[Code of Federal Regulations]

[Title 40, Volume 17]

[Revised as of July 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 40CFR82.18]



[Page 498-500]

 

                   TITLE 40--PROTECTION OF ENVIRONMENT

 

         CHAPTER I--ENVIRONMENTAL PROTECTION AGENCY (CONTINUED)

 

PART 82_PROTECTION OF STRATOSPHERIC OZONE--Table of Contents

 

              Subpart A_Production and Consumption Controls

 

Sec.  82.18  Availability of production in addition to baseline 

production allowances for class II controlled substances.



    (a) Article 5 allowances. (1) Effective January 1, 2003, a person 

apportioned baseline production allowances under Sec.  82.17 is also 

apportioned Article 5 allowances, equal to 15 percent of their baseline 

production allowances for the specified HCFC for each control period up 

until December 31, 2014, to be used for the production of the specified 

HCFC for export only to foreign states listed in Appendix E to this 

subpart.

    (2) Effective January 1, 2015, for all HCFCs, a person apportioned 

baseline production allowances under Sec.  82.17 is also apportioned 

Article 5 allowances, equal to 10 percent of their baseline production 

allowances for the specified HCFC for each control period up until 

December 31, 2029, to be used for the production of the specified HCFC 

for export only to foreign states listed in Appendix E to this subpart.

    (3) Effective January 1, 2030, for all HCFCs, a person apportioned 

baseline production allowances under Sec.  82.17 is also apportioned 

Article 5 allowances, equal to 15 percent of their baseline production 

allowances for the specified HCFC for each control period up until 

December 31, 2039, to be used for the production of the specified HCFC 

for export only to foreign states listed in Appendix E to this subpart.

    (b) Export production allowances. (1) Effective January 1, 2003, a 

person apportioned baseline production allowances for HCFC-141b under 

Sec.  82.17 is also apportioned export production allowances equal to 

100 percent of their baseline production allowances for HCFC-141b for 

each control period up until December 31, 2029, to be used for the 

production of HCFC-141b for export only, in accordance with this 

section.

    (2) [Reserved]

    (c) International trades of production allowances, export production 

allowances and Article 5 allowances. (1) A person may increase or 

decrease its production allowances, export production allowances, or 

Article 5 allowances, for a specified control period through trades with 

another Party to the Protocol as set forth in this paragraph (c). 

Effective January 1, 2004, a nation listed either: in Appendix L of this 

subpart that is also listed in Appendix C, Annex 1 of



[[Page 499]]



the Protocol as having ratified the Beijing Amendments, or in Appendix 

C, Annex 1 of the Protocol as having ratified the Copenhagen Amendments 

but not listed in Appendix L of this subpart, or in Appendix C, Annex 2 

of the Protocol, as being a foreign state complying with the Beijing 

Amendments if the foreign state is listed in Appendix L of this subpart, 

or as being a foreign state complying with the Copenhagen Amendments if 

the foreign state is not listed in Appendix L of this subpart must agree 

either to trade to the person for the current control period some 

quantity of production that the nation is permitted under the Montreal 

Protocol or to receive from the person for the current control period 

some quantity of production that the person is permitted under this 

subpart. The person must expend its consumption allowances allocated 

under Sec.  82.19, or obtained under Sec.  82.20 in order to produce 

with the additional production allowances.

    (2) Trade from a Party--Information requirements. (i) A person 

requesting a trade from a Party must submit to the Administrator a 

signed document from the principal diplomatic representative in that 

nation's embassy in the U.S. stating that the appropriate authority 

within that nation will establish or revise production limits for the 

nation to equal the lowest of the following three production quantities:

    (A) The maximum production that the nation is allowed under the 

Protocol minus the quantity (in kilograms) to be traded;

    (B) The maximum production that is allowed under the nation's 

applicable domestic law minus the quantity (in kilograms) to be traded; 

or

    (C) The average of the nation's actual national production level for 

the three years prior to the trade minus the production to be traded.

    (ii) A person requesting a trade from a Party must also submit to 

the Administrator a true copy of the document that sets forth the 

following:

    (A) The identity and address of the person;

    (B) The identity of the Party;

    (C) The names and telephone numbers of contact persons for the 

person and for the Party;

    (D) The chemical type and quantity (in kilograms) of production 

being traded;

    (E) Documentation that the Party possesses the necessary quantity of 

unexpended production rights;

    (F) The control period(s) to which the trade applies; and

    (G) For increased production intended for export to the Party from 

whom the allowances would be received, a signed statement of intent to 

export to the Party.

