EUROPEAN COMMISSION Brussels,8.11.2017 COM(2017) 676 final 2017/0293(COD) Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL setting emission performance standards for new passenger cars and for new light commercial vehicles as part of the Union's integrated approach to reduce CO2 emissions from light-duty vehicles FMT:Highlight=16and amending Regulation (EC) No 715/2007 /FMT (recast) (Text with EEA relevance) {SWD(2017) 650 final}



{SWD(2017) 651 final}



EXPLANATORY MEMORANDUM 1.CONTEXT OF THE PROPOSAL •Reasons for and objectives of the proposal The automotive sector is of particular importance for the EU, providing jobs for more than 12 million people in manufacturing, sales, maintenance and transport. The EU car industry as part of the global automotive sector is currently facing fundamental transformations. Digitalization and automation are altering traditional manufacturing processes. Innovation in electrified power trains, autonomous driving and connected vehicles constitute major challenges which may fundamentally transform the sector. In addition, the share of the EU car market in global sales has declined in the last decade from around a third to around 20%, putting additional pressure on EU industry to reach out to new markets. Following the Paris Agreement, the world has committed to move towards a low-carbon economy. Many countries are now implementing policies for low-carbon transport, including vehicle standards, often in combination with measures to improve air quality. Until now, the CO2 emission reduction standards for cars and vans in place in Europe have represented a fundamental tool to push for innovation and investments in low carbon technologies. But today, in the absence of tighter standards for the period beyond 2020, the EU risks losing its technological leadership in particular with respect to zero/low emission vehicles, with the US, Japan, South Korea and China moving ahead very quickly. China has just introduced mandatory quotas for zero/low-emission vehicles for car manufacturers from 2019 on. In the US, California and nine other States have successfully established a regulatory instrument to enhance the uptake of zero/low-emission vehicles. The strategic importance of zero/low emission vehicles for car manufacturers is underpinned by numerous recent announcements that the share of electrified powertrains in their global sales will significantly increase in the coming years. The EU automotive industry must become a global leader in these new technologies, as is currently the case with conventional car technologies. Consumers in the EU miss out on possible fuel savings under the current regulatory framework. According to the evaluation of the current CO2 Regulations, the fuel savings resulting from the CO2 standards significantly outweigh the additional purchase cost but lifetime fuel expenditure savings have been lower than anticipated, primarily because of the increasing divergence between test cycle and real world emissions performance. If the 'emissions gap' is reduced and technologies delivering fuel savings under real world conditions are fitted to new vehicles, consumers would benefit even more. The Commission's European Strategy for Low-Emission mobility, published in July 2016, sets the ambition that by 2050 greenhouse gas (GHG) emissions from transport will need to be at least 60 % lower than in 1990 and firmly on the path towards zero. Air pollutant emissions from transport need to be drastically reduced without delay. The Strategy also made clear that the deployment of low- and zero-emission vehicles would need to increase in order to gain significant market share by 2030 and set the EU firmly on the long-term trajectory towards zero-emission mobility. The Strategy was, in a first step, implemented by the May 2017 Communication 'Europe on the Move: An agenda for a socially fair transition towards clean, competitive and connected mobility for all'. It makes clear that the EU aims for the best low-emission, connected and automated mobility solutions, equipment and vehicles to be developed, offered and manufactured in Europe and to have in place the most modern infrastructure to support them. The Communication underlines that the EU must be a leader in shaping on-going changes in the automotive sector at a global level, building on the key progress already made. The current CO2 emission standards for cars and vans until 2020/21 have contributed to significantly reduce CO2 emissions from light duty vehicles. However, with current implemented policies GHG emissions are not expected to sufficiently decrease to reach the 2030 EU target of at least 40% emission reduction compared to 1990. Road transport was responsible for 22% of EU GHG emissions in 2015 with a steady increase of this share since 1990. Cars and vans accounted for 73% of road transport GHG emissions in 2015. While the transport sector has considerably reduced its emissions of air pollutants in the EU over the last decades, it remains the largest contributor to NOx emissions. Zero-emission vehicles do not only contribute to the reduction of CO2 emissions from road transport, but also deliver benefits in terms of air pollutant emission free transport. This proposal sets cost-effective CO2 emission reduction targets for new light-duty vehicles up to 2030 combined with a dedicated incentive mechanism to increase the share of zero/low-emission vehicles. This will ensure that the EU automotive industry maintains its technological leadership, thus strengthening its competitiveness and stimulate employment. It will also reduce fuel consumption costs for consumers. It will at the same time contribute to the achievement of the EU's commitments under the Paris Agreement. The incentive mechanism to increase the share of zero/low-emission vehicles will in particular contribute to the reduction of air pollutants and in turn increase air quality with public health benefits. It complements on-going efforts to address air quality problems at urban, regional, and national level. More specifically, it will provide a clear signal and predictability for industry to invest, stimulate employment, foster innovation and competitiveness. In addition, it will accelerate the deployment of zero/low-emission vehicles and the development of fuel efficient technologies in the EU and thus provide the basis for maintaining the EU automotive industry's success in global markets. Supported by the necessary flanking measures at EU and national levels, investments in charging infrastructures are expected to take place. New dedicated governance mechanisms will ensure that CO2 emission and fuel consumption values remain representative of the values experienced by consumers on the road. The proposal also ensures that efforts among the manufacturers are fairly distributed. This proposal is part of a broader mobility package which includes demand-side actions supporting the supply-side measures of this proposal. Directive 2009/33/EC on the promotion of clean, energy-efficient road vehicles seeks to stimulate the market for clean, energy-efficient vehicles. The proposed amendment ensures that the Directive covers all relevant procurement practices, that it provides clear, long-term market signals and that its provisions are simplified and effective to use. It should improve the contribution from the transport sector to the reduction of CO2 and air pollutant emissions and to competitiveness and growth of the sector. The Alternative Fuels Infrastructure Directive addresses the provision of common standards on the internal market, requirements for appropriate minimum infrastructure, to be developed through national policy frameworks, and consumer information on the compatibility of fuels and vehicles. The Action Plan on Alternative Fuels Infrastructure outlines a set of recommendations to reinforce implementation of National Policy Frameworks (NPFs) under the Directive and improve planning and financing of inter-operable fuels infrastructure. A battery initiative shall help to establish a complete value-chain for the development and manufacturing of batteries in the EU. In addition, in the first half of 2018, the Commission plans to table CO2 emission reduction targets for new heavy-duty vehicles. •Consistency with existing policy provisions in the policy area

This proposal will contribute to the Energy Union Framework Strategy goal to bring about the transition to a low-carbon, secure and competitive economy. It will help to meet the objectives set out in the EU 2030 framework for climate and energy, which includes targets of an at least 40% cut in domestic EU GHG emissions compared to 1990 levels. The GHG emission reductions in the non-ETS sectors, which include road transport, will have to amount to at least 30% by 2030 compared to 2005. The Commission has proposed 2030 GHG emission reduction targets for Member States under the Effort Sharing Regulation covering the non-ETS sectors. CO2 standards for light-duty vehicles for the period after 2020 will help Member States to achieve those targets. Moreover, the Emissions Trading System (ETS) as a cornerstone of the EU's climate policy contributes to decarbonise the power sector which will play an increasing role in road transport with a higher share of electrified vehicles. FP7 and Horizon 2020 have provided a total funding of more than EUR 1.5 billion to support research and development of batteries, alternative fuels and all aspects of vehicle electrification. The Commission's 2016 proposal for a revised Renewable Energy Directive (RED II) seeks to reduce GHG emissions in fuels through the introduction of an EU-level obligation for fuel suppliers to provide by 2030 a 6.8% minimum share of low-emission and renewable fuels including renewable electricity and advanced biofuels. The proposed revision of the Eurovignette Directive foresees charges based on emissions performance which will make it possible to reward the most environmentally-friendly vehicles and incentivise the renewal of the vehicle fleet. •Consistency with other Union policies As highlighted in the recently adopted Renewed Industrial Policy Strategy, a modern and competitive automotive industry is key for the EU economy. However, for the sector to maintain its technological leadership and thrive in global markets, it will have to accelerate the transition towards more sustainable technologies and new business models. Only this will ensure that Europe will have the most competitive, innovative and sustainable industry for 2030 and beyond. In addition, the Commission's Blueprint initiative for Sectoral Cooperation on Skills launched in May 2016 includes the automotive sector as one of the sectors targeted. It offers the possibility for project applications to bring together key stakeholders from the social partners to identify qualification and skills challenges combined with the roll-out of tailored strategies at national or regional level to address these challenges. 2.LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY •Legal basis The legal basis for this proposal is Article 192 TFEU. In accordance with Article 191 and 192(1) TFEU, the European Union shall contribute to the pursuit, inter alia, of the following objectives: preserving, protecting and improving the quality of the environment; promoting measures at international level to deal with regional or worldwide environmental problems, and in particular combating climate change. •Subsidiarity (for non-exclusive competence) CO2 emission standards for cars and vans have been in place at EU level since 2009 and 2011 respectively setting targets until 2020/21. Without further EU action in this field it is likely there would be little additional substantial CO2 reduction from new light-duty vehicles, as seen in the EU in the period between 1995 and 2006 for cars. Some reduction in emissions would still be expected beyond 2021 due to the continuing renewal of the existing fleet with newer cars and vans meeting the 2020/21 CO2 standards. However, with transport activity expected to further increase, the overall CO2 reductions would not be sufficient to reach the 2030 GHG reduction target and the commitments under the Paris Agreement. EU action is justified in view of both the cross-border impact of climate change and the need to safeguard single markets in vehicles. Without EU level action there would be a risk of a range of national schemes to reduce light duty vehicle CO2 emissions. If this were to happen it would result in differing ambition levels and design parameters which would require a range of technology options and vehicle configurations, diminishing economies of scale. National and local initiatives alone are likely to be less effective as they risk being incoherent, thus fragmenting the internal market. Since manufacturers hold differing shares of the vehicle market in different Member States they would therefore be differentially impacted by various national legislations potentially causing competitive distortions. This would raise compliance costs for manufacturers as well as weaken the incentive to design fuel efficient cars and vans because of the fragmentation of the European market. The additional costs which would arise from the lack of common standards and common technical solutions would be incurred by both component suppliers and vehicle manufacturers. However, they ultimately would be passed on to consumers who would face higher vehicle costs for the same level of greenhouse gas reduction without coordinated EU action. •Proportionality This proposal complies with the proportionality principle because it does not go beyond what is necessary in order to achieve the objectives set. The proposal sets new standards in a cost-effective manner in order to achieve the required CO2 emissions reductions from cars and vans in line with the agreed EU 2030 climate and energy framework while at the same ensuring a fair distribution of efforts among manufacturers. •Choice of the instrument Since this proposal is a recast of two existing Regulations, a Regulation is the only appropriate instrument.

