An assessment after five years of practice (200–2010)

During the first five years of its operation, from 2006 to 2010, the Compliance Com-mittee learned much from experience in applying its rules. It realized significant achievements, such as the full development and implementation of the compliance system that existed only on paper in 2006. However, the operation of the Commit-tee during this period has also revealed several difficulties and weaknesses which point to the need for further improvement of the compliance system. A full assessment of the operation of the system would be beyond the scope of this paper, but a number of considerations are highlighted.

The first two years of the Committee’s operation mainly involved the elaboration of further Rules of Procedure to fine-tune the functioning of the Committee. This proc-ess was influenced by the lproc-essons learned from the experience of the FB with the submission of South Africa, on behalf of the G77 and China, in 2006.¹¹⁶ The Rules of Procedure and working arrangements improved the Compliance Procedures and made the effective functioning of the Committee possible.

Since the end of 2007, the EB has demonstrated its ability effectively to resolve cases of non-compliance within the framework of the applicable rules. By the end of 2010 the EB had addressed questions of implementation with respect to Greece, Canada, Croatia, and Bulgaria. Both Greece and Bulgaria made successful efforts to return to compliance, after which their eligibility was reinstated and the EB closed their cases.¹¹⁷ Canada was able to resolve the issue at hand before a preliminary find-ing was adopted.¹¹⁸ The resolution of the question of implementation in the case of Croatia is pending at the time of writing. In August 2011, Croatia withdrew its

ap-dalities, Rules and Guidelines for Emissions Trading under Article 17 of the Kyoto Protocol’, UN Doc.

FCCC/KP/CMP/2005/8/Add.2 (2006), at 17, para. 2 of Annex.

113 As happened in the cases of Greece in 2008 and Croatia in 2009.

114 As happened in the case of Bulgaria in 2010.

115 Paras 32, 22, and 3 in the Annexes to Decisions 3/CMP.1, 9/CMP.1, and 11/CMP.1, respectively, supra note 112. A list with the eligibility status of Annex B parties is available at <http://unfccc.int/kyoto_pro-tocol/compliance/items/2875.php> (visited 10 January 2011).

116 See supra Part 2.

117 See Decision under Paragraph 2 of Section X (Party concerned: Greece), supra note 78; Decision under Paragraph 2 of Section X (Party concerned: Bulgaria), supra note 78.

118 See Decision not to Proceed Further (Party concerned: Canada), supra note 63.

peal, announced that it would submit a plan to remedy its non-compliance and re-quested reinstatement of its eligibility. Both the submission of the plan by Croatia and a decision of the enforcement branch on a possible reinstatement were pending as of the time of writing (September 2011). The experience gained with the questions of implementation with respect to Greece and Canada enabled the plenary of the Committee, on the basis of a ‘stock-taking exercise’ of the EB, to propose addi-tional Rules of Procedure, which were by and large adopted by CMP-4.¹¹⁹

The Compliance Procedures also represent a significant incentive for parties to avoid compliance problems and to attempt to resolve problems during the ERT process.

No question of implementation has arisen from ERTs with respect to the reporting deadlines regarding either the initial report or the subsequent annual inventory sub-missions. This contrasts with the more common disregard of reporting deadlines for national communications under the UNFCCC and the Protocol, which disregard does not in itself constitute a question of implementation to be indicated by ERTs (but which could be raised by parties using the triggering mechanisms).¹²⁰ Further, an analysis of the working of the ERT process prepared for the Committee (focusing on national systems) confirmed that parties have in general worked hard to resolve implementation problems identified by the ERTs during the review stage. It is worth reiterating that only in a few instances could these problems not be resolved, turning into questions of implementation that were listed in ERT reports and forwarded to the Committee.¹²¹ It may also be noted that no disagreement between an ERT and a party regarding actual emission figures and their adjustments had reached the Com-mittee by mid-2011. Arguably, the natural tendency of states to argue for favourable estimates has been balanced by the prospect of having to defend those estimates before the Committee.

The major gap and weakness in the operation of the compliance system is the lack of mobilization of its facilitation function. As noted above,¹²² the FB has not yet been called upon to address any question of implementation in substantive proceedings.

