Fluorinated gases including hydrofluorocarbons (HFCS)
- Document symbol
- G/LIC/N/3/EU/13
- Original language
- English
- Published on
- 19/11/2024
Outline of Systems
Q1. Give a brief description of each licensing system as a whole and, with respect to each, reply to the following questions as relevant, placing all of the material with respect to a given system in sequence together, and using cross references as appropriate when elements which have already been described are also present in another system.
Undertakings (legal and natural persons) must have a prior valid registration in the F-Gas Portal in order to be allowed to import or export any quantities of fluorinated gases (f-gases), either as bulk or pre-charged in equipment. A valid registration equals to a licence to import and export these gases, as required under the Montreal Protocol.
Import covers all Union customs procedures including special procedures such as customs warehousing and transit. Licensing is not applicable for products and equipment that are empty, are ‘personal effects’ or are under a temporary storage status.
Undertakings that intend to release into free circulation hydrofluorocarbons (HFCs) must ensure that the quantity of HFCs is covered by sufficient quota, or sufficient authorisations to use quota in the case of HFCs charged in refrigeration and air conditioning equipment, heat pumps, and metered dose inhalers (the later only as from 1 January 2025). Furthermore, importers placing on the market such pre-charged products or equipment must also draw up a declaration of conformity and submit it to custom authorities at the time of release for free circulation documenting compliance with quota rules.
Also, the placing on the market of certain products and equipment containing f-gases with a certain global warming potential are prohibited as from a certain date as state in Annex IV of the f-gas Regulation and the import, further supply, export, transport, storage or use of non-refillable containers of fluorinated gases (empty or not) is prohibited, unless it is for laboratory uses. Equipment, products and containers with fluorinated gases must be labelled appropriately.
On 3 March 2024 it will become obligatory for all EU Member States and the European Commission to ensure the interconnection between national customs systems and the F-gas Portal via the EU Single Window Environment for Customs. The interconnection will allow for automatic custom controls in real time at shipment level of f-gases in bulk and contained in products and equipment, as well as the electronic exchange and storage of information on each shipment of f-gases.
The replies below focus on the procedures in place for import of bulk HFCs and products and equipment charged with HFCs.
Purposes and Coverage of Licensing
Q2. Identify each licensing system maintained and state what products, appropriately grouped, are covered.
HFCs are together with perfluorocarbons (PFCs) and sulphur hexafluoride (SF6) a fluorinated greenhouse gas (F-gas). F-gases are powerful greenhouse gases, with a global warming effect up to 23 000 times greater than carbon dioxide (CO2). HFC is the most relevant F-gases from a climate perspective. Reducing emissions from fluorinated greenhouse gases is a part of EU's effort to implement the Paris Agreement under the United Nations Framework Convention on Climate Change.
Article 20 of the F-gas Regulation establishes an obligation for actors in the F-gas market, thus including HFCs, to register in the F-gas Portal, an electronic registry for licensing of imports and exports, quota management and reporting. Only undertakings with a prior valid registration can import and export HFCs into and from the European Union. Registration (=licensing) applies to all f-gases, in all customs procedures including special procedures such as transit or customs warehousing. Registration does not apply for goods as personal effects, empty, or under temporary storage status.
HFC's are listed in Annex I, Section 1, of the F-gas Regulation.
Customs procedure:
The licensing requirement applies for all import and export procedures (thus including special procedures such as transit, customs warehousing etc.), except for goods in temporary storage. Non-refillable containers (empty or not) are prohibited under all import/export, including temporary storage, unless for laboratory uses.
