Climate Change Law

On March 8, 2009 India submitted a letter to the UNFCC Secretariat in which India agreed to be formally listed as a party on the Copenhagen Accord.  On March 9, 2009, China agreed to be listed as a party.  With China and India agreeing to be listed, the Copenhagen Accord now includes all of the world’s leading emitters.  Importantly, the all agree (in the political, non-binding) Accord’s goal of  limiting global temperature rise since industrialization to 2 degrees Celsius (3.6 degrees Fahrenheit).  However, that China and India agreed only to be “listed” as parties to the accord, and did not declare full “association” with the accord.

Although the United States proposed replacing some of the existing U.N. texts with passages from the Copenhagen Accord, India and China have both strongly backed the twin-track (UNFCCC and Kyoto Protocol).  According to a March 9, 2009 Guardian article, Chinese Prime Minister Wen Jiabao takes the position that ”‘It is neither viable nor acceptable to start a new negotiation process outside the [UNFCCC] and the [Kyoto] protocol,’  Similarly, Rajani Ranjan Rashmi, India’s environment and forests minister, states in his letter, ‘The accord is not a new track of negotiations or a template for outcomes’ … The US now appears isolated as China, India and many other countries, firmly support the idea of continuing with the two existing UN negotiating tracks to try to achieve a consensus. The battle of the texts was fought for much of last year with the US backed by Britain and the rest of Europe. Today, the European Commission’s first formal statement since Copenhagen offered some support for the US: ‘The political guidance in the Copenhagen Accord – which was not formally adopted as a UN decision – needs to be integrated into the UN negotiating texts that contain the basis of the future global climate agreement.’ But some rich country governments now accept privately that they had ‘crossed a red line’ and failed to recognise that developing countries had not been prepared to abandon the Kyoto protocol without a new legal agreement in place to ensure developed countries reduced emissions.”

Tags: China, Copenhagen Accord, European Union, India, Kyoto Protocol, UNFCCC, United States

SEC Issues Interpretive Guidance on Disclosure Related to Business or Legal Developments Regarding Climate Change

FOR IMMEDIATE RELEASE
2010-15

Text of Chairman’s Statement

Washington, D.C., Jan. 27, 2010 — The Securities and Exchange Commission today voted to provide public companies with interpretive guidance on existing SEC disclosure requirements as they apply to business or legal developments relating to the issue of climate change.

Federal securities laws and SEC regulations require certain disclosures by public companies for the benefit of investors. Occasionally, to assist those who provide such disclosures, the Commission provides guidance on how to interpret the disclosure rules on topics of interest to the business and investment communities. The Commission’s interpretive releases do not create new legal requirements nor modify existing ones, but are intended to provide clarity and enhance consistency for public companies and their investors.

The interpretive release approved today provides guidance on certain existing disclosure rules that may require a company to disclose the impact that business or legal developments related to climate change may have on its business. The relevant rules cover a company’s risk factors, business description, legal proceedings, and management discussion and analysis.

“We are not opining on whether the world’s climate is changing, at what pace it might be changing, or due to what causes. Nothing that the Commission does today should be construed as weighing in on those topics,” said SEC Chairman Mary Schapiro. “Today’s guidance will help to ensure that our disclosure rules are consistently applied.”

Specifically, the SEC’s interpretative guidance highlights the following areas as examples of where climate change may trigger disclosure requirements:

• Impact of Legislation and Regulation: When assessing potential disclosure obligations, a company should consider whether the impact of certain existing laws and regulations regarding climate change is material. In certain circumstances, a company should also evaluate the potential impact of pending legislation and regulation related to this topic.
• Impact of International Accords: A company should consider, and disclose when material, the risks or effects on its business of international accords and treaties relating to climate change.
• Indirect Consequences of Regulation or Business Trends: Legal, technological, political and scientific developments regarding climate change may create new opportunities or risks for companies. For instance, a company may face decreased demand for goods that produce significant greenhouse gas emissions or increased demand for goods that result in lower emissions than competing products. As such, a company should consider, for disclosure purposes, the actual or potential indirect consequences it may face due to climate change related regulatory or business trends.
• Physical Impacts of Climate Change: Companies should also evaluate for disclosure purposes the actual and potential material impacts of environmental matters on their business.

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The SEC’s interpretive release will be posted on the SEC Web site as soon as possible.

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This site will support the coursebook by providing relevant international treaties and documents, links to reports and articles, statutes and regulations. It will also grow over time to reflect the evolving nature of climate change law.

We are looking to launch the site in January 2010.

Tags: coursebook, Documents, regulations

The book authors will be contributing to this site on a regular basis: Richard G. Hildreth, David R. Hodas, Nicholas A. Robinson and James Gustave Speth. For further information, please contact David R. Hodas drhodas@widener.edu.

Tags: authors, hildreth, hodas, robinson, speth