It is possible that part of the facilitative function of the overall system is being ef-fectively discharged through the ERT process; yet the FB has not been able to address Canada’s potential non-compliance with its emission target, even though this is an issue that appears to fall squarely under its ‘early-warning’ function.¹²³ Only parties

119 Report on the Meeting, Enforcement Branch of the Compliance Committee, Sixth meeting’, Doc. CC/

EB/6/2008/3 (2008), paras 6–9; Decision 4/CMP.4, supra note 6.

120 Delays in the submission of national communications by developed-country parties to the Protocol are notified to the Committee under Decision 22/CMP.1, supra note 77, at Annex, para. 139. The CMP has so far not responded to the request by the Committee contained in its second annual report to specify what action the Committee may take in this respect; see Second Annual Report of the Compliance Com-mittee, supra note 39, at para. 4(b); see also supra Part 2.

121 Description of the Elements of the Review Process under Article 8 and Synthesis of the Information Regarding the Review of National Systems’, Plenary of the Compliance Committee, Doc. CC/5/2008/2 (2008).

122 See supra Parts 2 and 4.

123 See supra Part 2.

are able to trigger the early-warning function (through either the self-trigger or the party-to-party trigger) leaving no basis for ERTs to indicate in their reports a question of implementation that relates to potential or likely future non-compliance. No question of implementation of this kind has to date been raised by a party. The in-ability of the FB to address, let alone to resolve, Canada’s potential non-compliance has led to criticism of the compliance system as a whole.¹²⁴

Developed-country parties to the Protocol, as a group, seem to be on course to achieve the overall target of reducing their greenhouse gas emissions ‘by at least 5 per cent below 1990 levels in the commitment period 2008 to 2012’, as is required by the Protocol’s Article 3(1) in spite of Canada’s declaration in public that it does not intend to meet its emission target. The Canadian government has made it clear that it does not plan to give effect to the necessary domestic policies and measures to achieve its target and has also voiced reservations about using the carbon-market mechanisms to this end.¹²⁵ According to data released by the UNFCCC in 2010, the 2008 emissions of the developed-country parties to the Protocol with emission tar-gets were almost 17 per cent below 1990 levels. As a side-effect of the economic downturn in the late 1980s and early 1990s, the level of emissions in Central and Eastern European Countries ‘with economies in transition’ was almost 37 per cent below 1990 levels; while other developed-country parties were, counted together, slightly above 1990 levels (less than one per cent). Of these, the 15 states which were members of the European Union in 1997 appear to be heading toward fulfilment of their joint emission target (as notified under Art. 4 of the Protocol).¹²⁶ Amongst the remaining developed-country parties to the Protocol – Australia, Canada, Japan, Liechtenstein, Monaco, New Zealand, Norway, and Switzerland – no state is as far from compliance with its emission target as is Canada.¹²⁷ Further, no one of the par-ties in this category has publicly backed away from its Kyoto target by calling it, as Canada has, ‘unrealistic’ and ‘unachievable’ and by putting forward an emission target for 2020 that is less ambitious than its Kyoto target.¹²⁸

124 See Peter J. Murtha, ‘Effective International Compliance Is Needed to Avoid “Dangerous Anthropo-genic Interference” with the Climate System’, in 8 INECE Special Report on Climate Compliance (2009).

125 See Minister of the Environment, A Climate Change Plan for the Purposes of the Kyoto Protocol Implemen-tation Act (Environment Canada, 2007), available at <http://www.ec.gc.ca/doc/ed-es/p_123/pre_eng.

htm> (visited 11 January 2011); see also René Lefeber, An Inconvenient Responsibility (Eleven Interna-tional Publishing, 2009) 10–11.

126 See also European Environment Agency, Annual European Community Greenhouse Gas Inventory 1990–

2007 and Inventory Report 2009 (EEA, 2009), available at <http://www.eea.europa.eu/publications/euro-pean-community-greenhouse-gas-inventory-2009/> (visited 11 January 2011); European Environment Agency, Greenhouse Gas Emission Trends and Projections in Europe 2009 (EEA, 2009), available at <http://

www.eea.europa.eu/publications/eea_report_2009_9> (visited 11 January 2011).

127 ‘Report of the Centralized In-depth Review of the Fourth National Communication of Canada’, UN Doc.

FCCC/IDR.4/CAN (2009). See also the review reports of the fourth national communications of other developed countries under the UNFCCC, available at <http://unfccc.int/national_reports/annex_i_nat-com/idr_reports/items/4056.php>, and the fifth national communications of developed countries, avail-able at <http://unfccc.int/national_reports/annex_i_natcom/submitted_natcom/items/4903.php> (both visited 11 January 2010).