Coverage:
The following HFC's are listed in Annex I, Section 1, of the F-gas Regulation:
|
Substances (HFCs) |
CN/TARIC code | |
|
HFC-23 - trifluoromethane (fluoroform) |
2903410000 | |
|
HFC-32 – difluoromethane |
2903420000 | |
|
HFC-41 - fluoromethane (methyl fluoride) |
2903430010 | |
|
HFC-125 – pentafluoroethane |
2903430020 | |
|
HFC-134 - 1,1,2,2-tetrafluoroethane |
2903450020 | |
|
HFC-134a - 1,1,1,2-tetrafluoroethane |
2903450010 | |
|
HFC-143 - 1,1,2-trifluoroethane |
2903440030 | |
|
HFC-143a - 1,1,1-trifluoroethane |
2903440020 | |
|
HFC-152 - 1,2-difluoroethane |
2903430020 | |
|
HFC-152a - 1,1-difluoroethane |
2903430030 | |
|
HFC-161 - fluoroethane (ethyl fluoride) |
2903499010 | |
|
HFC-227ea - 1,1,1,2,3,3,3-heptafluoropropane |
2903460010 | |
|
HFC-236cb - 1,1,1,2,2,3-hexafluoropropane |
2903460020 | |
|
HFC-236ea - 1,1,1,2,3,3-hexafluoropropane |
2903460030 | |
|
HFC-236fa - 1,1,1,3,3,3-hexafluoropropane |
2903460040 | |
|
HFC-245ca - 1,1,2,2,3-pentafluoropropane |
2903470020 | |
|
HFC-245fa - 1,1,1,3,3-pentafluoropropane |
2903470010 | |
|
HFC-365 mfc - 1,1,1,3,3-pentafluorobutane |
2903480010 | |
|
HFC-43-10 mee -1,1,1,2,2,3,4,5,5,5-decafluoropentane |
2903480020 |
Q3. The system applies to goods originating in and coming from which countries?
Undertakings can be EU and non-EU companies. Non-EU companies must nominate an only representative established in the EU for the purpose of compliance with the requirements of the F gas Regulation.
Country restrictions: None.
Q4. Is the licensing intended to restrict the quantity or value of imports, and if not, what are its purposes? Have alternative methods of accomplishing the purposes been considered and if so which? Why have they not been adopted?
Article 16 of the F-gas Regulation establishes the quota requirements regarding bulk HFCs, applicable since 1 January 2015.
The quota requirement do not apply to the following categories of HFCs:
- imported into the Union for destruction;
- used by a producer as feedstock or supplied directly by a producer or an importer to undertakings for use as feedstock;
- supplied directly by a producer or an importer to undertakings, for export out of the Union, not contained in products or equipment, where those HFCs are not subsequently made available to any other party within the Union, prior to export;
- supplied directly by a producer or an importer for use in military equipment;
- supplied directly by a producer or an importer to an undertaking using it for the etching of semiconductor material or the cleaning of chemicals vapour deposition chambers within the semiconductor manufacturing sector;
The licence registration and the quota system implements the requirements related to HFCs under the Montreal Protocol on the substances that deplete the ozone layer and in particular, its so-called Kigali Amendment that added HFCs to the list of controlled substances and agreed to a global phase-down of production and consumption of HFCs and required the implementation of a licensing system for import and export of HFCs.
Pursuant to Article 17 of the F-gas Regulation, the quotas of HFCs are allocated to the undertakings annually by the European Commission based on a system that takes into account amounts historically placed on the market by certain undertakings as well as any declarations made by any undertaking intending to place HFCs on the market. The maximum amounts of HFCs allowed to be placed in the Union market in a given year are stated in Annex VII of the F-gas Regulation and the mechanism to calculate quotas is laid down in Annex VIII.
Undertakings can be EU and non-EU companies. Non-EU undertakings must nominate an only representative established in the EU that assumes full responsibility for compliance with the requirements of the F‑gas Regulation.
Article 19 of the F-gas Regulation establishes the requirements related to the placing on the market of refrigeration and air conditioning equipment, heat pumps and metered dose inhalers charged with HFCs, inter alia, the link to the quota system and the declaration of conformity to this end. These conditions apply to all placing on the market, including for imported equipment released for free circulation. The purpose of this provision is to safeguard the environmental integrity of the phase-down of bulk HFCs.
Q5. Cite the law, regulation and/or administrative order under which the licensing is maintained. Is the licensing statutorily required? Does the legislation leave designation of products to be subjected to licensing to administrative discretion? Is it possible for the government (or the executive branch) to abolish the system without legislative approval?
