Loose ends from a fragmented negotiating process

The highly complex nature of the Kyoto Protocol, made necessary by the complex nature of the problem to which it responds, presented serious practical challenges to the negotiators. The compliance system sits at the heart of the operation of the Kyoto flexibility mechanisms and of the reporting and review procedures. However, during the negotiations, each of these issues was assigned to a separate working group. At several stages in the negotiations, delegations and the chairs of the various groups sought to ensure that cross-cutting and interlinking issues such as the links between the mechanisms and compliance were either clearly assigned to one negotiating group, or that they were taken in up in parallel in a conscious manner.

One specific issue that will be critical to the compliance system was negotiated in its entirety outside the JWG by another group: the definition of non-compliance. Coming to an understanding of how exactly non-compliance or potential non-compliance will be identified is important at both ends of the operation of the compliance system. At the point of initiating the procedure, the Compliance Committee must determine whether or not a question of implementation that has been raised is de minimis in nature. At the end of the procedure, a declaration of non-compliance may also need to take into account margins for error. Although these issues are fundamental legal concerns, they were never taken up by the JWG's legal experts. The implications of the difficulties in defining non-compliance are taken up in Chapter 2.

A further controversial issue, and the last to be resolved by negotiators in Marrakesh, was the relationship between the compliance system and the rules that would determine eligibility to participate in the Kyoto mechanisms. As has been described, the Enforcement Branch will have the authority to review questions of implementation raised with regard to an Annex I party's eligibility to participate in the Protocol's flexibility mechanisms, and the authority to suspend and reinstate that eligibility. In order to cement this essential aspect of the compliance/flexibility relationship, a number of delegations sought to introduce, in the negotiating group on mechanisms and in the JWG on compliance, a solid link between the two systems. In the mechanisms group, these delegations pressed for the express inclusion in the mechanism 'eligibility criteria' the commitment by each party to subject itself to the Enforcement Branch of the compliance system. The purpose of such a link would be twofold: to emphasize that the integrity of the flexibility mechanisms depended on the integrity of the compliance system, and to provide a strong incentive for all Annex I parties to adopt, adhere to and, potentially, ratify the compliance system, depending on what legal form the system would take. The issue of linkage was thus further complicated by the fact that the negotiators had not yet agreed on the legal character of the consequences and the means by which the compliance system would be adopted and become effective. While most delegations were comfortable having the Enforcement Branch review mechanism eligibility, some were adamantly opposed to making ratification of a compliance system with binding consequences a pre-condition for mechanism eligibility.

In the end, the link was left strongly implicit. The rules on the mechanisms agreed in Marrakesh provide that the:

eligibility to participate in the mechanisms by a Party included in Annex I shall be dependent on its compliance with methodological and reporting requirements [and that] [o]versight of this provision will be provided by the Enforcement Branch of the compliance committee, in accordance with the procedures and mechanisms relating to compliance as contained in decision 24/CP.7, assuming approval of such procedures and mechanisms by the Conference of the Parties serving as the meeting of the Parties to the Kyoto Protocol in decision form in addition to any amendment entailing legally binding consequences, noting that it is the prerogative of the Conference of the Parties serving as the meeting of the Parties to the Kyoto Protocol to decide on the legal form of the procedures and mechanisms relating to compliance.42

Despite its convoluted caveat about eventual decisions by the COP/MOP, the decision indicates that eligibility for the mechanisms must be reviewed and that the review will be made by the Enforcement Branch. No manner of alternative is provided for an Annex I party to participate in the mechanisms without having subjected itself to the jurisdiction of the Enforcement Branch. This suggests that if COP/MOP-1 decides to adopt a compliance system with legally binding consequences that are subject to ratification, mechanism eligibility will be tied to participation in that compliance system and, by implication, ratification of the binding consequences.

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