The recast technique allows in this case the merger of the two largely similar earlier Regulations into a single legislative text which makes the desired amendments, codifies those amendments with the unchanged provisions of the earlier acts, and repeals those acts. The proposed recast Regulation is in line with the Commission's commitment under the interinstitutional agreement on better law-making. 3.RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS •Ex-post evaluations/fitness checks of existing legislation An extensive evaluation of the existing regulations was carried out as part of the Regulatory Fitness Programme (REFIT). This was completed in April 2015 and the final report of the consultants has been published. The evaluation report assessed the regulations against the objectives set in the original legislation. It concluded that the regulations were still relevant, broadly coherent, and had generated significant emissions savings, while being more cost-effective than originally anticipated for meeting the targets set. They also generated significant EU added value that could not have been achieved to the same extent through national measures. Key conclusions of the evaluation were as follows: ·The Regulations are still valid and will remain so for the period beyond 2020. ·The Regulations have been more successful in reducing CO2 than previous voluntary agreements with industry. ·The passenger car CO2 Regulation is likely to have accounted for 65-85% of the reductions in tailpipe emissions achieved following its introduction. For light commercial vehicles (LCVs), the Regulation had an important role in speeding up emissions reductions. ·Impacts on competitiveness and innovation appear generally positive with no signs of competitive distortion. ·The evaluation report highlighted the following weaknesses: ·The NEDC test cycle does not adequately reflect real-world emissions and there is an increasing discrepancy between test cycle and real-world emissions performance which has eroded the benefits of the Regulations. ·The Regulations do not consider emissions due to the production of fuels or associated with vehicle production and disposal. ·Some design elements (modalities) of the Regulations are likely to have had an impact on the efficiency of the Regulations. In particular, the use of mass as the utility parameter penalises the mass reduction as an emissions abatement option. ·The Regulations have generated net economic benefits to society. ·Costs to manufacturers have been much lower than originally anticipated as emissions abatement technologies have, in general, proved less costly than expected. ·Lifetime fuel expenditure savings exceed upfront manufacturing costs, but have been lower than anticipated, primarily because of the increasing divergence between test cycle and real world emissions performance. ·The Regulations are largely coherent internally and with each other. ·Modalities potentially weakening the Regulations, albeit with limited impacts, are the derogation for niche manufacturers, super-credits and the phase-in period (cars). ·The harmonisation of the market is the most crucial aspect of EU added-value and it is unlikely that uncoordinated action would have been as efficient. The Regulations ensure common requirements, thus minimising costs for manufacturers, and provide regulatory certainty.

•Stakeholder consultations The Commission sought feedback from stakeholders through the following elements: ·a public on-line consultation between 20 July and 28 October 2016 ·a stakeholder workshop (24 March 2017) to present the results of the public consultation; ·a stakeholder workshop dedicated to jobs and skills (26 June 2017); ·meetings with relevant industry associations representing car manufacturers, components and materials suppliers, fuel suppliers. ·bilateral meetings with Member State authorities, vehicle manufacturers, suppliers, social partners and NGOs; ·position papers submitted by stakeholders or Member States. A synopsis of the stakeholder consultation is provided in Annex 2 of the Impact Assessment for this proposal. The main outcomes of the stakeholder consultations can be summarised as follows. Concerning target levels, cars and vans manufacturers in general support less ambitious target levels for 2030 compared to environment and transport NGOs as well as consumer organisations that are in favour of more ambitious target levels for both 2025 and 2030. As regards the distribution of efforts, manufacturers support a limit value curve based on mass, whereas environment and transport NGOs as well as consumer organisations prefer footprint as utility parameter. While the automotive industry is mostly against a LEV/ZEV mandate, battery and electricity producers, and infrastructure investors, many European cities facing air quality problems, as well as most environment and transport NGOs call for such an approach. Consumer organisations take a neutral position on LEV/ZEV incentives. •Collection and use of expertise The Impact Assessment draws on evidence from the evaluation of the existing Regulations. For the quantitative assessment of the economic, social and environmental impacts, the Impact Assessment report relies on a dedicated set of cost curves, covering a broad range of up-to-date technologies for reducing CO2 emissions from cars and vans, and a suite of models. A range of scenarios was developed through the PRIMES-TREMOVE model, projecting the evolution of the road transport sector. This analysis was complemented by applying other modelling tools, such as GEM-E3 and E3ME (for the macro-economic impacts) and the JRC DIONE model, with newly developed features to assess impacts at manufacturer (category) level. Data on greenhouse gas emissions and other characteristics of the new light-duty vehicle fleet was sourced from the annual monitoring data reported by Member States and collected by the European Environment Agency (EEA) under Regulations 443/2009 and 510/2011 on CO2 emissions from light-duty vehicles. In addition to the stakeholder consultations, further information was gathered through several support studies commissioned from external contractors, in particular addressing the following issues: ·the available technologies that can be deployed in the relevant time period to reduce new LDV CO2 emissions, as well as their effectiveness and cost; ·elements potentially impacting industrial competitiveness and employment; ·growing gap between test and real driving emissions and the factors contributing to this; ·the impact of different regulatory approaches, regulatory metrics and possible design elements (modalities); ·impacts on GHG and pollutant emissions.

A list of studies is provided in Annex 1 of the Impact Assessment for this proposal. •Impact assessment The Impact Assessment accompanying this proposal has been prepared and developed in line with the applicable Better Regulation guidance, and the Regulatory Scrutiny Board has issued a positive opinion with reservations on 13 October 2017. Improvements as recommended by the Board have been incorporated in the final version. This concerns the following: (1) description of the links with other EU policy initiatives, in particular the broader mobility packages presented by the Commission; (2) explanation of the main bottlenecks hampering the uptake of zero- and low-emission vehicles and how the proposed Regulation would contribute to addressing them; (3) clarification of the competitiveness challenge for the EU industry, in particular in terms of the risk of losing technological leadership and how the proposed Regulation can address it; (4) identification of the key trade-offs for the political decision; (5) assessment of the regulatory burden and the potential for simplification. Policy options The policy options considered in the impact assessment are grouped into five key elements which are to address the identified problems and achieve the policy objectives. 1)Targets (level, timing and metric) Different target levels were assessed for the period until 2030, ranging from 10% to 40% reduction in 2030 compared to the 2021 EU fleet-average target for cars and the 2020 target for vans. Two options reflecting the target levels indicated by the European Parliament, which the Commission committed to assess during the 2014 negotiations, were also assessed. Concerning the timing of the targets, the options considered included setting a target for 2030 only, setting targets for 2025 and 2030 as well as setting annual targets for each of the years 2022-2030. As for the metric for expressing the target, options considered included the current approach based on tailpipe emissions ("tank to wheel") as well as alternative options ("well to wheel", "embedded emissions", "mileage weighting"). The preferred option for the target levels is to set new EU fleet-wide CO2 targets equal to a 30% reduction in 2030 compared to the 2021 targets, both for cars and for vans. The preferred option for the emission target metric is to maintain the Tank-to-Wheel (TTW) approach with targets set in g CO2/km for the sales-weighted average of the fleet because this approach is fully consistent with other policy instruments and changing the metric would not have delivered major benefits. The preferred option for the timing of the targets is to set new CO2 targets for cars and vans applying from 2025 and stricter targets applying from 2030 on in order to ensure that required cumulative CO2 emission reductions are achieved by 2030 to help meeting the targets set under the Effort Sharing Regulation. Such an approach will also provide a clear and early signal for the investment in low- and zero-emission vehicles. 2)Distribution of effort Under the current Regulations, a limit value line is used to define the specific emission targets for individual manufacturers, starting from the EU-wide fleet targets. This linear curve defines the relation between the CO2 emissions and the vehicle mass in running order. Besides the current approach, the following options were considered in the impact assessment: changing the slope of the limit value line, using another utility parameter (e.g. footprint) or using no utility parameter (equal reduction or equal target for all manufacturers). The preferred option for distributing the EU-wide fleet targets across individual manufacturers from 2025 on, is to use a limit value curve, with the manufacturer specific targets depending on the average WLTP test mass of the vehicles and with the slope(s) of the curve ensuring an equivalent reduction effort amongst manufacturers. 3)ZEV/LEV incentives (definitions and types of incentives) Using different definitions for low-emission vehicles (LEV), the impact assessment considered two different types of specific incentives for ZEV/LEV: ·Binding mandate: The same ZEV/LEV share would be required from all manufacturers. ·Crediting system: This incentive would take into account a manufacturer’s share of ZEV/LEV when setting its specific CO2 target. A manufacturer exceeding a certain benchmark level of ZEV/LEV would be rewarded by getting a less strict CO2 target. For each of the two types different mandate/benchmark levels were considered.