    (3) Trade to a Party--Information requirements. A person requesting 

a trade to a Party must submit a request that sets forth the following 

information to the Administrator:

    (i) The identity and address of the person;

    (ii) The identity of the Party;

    (iii) The names and telephone numbers of contact persons for the 

person and for the Party;

    (iv) The chemical type and quantity (in kilograms) of allowable 

production being traded; and

    (v) The control period(s) to which the trade applies.

    (4) Review of international trade request to a Party. After 

receiving a trade request that meets the requirements of paragraph 

(c)(3) of this section, the Administrator may, at his/her discretion, 

consider the following factors by seeking concurrence from the 

Department of Commerce, the United States Trade Representative, and the 

Department of State, where appropriate, in deciding whether to approve 

such a trade:

    (i) Possible creation of domestic economic hardship;

    (ii) Possible effects on trade;

    (iii) Potential environmental implications; and

    (iv) The total quantity of unexpended production allowances held by 

U.S. entities.

    (5) Notice of trade. If the request meets the requirement of 

paragraph (c)(2) of this section for trades from Parties and paragraphs 

(c)(3) and (4) of this section for trades to Parties, the Administrator 

will issue the person a notice. The notice will either grant or deduct 

production allowances or export production allowances or Article 5 

allowances and specify the control period



[[Page 500]]



to which the trade applies. The Administrator may disapprove the trade 

request contingent on the consideration of factors listed in paragraph 

(c)(4) of this section for trades to Parties.

    (i) For trades from a Party, the Administrator will issue a notice 

revising the allowances held by the recipient of the trade to equal the 

unexpended production allowances, unexpended export production 

allowances, or unexpended Article 5 allowances held by the recipient of 

the trade under this subpart plus the quantity of allowable production 

traded from the Party.

    (ii) For trades to a Party, the Administrator will issue a notice 

revising the production limit for the trader to equal the lesser of:

    (A) The unexpended production allowances, unexpended export 

production allowances or unexpended Article 5 allowances held by the 

trade or minus the quantity traded; or

    (B) The unexpended production allowances held by the trader minus 

the amount by which the U.S. average annual production of the class II 

controlled substance being traded for the three years prior to the trade 

is less than the total allowable production of that class II controlled 

substance under this subpart minus the amount traded; or

    (C) The total U.S. allowable production of the class II controlled 

substance being traded minus the three-year average of the actual annual 

U.S. production of the class II controlled substance prior to the 

control period of the trade.

    (6) Revised notices of production limits for subsequent traders. If 

after one person obtains approval of a trade of allowable production of 

a class II controlled substance to a Party and other persons obtain 

approval for trades of the same class II controlled substance during the 

same control period, the Administrator will issue revised notices. The 

notices will revise the production limits for each of the other persons 

trading to equal the lesser of:

    (i) The unexpended production allowances, unexpended export 

production allowances or unexpended Article 5 allowances held by the 

trader under this subpart minus the quantity traded; or

    (ii) The result of the following set of calculations:

    (A) The total U.S. allowable production of the class II controlled 

substance minus the three-year average of the actual annual U.S. 

production of the class II controlled substance prior to the control 

period of the trade;

    (B) The quantity traded divided by the total quantity traded by all 

the other persons trading the same class II controlled substance in the 

same control period;

    (C) The result of paragraph (c)(6)(ii)(A) of this section multiplied 

by the result of paragraph (c)(6)(ii)(B) of this section;

    (D) The quantity derived in paragraph (c)(6)(i) of this section, 

minus the result of paragraph (c)(6)(ii)(C) of this section;

    (7) Production limit for previous traders. The Administrator will 

also issue a notice revising the production limit for each trader who 

previously obtained approval of a trade of the class II controlled 

substance to a Party in the same control period to equal the result of 

the following set of calculations:

    (i) The total U.S. allowable production of the class II controlled 

substance minus the three-year average of the actual annual U.S. 

production of the class II controlled substance prior to the control 

period of the trade;

    (ii) The quantity traded by the person divided by the quantity 

traded by all the persons who have traded that class II controlled 

substance in that control period;

    (iii) The result of paragraph (c)(7)(i) of this section multiplied 

by the result of paragraph (c)(7)(ii) of this section.

    (iv) The unexpended production allowances, unexpended export 

production allowances or unexpended Article 5 allowances held by the 

person plus the result of paragraph (c)(7)(iii) of this section;

    (8) Effective date of revised production limits. The change in 

production allowances, export production allowances or Article 5 

allowances will be effective on the date that the notice is issued.



[68 FR 2848, Jan. 21, 2003]



[[Page 501]]