This Statutory Instrument has been made in part in consequence of defects in S.I. 2023/1394 and is being issued free of charge to all known recipients of that Statutory Instrument.
2025 No. 1101
CLIMATE CHANGE
ROAD TRAFFIC
The Vehicle Emissions Trading Schemes (Amendment) (No. 2) Order 2025
Made
15th October 2025
Laid before Parliament
17th October 2025
Laid before the Northern Ireland Assembly
17th October 2025
Laid before the Scottish Parliament
17th October 2025
Laid before Senedd Cymru
17th October 2025
Coming into force
1st January 2026
At the Court at Buckingham Palace, the 15th day of October 2025
Present,
The King's Most Excellent Majesty in Council
This Order is made in exercise of the powers conferred by sections 44 and 90(3)(a) and (b) of, and Parts 1 and 3 of Schedule 2 and paragraph 9 of Schedule 3 to, the Climate Change Act 2008.
In accordance with paragraph 10 of Schedule 3 to that Act, before the recommendation to His Majesty in Council to make this Order was made—
the advice of the Committee on Climate Change was obtained and taken into account; and
such persons likely to be affected by the Order as the Secretary of State, Department for Infrastructure, the Scottish Ministers and the Welsh Ministers considered appropriate were consulted.
Accordingly, His Majesty, by and with the advice of His Privy Council, makes the following Order.
(1) This Order may be cited as the Vehicle Emissions Trading Schemes (Amendment) (No. 2) Order 2025 and comes into force on 1st January 2026.
(2) This Order extends to England and Wales, Scotland and Northern Ireland.
In article 3, in paragraph (1)—
(a) in the definition of “CRTS credit”, for “23” substitute “23B, 57A and 58A”;
(b) in the definition of “VRTS credit”, for “50 to 55” substitute “25A, 26A and 50 to 55B”.
4 Amendment of article 14 (banking CRTS allowances)
In article 14, in paragraph (1)—
(a) after sub-paragraph (b), insert—
(ba) traded in accordance with article 25A during the trading window following the scheme year of allocation, or the trading window following any of the three subsequent scheme years, by that CRTS participant or by a CRTS participant which acquires the CRTS allowance through trading in accordance with article 25;
;
(b) for sub-paragraph (c) substitute—
(c) exchanged for CCTS allowances in accordance with article 35 during the trading window following the scheme year of allocation, or the trading window following any of the three subsequent scheme years, by that CRTS participant or by a CRTS participant which acquires the CRTS allowance through trading in accordance with article 25;
(d) exchanged for part of a VRTS credit in accordance with article 55A during the trading window following the scheme year of allocation, or the trading window following any of the three subsequent years, by that CRTS participant or by a CRTS participant which acquires the CRTS allowance through trading in accordance with article 25.
.
5 Amendment of article 15 (borrowing CRTS allowances)
(1) Article 15 is amended as follows.
(2) In paragraph (1), for “the 2024 scheme year, the 2025 scheme year or the 2026 scheme year” substitute “any scheme year other than the 2030 scheme year”.
(3) In paragraph (2)—
(a) in sub-paragraph (b), for “14%” substitute “19.6%”;
(b) omit the “and” at the end of sub-paragraph (b);
(c) after sub-paragraph (c) insert—
(d) the number of CRTS allowances which the CRTS participant borrows to surrender for the 2027 scheme year does not exceed 7.6% of the total number of cars of which the participant is manufacturer and which are registered during the 2027 scheme year;
(e) the number of CRTS allowances which the CRTS participant borrows to surrender for the 2028 scheme year does not exceed 7.8% of the total number of cars of which the participant is manufacturer and which are registered during the 2028 scheme year; and
(f) the number of CRTS allowances which the CRTS participant borrows to surrender for the 2029 scheme year does not exceed 6.6% of the total number of cars of which the participant is manufacturer and which are registered during the 2029 scheme year.
.
(4) In paragraph (6), for “, the 2026 scheme year or the 2027 scheme year” substitute “or for any subsequent scheme year”.
(5) After paragraph (10), insert—
(10A) If the CRTS participant accounts for the borrowed allowances for a scheme year which begins three years after the end of the scheme year for which the borrowed allowances were surrendered, the CRTS participant must surrender—
(a) a number of CRTS allowances or CRTS credits which is equal to the number of borrowed allowances; and
(b) an additional number of CRTS allowances or CRTS credits which amounts to 14.75% of the number of borrowed allowances.
