In Australia, the legislation has adopted a significant
improvement in market design over the EU scheme in order to address
How does the Regulator address security risk and protect
The Clean Energy Regulator will be empowered to act to prevent
the system from being undermined. The Regulator will be able
unilaterally close, with notice, any Registry account if an
account holder has breached the Registry regulations; and
correct any errors in the Registry, on the Regulator's own
initiative, if an entry was made without cause, is wrongly in the
Registry or has been wrongly removed.
The Regulator can also do any of the following in order to
ensure the integrity of the registry or to prevent, mitigate or
minimise abuse of the Registry or prevent, mitigate or minimise
criminal activity involving the Registry:
suspend the operation of the Registry;
defer giving effect to a transfer instruction for up to 48
refuse to give effect to a transfer instruction;
impose conditions restricting or limiting the operation of an
account for a specified period; or
suspend a person's registry account; and
refuse to make an entry in the Registry for a Kyoto unit being
transferred in from a foreign account if it has reasonable grounds
to suspect that the instruction is fraudulent.
The Regulator's powers do not protect the innocent upon whom
the fraud was perpetrated.
Negotiable title – the Australian answer to the
The Clean Energy Bill does protect the innocent defrauded by
providing for negotiable title to units. It sets out that the
registered holder of a carbon unit is the legal owner of that unit,
provided that they purchased it in good faith for value without
notice of any defect in the title. The Clean Energy (Consequential
Amendments) Bill provides the same protection for registered
holders of eligible international emissions units entered onto into
Registry.What does this mean? If the Regulator fails to prevent a
holder from becoming the registered holder of a fraudulent unit,
for value without notice of a prior fraud, you will nonetheless
have good title without the need to prove a chain of title all the
way to the original holder of the instrument.
What if another person has obtained and hold units fraudulently?
The courts are empowered to act when a person has been convicted of
specific crimes under the Criminal Code 1995, relating to
fraudulent conduct or making misleading and deceptive statements.
The court may order the relinquishment of units if any or all of
the person's units are directly attributable to their
Clayton Utz communications are intended to provide
commentary and general information. They should not be relied upon
as legal advice. Formal legal advice should be sought in particular
transactions or on matters of interest arising from this bulletin.
Persons listed may not be admitted in all states and
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This legal update is an overview of existing eligible project activities and new project types proposed to be developed.
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