Legal basis:
- Regulation (EU) 2024/573 of the European Parliament and of the Council of 7 February 2024 on fluorinated greenhouse gases amending Directive (EU) 2019/1937 and repealing Regulation (EU) No 517/2014 ("the F-gas Regulation").
OJ L, 2024/573, 20.2.2024, ELI: http://data.europa.eu/eli/reg/2024/573/oj
Procedures
Q6. For products under restriction as to the quantity or value of imports (whether applicable globally or to a limited number of countries or whether established bilaterally or unilaterally):
Undertakings intending to import or export f-gases, thus including HFCs, in bulk or charged in any product or equipment must request registration (licence) in the F-gas Portal prior to the import/export. The detailed requirements for registrations are laid down in Commission Implementing Regulation (EU) 2024/2473 ensuring the smooth functioning of the electronic registry for quotas for placing hydrofluorocarbons on the market (OJ L 112, 26.4.2019, p.11). The act will be repealed and replaced by a new in the coming months.
Undertakings report on all relevant f-gas activities, including quantities imported and exported, by 31 March in the year following the activity. The reporting is done directly in a reporting tool. The reporting format is based on Commission Implementing Regulation (EU) No. 1191/2014. The act will be repealed and replaced by a new in the coming months.
Please see Answers 6.1-6.11.
Q6.I. Is information published, and where, concerning allocation of quotas and formalities of filing applications for licences? If not, how is it brought to the attention of possible importers? Of governments and export promotion bodies of exporting countries and their trade representatives? Is the overall amount published? The amount allocated to goods from each country? The maximum amount allocated to each importer? How to request any exceptions or derogations from the licensing requirement?
Reference values for the quota allocation are published in a Commission Decision every three years and the quota is updated annually in the F-gas Portal. Quota amounts are confidential as they are commercially sensitive.
Q6.II. How is the size of the quotas determined: on a yearly, six-monthly or quarterly basis? Are there cases where the size of quota is determined on a yearly basis but licences are issued for imports on a six-monthly or quarterly basis? In the latter case, is it necessary for importers to apply for fresh licence on a six-monthly or quarterly basis?
Quota is determined on a yearly basis. It is based on the account amounts historically placed on the market (tri-annual reference values) since 2015 and any declarations made regarding the intention to place additional HFCs on the market. The quotas are calculated on the basis of the maximum quantities allowed on the Union market on a given year as stated in Annex VII and by applying the allocation mechanism laid down in Annex VIII to the F-gas Regulation. As from 2026, quota are allocated subject to undertaking paying the price of 3 euro per 1 tonne of CO2 equivalent (see Articles 17(5) and (6) for more details on the procedure).
Q6.III. Are licences allotted for certain goods partly or only to domestic producers of like goods? What steps are taken to ensure that licences allocated are actually used for imports? Are unused allocations added to quotas for a succeeding period? Are the names of importers to whom licences have been allocated made known to governments and export promotion bodies of exporting countries upon request? If not, for what reason? (Indicate products to which replies relate.)
Quota are valid only for the year allocated and can only be used for quantities placed on the market during that year. The Commission will also establish quotas for production rights to all concerned undertakings as established under Article 14 of the F-gas Regulation.
Q6.IV. From the time of announcing the opening of quotas, as indicated in I above, what is the period of time allowed for the submission of applications for licences?
The validity of the licence is in principle time unlimited. The timeframe for the licence registry can vary depending on information provided by the undertaking but is usually completed within a few working days if the provided information is accurate and complete. Undertakings must be registered (have a licence) before carrying out any f-gas related activity listed as Article 20 of the F-gas Regulation, including receiving quota.
Q6.V. What are the minimum and maximum lengths of time for processing applications?
Min and max length of licence registry requests – one day to a few months – depending on completeness and accurateness of information provided.
Q6.VI. How much time remains, at a minimum, between the granting of licences and the date of opening of the period of importation?
Import may only occur if an importer already has a licence and sufficient quota to cover the import at the time of release for free circulation. Quota for a given year must be allocated to entitled undertakings annually by 31 December of the previous year. Entitled undertakings may also request, for a quota allocation on the basis a declaration; the request may only be made once, every three years, by 1 April, and any the quota will be allocated annually.