(10B) If the CRTS participant accounts for the borrowed allowances for a scheme year which begins four years after the end of the scheme year for which the borrowed allowances were surrendered, the CRTS participant must surrender—
(a) a number of CRTS allowances or CRTS credits which is equal to the number of borrowed allowances; and
(b) an additional number of CRTS allowances or CRTS credits which amounts to 18.77% of the number of borrowed allowances.
(10C) If the CRTS participant accounts for the borrowed allowances for a scheme year which begins five years after the end of the scheme year for which the borrowed allowances were surrendered, the CRTS participant must surrender—
(a) a number of CRTS allowances or CRTS credits which is equal to the number of borrowed allowances; and
(b) an additional number of CRTS allowances or CRTS credits which amounts to 22.93% of the number of borrowed allowances.
.
(6) In paragraph (11), for “paragraph (8)(b), (9)(b) or (10)(b)” substitute “sub-paragraph (b) of any of paragraphs (8) to (10C)”.
(7) In each of paragraphs (12) and (13), for “the 2027 scheme year” substitute “the 2030 scheme year”.
(8) In paragraph (15), after “article 25”, insert “or 25A or exchanged under article 35 or 55A”.
(1) Article 18 is amended as follows.
(2) In paragraph (1), for “and 23” substitute “, 23 to 23B, 57A and 58A”.
(3) In paragraph (2)—
(a) in the opening words, for “its” substitute “it”;
(b) at the end of sub-paragraph (b) insert “, unless the credit was acquired by the CRTS participant in accordance with article 23, 23A, 23B, 57A or 58A”.
(4) In paragraph (4), after “article 26” insert “or 26A”.
(5) In paragraph (5)—
(a) for “23” substitute “23B”;
(b) after “accordingly” insert “(see also the requirement for the administrator to update the registry in articles 57A(7) and 58A(8))”.
7 Amendment of article 22 (CRTS credits: car clubs (SPV car manufacturers))
(1) Article 22 is amended as follows.
(2) In paragraph (2), in sub-paragraph (b), after “article 26” insert “or 26A”.
(3) In paragraph (3), after “article 26” insert “or 26A”.
8 Amendment of article 23 (CRTS credits: conversion of unused CCTS allowances)
(1) Article 23 is amended as follows.
(2) In paragraph (1), in sub-paragraph (c), for “the 2024 scheme year, the 2025 scheme year or the 2026 scheme year” substitute “any scheme year other than the 2030 scheme year”.
(3) In paragraph (4), for “12.6%” substitute “25.2%”.
(4) In paragraph (5), for “8.25%” substitute “26.4%”.
(5) After paragraph (5), insert—
(5A) A request under paragraph (1) to exchange unused CCTS allowances allocated for the 2027 scheme year is limited to a number of CRTS credits which does not exceed 26.6% of the total number of cars of which the CRTS participant is the manufacturer and which were registered during that scheme year.
(5B) A request under paragraph (1) to exchange unused CCTS allowances allocated for the 2028 scheme year is limited to a number of CRTS credits which does not exceed 31.2% of the total number of cars of which the CRTS participant is the manufacturer and which were registered during that scheme year.
(5C) A request under paragraph (1) to exchange unused CCTS allowances allocated for the 2029 scheme year is limited to a number of CRTS credits which does not exceed 33% of the total number of cars of which the CRTS participant is the manufacturer and which were registered during that scheme year.
.
9 Insertion of new article 23A (CRTS credits: conversion of unused VRTS allowances by a CRTS participant which is also a VRTS participant)
After article 23, insert—
CRTS credits: conversion of unused VRTS allowances by a CRTS participant which is also a VRTS participant
23A (1) During a trading window, a CRTS participant which is also a VRTS participant may acquire two CRTS credits in exchange for one unused VRTS allowance by making a request to the administrator if—
(a) the participant’s number of units of activity in the VRTS in a scheme year does not exceed the sum of—
(i) the number of VRTS allowances which were allocated to the participant in accordance with article 45 for that year;
(ii) the number of any VRTS allowances which were banked by the participant in accordance with article 46 and were available for it to use at the beginning of the trading window; and
(iii) the number of any VRTS credits which were acquired by the participant in accordance with article 55 (conversion of unused VCTS allowances);
(b) the participant has more VRTS allowances than it requires in order to comply with article 59 (accounting for activity in the VRTS) for that scheme year (referred to in this article as “unused VRTS allowances”); and
(c) the participant did not acquire the unused VRTS allowances in accordance with article 47 (borrowing VRTS allowances).