The preferred option as regards the LEV/ZEV incentive mechanism is a crediting system. 4)Elements for cost-effective implementation Different elements that allow for cost-effective implementation were assessed. These include measures already included in the current Regulations such as eco-innovations, pooling, and derogations. In addition, new elements were considered such as trading as well as banking and borrowing. The preferred option is to maintain the eco-innovation provisions, while extending the scope to air-conditioning systems and allowing for a revision of the 7 g/km cap, to maintain the pooling provisions, while clarifying how manufacturers may form open pools, not to introduce the possibility for trading, nor for banking or borrowing of CO2 credits and to remove the possibility for car manufacturers to be granted a "niche" derogation. 5)Governance The effectiveness of the targets in reducing CO2 emissions in reality depends on the one hand on the representativeness of the test procedure with respect to average real-world driving, and on the other hand on the extent to which the vehicles placed on the market conform to the reference vehicles tested at type approval. In this context, the European Parliament Recommendation following the inquiry into emission measurements in the automotive sector stressed that market surveillance mechanisms are critical for maintaining a reliable and trustworthy system. Against that background and in line with the Recommendations of the Scientific Advice Mechanism (SAM), several options have been considered. A first one was the collection, publication, and monitoring of real world fuel consumption data based on an obligation for manufacturers to fit a standardized 'fuel consumption measurement devices' in new vehicles through type-approval legislation. A second one related to market surveillance measures are considered in relation to conformity of production and in service conformity checks. The preferred option is to establish an empowerment for the Commission to allow (i) the collection, publication and monitoring of real world fuel consumption data and creating an obligation to report deviations linked to a correction mechanisms and (ii) to correct reported CO2 emission values in case of deviations detected through improved market surveillance. Reference of the Executive Summary of the Impact Assessment: SWD(2017)650 Reference of the opinion of the Regulatory Scrutiny Board: SEC(2017)476 •Regulatory fitness and simplification In line with the Commission commitment to Better Regulation, the proposal has been prepared inclusively, based on transparency and continuous engagement with stakeholders. The Impact Assessment has also analysed how to possibly simplify the legislation and reduce unnecessary administrative costs. Manufacturers responsible for less than 1,000 newly registered vehicles per year, in many cases SMEs, remain exempt from meeting specific CO2 emissions targets. De minimis exemptions reduce compliance and administrative costs for small manufacturers. It also facilitates the market entry of new manufacturers whilst having no significant impacts on the overall CO2 reductions of the overall EU vehicles fleet. Moreover, the proposal maintains several elements for cost-effective implementation such as pooling which reduce compliance costs for manufacturers. The crediting system for zero- and low-emission vehicles would not create additional administrative burden. The deletion of the derogation for niche manufacturers will reduce administrative burden. No changes in the compliance regime and in the level of fines are foreseen. The impacts of the options related to governance will depend on the concrete implementing measures. •Fundamental rights The proposal respects the fundamental rights and observes the principles recognised in particular by the Charter of Fundamental Rights of the European Union. 4.BUDGETARY IMPLICATIONS

The proposal does not require additional financial resources. 5.OTHER ELEMENTS •Implementation plans and monitoring, evaluation and reporting arrangements The proposal builds on the annual reporting and monitoring procedure that has been established under the current Regulations. In order to assess the compliance of manufacturers with their annual specific emissions targets, Member States report every year data for all newly registered cars and vans to the Commission. In addition to the type-approved CO2 emission and mass values, a number of other relevant data entries are monitored, including fuel type and CO2 emission savings from eco-innovations. The Commission, supported by the European Environment Agency (EEA), publishes every year the monitoring data of the preceding calendar year including manufacturer specific CO2 performance calculations. Manufacturers have the opportunity to notify errors in the provisional data, as submitted by Member States. This well-established monitoring system constitutes an important basis for monitoring the impacts of the legislation. In order to strengthen the governance aspects of the monitoring system, the impact assessment considered the option to take into account, for the manufacturer compliance check, whether the emissions of vehicles in use are in conformity with the type approved CO2 values. In addition to the compliance assessment procedure, the impact assessment identified a list of core indicators to monitor the specific policy objectives to be achieved with this proposal. These are complemented by a set of operational objectives and indicators. • Detailed explanation of the specific provisions of the proposal Article 1- Subject matter and objectives This Article specifies the EU fleet wide CO2 targets applicable to new passenger cars and new light commercial vehicles from 2020, 2025 and 2030. The Regulation is to apply from 2020 in order to ensure a coherent transition to a new target regime starting from 2025. It therefore includes the already established EU fleet wide targets for 2020 of 95g/km (NEDC based) for passenger cars and 147g/km (NEDC based) for light commercial vehicles, as well as new targets for 2025 and 2030. Starting from 2021, the specific emission targets will be based on the new emissions test procedure, the Worldwide Harmonised Light Vehicle Test Procedure (WLTP). Therefore, the 2025 and 2030 fleet wide targets, which are WLTP based, are expressed as percentage reductions compared to the average of the specific emission targets for 2021 determined for each manufacturer in accordance with section 4 of Annex I. Article 2- Scope This Article defines the categories of vehicles that fall within the scope of this Regulation by reference to the type approval legislation. It also clarifies that the de minimis exemption applicable to manufacturers responsible for less than 1000 new registrations per year should not apply where a manufacturer eligible for such an exemption nevertheless applies for and is granted a derogation. Article 3 - Definitions New definitions have been added for "EU fleet-wide targets", "zero- and low-emission vehicles" and "test mass". Article 4 - Specific emission targets This Article sets out the general obligation for a manufacturer to ensure that the average CO2 emissions of its fleet of newly registered vehicles in a calendar year do not exceed its annual specific emissions target. That target is manufacturer specific and is calculated as a function of the applicable EU fleet wide target, the limit value curve, the average mass of the manufacturer's fleet and the reference mass (M0 or TM0). The mass calculation is based on mass in running order until 2024 inclusive. From 2025 the vehicle's test mass, which is closer to the real mass of the finished vehicle, should be used instead. The formulae for the calculations of the specific emission targets for the period from 2020 to 2030 are set out in Parts A and B of Annex I. The target calculations applicable in 2020 to 2024 are those set out in existing legislation. From 2025, the specific emissions target for a manufacturer should be calculated taking into account the share of zero- and low-emission vehicles in the manufacturer's fleet. For the calculation of that share, the zero- and low-emission vehicles should be counted based on a weighting of the emissions of each vehicle. Where the share exceeds the EU fleet-wide benchmark, the manufacturer benefits from a higher specific emissions target. In the case of light commercial vehicles, a distinction is made in the distribution of the effort between manufacturers of light commercial vehicles with an average test mass exceeding the average reference mass (TM0) and those with an average test mass lower than TM0. For the first group, the slope of the limit value curve is kept constant over time, while in the latter case the same approach as for passenger cars is used, i.e. the slope is modified according to the EU fleet wide target. Article 5 - Super credits for the 95 g CO2/km target for cars

This provision is unchanged and applies until 2022 inclusive. Article 6 - Pooling The provisions on pooling for connected undertakings and independent manufacturers remain unchanged. However, an empowerment has been added for the Commission to clarify the conditions for pooling arrangements between independent manufacturers, in particular with regard to competition rules. Article 7 - Monitoring and reporting The general provisions on the monitoring of CO2 data from Member States remain unchanged. However, a strengthening of the obligation on Member States to ensure high quality data and cooperate with the Commission has been added. A mechanism is added to take into account for the purpose of the monitoring deviations found in the CO2 emissions of vehicles in use as compared to the type approval values. This mechanism builds on the proposal to introduce a procedure for in-service conformity checks of the CO2 emission values in type approval legislation. Type approval authorities should report any deviations detected, and the Commission should take those into account when checking manufacturers' compliance with their targets. The provision includes an empowerment for the Commission to provide the details for such a procedure by way of an implementing act. Article 8 - Excess emission premium This Article sets out the formula for calculating the financial penalties in case a manufacturer exceeds its target. The excess emission premium from the existing Regulations is maintained, i.e. 95 euro/g CO2/km. Article 9 - Publication of performance of manufacturers The Article lists the data that the Commission shall publish with regard to manufacturers' annual target compliance (i.e. the annual monitoring decision). Test mass has been added as a data parameter to be published, in view of its use as utility parameter from 2025 onwards, as well as a vehicle's electric range. Article 10 - Derogation for certain manufacturers The possibility for small volume manufacturers (i.e. those responsible for 1,000 to 10,000 registrations for cars, and 1,000 to 22,000 registrations for vans) to apply for a derogation from their specific emissions targets is maintained. However, for niche manufacturers of cars, i.e. those responsible for between 10,000 and 300, 000 new registered vehicles, the possibility to benefit from a derogation from the 95g CO2/km target remains. However, with effect from 2025 this group of manufacturers will have to meet the specific emission targets calculated in accordance with Annex I. Article 11 - Eco-innovations Manufacturers may continue to benefit from lower average emissions by fitting their vehicles with eco-innovations approved in accordance with this Article. In order to take into account the changes in eco-innovation savings that may occur as a result of the change in the regulatory test procedure, an empowerment for the Commission to adjust the 7 g CO2/km cap set on the CO2 savings that a manufacturer may take into account for reducing its average emissions has been added. This empowerment should apply from 2025 onwards. The eligibility criteria for being considered an eco-innovation remain unchanged until 2024 inclusive. From 2025 the removal of the reference to the integrated approach measures will allow mobile air-conditioning equipment to be eligible as an eco-innovation. Article 12 - Real world CO2 emissions and energy consumption This Article provides an empowerment for the Commission to monitor and assess the real world representativeness the WLTP test procedure and to ensure that the public is informed of how that representativeness evolves over time. For that purpose, the Commission should have the power to request real world data to be collected and reported by Member States and manufacturers. Article 13 - Adjustments of M0 and TM0

