Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Regulation (EC) No .../2000 [on substances that deplete the ozone layer] as regards the base year for the allocation of hydrochlorofluorocarbons

(presented by the Commission)

EXPLANATORY MEMORANDUM

This proposal for an amendment to Regulation of the European Parliament and of the Council on substances that deplete the ozone layer is necessary because the date currently contained in this Regulation for determining the allocation of quotas of hydrochlorofluorocarbons is inappropriate and if kept could result in the Community being open to legal challenge.

2000/0170 (COD)

Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Regulation (EC) No .../2000 [on substances that deplete the ozone layer] as regards the base year for the allocation of hydrochlorofluorocarbons

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 175(1) thereof,

Having regard to the proposal from the Commission [1],

[1] OJ C

Having regard to the opinion of the Economic and Social Committee [2],

[2] OJ C

Having regard to the opinion of the Committee of the Regions [3],

[3] OJ C

Acting in accordance with the procedure laid down in Article 251 of the Treaty [4],

[4] OJ C

Whereas:

(1) Regulation (EC) No .../2000 of the European Parliament and of the Council of ... on substances that deplete the ozone layer [5] takes 1996 as the base year for allocating quotas of hydrochlorofluorocarbons (HCFCs). Since 1996 the HCFC market has changed considerably with respect to importers and the maintenance of 1996 would result in a large number of importers being deprived of their import quota. As a general rule quotas should be based on the most recent and representative figures available, in this case those for 1999 and so the maintenance of 1996 could be considered arbitrary and might also result in a breach of the principles of non-discrimination and legitimate expectations.

[5] OJ L

(2) Regulation (EC) No .../2000 should therefore be amended accordingly,

HAVE ADOPTED THIS REGULATION:

Article 1

In Article 4(3)(i)(h) of Regulation (EC) No .../2000, "1996" shall be replaced by "1999".

Article 2

This Regulation shall enter into force on the day following that of its publication in the Official Journal of the European Communities.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels,

For the European Parliament For the Council

The President The President

IMPACT ASSESSMENT FORM THE IMPACT OF THE PROPOSAL ON BUSINESS WITH SPECIAL REFERENCE TO SMALL AND MEDIUM-SIZED ENTERPRISES( SMEs)

Title of proposal

Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No .../2000 on substances that deplete the ozone layer as regards the base year for the allocation of hydrochlorofluorocarbons

Document reference number

Regulation (EC) No .../2000 of the European Parliament and of the Council

The impact on business

* Article 4(3)(i)(h) of the new Regulation links the assignment of quotas for producers and importers in respect of their placing on the market of hydrochlorofluorocarbons (HCFCs) for the calendar years 1999 to 2002 inclusive, to the market share of the producer or importer in 1996. Any company which started producing or importing HCFCs after the close of the calendar year 1996 would thus not be entitled to place HCFCs on the market during the years 1999-2002 inclusive.

* The total quantity of HCFCs for placing on the market is 8079 ODP tonnes (the cap resulting from the Montreal Protocol). In 1996, 7836 ODP tonnes was allocated to producers (97% of total quota) and 243 ODP tonnes to importers compared to 7756 ODP tonnes (96% of total quota) and 323 ODP tonnes respectively in 1999. There has been a slight decrease in the quota for Community producers but the relative share of the distribution of quotas between producers has remained constant since 1996.

* Since 1996, the market for the production and importation has changed considerably as regards the number of importers. Many companies currently importing HCFCs under the current EC Regulation 3093/94 did not import HCFCs in 1996. Out of the 32 importers to which the Commission allocated quota in 1999, 27 of them would be deprived of a quota allocation in 2001 if the base date remains at 1996 and others would see significant cuts in their allowances. The overall amounts of HCFCs that could be placed on the market would be cut by some 250 ODP tonnes.

* Considering the time which elapsed since the proposal for the new Regulation was made in 1998, and the fact that the HCFC market has changed considerably since 1996, the choice of 1996 could be considered arbitrary and might also result in a breach of the principle of non-discrimination and legitimate expectations. As a general rule in Community legislation quotas should be based on the most recent and representative figures available, in this case 1999.

* If the 1996 base date is not changed, a number of small and medium-sized enterprises could suddenly be deprived of the HCFCs that is necessary for their business. Changing the base date will benefit these enterprises without affecting the overall quantities of HCFCs that can be imported and will, therefore not have any negative effects for the environment.