Q6.VII. Is consideration of licence applications effected by a single administrative organ? Or must the application be passed on to other organs for visa, note or approval? If so, which? Does the importer have to approach more than one administrative organ?
Only the European Commission is involved in the processes. Member States are involved via an implementing Committee as regards the determination of the tri-annual reference values.
Q6.VIII. If the demand for licences cannot be fully satisfied, on what basis is the allocation to applicants made? First come, first served? Past performance? Is there a maximum amount to be allocated per applicant and, if so, on what basis is it determined? What provision is made for new importers? Are applications examined simultaneously or on receipt?
Quota is allocated based on historic amounts placed on the market (tri-annual reference value) since 2015 and annual declarations on the intention to place on the market. The latter quotas are allocated on a pro rata basis. See Article 17 and Annexes VII and VIII of the F-gas Regulation.
Q6.IX. In the case of bilateral quotas or export restraint arrangements where export permits are issued by exporting countries, are import licences also required? If so, are licences issued automatically?
Q6.X. In cases where imports are allowed on the basis of export permits only, how is the importing country informed of the effect given by the exporting countries to the understanding between the two countries?
Q6.XI. Are there products for which licences are issued on condition that goods should be exported and not sold in the domestic market?
Q7. Where there is no quantitative limit on importation of a product or on imports from a particular country:
Q7.a. How far in advance of importation must application for a licence be made? Can licences be obtained within a shorter time-limit or for goods arriving at the port without a licence (for example, owing to inadvertency)?
Q7.b. Can a licence be granted immediately on request?
Q7.c. Are there any limitations as to the period of the year during which application for licence and/or importation may be made? If so, explain.
Q7.d. Is consideration of licence applications effected by a single administrative organ? Or must the application be passed on to other organs for visa, note or approval? If so, which? Does the importer have to approach more than one administrative organ?
Q8. Under what circumstances may an application for a licence be refused other than failure to meet the ordinary criteria? Are the reasons for any refusal given to the applicant? Have applicants a right of appeal in the event of refusal to issue a licence and, if so, to what bodies and under what procedures?
Companies that meet the conditions set out in Commission Implementing Regulation (EU) 2024/2473 ensuring the smooth functioning of the electronic registry for quotas for placing hydrofluorocarbons on the market are being registered (licenced). The Commission may refuse, suspend or cancel a registration if the conditions are not fulfilled.
Eligibility of Importers to Apply for Licence
Q9. Are all persons, firms and institutions eligible to apply for licences: (If not, is there a system of registration of persons or firms permitted to engage in importation? What persons or firms are eligible? Is there a registration fee? Is there a published list of authorized importers?) a) under restrictive licensing systems? b) under non-restrictive systems?
Registration in the F-gas Registry can happen all year long. Applications for annual quota can only be made during a declaration period (which opens on 1 April every three years).
Article 18 of the F-gas Regulation stipulates that:
- Quota shall be allocated only to producers or importers that have an establishment within the Union, or which have appointed an only representative with an establishment within the Union that assumes the full responsibility for compliance with this Regulation and with the requirements of Title II of Regulation (EC) No 1907/2006. The only representative may be the same as the one appointed pursuant to Article 8 of Regulation (EC) No 1907/2006.
- Only producers and importers that have experience in trading activities of chemicals or in servicing refrigeration, air-conditioning or fire protection equipment or heat pumps for 3 consecutive years prior to the quota allocation period, may submit a declaration referred to in Article 17(3) or receive a quota allocation on that basis, pursuant to Article 17(4). The producers and importers shall submit evidence to that effect to the Commission, upon request.
- For the purpose of registration in the F-gas Portal, producers and importers shall provide a physical address where the undertaking is located and from where it conducts its business. Only one undertaking shall be registered under the same physical address.