The CO2 reduction effort is distributed among manufacturers on the basis of the average mass of the vehicle fleet over a certain period. That reference value is expressed as M0 or TM0 depending on whether mass in running order (M) or the vehicle test mass (TM) is used. The provision clarifies the process for adjusting the reference mass value to ensure that the specific emission targets continue to reflect the EU fleet wide target. With effect from 2025, the frequency of those adjustments should increase from every three years to every second year. A more frequent adjustment will allow changes in the average test mass and their effect on the positioning of manufacturers on the limit value curve to be taken into account earlier. Article 14 - Review and report This Article includes a requirement for the Commission to provide a report on the effectiveness of this Regulation, where appropriate accompanied by a proposal. The report is proposed to be submitted in 2024 to align it with the review and reporting provisions proposed under the Effort Sharing Regulation and the Emissions Trading Directive. The Article also maintains provisions on the review of the type approval test procedure as well as the empowerments for taking into account changes in the regulatory test procedure. Articles 15 and 16 - Comitology and delegation of powers These are standard provisions on the committee procedure and the delegation of powers. Article 17 - Amendment to Regulation (EC) No 715/2007 This amendment aims to introduce a legal basis in Regulation (EC) No 715/2008 (Euro 5/6 emissions type approval regulation) for the Commission to set up an in-service conformity procedure for verifying CO2 emission. This procedure is essential for an effective market surveillance of the type approval system and the CO2 emission values used for target compliance purposes. Article 18 and 19 - Repeal and entry into force Regulations (EC) No 443/2009 and (EU) No 510/2011 are repealed with effect from 1 January 2020. Entry into force should take place within 20 days of publication of the act. Annexes I to V Annex I: sets out the formulae for calculating the annual specific emissions targets that should be achieved by the average emissions of the manufacturers' fleets of newly registered vehicles. Part A covers passenger cars, while Part B covers light commercial vehicles. Annex II and III: These Annexes set out the monitoring data parameters that are needed for the calculation of the targets and for checking target compliance. Annex III – covering light commercial vehicles – also makes reference to the need to consider the specificities of vehicles that are type approved in multiple stages. Annex IV: This Annex lists the legal acts covered by the recast, i.e. the two basic Regulations (EC) No 443/2009 and (EU) No 510/2011 with their respective amending acts. Annex V: The correlation table ê 510/2011 (adapted) ð new 2017/0293 (COD)

Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL setting emission performance standards Ö for new passenger cars and Õ for new light commercial vehicles as part of the Union's integrated approach to reduce CO2 emissions from light-duty vehicles ð and amending Regulation (EC) No 715/2007 ï (recast) (Text with EEA relevance) THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty on the Functioning of the European Union, and in particular Article 192(1) thereof, Having regard to the proposal from the European Commission, After transmission of the draft legislative act to the national parliaments Having regard to the opinion of the European Economic and Social Committee, Having regard to the opinion of the Committee of the Regions, Acting in accordance with the ordinary legislative procedure, Whereas: ò new (1)Regulation (EC) No 443/2009 of the European Parliament and of the Council and Regulation (EU) No 510/2011 of the European Parliament and of the Council have been substantially amended several times. Since further amendments are to be made, those Regulations should be recast in the interests of clarity. (2)This Regulation should apply from 1 January 2020 in order to provide a coherent and efficient transition following the recast and repeal of Regulations (EC) No 443/2009 and (EU) No 510/2011. However, it is appropriate to maintain the CO2 performance standards and the modalities for achieving them as set out in those Regulation without changes until 2024. ê 443/2009 recital 1 The objective of this Regulation is to set emission performance standards for new passenger cars registered in the Community which forms part of the Community's integrated approach to reducing CO2 emissions from light-duty vehicles while ensuring the proper functioning of the internal market.

ê 510/2011 recital 1 (adapted) The United Nations Framework Convention on Climate Change, which was approved on behalf of the European Community by Council Decision 94/69/EC (3), seeks to stabilise greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system. In order to meet this objective, the overall global annual mean surface temperature increase should not exceed 2 degrees Celsius above pre-industrial levels. The Intergovernmental Panel on Climate Change's (IPCC) fourth Assessment Report shows that in order to reach that objective, global emissions of greenhouse gases must peak by 2020. At its meeting of 8-9 March 2007, the European Council made a firm commitment to reduce the overall greenhouse gas emissions of the Community by at least 20 % compared to 1990 levels by 2020 and by 30 % provided that other developed countries commit themselves to comparable emission reductions and economically more advanced developing countries contribute according to their respective capabilities. ò new (3)The European Strategy for Low-Emission Mobility sets a clear ambition: by mid-century, greenhouse gas emissions from transport will need to be at least 60% lower than in 1990 and be firmly on the path towards zero. Emissions of air pollutants from transport that harm our health need to be drastically reduced without delay. Emissions from conventional combustion engines will need to further reduce after 2020. Zero- and low emission vehicles will need to be deployed and gain significant market share by 2030. (4)The Commissions Communications "Europe on the move" and "Delivering on the European Strategy for low-emission mobility A European Union that protects the planet, empowers its consumers, and defends its industry and workers" highlight that the CO2 emissions standards for passenger cars and light commercial vehicles are a strong driver for innovation and efficiency and will contribute to strengthening competitiveness of the automotive industry and pave the way for zero and low-emission vehicles in a technology-neutral way. (5)This Regulation provides a clear pathway for CO2 emissions reductions from the road transport sector and contributes to the binding target of at least a 40% domestic reduction in economy-wide greenhouse gas emissions by 2030 compared to 1990, as was endorsed in the Conclusions of the European Council of 23-24 October 2014, and approved as the Union Intended Nationally Determined Contribution under the Paris Agreement at the Environment Council meeting on 6 March 2015. (6)The European Council Conclusions of October 2014 endorsed a greenhouse gas emissions reduction of 30% by 2030 compared to 2005 for the sectors that are not part of the European Union emissions trading system. Road transport provides a major contribution to the emissions of those sectors, and its emissions remain significantly above 1990 levels. If the road transport emissions increase further, it will offset reductions made by other sectors to combat climate change. (7)The European Council Conclusions of October 2014 highlighted the importance of reducing greenhouse gas emissions and risks related to fossil fuel dependency in the transport sector through a comprehensive and technology neutral approach for the promotion of emissions reduction and energy efficiency in transport, for electric transportation and for renewable energy sources in transport also after 2020. (8)Energy efficiency contributing to moderation of demand is one of the five mutually-reinforcing and closely interrelated dimensions of the Energy Union Strategy adopted on 25 February 2015, to give consumers in the Union secure, sustainable, competitive and affordable energy. The Energy Union Strategy states that, while all economic sectors must take steps to increase the efficiency of their energy consumption, transport has a huge energy efficiency potential, which can be realised also with a continued focus on tightening CO2 emission standards for passenger cars and light commercial vehicles in a 2030 perspective. (9)An evaluation of Regulations (EC) No 443/2009 and (EU) No 510/2011 in 2015 concluded that those Regulations have been relevant, broadly coherent, and have generated significant emissions savings, whilst being more cost-effective than originally anticipated. They have also generated significant added value for the Union that could not have been achieved to the same extent through national measures. (10)It is therefore appropriate to pursue the objectives of those Regulations by setting new Union fleet-wide CO2 reduction targets for passenger cars and light commercial vehicles for the period up to 2030. In defining the reduction levels, account has been taken of their effectiveness in delivering a cost-effective contribution to reducing emissions of the sectors covered by the Effort Sharing Regulation […/…] by 2030, of the resulting costs and savings for society, manufacturers and vehicle users, as well as of their direct and indirect implications for employment, competitiveness and innovation and the co-benefits generated in terms of reduced air pollution and energy security. (11)A new test procedure for measuring CO2 emissions from and fuel consumption of light duty vehicles, the Worldwide Harmonised Light Vehicles Test procedure (WLTP), set out in Commission Regulation (EU) 2017/1151 , entered into force in 2017. This new test procedure will provide CO2 emission and fuel consumption values that are more representative of real world conditions. It is therefore appropriate that the new CO2 emission targets should be based on the CO2 emissions determined on the basis of that test procedure. Considering however that WLTP-based CO2 emissions will be available for target compliance purposes from 2021, it is appropriate that the new emissions performance standards should be defined as reduction levels set in relation to the 2021 average of the specific emissions targets applicable in that year. ê 443/2009 recital 2 (adapted) The United Nations Framework Convention on Climate Change, which was approved on behalf of the European Community by Council Decision 94/69/EC of 15 December 1993 , requires all parties to formulate and implement national and, where appropriate, regional programmes containing measures to mitigate climate change. In this respect, the Commission proposed in January 2007 that, in the context of international negotiations, the European Union should pursue the objective of a 30 % reduction of greenhouse gas emissions by developed countries by 2020 (compared to 1990 levels) and that the Union itself should make a firm independent commitment to achieve at least a 20 % reduction of greenhouse gas emissions by 2020 (compared to 1990 levels), irrespective of reductions achieved by other developed countries. This objective was endorsed by the European Parliament and the Council. ê 443/2009 recital 3 One of the implications of those commitments is that all Member States will need to reduce significantly emissions from passenger cars. Policies and measures should be implemented at Member State and Community level across all sectors of the Community economy, and not only within the industry and energy sectors, in order to generate the substantial reductions needed. Road transport is the second largest greenhouse-gas emitting sector in the Union and its emissions continue to rise. If the climate change impact of road transport continues to increase, it will significantly undermine reductions made by other sectors to combat climate change.

