Amendments to extend the scope of the EU Directive for EU Emissions Trading System to the shipping sector (hereinafter EU-ETS Directive) were adopted, with effect from 1 January 2024. Under these amendments, ships of 5,000 Gross tonnage and above, arriving at or departing from ports within the jurisdiction of any EEA member state1, regardless of the Flag state, will be required to purchase and surrender2 allowances equivalent to EU ETS applicable GHG emissions on an annual basis. Failure to do so will result in penalties such as fines and a ban on entry into ports within the EEA territories.
In connection with the application of the EU-ETS Directive, amendments to the EU-MRV Regulations have also been adopted.

The following is the summary of the EU-ETS Directive on the shipping sector and the amendments to the EU-MRV Regulations.

1. Summary of the EU-ETS Directive on the shipping sector

(1) Name of the Regulation
Directive (EU) 2023/959 of the European Parliament and of the Council of 10 May 2023 amending Directive 2003/87/EC establishing a system for greenhouse gas emission allowance trading within the Union and Decision (EU) 2015/1814 concerning the establishment and operation of a market stability reserve for the Union greenhouse gas emission trading system (Reference URL 1)

(2) Scope of application
(i) EU-ETS Directive applies to ships of 5,000 GT or above, arriving at or departing from ports within the jurisdiction of any EEA member state, regardless of the Flag state
(ii) EU-ETS Directive applies to total GHG emissions from the following activities:
･ Voyages between an EEA port of call3 and a non-EEA port of call: 50% of the emissions
･ Voyages within EEA ports: 100% of the emissions
･ Emissions in EEA ports: 100% of the emissions

1 EEA(European Economic Area) Member States: 30 States consist of 27 EU Member States and 3 EEA States, Norway, Iceland and Lichtenstein.
2 "surrender" roughly means reporting allowances purchased to Administering Authority electronically.
3 "port of call" means the port where a ship stops to load or unload cargo or to embark or disembark passengers, or the port where an offshore ship stops to relieve the crew.

(To be continued)