(2) A request under paragraph (1)—
(a) must be made during the trading window following the scheme year for which the participant intends to surrender the CRTS credits to which the request relates; and
(b) may be for the exchange of a part of a VRTS allowance but may not be for the exchange of a part which is smaller than one tenth of a VRTS allowance.
(3) A CRTS credit acquired in accordance with this article may not be traded under article 25.
.
10 Insertion of new article 23B (CRTS credits: conversion of VRTS credits by a CRTS participant which is also an SPV van manufacturer)
After article 23A (as inserted by article 9 of this Order), insert—
CRTS credits: conversion of VRTS credits by a CRTS participant which is also an SPV van manufacturer
23B (1) During a trading window, a CRTS participant which is also an SPV van manufacturer may acquire two CRTS credits in exchange for one VRTS credit by making a request to the administrator.
(2) A request under paragraph (1)—
(a) must be made during the trading window following the scheme year for which the participant intends to surrender the CRTS credits to which the request relates; and
(b) may be for the exchange of a part of a VRTS credit but may not be for the exchange of a part which is smaller than one tenth of a VRTS credit.
(3) A CRTS credit acquired in accordance with this article may not be traded under article 25.
.
11 Amendment of article 25 (trading CRTS allowances and credits: CRTS participants)
(1) Article 25 is amended as follows.
(2) In paragraph (1), at the end of sub-paragraph (b), insert “, article 23A (conversion of unused VRTS allowances), article 23B (conversion of VRTS credits by a SPV van manufacturer), article 57A (trading VRTS allowances with CRTS participants) or article 58A (trading VRTS credits with CRTS participants: SPV van manufacturers)”.
(3) In paragraph (3)—
(a) in the opening words, after “party to a trade” insert “under this article”;
(b) after sub-paragraph (b) insert—
(ba) a statement of the fact that the trade was carried out under this article;
.
12 Insertion of new article 25A (trading CRTS allowances with VRTS participants)
After article 25 insert—
Trading CRTS allowances with VRTS participants
25A (1) During a trading window, a CRTS participant may trade any unused CRTS allowances with a VRTS participant if—
(a) the CRTS participant’s number of units of activity in the CRTS in a scheme year does not exceed the sum of—
(i) the number of CRTS allowances which were allocated to the CRTS participant in accordance with article 13 for that year;
(ii) the number of any CRTS allowances which were banked by the CRTS participant in accordance with article 14 and were available for it to use at the beginning of the trading window; and
(iii) the number of any CRTS credits which were acquired by the CRTS participant in accordance with article 23 (conversion of unused CCTS allowances) and are available for it to use;
(b) the CRTS participant has more CRTS allowances than it requires in order to comply with article 27 (accounting for activity in the CRTS) for that scheme year (referred to in this article as “unused CRTS allowances”); and
(c) the CRTS participant did not acquire the unused CRTS allowances in accordance with article 15 (borrowing CRTS allowances).
(2) Where a CRTS participant trades a CRTS allowance under this article, the CRTS allowance is automatically converted to four tenths of a VRTS credit on disposal.
(3) The CRTS participant may trade parts of CRTS allowances (in which case the conversion rate in paragraph (2) applies on a proportional basis) but may not trade a part smaller than one tenth of a CRTS allowance.
(4) Each party to a trade under this article must, before the end of the trading window, notify the administrator of the trade, and each notification must include—
(a) the name and account number in the registry of the transferor;
(b) the name and account number in the registry of the transferee;
(c) a statement of the fact that the trade was carried out under this article;
(d) the number of CRTS allowances traded; and
(e) the price paid for those CRTS allowances.
(5) Each party to a trade under this article must inform the other party to the trade of their account number in the registry.
(6) Where—
(a) the transferor is a pool CRTS participant, article 25(5) applies to a trade under this article as it applies to a trade under that article;
(b) the transferee is a pool VRTS participant, article 57(5) applies to a trade under this article as it applies to a trade under that article.
(7) Where a trade is notified in accordance with paragraph (4), the administrator must update the registry and notify the parties to the trade accordingly.
(8) Unless the administrator is satisfied that notification of a trade has been given in accordance with paragraph (4), the trade is treated as not having taken place.
.
13 Amendment of article 26 (trading CRTS credits: SPV car manufacturers)
(1) Article 26 is amended as follows.
(2) In the heading, after “CRTS credits” insert “with CRTS participants”.
(3) In paragraph (1), after “article 21 or 22” insert “with a CRTS participant”.