ê 510/2011 recital 3 Policies and measures should be implemented at Member State and Union level across all sectors of the Union economy, and not only within the industrial and energy sectors, in order to achieve the necessary emissions reductions. Decision No 406/2009/EC of the European Parliament and of the Council of 23 April 2009 on the effort of Member States to reduce their greenhouse gas emissions to meet the Community's greenhouse gas emission reduction commitments up to 2020 ( 4 ) provides for an average reduction of 10 % compared to 2005 levels in the sectors not covered by the EU Emissions Trading Scheme, established by Directive 2003/87/EC of the European Parliament and of the Council of 13 October 2003 establishing a scheme for greenhouse gas emission allowance trading within the Community ( 5 ), including road transport. Road transport is the second largest greenhouse gas emitting sector in the Union and its emissions, including those from light commercial vehicles, continue to rise. If road transport emissions continue to increase, it will significantly undermine efforts made by other sectors to combat climate change. ê 443/2009 recital 4 Community targets for new passenger cars provide manufacturers with more planning certainty and more flexibility to meet the CO2 reduction requirements than would be provided by separate national reduction targets. In setting emission performance standards, it is important to take into account the implications for markets and for the competitiveness of manufacturers, the direct and indirect costs imposed on business and the benefits that accrue in terms of stimulating innovation and reducing energy consumption. ê 443/2009 recital 5 (adapted) (12)This Regulation builds on a well-established process of measuring and monitoring the CO2 emissions of vehicles registered in the Community in accordance with Decision No 1753/2000/EC of the European Parliament and of the Council of 22 June 2000 establishing a scheme to monitor the average specific emissions of CO2 from new passenger cars . It is important that the setting of CO2 emissions reduction requirements continues to provide Community Ö Union Õ -wide predictability and planning security for vehicle manufacturers across their new car Ö and light commercial vehicle fleets Õ fleet in the Community Ö Union Õ. ê 510/2011 recital 5 To enhance the competitiveness of the European automotive industry, incentive schemes such as the offsetting of eco-innovations and the award of super-credits should be used. ò new (13)Reduction levels for the Union-wide fleets of new passenger cars and light commercial vehicles should therefore be set for 2025 and for 2030, taking into account the vehicle fleet renewal time and the need for the road transport sector to contribute to the 2030 climate and energy targets. This stepwise approach also provides a clear and early signal for the automotive industry not to delay the market introduction of energy efficient technologies and zero- and low-emission vehicles. (14)While the Union is among the world's major producers of motor vehicles and demonstrates technological leadership in this sector, competition is increasing and the global automotive sector is changing rapidly through new innovations in electrified powertrains, and cooperative, connected and automated mobility. In order to retain its global competitiveness and access to markets, the Union needs a regulatory framework, including a particular incentive in the area of zero- and low-emission vehicles, which creates a large home market and supports technological development and innovation. (15)A dedicated incentive mechanism should be introduced to facilitate a smooth transition towards zero-emission mobility. This crediting mechanism should be designed so as to promote the deployment on the Union market of zero- and low-emission vehicles. (16)Setting a benchmark for the share of zero- and low-emission vehicles in the Union fleet together with a well-designed mechanism for adjusting a manufacturer specific CO2 target based on the share of zero- and low-emission vehicles in the manufacturer's own fleet should provide a strong and credible signal for the development and deployment of such vehicles while still allowing for the further improvement of the efficiency of the conventional internal combustion engines. (17)In determining the credits for the zero- and low-emission vehicles, it is appropriate to account for the difference in CO2 emissions between the vehicles. The adjustment mechanism should ensure that a manufacturer exceeding the benchmark level would benefit from a higher specific CO2 target. In order to ensure a balanced approach, limits should be set to the level of adjustment possible within that mechanism. This will provide for incentives, promoting a timely roll-out of recharging and refuelling infrastructure and yielding high benefits for consumers, competitiveness, and the environment. ê 443/2009 recital 6 (adapted)

The Commission adopted a Community Strategy for reducing CO2 emissions from cars in 1995. The strategy was based on three pillars: voluntary commitments from the car industry to cut emissions, improvements in consumer information and the promotion of fuel-efficient cars by means of fiscal measures. ê 443/2009 recital 7 (adapted) In 1998, the European Automobile Manufacturers' Association (ACEA) adopted a commitment to reduce average emissions from new cars sold to 140 g CO2/km by 2008 and, in 1999, the Japanese Automobile Manufacturers' Association (JAMA) and the Korean Automobile Manufacturers' Association (KAMA) adopted a commitment to reduce average emissions from new cars sold to 140 g CO2/km by 2009. These commitments were recognised by Commission Recommendation 1999/125/EC of 5 February 1999 on the reduction of CO2 emissions from passenger cars (ACEA), Commission Recommendation 2000/303/EC of 13 April 2000 on the reduction of CO2 emissions from passenger cars (KAMA) and Commission Recommendation 2000/304/EC of 13 April 2000 on the reduction of CO2 emissions from passenger cars (JAMA) . ê 443/2009 recital 8 (adapted) On 7 February 2007, the Commission adopted two parallel Communications: a Communication setting out the results of the review of the Community Strategy to reduce CO2 emissions from passenger cars and light-commercial vehicles and a Communication on a Competitive Automotive Regulatory Framework for the 21st Century (CARS21). The Communications underlined that progress had been made towards the target of 140 g CO2/km by 2008/2009, but that the Community objective of 120 g CO2/km would not be met by 2012 in the absence of additional measures. ê 510/2011 recital 8 (adapted) The provisions implementing the objective concerning emissions from light commercial vehicles should be consistent with the legislative framework for implementing the objectives concerning emissions from the new passenger car fleet set out in Regulation (EC) No 443/2009 of the European Parliament and of the Council of 23 April 2009 setting emission performance standards for new passenger cars as part of the Community's integrated approach to reduce CO 2 emissions from light-duty vehicles ( 1 ). ê 443/2009 recital 9 (adapted) The Communications proposed an integrated approach with a view to reaching the Community target of 120 g CO2/km by 2012 and announced that the Commission would propose a legislative framework to achieve the Community objective by focusing on mandatory reductions of emissions of CO2 to reach an objective of 130 g CO2/km for the average new car fleet by means of improvements in vehicle motor technology. Consistent with the approach under the voluntary commitments adopted by manufacturers, this covers those elements that are taken into account in the measurement of the CO2 emissions of passenger cars in accordance with Regulation (EC) No 715/2007 of the European Parliament and of the Council of 20 June 2007 on type approval of motor vehicles with respect to emissions from light passenger and commercial vehicles (Euro 5 and Euro 6) and on access to vehicle repair and maintenance information . A further reduction of 10 g CO2/km, or equivalent if technically necessary, will be delivered by other technological improvements and by an increased use of sustainable biofuels. ê 443/2009 recital 10 (adapted) (18)The legislative framework for implementing the average new car Ö and light commercial vehicle Õ fleet target should ensure competitively neutral, socially equitable and sustainable reduction targets which take account of the diversity of European automobile manufacturers and avoid any unjustified distortion of competition between them. The legislative framework should be compatible with the overall objective of reaching the Community's Kyoto targets and should be complemented by other more use-related instruments such as differentiated car and energy taxes. ê 443/2009 recital 11 Appropriate funding should be ensured in the general budget of the European Union to promote the development of technologies intended to reduce radically CO2 emissions from road vehicles.

ê 443/2009 recital 12 (adapted) ð new (19)In order to maintain the diversity of the car market Ö for passenger cars and light commercial vehicles Õ and its ability to cater for different consumer needs, CO2 targets for passenger cars should be defined according to the utility of the cars Ö vehicles Õ on a linear basis. ð Maintaining mass as the utility parameter is considered coherent with the existing regime. In order to better reflect the mass of vehicles used on the road, the parameter should be changed from mass in running order to the vehicle's test mass as specified in Regulation (EU) 2017/1151 of 1 June 2017 with effect from 2025.ï Moreover, data on mass is readily available. Data on alternative utility parameters such as footprint (track width times wheelbase) should be collected in order to facilitate longer-term evaluations of the utility-based approach. The Commission should, by 2014, review the availability of data and, if appropriate, submit a proposal to the European Parliament and to the Council to adapt the utility parameter. ò new (20)It should be avoided that the Union fleet-wide targets are altered due to changes in the average mass of the fleet. Changes in the average mass should therefore be reflected without delay in the specific emission target calculations, and the adjustments of the average mass value that is used to this end should therefore take place every two years with effect from 2025. (21)In order to distribute the emission reduction effort in a competitively neutral and fair way that reflects the diversity of the market for passenger cars and light commercial vehicles, and in view of the change in 2021 to WLTP-based specific emission targets, it is appropriate to determine the slope of the limit value curve on the basis of the specific emissions of all newly registered vehicles in that year, and to take into account the change in the Union fleet-wide targets between 2021, 2025 and 2030 with a view to ensuring an equal reduction effort of all manufacturers. With regard to light commercial vehicles, the same approach as that for car manufacturers should apply to manufacturers of lighter, car derived, vans, while for manufacturers of vehicles falling within the heavier segments, a higher and fixed slope should be set for the whole target period. ê 443/2009 recital 13 (adapted) ð new (22)The aim of this Regulation is to create incentives for the car automotive industry to invest in new technologies. This Regulation actively promotes eco-innovation and ð provides a mechanism that should be able to acknowledge ï takes into account future technological development. The development of innovative propulsion technologies should particularly be promoted, as they result in significantly lower emissions than traditional passenger cars. In this way, the long-term competitiveness of the European industry is promoted and more high-quality jobs are created. The Commission should consider the possibility of including eco-innovation measures in the review of test procedures pursuant to Article 14(3) of Regulation (EC) No 715/2007, taking into consideration the technical and economic impacts of such inclusion. ð Experience shows that eco-innovations have successfully contributed to the cost-effectiveness of Regulations (EC) No 443/2009 and (EU) No 510/2011 and to the reduction of real world CO2 emissions. This modality should therefore be maintained and the scope should be extended to incentivise efficiency improvements in air-conditioning systems. ï ê 510/2011 recital 12 Directive 1999/94/EC of the European Parliament and of the Council of 13 December 1999 relating to the availability of consumer information on fuel economy and CO 2 emissions in respect of the marketing of new passenger cars ( 3 ) already requires that promotional literature for cars provides end-users with the official CO 2 emission data and the official fuel consumption of the vehicle. The Commission, in its Recommendation 2003/217/EC of 26 March 2003 on the application to other media of the provisions of Directive 1999/94/EC concerning promotional literature ( 4 ), has interpreted this as including advertising. The scope of Directive 1999/94/EC should therefore be extended to light commercial vehicles, so that advertisements for any light commercial vehicles should be required to provide end-users with the official CO 2 emission data and official fuel consumption of the vehicle where energy- or price- related information is disclosed, at the latest by 2014. ò new (23)A balance should however be ensured between incentives given to eco-innovations and those technologies for which the emission reduction effect is demonstrated on the official test procedure. As a consequence, it is appropriate to maintain a cap on the eco-innovation savings that a manufacturer may take into account for target compliance purposes. The Commission should have the possibility to review the level of the cap, in particular, to take into account the effects of the change in the official test procedure. It is also appropriate to clarify how the savings should be calculated for target compliance purposes. ê 443/2009 recital 14 In recognition of the very high research and development and unit production costs of early generations of very low carbon vehicle technologies to be introduced into the marketplace following its entry into force, this Regulation seeks to accelerate and facilitate, on an interim basis, the process of introducing into the Community market ultra low carbon vehicles at their initial stages of commercialisation.

