On 13 February 2009, the CDM Executive Board (CDM EB) adopted the procedures (the "Procedures") for modalities of communication (MoC) between project participants (PPs) in clean development mechanism (CDM) projects and the CDM EB, and a standardised MoC form (the "MoC Form").1 This Legal Alert gives an overview of the main elements of the Procedures and highlights certain insolvency issues related to the MoC.

Introduction

The Delaware Bankruptcy Court recently authorized the sale of La Paloma’s electricity-generating assets “free and clear” of any obligations to surrender compliance certificates under California’s Cap-and-Trade Program. The ruling confirms the viability of Bankruptcy Code section 363 sales as a mechanism to release energy-related assets from certain ongoing environmental obligations.

Briefings

A recent ruling by the English High Court in BILTA v RBS1, concerning EU Emissions Allowances (“EUAs” or “carbon-credits”) trading has re-opened the debate on when materials forming part of an internal investigation can benefit from litigation privilege. The decision further undermines the restrictive approach taken by Andrews J in SFO v ENRC2 when applying the “sole or dominant purpose test” to dual-purpose communications.

Background – Emissions Trading Fraud