(4) For paragraph (2) substitute—
(2) An SPV car manufacturer may only trade a CRTS credit under this article during the trading window following the scheme year for which the CRTS credit was acquired by the SPV car manufacturer.
.
(5) In paragraph (3), for “paragraph (2)” substitute “this article”.
14 Insertion of new article 26A (trading CRTS credits with VRTS participants: SPV car manufacturers)
After article 26, insert—
Trading CRTS credits with VRTS participants: SPV car manufacturers
26A (1) An SPV car manufacturer may trade any CRTS credits acquired by it under article 21 or 22 with a VRTS participant in accordance with paragraphs (2) to (7).
(2) An SPV car manufacturer may only trade a CRTS credit under this article during the trading window following the scheme year for which the CRTS credit was acquired by the SPV car manufacturer.
(3) Where an SPV car manufacturer trades a CRTS credit with a VRTS participant under this article, the CRTS credit is automatically converted to four tenths of a VRTS credit on disposal.
(4) An SPV car manufacturer may trade parts of CRTS credits (in which case the conversion rate in paragraph (3) applies on a proportional basis) but may not trade a part smaller than one tenth of a CRTS credit.
(5) Each party to a trade under this article must, before the end of the trading window, notify the administrator of the trade, and each notification must include—
(a) the name and account number in the registry of the transferor;
(b) the name and account number in the registry of the transferee;
(c) a statement of the fact that the trade was carried out under this article;
(d) the number of CRTS credits traded; and
(e) the price paid for those CRTS credits.
(6) Each party to a trade under this article must inform the other party to the trade of their account number in the registry.
(7) Where the transferee is a pool VRTS participant, article 57(5) applies to a trade under this article as it applies to a trade under that article.
(8) Where a trade is notified in accordance with paragraph (5), the administrator must update the registry and notify the parties to the trade accordingly.
(9) Unless the administrator is satisfied that notification of a trade has been given in accordance with paragraph (5), the trade is treated as not having taken place.
.
(1) Article 28 is amended as follows.
(2) In paragraph (2)—
(a) at the beginning of the opening words, insert “Subject to paragraph (2A),”;
(b) for “£15,000” substitute “£12,000”.
(3) After paragraph (2), insert—
(2A) For the 2024 scheme year, the payment amount in respect of each of the matters mentioned in paragraph (2)(a), (b) or (c) is £15,000.
.
16 Amendment of article 29 (banked or borrowed CRTS allowances of former CRTS participants)
(1) Article 29 is amended as follows.
(2) In paragraph (3)—
(a) after “article 25” insert “or 25A, or exchanging in accordance with article 35 or 55A,”;
(b) for “that article” substitute “those articles”;
(c) for “paragraph (3)(b)” substitute “article 25(3)(b)”.
(3) In paragraph (5), in sub-paragraph (b), for “trading in accordance with article 25 or 26” substitute “exchanging in accordance with article 23, 23A or 23B, or trading in accordance with article 25, 26, 57A or 58A,”.
17 Amendment of article 30 (expiry of CRTS allowances and CRTS credits)
(1) Article 30 is amended as follows.
(2) In paragraph (1)—
(a) omit the “or” at the end of sub-paragraph (c);
(b) after sub-paragraph (c), insert—
(ca) converted into part of a VRTS credit pursuant to a trade under article 25A;
(cb) converted into part of a VRTS credit in accordance with article 55A; or
.
(3) In paragraph (2)—
(a) omit the “or” at the end of sub-paragraph (a);
(b) after sub-paragraph (b), insert—
(c) converted into part of a VRTS credit pursuant to a trade under article 26A; or
(d) converted into part of a VRTS credit in accordance with article 55B.
.
18 Amendment of article 35 (conversion of unused CRTS allowance into CCTS allowances)
In article 35, in paragraph (1)—
(a) at the beginning of the opening words, insert “During a trading window,”;
(b) for sub-paragraph (a) substitute—
(a) the participant's number of units of activity in the CRTS in a scheme year, measured in accordance with article 24, does not exceed the sum of—
(i) the number of CRTS allowances which were allocated to the participant in accordance with article 13 for that year; and
(ii) the number of any CRTS allowances which were banked by the participant in accordance with article 14 and were available for it to use at the beginning of the trading window;
.