ê 443/2009 recital 15 (adapted) The use of certain alternative fuels can offer significant CO2 reductions in well-to-wheel terms. This Regulation therefore incorporates specific provisions aimed at promoting further deployment of certain alternative-fuel vehicles in the Community market. ê 510/2011 recital 15 By 1 January 2012 at the latest and with a view to improving data gathering on and measurement of fuel consumption, the Commission should consider whether to amend the relevant legislation in order to include an obligation for manufacturers seeking type approval for vehicles of category N 1 as defined in Annex II to Directive 2007/46/EC of the European Parliament and of the Council of 5 September 2007 establishing a framework for the approval of motor vehicles and their trailers, and of systems, components and separate technical units intended for such vehicles ( 1 ) to equip every vehicle with a fuel consumption meter. ê 443/2009 recital 16 To provide consistency with the approach adopted under the Commission's CO2 and cars strategy, in particular in relation to the voluntary commitments undertaken by the manufacturers associations, the target should be applied to new passenger cars which are registered in the Community for the first time and which, except for a limited period to avoid abuses, have not previously been registered outside the Community. ê 510/2011 recital 16 To ensure consistency with Regulation (EC) No 443/2009 and to avoid abuses, the target should be applied to new light commercial vehicles registered in the Union for the first time and that have not previously been registered outside the Union except for a limited period. ê 510/2011 recital 17 (24)Directive 2007/46/EC of the European Parliament and of the Council establishes a harmonised framework containing the administrative provisions and general technical requirements for approval of all new vehicles within its scope. The entity responsible for complying with this Regulation should be the same as that responsible for all aspects of the type-approval process in accordance with that Directive and for ensuring conformity of production. ê 443/2009 recital 18 (25)For the purposes of type-approval, specific requirements apply for special-purpose vehicles, as defined in Annex II of Directive 2007/46/EC, and they should therefore be excluded from the scope of this Regulation. Vehicles which are classified as category M1 before the entry into force of this Regulation, which are built specifically for commercial purposes to accommodate wheelchair use inside the vehicle and which meet the definition of special-purpose vehicle in Annex II of Directive 2007/46/EC should also be excluded from the scope of this Regulation in line with Community policy to help people with disabilities. ê 510/2011 recital 18 (adapted)

Manufacturers should have flexibility to decide how to meet their targets under this Regulation and should be allowed to average emissions over their new vehicle fleet rather than having to respect CO 2 targets for each individual vehicle. Manufacturers should therefore be required to ensure that the average specific emission for all the new light commercial vehicles registered in the Union for which they are responsible does not exceed the average of the emissions targets for those vehicles. This requirement should be phased in between 2014 and 2017 in order to facilitate its introduction. This is consistent with the lead times given and the duration of the phase-in period set in Regulation (EC) No 443/2009. ê 443/2009 recital 19 (adapted) Manufacturers should have flexibility to decide how to meet their targets under this Regulation and should be allowed to average emissions over their new car fleet rather than having to respect CO2 targets for each individual car. Manufacturers should therefore be required to ensure that the average specific emission for all the new cars registered in the Community for which they are responsible does not exceed the average of the emissions targets for those cars. This requirement should be phased in between 2012 and 2015 in order to facilitate the transition. ê 510/2011 recital 19 (adapted) In order to ensure that targets reflect the particularities of small and niche manufacturers and are consistent with the manufacturer's reduction potential, alternative emission reduction targets should be set for such manufacturers, taking into account the technological potential of a given manufacturer's vehicles to reduce their specific emissions of CO 2 and consistently with the characteristics of the market segments concerned. This derogation should be covered by the review of the specific emission targets in Annex I, to be completed by the beginning of 2013 at the latest. ê 443/2009 recital 20 (adapted) ð new (26)It is not appropriate to use the same method to determine the emissions reduction targets for large-volume manufacturers as for small-volume manufacturers considered as independent on the basis of the criteria set out in this Regulation. Such small-volume manufacturers should have ð the possibility to apply for ï alternative emissions reduction targets relating to the technological potential of a given manufacturer's vehicles to reduce their specific emissions of CO2 and consistent with the characteristics of the market segments concerned. This derogation should be covered by the review of the specific emissions targets in Annex I, to be completed by the beginning of 2013 at the latest. ê 333/2014 recital 7 (adapted) ð new (27)In recognition of the disproportionate impact on the smallest manufacturers resulting from compliance with specific emissions targets defined on the basis of the utility of the vehicle, the high administrative burden of the derogation procedure, and the marginal resulting benefit in terms of CO2 emissions reduction from the vehicles sold by those manufacturers, manufacturers responsible for fewer than 1 000 new passenger cars Ö and new light commercial vehicles Õ registered in the Union annually should be excluded from the scope of the specific emissions target and the excess emissions premium. ð However, where a manufacturer that is covered by an exemption nevertheless applies for and is granted a derogation, it is appropriate that the manufacturer should be required to comply with that derogation target. ï In order to ensure from the earliest point legal certainty for those manufacturers, it is essential that this derogation apply from 1 January 2012. ê 333/2014 recital 9 (adapted) ð new (28)The procedure for granting derogations ð from the 95 g CO2/km fleet target ï to niche car manufacturers should continue beyond 2020. However, in order to ensure ensures that the reduction effort required by such manufacturers is consistent with that of large volume manufacturers ð with regard to that target ï . , a target 45 % lower than the average specific emissions of niche manufacturers in 2007 should therefore apply from 2020. ð However, experience shows that niche manufacturers have the same potential as large manufacturers to meet the CO2 targets and with regard to the targets set from 2025 onwards it is not considered appropriate to distinguish between those two categories of manufacturers. ï

ê 510/2011 recital 20 The Union strategy to reduce CO2 emissions from passenger cars and light commercial vehicles established an integrated approach with a view to reaching the Union target of 120 g CO2 /km by 2012, while also presenting a longer-term vision of further emission reductions. Regulation (EC) No 443/2009 substantiates this longer-term view by setting a target of 95 g CO2 /km as average emissions for the new car fleet. In order to ensure consistency with that approach and to provide planning certainty for the industry, a long-term target for the specific emissions of CO2 of light commercial vehicles in 2020 should be set. ê 443/2009 recital 21 (adapted) Niche manufacturers should be allowed to benefit from an alternative target which is 25 % lower than their average specific emissions of CO2 in 2007. An equivalent target should be determined where information on a manufacturer's average specific emissions does not exist for the year 2007. This derogation should be covered by the review of the specific emissions targets in Annex I, to be completed by the beginning of 2013 at the latest. ê 443/2009 recital 22 (adapted) (29)In determining the average specific emissions of CO2 for all the new cars Ö and new light commercial vehicles Õ registered in the Community Ö Union Õ for which manufacturers are responsible, all cars Ö and light commercial vehicles Õ should be taken into account irrespective of their mass or other characteristics. Although Regulation (EC) No 715/2007 does not cover passenger cars Ö and light commercial vehicles Õ with a reference mass exceeding 2610 kg and to which type approval is not extended in accordance with Article 2(2) of Regulation (EC) No 715/2007, the emissions for these cars Ö vehicles Õ should be measured in accordance with the same measurement procedure as specified for passenger cars Ö light duty vehicles Õ in Commission Regulation (EC) No 692/2008 Ö and Regulations (EU) 2017/1151, (EU) 2017/1152 and (EU) 2017/1153 Õ . The resulting CO2 emission values should be entered in the certificate of conformity of the vehicle in order to enable their inclusion in the monitoring scheme. ê 510/2011 recital 22 (adapted) (30)The specific emissions of CO2 of completed Ö light commercial Õ vehicles should be allocated to the manufacturer of the base vehicle. ê 510/2011 recital 23 In order to ensure that the values of CO2 emissions and fuel efficiency of completed vehicles are representative, the Commission should come forward with a specific procedure and consider, where appropriate, reviewing the type-approval legislation. ò new (31)Consideration should be given to the specific situation of manufacturers of light commercial vehicles producing incomplete vehicles that are type approved in multiple stages. While those manufacturers are responsible for meeting the CO2 emission targets, they should have the possibility to predict with reasonable certainty the CO2 emissions of the completed vehicles. The Commission should ensure that those needs are appropriately reflected in Regulation (EU) 2017/1151. ê 443/2009 recital 23 (adapted) (32)In order to provide for flexibility for the purposes of meeting their targets under this Regulation, manufacturers may agree to form a pool on an open, transparent and non-discriminatory basis. An agreement to form a pool should not exceed five years but may be renewed. Where manufacturers form a pool, they should be deemed to have met their targets under this Regulation provided that the average emissions of the pool as a whole do not exceed the Ö specific emissions Õ target for the pool.