128 For 2008 emission figures, see ‘National Greenhouse Gas Inventory Data for the Period 1990–2008’, Note by the Secretariat, UN Doc. FCCC/SBI/2010/18 (2010); see also ‘Annual Compilation and

Ac-It might be possible to improve the capacity of the compliance system to address, and resolve, potential or likely future non-compliance with emission targets might be improved. Assuming that parties will continue to be hesitant to use the party-to-party trigger, ERTs could be instructed to indicate a question of implementation where a party departs too far from a compliance trajectory. Alternatively, the Compli-ance Committee could be mandated regularly to review parties’ performCompli-ance with respect to their emission targets. In either case, further consideration is surely war-ranted to identify the appropriate branch to handle this and the adequate conse-quences to be applied. Under the rules currently in place, the early-warning function falls under the mandate of the FB, but the FB does not currently have the authority to go beyond issuing recommendations.¹²⁹

Two additional observations might be made on the future relevance of the compliance system in terms of a projected future in which, firstly, no second commitment period is established under the Kyoto Protocol; and, secondly, its provisions are not incorporated into a new post-2012 agreement. Obviously, even in such a projection there would be little reason to discard the compliance system of the Protocol before the completion of the current compliance cycle. Parties will continue to have commitments under the Protocol – and the compliance system can continue to hold them accountable (even though the deduction rate would lose much of its sting) and can continue to fulfil its other important functions (including resolving disagreements between ERTs and par-ties; and ascertaining eligibility to participate in the carbon-market mechanisms). Fur-ther, any alternative to the Kyoto Protocol which contains international commitments would face the challenge of holding parties accountable (in respect of their emission mitigation and reporting); that alternative might also need to resolve disagreements over reported data; and it is likely to need to ensure the functioning of the carbon-market mechanisms. The Kyoto Protocol’s compliance system has proved its ability to make a significant contribution to meeting the related functional demands; and its overall de-sign and its individual elements thus establish an important benchmark.¹³⁰

7 Conclusion

The compliance system has developed to form an integral part of the overall govern-ance system of the Kyoto Protocol. It fulfills several functions which are central to

counting Report for Annex B Parties under the Kyoto Protocol’, Note by the Secretariat, UN Doc. FCCC/

KP/CMP/2010/5 (2010); the review reports of the fourth national communications of developed coun-tries, including an assessment of the effects of planned policies and measures, are available at the Secre-tariat’s website.

129 See also Murtha, ‘Effective International Compliance’, supra note 124. Building a regular review function into the compliance system would incorporate the proposal by the United States and other parties to establish a public implementation review under a new post-2012 agreement.

130 As mentioned in the introduction, engaging in a more detailed discussion on how the compliance system might be adapted – or replaced – within the context of a post-2012 regime would be beyond the scope of the present paper.

the functioning of the Protocol in general, beyond merely addressing problems relat-ing to the fulfillrelat-ing of emission targets. Even though the system is activated only once there is already a problem, its existence provides an important incentive to devel-oped-country parties to achieve compliance, not least with the methodological and reporting requirements. In particular, the system is of great assistance to the ERT process and it supports resolution of disagreements between ERTs and individual parties. Furthermore, the compliance system plays a crucial role in the governance of the carbon-market mechanisms, especially as regards the determination and fulfil-ment of the eligibility requirefulfil-ments.

The strength of the compliance system is unique among MEAs. Driven by strong concerns about the participation of ‘free-riders’ in the Protocol, the enforcement component (including the consequences available for addressing compliance prob-lems) goes far beyond the means available in other MEAs and, for that matter, many other international institutions. The core strength of the compliance system can be found in the incentives and disincentives which have been generated by the overall design of the Protocol and its implementing decisions. Although parties have not made the consequences legally binding, as they could have done by adopting an amendment to the Protocol, the consequences can be effectively applied as long as states do not withdraw from the Protocol and as long as new commitment periods follow.