19 Amendment of article 46 (banking VRTS allowances)
In article 46, in paragraph (1)—
(a) after sub-paragraph (b) insert—
(ba) traded in accordance with article 57A during the trading window following the scheme year of allocation or the trading window following any of the three subsequent scheme years, by that VRTS participant or by a VRTS participant which acquires the VRTS allowance through trading in accordance with article 57;
(bb) exchanged for CRTS credits in accordance with article 23A during the trading window following the scheme year of allocation or the trading window following any of three subsequent years, by that participant or by a VRTS participant which acquires the VRTS allowance through trading in accordance with article 57;
;
(b) for sub-paragraph (c) substitute—
(c) exchanged for VCTS allowances in accordance with article 67 during the trading window following the scheme year of allocation, or the trading window following any of the three subsequent years, by that participant or by a VRTS participant which acquires the VRTS allowance through trading in accordance with article 57.
.
20 Amendment of article 47 (borrowing VRTS allowances)
(1) Article 47 is amended as follows.
(2) In paragraph (1), for “the 2024 scheme year, the 2025 scheme year or the 2026 scheme year” substitute “any scheme year other than the 2030 scheme year”.
(3) In paragraph (2)—
(a) in sub-paragraph (b), for “8%” substitute “11.2%”;
(b) omit the “and” at the end of sub-paragraph (b);
(c) after sub-paragraph (c), insert—
(d) the number of VRTS allowances which the VRTS participant borrows to surrender for the 2027 scheme year does not exceed 6.8% of the total number of vans of which the participant is manufacturer and which are registered during the 2027 scheme year;
(e) the number of VRTS allowances which the VRTS participant borrows to surrender for the 2028 scheme year does not exceed 6.9% of the total number of vans of which the participant is manufacturer and which are registered during the 2028 scheme year; and
(f) the number of VRTS allowances which the VRTS participant borrows to surrender for the 2029 scheme year does not exceed 5.8% of the total number of vans of which the participant is manufacturer and which are registered during the 2029 scheme year.
.
(4) In paragraph (6), for “, the 2026 scheme year or the 2027 scheme year” substitute “or for any subsequent scheme year”.
(5) After paragraph (10) insert—
(10A) If the VRTS participant accounts for the borrowed allowances for a scheme year which begins three years after the end of the scheme year for which the borrowed allowances were surrendered, the VRTS participant must surrender—
(a) a number of VRTS allowances or VRTS credits which is equal to the number of borrowed allowances; and
(b) an additional number of VRTS allowances or VRTS credits which amounts to 14.75% of the number of borrowed allowances.
(10B) If the VRTS participant accounts for the borrowed allowances for a scheme year which begins four years after the end of the scheme year for which the borrowed allowances were surrendered, the VRTS participant must surrender—
(a) a number of VRTS allowances or VRTS credits which is equal to the number of borrowed allowances; and
(b) an additional number of VRTS allowances or VRTS credits which amounts to 18.77% of the number of borrowed allowances.
(10C) If the VRTS participant accounts for the borrowed allowances for a scheme year which begins five years after the end of the scheme year for which the borrowed allowances were surrendered, the VRTS participant must surrender—
(a) a number of VRTS allowances or VRTS credits which is equal to the number of borrowed allowances; and
(b) an additional number of VRTS allowances or VRTS credits which amounts to 22.93% of the number of borrowed allowances.
.
(6) In paragraph (11), for “paragraph (8)(b), (9)(b) or (10)(b)” substitute “sub-paragraph (b) of any of paragraphs (8) to (10C)”.
(7) In each of paragraphs (12) and (13), for “the 2027 scheme year” substitute “the 2030 scheme year”.
(8) In paragraph (15)—
(a) after “may not be” insert “exchanged under article 23A or 67 or”;
(b) after “article 57” insert “or 57A”.
21 Amendment of article 50 (VRTS credits: general)
(1) Article 50 is amended as follows.
(2) In paragraph (1), for “51, 52 and 55” substitute “25A, 26A, 51, 52 and 55 to 55B”.
(3) In paragraph (2), at the end of sub-paragraph (b), insert “unless the credit was acquired in accordance with article 25A, 26A, 55, 55A or 55B”.
(4) In paragraph (4), after “article 58” insert “or 58A”.
(5) In paragraph (5)—
(a) for “55” substitute “55B”;
(b) after “accordingly” insert “(see also the requirement for the administrator to update the registry in articles 25A(7) and 26A(8))”.
23 Amendment of article 55 (VRTS credits: conversion of unused VCTS allowances)
(1) Article 55 is amended as follows.
(2) In paragraph (1), in sub-paragraph (c), for “the 2024 scheme year, the 2025 scheme year or the 2026 scheme year” substitute “any scheme year other than the 2030 scheme year”.