ò new (33)The possibility for manufacturers to form pools has proven a cost-effective way to achieve compliance with the CO2 emissions targets, in particular facilitating compliance for those manufacturers that produce a limited range of vehicles. In order to improve the competitive neutrality, the Commission should have the powers to clarify the conditions on which independent manufacturers may form a pool in order to allow them to be placed in a position equivalent to connected undertakings. ê 443/2009 recital 24 (34)A robust compliance mechanism is necessary in order to ensure that the targets under this Regulation are met. ò new (35)It is also essential for achieving the CO2 reductions required under this Regulation, that the emissions of vehicles in use are in conformity with the CO2 values determined at type approval. It should therefore be possible for the Commission to take into account in the calculation of the average specific emissions of a manufacturer any systemic non-conformity found by type approval authorities with regard to the CO2 emissions of vehicles in use. (36)In order to be in position to take such measures the Commission should have the powers to prepare and implement a procedure for verifying the in-service conformity of the CO2 emissions of light duty vehicles placed on the market. For that purpose Regulation (EC) No 715/2007 should be amended. ê 443/2009 recital 25 (adapted) ð new (37)The specific emissions of CO2 from new passenger cars Ö and light commercial vehicles Õ are measured on a harmonised basis in the Community Ö Union Õ according to the methodology laid down in Regulation (EC) No 715/2007. To minimise the administrative burden of this Regulation, compliance should be measured by reference to data on registrations of new cars Ö and light commercial vehicles Õ in the Community Ö Union Õ collected by Member States and reported to the Commission. To ensure the consistency of the data used to assess compliance, the rules for the collection and reporting of this data should be harmonised as far as possible. ð The competent authorities' responsibility to provide correct and complete data should therefore be clearly stated as well as the need for an effective cooperation between those authorities and the Commission in addressing data quality issues. ï ê 443/2009 recital 26 (adapted) Directive 2007/46/EC provides that manufacturers are to issue a certificate of conformity which must accompany each new passenger car and that Member States are to permit the registration and entry into service of a new passenger car only if it is accompanied by a valid certificate of conformity. Data collected by Member States should be consistent with the certificate of conformity issued by the manufacturer for the passenger car and should be based on this reference only. Should Member States, for justified reasons, not use the certificate of conformity to complete the process of registration and entry into service of a new passenger car, they should put the necessary measures in place to ensure adequate accuracy in the monitoring procedure. There should be a Community standard database for certificate of conformity data. It should be used as a single reference to enable Member States to more easily maintain their registration data when vehicles are newly registered. ê 510/2011 recital 27 (adapted) (38)Manufacturers’ compliance with the targets under this Regulation should be assessed at Union level. Manufacturers whose average specific emissions of CO2 exceed those permitted under this Regulation should pay an excess emissions premium with respect to each calendar year. from 1 January 2014. The premium should be modulated as a function of the extent to which manufacturers fail to comply with their target. In order to ensure consistency, the premium mechanism should be similar to the one set in Regulation (EC) No 443/2009. The amounts of the excess emissions premium should be considered as revenue for the general budget of the European Union.

ê 510/2011 recital 28 (39)Any national measure that Member States may maintain or introduce in accordance with Article 193 of the Treaty of the Functioning of the European Union (TFEU) should not, in consideration of the purpose of and procedures established in this Regulation, impose additional or more stringent penalties on manufacturers who fail to meet their targets under this Regulation. ê 510/2011 recital 29 (40)This Regulation should be without prejudice to the full application of Union competition rules. ê 443/2009 recital 30 (adapted) The Commission should consider new modalities for reaching the long-term target, in particular the slope of the curve, the utility parameter and the excess emissions premium scheme. ê 510/2011 recital 31 The speed of road vehicles has a strong influence on their fuel consumption and CO 2 emissions. In addition, in the absence of speed limitation for light commercial vehicles, it is possible that there is an element of competition as regards top speed which could lead to oversized powertrains and associated inefficiencies in slower operating conditions. It is therefore appropriate to investigate the feasibility of extending the scope of Council Directive 92/6/EEC of 10 February 1992 on the installation and use of speed limitation devices for certain categories of motor vehicles in the Community ( 1 ), with the aim of including light commercial vehicles covered in this Regulation. ê 443/2009 recital 31 (adapted) The measures necessary for the implementation of this Regulation should be adopted in accordance with Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission . ò new (41)The effectiveness of the targets set out in this Regulation in reducing CO2 emissions in reality is strongly dependent on the representativeness of the official test procedure. In accordance with the Opinion of the Scientific Advice Mechanism (SAM) and the recommendation of the European Parliament, following its inquiry into emission measurements in the automotive sector, a mechanism should be put in place to assess the real world representativeness of vehicle CO2 emissions and energy consumption values determined in accordance with Regulation (EU) 2017/1151. The Commission should have the powers to ensure the public availability of such data, and, where necessary, develop the procedures needed for identifying and collecting the data required for performing such assessments. (42)In 2024 it is foreseen to review the progress achieved under the [Effort Sharing Regulation and Emissions Trading System Directive]. It is therefore appropriate to assess the effectiveness of this Regulation in that same year to allow a coordinated and coherent assessment of the measures implemented under all these instruments. (43)Regulations (EC) No 443/2009 and (EU) No 510/2011 should be repealed with effect from 1 January 2020.

ê 333/2014 recital 15 (adapted) (44)In order to ensure uniform conditions for the implementation of this Regulation, implementing powers should be conferred on the Commission. Those powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council . ò new (45)The implementing powers relating to Articles 6(8), 7(7) and (8), 8(3), 11(2), 12(3) and 14(3) should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council. ê 443/2009 recital 32 (adapted) In particular, the Commission should be empowered to amend the monitoring and reporting requirements in the light of the experience of the application of this Regulation, to establish methods for the collection of excess emissions premiums, to adopt detailed provisions concerning the derogation for certain manufacturers, and to adapt Annex I to take account of the evolution of the mass of new passenger cars registered in the Community and to reflect any change in the regulatory test procedure for the measurement of specific emissions of CO2. Since those measures are of general scope and are designed to amend non-essential elements of this Regulation, inter alia, by supplementing it with new non-essential elements, they must be adopted in accordance with the regulatory procedure with scrutiny provided for in Article 5a of Decision 1999/468/EC. ê 333/2014 recital 16 (adapted) ð new (46)ð In order to amend or supplement non-essential elements of the provisions of this Regulation ï tThe power to adopt acts in accordance with Article 290 of the TFEU Treaty on the Functioning of the European Union should be delegated to the Commission in order to Ö respect of Õ amend Ö amending Õ Annexes II Ö and III Õ to Regulation (EC) No 443/2009 as regards data requirements and data parameters;, supplement Ö supplementing Õ the rules on the interpretation of the eligibility criteria for derogations from the specific emissions targets, on the content of applications for a derogation and on the content and assessment of programmes for the reduction of specific emissions of CO2 ,; adjust Ö adjusting Õ the figure of M0 ð and TM0 ï , referred to in Annex I to Regulation (EC) No 443/2009, Article 13, ð the 7g CO2/km cap referred to in Article 11, and the adjustment of the formulae in Annex I referred to in Article 14(3) ï to the average mass of new passenger cars in the previous three calendar years; and adapt the formulae in Annex I to Regulation (EC) No 443/2009. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level Ö and that those consultations be conducted in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making Õ. The Commission, when preparing and drawing up Ö In particular, to ensure equal participation in the preparation of Õ delegated acts, should ensure a simultaneous, timely and appropriate transmission of relevant documents to the European Parliament and to the Council Ö should receive all documents at the same time as Member States' experts, and their experts should systematically have access to meetings of Commission expert groups dealing with the preparation of delegated acts Õ . ê 443/2009 recital 33 (adapted) Decision No 1753/2000/EC should be repealed for reasons of simplification and legal clarity. ê 510/2011 recital 34 (adapted) (47)Since the objective of this Regulation, namely the establishment of CO2 emissions performance requirements for new Ö passenger cars and new Õ light commercial vehicles, cannot be achieved by the Member States, and can therefore, by reason of its scale and effects, be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality, as set out in that Article, this Regulation does not go beyond what is necessary in order to achieve that objective, HAVE ADOPTED THIS REGULATION:

ê 443/2009 (adapted) Article 1 Subject matter and objectives 1. This Regulation establishes CO2 emissions performance requirements for new passenger cars Ö and for new light commercial vehicles Õ in order to ensure the proper functioning of the internal market. and to achieve the overall objective of the European Community of 120 g CO2/km as average emissions for the new car fleet. This Regulation sets the average CO2 emissions for new passenger cars at 130 g CO2/km, by means of improvement in vehicle motor technology, as measured in accordance with Regulation (EC) No 715/2007 and its implementing measures and innovative technologies. ê 510/2011 (adapted) Article 1 Subject matter and objectives 1. This Regulation establishes CO2 emissions performance requirements for new light commercial vehicles. This Regulation sets the average CO2 emissions for new light commercial vehicles at 175 g CO2/km, by means of improvements in vehicle technology, as measured in accordance with Regulation (EC) No 715/2007 and its implementing measures, and innovative technologies. ê 333/2014 Art. 1.1 (adapted) From 2020 onwards, this Regulation sets a target of 95 g CO2/km for the average emissions of the new car fleet as measured in accordance with Regulation (EC) No 715/2007 and Annex XII to Regulation (EC) No 692/2008 and its implementing measures and innovative technologies. ê 253/2014 Art. 1.1 (adapted) ð new 2. From ð 1 January ï 2020, this Regulation sets a ð an EU fleet-wide ï target of Ö95 g CO2/km for the average emissions of new passenger cars and Õ a ð an EU fleet-wide ï target of 147 g CO2/km for the average emissions of new light commercial vehicles registered in the Union, as measured ð until 31 December 2020 ï in accordance with Regulation (EC) No 715/2007 692/2008 ð together with Implementing Regulations (EU) 2017/1152 and 2017/1153, and, from 1 January 2021 measured in accordance with Regulation (EU) 2017/1151 ï and its implementing measures, and innovative technologies. ê 443/2009 (adapted) ð new

