Case 1: The first case in the country! A product in Zhangjiagang, Suzhou City, failed to perform on time - a fine of 20,000 yuan
In 2022, the country's first case of non-compliance with carbon emission quotas in the national carbon market was investigated and punished, and a penalty of 20,000 yuan was imposed.
Case 2: A thermal power limited liability company of a coal group in Ordos City falsely reported and concealed carbon emissions-related data - a penalty of 30,000 yuan
After the penalty was announced, the public, especially EHS managers, thought that the penalty was too light, and that it seemed to be no different from not being punished. This amount of money, there is no deterrent. Why?
These cases all occurred around 2022, and there are no laws or administrative regulations on carbon trading. Only the Ministry of Ecology and Environment issued the "Measures for the Administration of Carbon Emission Trading (Trial)".The Measures are departmental regulations.
As everyone knows, the state stipulates the scope and range of administrative penalties for different levels of regulations. Among them,Notice on the Implementation of the Administrative Punishment Law of the People's Republic of ChinaThe work of amending the regulations should be completed by xx-xx-xx. Until then, the administrative penalties already provided for in the current regulations remain in force. However, the rules formulated after the implementation of the Administrative Punishment Law establish new administrative penalties, and they must be implemented in accordance with the provisions of the Administrative Punishment Law. **The rules formulated by each department shall not set a fine of more than yuan for illegal acts in non-business activities; There are illegal gains from illegal acts in business activitiesThe fine shall not exceed multiple times of the illegal gains, but the maximum shall not exceed RMBwhere there are no illegal gains, the fine shall not exceed RMB; If the above limit is exceeded, it shall be reported for approval. The limits of fines set by local ** rules are to be prescribed by the standing committees of the people's congresses of provinces, autonomous regions, and municipalities directly under the Central Government, and may not be subject to the restrictions of the above provisions.
According to the provisions of the Administrative Punishment LawArticle 11Administrative regulations may set administrative penalties other than restrictions on personal liberty. Where the law has already made provisions on administrative punishment for illegal acts, and administrative regulations need to make specific provisions, they must be provided for within the scope of the acts, types, and scope of administrative punishments prescribed by law.
Since there is no legislation in the carbon trading country, the amount of the fine can be set by administrative regulations.
To this end, on January 25, 2024, ** was releasedInterim Regulations on the Administration of Carbon Emission Trading(**Decree No. 775), effective from May 1, 2024. Available only in the nationwide market
In response to the above two cases, the penalties under the new regulations are as follows:
Non-performance. Article 24If a key emitting entity fails to pay its carbon emission allowances in accordance with regulations, the competent department of ecology and environment shall order it to make corrections and impose a market transaction one month before the time limit for the settlement of unpaid carbon emission allowancesPenalty of between 5 and 10 times the average turn**If they refuse to make corrections, they shall reduce their carbon emission quotas for the following year by the same amount of the unpaid carbon emission quotas, and may be ordered to suspend production for rectification
False data.
Article 22In any of the following circumstances, the competent department of ecology and environment shall order a key emitting enterprise to make correctionsConfiscation of illegal gainsand impose a concurrent penalty on illegal gainsFines of between 5 and 10 times；There are no illegal gains or illegal gainswhere it is less than 500,000 RMB, a fine of between 500,000 and 2,000,000 RMB is to be imposed；directly responsible for itManagers and other directly responsible personnel are to be fined between 50,000 and 200,000 RMB；If they refuse to make corrections, their carbon emission quotas for the next year shall be reduced according to the proportion of between 50% and 100%, and they may be ordered to stop production for rectification
2) There are major defects or omissions in the annual emission report prepared, tampering with or falsifying data in the process of preparing the annual emission report, using false data or other fraudulent acts;
Designate a person to be responsible;
improve rules and regulations;
Complete data review systems.
Hire a professional third-party agency to provide counseling.
2024 ESG EHS Compliance Management Series
LecturerHuang QirongPartner: EHS Professional Lawyer
Bachelor's degree (Chemical Engineering & Technology).
Practicing lawyer. National Registered Safety Engineer.
Corporate Compliance Officer (Senior).
Clean Audit Auditor.
Safety production standardization auditor.
ISO Internal Auditor.
Director of the Environmental Resources and Energy Business Research Committee of the Shanghai Bar Association.
Member of the part-time legal counsel group of the emergency management bureau of a municipality directly under the central government.
Member of the Part-time Legal Counsel Group of the Ecological Environment Bureau of a municipality directly under the Central Government.
Hearing officer of the People's Procuratorate of Changning District, Shanghai.
Third-party expert on compliance of enterprises involved in the case in Jing'an District, Shanghai.
A third-party expert on compliance with enterprises involved in the case in Guyuan City, Ningxia Hui Autonomous Region.
Writings
In 2022, publishedEnvironmental Law in Practice – Dispute Resolution and Compliance Development(Law Press).
Written for three consecutive yearsChambers Global Practice Guide - Environmental Law (China Edition).
Rewards:
In 2019, he participated in the course "Fine Chemicals Production Technology" recorded by Beijing Forestry University, which was rated as "National First-class Online Undergraduate Course" and "National Informatization Teaching **A-level Courseware" by the Ministry of Education and the State Forestry Administration
In 2021, he was awarded the "First Best Industrial Promotion Legal Partner Award in Lingang New Area".
In 2023, the publication of "Solid Waste Management and Circular Economy: Legal Dilemmas and Solutions Ideas" won the third prize of the 18th East China Lawyers Forum.
Publications:
In May 2023, ".Key changes to AQ T 3034-2022 Guidelines for Chemical Process Safety Management(Shanghai Safety Production Magazine).
June 2023, ".Changes and impacts of the new "Safety Code for Gas Station Operations".(Shanghai Safety Production Magazine).
December 2023,"Continuously Optimizing the Business Environment to Help Precise Law Enforcement in Emergency Response".(Shanghai Safety Production Magazine).
After graduating in 2002, Mr. Huang worked for 16 years in a large state-owned chemical company, a Taiwan-funded enterprise and a well-known U.S.-funded company, serving as a production supervisor, environmental health and safety supervisor and factory manager. Prior to practicing law, he worked as a full-time environmental health and safety manager (EHS) at DuPont for nearly 10 years. Familiar with EHS-related laws and regulations, with rich EHS legal risk identification, risk assessment and risk control capabilities, good at maintaining a good relationship between government and enterprises.
Mr. Huang is good at combining legal requirements with practical experience to provide enterprises with more operational and targeted overall legal solutions, including EHS compliance consulting and audit for daily operations, legal due diligence on environmental safety in the process of corporate investment and financing, mergers and acquisitions, and restructuring, on-site audits, training, etc.