(3) In paragraph (4), for “7.2%” substitute “14.4%”.
(4) In paragraph (5), for “6%” substitute “19.2%”.
(5) After paragraph (5), insert—
(5A) A request under paragraph (1) to exchange unused VCTS allowances allocated for the 2027 scheme year is limited to a number of VRTS credits which does not exceed 23.8% of the total number of vans of which the VRTS participant is the manufacturer and which were registered during that scheme year.
(5B) A request under paragraph (1) to exchange unused VCTS allowances allocated for the 2028 scheme year is limited to a number of VRTS credits which does not exceed 27.6% of the total number of vans of which the VRTS participant is the manufacturer and which were registered during that scheme year.
(5C) A request under paragraph (1) to exchange unused VCTS allowances allocated for the 2029 scheme year is limited to a number of VRTS credits which does not exceed 29% of the total number of vans of which the VRTS participant is the manufacturer and which were registered during that scheme year.
.
24 Insertion of new article 55A (VRTS credits: conversion of unused CRTS allowances by a VRTS participant which is also a CRTS participant)
After article 55 insert—
VRTS credits: conversion of unused CRTS allowances by a VRTS participant which is also a CRTS participant
55A (1) During a trading window, a VRTS participant which is also a CRTS participant may acquire one VRTS credit in exchange for two and a half unused CRTS allowances by making a request to the administrator if—
(a) the participant’s number of units of activity in the CRTS in a scheme year does not exceed the sum of—
(i) the number of CRTS allowances which were allocated to the participant in accordance with article 13 for that year;
(ii) the number of any CRTS allowances which were banked by the participant in accordance with article 14 and were available for it to use at the beginning of the trading window; and
(iii) the number of any CRTS credits which were acquired by the participant in accordance with article 23 (conversion of unused CCTS allowances into CRTS credits) and are available for it to use;
(b) the participant has more CRTS allowances than it requires in order to comply with article 27 (accounting for activity in the CRTS) for that scheme year (referred to in this article as “unused CRTS allowances”); and
(c) the participant did not acquire the unused CRTS allowances in accordance with article 15 (borrowing CRTS allowances).
(2) A request under paragraph (1)—
(a) must be made during the trading window following the scheme year for which the participant intends to surrender the VRTS credits to which the request relates;
(b) may be for the exchange of a part of a CRTS allowance but may not be for the exchange of a part which is smaller than one tenth of a CRTS allowance.
(3) A VRTS credit acquired in accordance with this article may not be traded under article 57.
.
25 Insertion of article 55B (VRTS credits: conversion of CRTS credits by a VRTS participant which is also an SPV car manufacturer)
After article 55A (as inserted by article 24 of this Order), insert—
VRTS credits: conversion of CRTS credits by a VRTS participant which is also an SPV car manufacturer
55B (1) During a trading window, a VRTS participant which is also an SPV car manufacturer may acquire one VRTS credit in exchange for two and a half CRTS credits by making a request to the administrator.
(2) A request under paragraph (1)—
(a) must be made during the trading window following the scheme year for which the participant intends to surrender the VRTS credits to which the request relates; and
(b) may be for the exchange of a part of a CRTS credit but may not be for the exchange of a part which is smaller than one tenth of a CRTS credit.
(3) A VRTS credit acquired in accordance with this article may not be traded under article 57.
.
26 Amendment of article 57 (trading VRTS allowances and credits: VRTS participants)
(1) Article 57 is amended as follows.
(2) In paragraph (1), in sub-paragraph (b), for the text after “in accordance with” substitute “article 25A (trading CRTS allowances with VRTS participants), article 26A (trading CRTS credits with VRTS participants: SPV car manufacturers), article 55 (conversion of unused VCTS allowances), article 55A (conversion of unused CRTS allowances) or article 55B (conversion of CRTS credits by SPV car manufacturer)”.
(3) In paragraph (3)—
(a) in the opening words, after “party to a trade” insert “under this article”;
(b) after sub-paragraph (b) insert—
(ba) a statement of the fact the trade was carried out under this article;
.