3. This Regulation will ð until 31 December 2024 ï be complemented by additional measures corresponding to a reduction of 10 g CO2/km as part of the Community Ö Union Õ 's integrated approach Ö referred to in the 2007 Communication from the Commission to the Council and the European Parliament Õ . ò new 4. From 1 January 2025 the following EU fleet-wide targets shall apply: (a) for the average emissions of the new passenger car fleet, an EU fleet-wide target equal to a 15% reduction of the average of the specific emissions targets in 2021 determined in accordance with point 6.1.1 of Part A of Annex I; (b) for the average emissions of the new light commercial vehicles fleet, an EU fleet- wide target equal to a 15% reduction of the average of the specific emissions targets in 2021 determined in accordance with point 6.1.1 of Part B of Annex I; 5. From 1 January 2030 the following targets shall apply: (a) for the average emissions of the new passenger car fleet, an EU fleet-wide target equal to a 30% reduction compared to the average of the specific emissions targets in 2021 determined in accordance with point 6.1.2 of Part A of Annex I; (b) for the average emissions of the new light commercial vehicles fleet, an EU fleet- wide target equal to a 30% reduction of the average of the specific emissions targets in 2021 determined in accordance with point 6.1.2 of Part B of Annex I. ê 443/2009 (adapted) Article 2 Scope 1.This Regulation shall apply to Ö the following Õ motor vehicles of: (a)category M1 as defined in Annex II to Directive 2007/46/EC (‘passenger cars’) which are registered in the Community Ö Union Õ for the first time and which have not previously been registered outside the Community Ö Union Õ (‘new passenger cars’).; 2. A previous registration outside the Community made less than three months before registration in the Community shall not be taken into account. 3. This Regulation does not apply to special-purpose vehicles as defined in point 5 of Part A of Annex II to Directive 2007/46/EC. ê 333/2014 Art. 1.2 (adapted) 4. With effect from 1 January 2012, Article 4, Article 8(4)(b) and (c), Article 9 and Article 10(1)(a) and (c) shall not apply to a manufacturer which, together with all of its connected undertakings, is responsible for fewer than 1000 new passenger cars registered in the Union in the previous calendar year.

ê 510/2011 (adapted) Article 2 Scope 1.This Regulation shall apply to motor vehicles of (b)category N1 as defined in Annex II to Directive 2007/46/EC with a reference mass not exceeding 2610 kg and to vehicles of category N1 to which type-approval is extended in accordance with Article 2(2) of Regulation (EC) No 715/2007 (‘light commercial vehicles’) which are registered in the Union for the first time and which have not previously been registered outside the Union (‘new light commercial vehicles’). 2.A previous registration outside the Union made less than three months before registration in the Union shall not be taken into account. 3.This Regulation shall not apply to special purpose vehicles as defined in point 5 of Part A to Annex II to Directive 2007/46/EC. ê 253/2014 Art. 1.2 (adapted) ð new 4.Article 4, Article 8 7 (4)(b) and (c), Article 98 and Article 910(1)(a) and (c) shall not apply to a manufacturer which, together with all of its connected undertakings, is responsible Ö for fewer than 1000 new passenger cars or Õ for fewer than 1000 new light commercial vehicles registered in the Union in the previous calendar year ð , unless that manufacturer applies for and is granted a derogation in accordance with Article 10 ï. ê 443/2009 (adapted) Article 3 Definitions 1. For the purposes of this Regulation, the following definitions shall apply: (a)‘average specific emissions of CO2’ means, in relation to a manufacturer, the average of the specific emissions of CO2 of all new passenger cars of which it is the manufacturer; (b)‘certificate of conformity’ means the certificate referred to in Article 18 of Directive 2007/46/EC; (c)‘manufacturer’ means the person or body responsible to the approval authority for all aspects of the EC type-approval procedure in accordance with Directive 2007/46/EC and for ensuring conformity of production; (d)‘mass’ means the mass of the car with bodywork in running order as stated in the certificate of conformity and defined in section 2.6 of Annex I to Directive 2007/46/EC;

(e)‘footprint’ means the track width multiplied by the wheelbase as stated in the certificate of conformity and defined in sections 2.1 and 2.3 of Annex I to Directive 2007/46/EC; (g)‘specific emissions target’ means, in relation to a manufacturer, the average of the specific emissions of CO2 permitted in accordance with Annex I in respect of each new passenger car of which it is the manufacturer or, where the manufacturer is granted a derogation under Article 11, the specific emissions target determined in accordance with that derogation. 2. For the purposes of this Regulation ‘a group of connected manufacturers’ means a manufacturer and its connected undertakings. In relation to a manufacturer, ‘connected undertakings’ means: (a)undertakings in which the manufacturer has, directly or indirectly: ê 333/2014 Art. 1.3 (adapted) –the power to exercise more than half the voting rights, or ê 443/2009 (adapted) –the power to appoint more than half the members of the supervisory board, board of management or bodies legally representing the undertaking; or –the right to manage the undertaking's affairs; (b)undertakings which directly or indirectly have, over the manufacturer, the rights or powers listed in point (a); (c)undertakings in which an undertaking referred to in point (b) has, directly or indirectly, the rights or powers listed in point (a); (d)undertakings in which the manufacturer together with one or more of the undertakings referred to in points (a), (b) or (c), or in which two or more of the latter undertakings, jointly have the rights or powers listed in point (a); (e)undertakings in which the rights or the powers listed in (a) are jointly held by the manufacturer or one or more of its connected undertakings referred to in points (a) to (d) and one or more third parties. ê 510/2011 (adapted) ð new Article 3 Definitions

1. For the purposes of this Regulation, the following definitions shall apply: (a)‘average specific emissions of CO2’ means, in relation to a manufacturer, the average of the specific emissions of CO2 of all Ö new passenger cars or of all new Õ light commercial vehicles of which it is the manufacturer; (b)‘certificate of conformity’ means the certificate referred to in Article 18 of Directive 2007/46/EC; (c)‘completed vehicle’ means a Ö light commercial Õ vehicle where type-approval is granted following completion of a process of multi-stage type-approval in accordance with Directive 2007/46/EC; (d)‘complete vehicle’ means any Ö light commercial Õ vehicle which does not need to be completed in order to meet the relevant technical requirements of Directive 2007/46/EC; (e)‘base vehicle’ means any Ö light commercial Õ vehicle which is used at the initial stage of a multi-stage type-approval process; (f)‘manufacturer’ means the person or body responsible to the approval authority for all aspects of the EC type-approval procedure in accordance with Directive 2007/46/EC and for ensuring conformity of production; (g)‘mass ð in running order ï ’ means the mass of the Ö passenger car or light commercial Õ vehicle with bodywork in running order as stated in the certificate of conformity and defined in section 2.6 of Annex I to Directive 2007/46/EC; (h) 'specific emissions of CO2' means the emissions of a light commercial vehicle measured in accordance with Regulation (EC) No 715/2008 and specified as the CO2 mass emission (combined) in the certificate of conformity of the complete or completed vehicle; ê 443/2009 (adapted) ð new (f)(h)‘specific emissions of CO2’ means the emissions of a passenger car Ö or a light commercial vehicle Õ measured in accordance with Regulation (EC) No 715/2007 Ö and its implementing Regulations Õ and specified as the CO2 mass emission (combined) in the certificate of conformity of the vehicle. For passenger cars ð or light commercial vehicles ï which are not type-approved in accordance with Regulation (EC) No 715/2007, ‘specific emissions of CO2’ means the CO2 emissions measured in accordance with the same measurement procedure as specified in Regulation (EC) No 692/2008 ð until 31 December 2020, and from 1 January 2021, Regulation (EU) 2017/1151 ï, or in accordance with procedures adopted by the Commission to establish the CO2 emissions for such passenger cars Ö vehicles Õ ; ê 510/2011 (adapted) ð new (j)(i) ‘footprint’ means the average track width multiplied by the wheelbase as stated in the certificate of conformity and defined in Sections 2.1 and 2.3 of Annex I to Directive 2007/46/EC; (i)(j)‘specific emissions target’ means, in relation to a manufacturer, the average of the indicative specific emissions of CO2 ð the annual target ï determined in accordance with Annex I in respect of each new light commercial vehicle for which it is the manufacturer, or, if the manufacturer is granted a derogation in accordance with Article 11 10the specific emissions target determined according to that derogation;

ò new (k)'EU fleet-wide target' means the average CO2 emissions of all new passenger cars or all new light commercial vehicles to be achieved in a given period; (l)'test mass' means the test mass of a passenger car or light commercial vehicle as stated in the certificate of conformity and as defined in point 3.2.25 of Annex XXI to Regulation (EU) 2017/1151; (m) 'zero- and low-emission vehicle' means a passenger car or a light commercial vehicle with tailpipe emissions from zero up to 50 g CO2/km, as determined in accordance with Regulation (EU) 2017/1151. ê 510/2011 (adapted) (k) (n)‘payload’ means the difference between the technically permissible maximum laden mass pursuant to Annex II to Directive 2007/46/EC and the mass of the vehicle. 2.For the purposes of this Regulation ‘a group of connected manufacturers’ means a manufacturer and its connected undertakings. In relation to a manufacturer, ‘connected undertakings’ means: (a)undertakings in which the manufacturer has, directly or indirectly: (i)the power to exercise more than half the voting rights; or (ii)the power to appoint more than h