a Member State, to the newcompany and to the Commission, as close as practicable to the day of the completion of thechange and no later than three months thereafter, a verified emissions report covering theperiod corresponding to the activities carried out under its responsibility.
(3) Update and assessment of a ship's Monitoring Plan
Shipping companies should update monitoring plans for individual ships and submit the MPs thathave been assessed by their verifier to their Administering Authority by 1 April 2024. The updated
monitoring plan needs to contain monitoring methods for CH4 and N2O emissions, which are to beannounced by the Commission by 1 October 2023.
(To be continued)

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ClassNK Technical Information No. TEC-1299(4) In the case of ships falling within the scope of above (3) for the first time after 1 January 2024
Companies shall submit a monitoring plan in conformity with the requirements of this Regulation
to the administering authority responsible without undue delay and no later than three months after
each ship's first call in a port under the jurisdiction of a Member State.
(5) Preparation and submission of emission reports for individual ships and aggregated emissions dataat company level (under the revised EU-MRV regulations)
From 2025, by 31 March of each year, companies shall, for each ship under their responsibility,
submit an emissions report for the entire reporting period of the previous year, which has beenverified as satisfactory by a verifier to the administering authority responsible, to the authorities ofthe flag States concerned for ships flying the flag of a Member State and to the Commission. Also,
companies shall submit to the administering authority by 31 March of each year, the aggregatedemissions data at company level that cover the emissions in the reporting period of the previous
year to be reported under EU-ETS.
3.

ClassNK's support services

ClassNK prepared "FAQs on the EU-ETS for Shipping (1st Edition)," which provides an overview ofthe EU-ETS and relevant information in EU-ETS for shipping sector. We hope that the document will
help maritime stakeholders in their preparations for EU-ETS.
https://www.classnk.or.jp/hp/pdf/authentication/eumrv/EUETS_faq_e.pdf
Once new information on EU-ETS comes out, we will update the FAQ.
ClassNK is updating the system "ClassNK MRV Portal" for verification of EU-MRV/IMO-DCS forshipping companies to submit smoothly updated MPs and company-level ERs. We will inform you once
it is ready.
For your reference, relevant information on the EU-MRV, UK-MRV and EU-ETS is available on
ClassNK website.
Location: Top > Certification Services > EU-MRV･UK-MRV regulations / EU-ETS for shipping sector
URL: https://www.classnk.or.jp/hp/en/authentication/eumrv/

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ClassNK Technical Information No. TEC-1299

For any questions about the above, please contact:
NIPPON KAIJI KYOKAI (ClassNK)
Marine GHG Certification Department DCS Section, Administration Center, Head Office
Address:
4-7 Kioi-cho, Chiyoda-ku, Tokyo 102-8567, JapanTel.:+81-3-5226-3025
Fax:+81-3-5226-3026
E-mail:dcs@classnk.or.jp

Reference URL:
1.
2.

DIRECTIVE(EU)2023/959 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of
10 May 2023
REGULATION(EU)2023/957 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
of 10 May 2023

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