There are other features which can be described as notable – and even as unprece-dented. The emphasis on enforcement has led to the twin institutional setup of the two branches. The enforcement function has raised concerns about a potential po-liticization of the Compliance Committee and thus provided a rationale for the far-reaching independence of the Committee from the CMP, as well as an emphasis being placed on the independence and impartiality of Committee members. The independence of the Committee, combined with concerns about politicization, fuelled demands for the inclusion of explicit and detailed safeguards of due process, as enshrined in the Compliance Procedures. Finally, these concerns, combined with the economic repercussions of the decisions, especially those of the EB, reinforced requests for a high degree of automaticity and predictability of the procedures, in-cluding rigid timelines. Overall, the imperatives toward protection of the parties and the political independence of the Committee took precedence over political oversight of the Committee.

Since the adoption of the Compliance Procedures in 2005, the compliance system of the Protocol has evolved from a ‘paper tiger’ to a fully operational system with a functioning Compliance Committee at its centre. The Committee has elaborated Rules of Procedure and working arrangements that have enabled the application of the Compliance Procedures in practice. The operation of the compliance system has also generated experience of its crucial functions within the Protocol’s overall govern-ance system. The EB has proved its ability to effectively address and resolve cases of

non-compliance in respect of both methodological and reporting requirements, as well as the functioning of the carbon market. On the downside, the facilitative func-tions of the compliance system have yet to be used, and remain to be further devel-oped.

As remarkable as the compliance system of the Protocol is, it is uncertain whether it will continue to be effective and ultimately be able to ensure parties’ compliance with their emission targets. Whereas the compliance system may be considered strong when compared with that of other MEAs, and indeed many other international in-stitutions, it is unclear whether it is strong enough to bring about and restore compli-ance in the face of significant economic and political incentives to defect.¹³¹ In the event of a continuation of the Kyoto Protocol being negotiated, parties which are likely to be in non-compliance in the first commitment period might well be able to negotiate second-commitment-period targets which compensate for projected de-ductions. Above all, the uncertain future of the Protocol casts doubt on the compli-ance system’s ability to effectively address non-complicompli-ance with emission targets; and, to some extent, it also casts doubt on the future of the compliance system in general.

Evaluation of the rules and practice of the Kyoto compliance system has clear rele-vance for international environmental law and governance generally.¹³² To engage in detail with the broader debates about the need and options for a reformed or new compliance system for any post-2012 climate agreement is beyond the scope of this paper.¹³³ Nevertheless, the analysis of the compliance system is relevant to those debates. Investigating both the need for and options for a future compliance system would require considering the potential form and content of a post-2012 climate regime (which might deal with emission mitigation for both developed and develop-ing countries, emissions from deforestation and forest degradation in developdevelop-ing countries, new and existing carbon-market mechanisms, financial assistance and investment, technology cooperation, and so forth), which is itself highly uncertain.

It can be argued that an in-depth understanding of the existing compliance system of the Kyoto Protocol and its achievements would provide valuable (and perhaps

131 It is not suggested that strength be equated with success. While compliance mechanisms of other MEAs might be weaker, they might at the same time be as – or even more – successful.

132 For some examples of the large and expanding literature on implementation and compliance in interna-tional environmental governance, see Abram Chayes and Antonia Handler Chayes, The New Sovereignty:

Compliance with International Regulatory Agreements (Harvard University Press, 1995); George W. Downs, David M. Rocke, and Peter N. Barsoom, ‘Is the Good News about Compliance Good News about Co-operation?’, 50 International Organization (1996) 379–406; Edith Brown Weiss and Harold K. Jacobson (eds), Engaging Countries. Strengthening Compliance with International Environmental Accords (MIT Press, 1998); David G. Victor, Kal Raustiala, and Eugene B. Skolnikoff (eds), The Implementation and Effective-ness of International Environmental Commitments: Theory and Practice (MIT Press, 1998); Kal Raustiala and Anne-Marie Slaughter, ‘International Law, International Relations and Compliance’ in Walter Carl-snaes, Thomas Risse and Beth A. Simmons (eds), Handbook of International Relations (2002) 538–558;

Daniel Bodansky, The Art and Craft of International Environmental Law (Harvard University Press, 2010), especially chapters 10 and 11.

133 For two relevant contributions, see Murtha, ‘Effective International Compliance’, supra note 124; and Pew Center, Verifying Mitigation Efforts, supra note 110.

even necessary) input into debates about how to enhance compliance with, and implementation of, future climate change-related agreements. There are good reasons

even necessary) input into debates about how to enhance compliance with, and implementation of, future climate change-related agreements. There are good reasons