OVG Berlin: No Fine if False but Certified TEHG Emissions Report Is Submitted

The Emissions Trading Authority (DEHSt) may not impose a fine if a false, but certified emissions report pursuant to the Greenhouse Gas Emission Trading Act (TEHG) has been submitted, the Higher Administrative Court of the states of Berlin and Brandenburg (OVG Berlin Brandenburg) decided.

In accordance with Section 5 para. 1 sent. 1 TEHG 2004, plaintiff had calculated the emissions caused by his economic activities in 2005 (the first year of the first emission trading period of TEHG). He submitted a report to DEHSt. However, based on an opinion by the Federal Ministry for the Environment, he had not declared emissions for an installation which he believed was not subject to the TEHG provisions. As required by law, the report was certified by an expert. Based on the report, plaintiff submitted the amount of emission allowances required for the declared emissions.

In the following discussions with DEHSt plaintiff learnt about his mistake in the calculation. He corrected the report and submitted the necessary emission allowances. The defendant (the Federal Republic of Germany on whose behalf DEHSt had acted) imposed a fine, arguing plaintiff had not submitted the necessary amount of emissions allowances in the first place. There had not been a case of force majeure, in which case DEHSt could abstain from imposing a fine according to Section 18 para. 1 sent. 2 TEHG. The certification of the emissions report did not absolve plaintiff from the obligation to accurately prepare and verify the report.

In essence, OVG Berlin-Brandenburg had to decide whether the obligation to submit emission allowances in Section 6 para. 1 TEHG (after the latest TEHG amendment now Section 7 para. 1) refers to the emissions that were actually caused and should have been declared pursuant to TEHG, or to the emissions identified as caused in the emissions report.

In line with the previous instance, OVG ruled that the latter was the case so that the fine was not justified. In a detailed analysis of the reasons given for TEHG, the statutory system of the TEHG and the relation of the different sections to one another as well as the underlying EU Directive 2003/87/EC  establishing a scheme for greenhouse gas emission allowance trading, OVG held that the verification of the emissions report is essentially assigned to the certified expert. Hence, this justified the interpretation of Section 6 para. 1 TEHG in a way that emissions allowances in the amount of the certified report had to be submitted.

OVG granted leave to appeal to the Federal Administrative Court (Bundesverwaltungsgericht), as it considered the matter of fundamental importance.

Source: OVG Berlin Brandenburg, ref. no. OVG 12 B 20.10

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