If a free-allocation recipient relocates or transfers its production/economic activity outside the EU, the Member State must claw back (or deduct from future allocations) the free allowances already received for that period.
Operators who relocate production outside the EU after receiving free allocation must comply, and this is not law yet.
Why it matters
This is a Commission proposal: it is not law yet, and it can change before it is.
- It is Art. 1(15)(d), inserting Art. 10a(3c), second subparagraph of Directive 2003/87/EC, in the EU ETS revision. as of 2026-08-14
- The act gives its timing as: from 2031. as of 2026-08-14
- It names no industry: it applies across the economy rather than to one of them. as of 2026-08-14
- Compliance is checked by competent authority, if it happens. as of 2026-08-14
The rule
relocation or direct/indirect transfer, in whole or in part, of production capacity or economic activity outside the Union
If a free-allocation recipient relocates or transfers its production/economic activity outside the EU, the Member State must claw back (or deduct from future allocations) the free allowances already received for that period.
Who is affected
Burden drivers
Source text
Where an installation has received allowances in accordance with the first subparagraph during each five-year period starting in 2031, but has then relocated or otherwise, directly or indirectly, transferred, in whole or in part, its relevant production capacity or the associated economic activity outside the Union, the Member State shall require the operator to reimburse the received allowances for the relevant allocation period.
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