27 Insertion of new article 57A (trading VRTS allowances with CRTS participants)
After article 57, insert—
Trading VRTS allowances with CRTS participants
57A (1) During a trading window, a VRTS participant may trade any unused VRTS allowances with a CRTS participant if—
(a) the VRTS participant’s number of units of activity in the VRTS in a scheme year does not exceed the sum of—
(i) the number of VRTS allowances which were allocated to the VRTS participant in accordance with article 45 for that year;
(ii) the number of any VRTS allowances which were banked by the VRTS participant in accordance with article 46 and were available for it to use at the beginning of the trading window; and
(iii) the number of any VRTS credits which were acquired by the VRTS participant in accordance with article 55 (conversion of unused VCTS allowances into VRTS credits) and are available for it to use;
(b) the VRTS participant has more VRTS allowances than it requires in order to comply with article 59 (accounting for activity in the VRTS) (referred to in this article as “unused VRTS allowances”); and
(c) the VRTS participant did not acquire the unused VRTS allowances in accordance with article 47 (borrowing VRTS allowances).
(2) Where a VRTS participant trades an unused VRTS allowance under this article, the VRTS allowance is automatically converted to two CRTS credits on disposal.
(3) A VRTS participant may trade parts of VRTS allowances (in which case the conversion rate in paragraph (2) applies on a proportional basis) but may not trade a part smaller than one tenth of a VRTS allowance.
(4) Each party to a trade under this article must, before the end of trading window, notify the administrator of the trade, and each notification must include—
(a) the name and account number in the registry of the transferor;
(b) the name and account number in the registry of the transferee;
(c) a statement of the fact that the trade was carried out under this article;
(d) the number of VRTS allowances traded; and
(e) the price paid for those VRTS allowances.
(5) Each party to a trade under this article must inform the other party to the trade of their account number in the registry.
(6) Where—
(a) the transferor is a pool VRTS participant, article 57(5) applies to a trade under this article as it applies to a trade under that article;
(b) the transferee is a pool CRTS participant, article 25(5) applies to a trade under this article as it applies to a trade under that article.
(7) Where a trade is notified in accordance with paragraph (4), the administrator must update the registry and notify the parties to the trade accordingly.
(8) Unless the administrator is satisfied that notification of a trade has been given in accordance with paragraph (4), the trade is treated as not having taken place.
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28 Amendment of article 58 (trading VRTS credits: SPV van manufacturers)
(1) Article 58 is amended as follows.
(2) In the heading, after “Trading VRTS credits” insert “with VRTS participants”.
(3) In paragraph (1), after “article 53 or 54” insert “with a VRTS participant”.
(4) For paragraph (2) substitute—
(2) An SPV car manufacturer may only trade a VRTS credit under this article during the trading window following the scheme year for which the VRTS credit was acquired by the SPV van manufacturer.
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(5) In paragraph (3), for “paragraph (2)” substitute “this article”.
29 Insertion of new article 58A (trading VRTS credits with CRTS participants: SPV van manufacturers)
After article 58, insert—
Trading VRTS credits with CRTS participants: SPV van manufacturers
58A (1) An SPV van manufacturer may trade VRTS credits acquired by it under article 53 or 54 with a CRTS participant in accordance with paragraphs (2) to (7).
(2) An SPV van manufacturer may only trade a VRTS credit under this article during the trading window following the scheme year for which the VRTS credit was acquired by the SPV van manufacturer.
(3) Where an SPV van manufacturer trades a VRTS credit with a CRTS participant under this article, the VRTS credit is automatically converted to two CRTS credits on disposal.
(4) An SPV van manufacturer may trade parts of VRTS credits (in which case the conversion rate in paragraph (3) applies on a proportional basis) but may not trade a part smaller than one tenth of a VRTS credit.
(5) Each party to a trade under this article must, before the end of the trading window, notify the administrator of the trade, and each notification must include—
(a) the name and account number in the registry of the transferor;
(b) the name and account number in the registry of the transferee;
(c) a statement of the fact that the trade was carried out under this article;
(d) the number of VRTS credits traded; and
(e) the price paid for those VRTS credits.
(6) Each party to a trade under this article must inform the other party to the trade of their account number in the registry.
(7) Where the transferee is a pool CRTS participant, article 25(5) applies to a trade under this article as it applies to a trade under that article.
(8) Where a trade is notified in accordance with paragraph (5), the administrator must update the registry and notify the parties to the trade accordingly.
(9) Unless the administrator is satisfied that notification of a trade has been given in accordance with paragraph (5), the trade is treated as not having taken place.
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31 Amendment of article 61 (banked or borrowed VRTS allowances of former VRTS participants)
(1) Article 61 is amended as follows.
(2) In paragraph (3)—
(a) after “the first non-participation scheme year through” insert “exchanging in accordance with article 23A or 67, or”;
(b) after “article 57” insert “or 57A”;
(c) for “that article” substitute “those articles”.
