BlueNext SA is waiting for Romania to confirm the theft of European Union carbon permits from a cement maker with two factories in the country, according to the exchange’s chief.
The Romanian unit of Jonas, Switzerland-based Holcim Ltd., the world’s second-biggest cement maker, said Nov. 30 that about 15 million euros ($19 million) worth of the allowances, known as EUAs, were stolen from its account. Holcim asked the EU, which oversees national registries of the electronic permits, to help track them down. The EUAs in question are listed on the company’s website.
BlueNext has asked for confirmation of the theft from the Romanian National Registry, responsible for operating the accounts for emissions permits, Paris-based Francois-Xavier Saint-Macary said today in a telephone interview. Romania must also clarify who would be the legal owner of the permits if they’ve been traded, he said.
“Under French law, assuming the EUAs in an account were acquired in accordance with the law, the trades associated with them remain firm,” BlueNext said in an e-mailed statement. “However, the issues surrounding this event remain under investigation and await final clarification from the Romanian authorities.”
The EU regulator said it regrets the unathorized access to an account in Romania’s carbon registry and sees no indication of insufficient security measures in its trading system.
“The recovery of any allowances which are claimed to have been transferred fraudulently is a matter for national law and national law-enforcement authorities,” Jos Delbeke, director general for climate at the European Commission, said today in a statement. “The Commission has no powers to block any such allowances in a registry account as such allowances continue to represent legally valid compliance instruments.”
Delbeke said the commission is “fully cooperating” with national authorities to facilitate their work.
The legal ownership of stolen permits is “not straightforward,” according to Owen Lomas, a consultant at Allen & Overy LLP’s climate-change group.
The EU’s cap-and-trade program covers more than 11,000 factories and power stations across Europe. Theft of permits hadn’t been anticipated when the EU drafted the laws for trading carbon allowances, Lomas said. Lawyers have to revert to basic property law in these cases, he said.
Holcim said a total of 1.5 million permits had gone missing from its account. The company has two sites in Romania, under the emissions trading system, which spewed about 1 million tons of carbon-dioxide last year, emissions data on Bloomberg show.
Romania has the largest surplus of allowances, according to the data. The country caps about 235 factories and power stations and had a national limit of 48.6 million metric tons of carbon dioxide last year. They had a surplus of 25 million permits after emissions declined.
Emissions permits may have been stolen from other Romanian companies, according to Andrew Ager, London-based head of emissions at Prudential Financial Inc.’s Bache Commodities Ltd.,
“Holcim would have noticed the theft whereas smaller installations may not even yet be aware that allowances may have been taken from their account,” Ager said in an e-mail.