(3) In paragraph (5)—
(a) after “the first non-participation scheme year through” insert “exchanging in accordance with article 55, 55A or 55B, or”;
(b) after “with article” insert “25A, 26A,”.
32 Amendment of article 62 (expiry of VRTS allowances and VRTS credits)
(1) Article 62 is amended as follows.
(2) In paragraph (1)—
(a) omit the “or” at the end of sub-paragraph (c);
(b) after sub-paragraph (c) insert—
(ca) converted into CRTS credits in accordance with article 23A;
(cb) converted into CRTS credits pursuant to a trade under article 57A; or
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(3) In paragraph (2)—
(a) omit the “or” at the end of sub-paragraph (a);
(b) after sub-paragraph (b) insert—
(c) converted into CRTS credits in accordance with article 23B; or
(d) converted into CRTS credits pursuant to a trade under article 58A.
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33 Amendment of article 67 (conversion of unused VRTS allowances into VCTS allowances)
In article 67, in paragraph (1)—
(a) at the beginning of the opening words, insert “During a trading window,”;
(b) for sub-paragraph (a) substitute—
(a) the participant's number of units of activity in the VRTS in a scheme year, measured in accordance with article 56, does not exceed the sum of—
(i) the number of VRTS allowances which were allocated to the participant in accordance with article 45 for that year; and
(ii) the number of any VRTS allowances which were banked by the participant in accordance with article 46 and were available for it to use at the beginning of the trading window;
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34 Amendment of article 80 (publication of final information)
(1) Article 80 is amended as follows.
(2) In paragraph (2), for “article 25, 26, 37, 57, 58 or 69” substitute “article 25, 25A, 26, 26A, 37, 57, 57A, 58, 58A or 69”.
(3) In paragraph (3), for “article 26 or 58” substitute “article 26, 26A, 58 or 58A”.
(1) Article 3 is amended as follows.
(2) In paragraph (4), after “within paragraph” insert “(4A) or”.
(3) After paragraph (4) insert—
(4A) Where the administrator has granted an application under Schedule 3A (alternative specific emissions of CO2: OVC hybrid electric vehicles) in respect of a car or van, the specific emissions of CO2 of the vehicle are to be determined in accordance with Part 6 of that Schedule.
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(4) For paragraph (5) substitute—
(5) Where—
(a) a car, a complete van or an SPV is classed as an OVC hybrid electric vehicle in the certificate of conformity or individual approval certificate; and
(b) in the case of a car or complete van, paragraph (4A) does not apply in relation to the vehicle,
the specific emissions of CO2 of the vehicle are those specified as the “weighted, combined” CO2 emissions in that certificate.
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(5) In paragraph (6), after “of a completed van” insert “, other than a van within paragraph (4A),”.
37 Amendment of article 36 (measuring activity in the CCTS)
In article 36, for paragraph (2) substitute—
(2) For the purposes of this article, the number of grams of CO2 per kilometre emitted by an NZE car is the specific emissions of CO2 of the car, with that number having been—
(a) if applicable, reduced in accordance with paragraph (3); and
(b) if applicable, corrected in accordance with Article 13(3) of Regulation (EU) 2019/631 (lack of correspondence of CO2 emission and fuel consumption values).
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38 Amendment of article 68 (measuring activity in the VCTS)
In article 68, for paragraph (2) substitute—
(2) For the purposes of this article, the number of grams of CO2 per kilometre emitted by an NZE van is the specific emissions of CO2 of the van, with that number having been—
(a) if applicable, reduced in accordance with paragraph (3); and
(b) if applicable, corrected in accordance with Article 13(3) of Regulation (EU) 2019/631 (lack of correspondence of CO2 emission and fuel consumption values).
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39 Amendment of article 73 (information: participants in the Trading Schemes)
In article 73, after paragraph (4) insert—
(4A) For the purposes of the obligations in paragraphs (1) and (3), the reference to “specific emissions of CO2” in paragraph 1(g) of Schedule 7, is to be treated, in relation to a vehicle in respect of which the administrator has granted an application under Schedule 3A (alternative specific emissions of CO2: OVC hybrid electric vehicles), as having the meaning it would have if that application had not been granted.
(4B) Where the administrator has granted an application for the specific emissions of CO2 of a vehicle to be determined in accordance with Part 6 of Schedule 3A, the administrator must also record the specific emissions of CO2 of the vehicle as determined in accordance with that Part.
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