- For the purpose of submitting a quota declaration pursuant to Article 17(3) and receiving a quota allocation pursuant to Article 17(4), as well as for the purpose of determining reference values pursuant to Article 17(1), all undertakings that share the same beneficial owner shall be considered as a single undertaking. Only that single undertaking, which is the one registered first in the F-gas Portal unless indicated otherwise by the beneficial owner, shall be entitled to a reference value pursuant to Article 17(1) and to a quota allocation pursuant to Article 17(4)
Undertakings must also meet the conditions of registration as set out in Commission Implementing Regulation (EU) 2024/2473 The Commission may refuse, suspend or cancel a registration if the conditions are not fulfilled..
Registration is compulsory for the following activities as per Article 20 of the F-gas Portal:
|
(a) |
the import or export of fluorinated greenhouse gases, and products and equipment containing fluorinated greenhouse gases, except in the case of temporary storage as defined in Article 5, point (17), of Regulation (EU) No 952/2013; |
|
(b) |
submitting a declaration pursuant to Article 17(3); |
|
(c) |
receiving a quota allocation for the placing on the market of hydrofluorocarbons in accordance with Article 17(4), or making or receiving a quota transfer in accordance with Article 21(1), or making or receiving an authorisation to use quota in accordance with Article 21(2), or delegating that authorisation to use quota in accordance with Article 21(3); |
|
(d) |
supplying or receiving hydrofluorocarbons for the purposes listed in Article 16(2), points (a) to (e); |
|
(e) |
carrying out all other activities that require reporting under Article 26; |
|
(f) |
receiving production rights pursuant to Article 14 and for making or receiving a transfer and an authorisation of production rights referred to in Article 15; |
|
(g) |
verifying reports referred to in Article 19(3) and Article 26(8). |
This registration is free of charge.
Documentational and Other Requirements for Application for Licence
Q10. What information is required in applications? Submit a sample form. What documents is the importer required to supply with the application?
The general information requirements for a registration licence is laid down in Article 3 of Commission Implementing Regulation (EU) 2024/2473. Please note that a new act will soon be published which amends to a certain extent the registration requirements on the existing one, taking into account mainly Article 18 and the F-gas Regulation.
For undertakings established in the Union:
- name and legal form of the undertaking:
- full address;
- telephone number;
- VAT number;
- Economic Operators Registration and Identification (EORI) number;
- the name and e-mail address of a contact person who is either a beneficial owner or an employee of the company, authorised to perform legally binding activities on behalf of the company;
- a description of the undertaking's business activities;
- written confirmation of the undertaking's intention to register in the registry signed by a beneficial owner or employee of the undertaking;
- bank account details – and validated.
For undertakings established outside the Union:
- the information listed in points (a), (b) and (c) above, but with respect to both the undertaking and the only representative, and accompanied, in the case of the information listed in point (a), a relevant official document on which the name and legal form appears in each case, together with a certified translation of that document in English;
- the information listed in points (d), (e) and (i) above, but with respect to the only representative rather than the undertaking;
- the full name of one contact person who is either a beneficial owner or an employee of the only representative of the company authorised to perform legally binding activities on behalf of the only representative and the company;
- an electronic address for the only representative;
- a description of the undertaking's business activities;
- the written confirmation listed in point (h) above but signed additionally by a beneficial owner or employee of the only representative.
Q11. What documents are required upon actual importation?
Upon importation of bulk HFCs no additional documents are required under the F-Gas Regulation. Upon importation of refrigeration, air conditioning and heat pump equipment charged with HFCs a declaration of conformity must be available.
Q12. Is there any licensing fee or administrative charge? If so, what is the amount of the fee or charge?
There is no fee.
Q13. Is there any deposit or advance payment requirement associated with the issue of licences? If so, state the amount or rate, whether it is refundable, the period of retention and the purpose of the requirement.
There is no fee.
Conditions of Licensing
Q14. What is the period of validity of a licence? Can the validity of a licence be extended? How?
Registration licence is valid until cancelled or suspended by the Commission in line with Commission Implementing Regulation (EU) 2024/2473. Bulk quota may only be used for the year for which they are allocated (unused quota for a given year cannot be transferred to a future year).
Q15. Is there any penalty for the non-utilization of a licence or a portion of a licence?
There is no penalty for unused quota. Undertakings that have exceeded their quota are allocated a reduced quota allocation for the allocation period after the excess has been detected. The amount of reduction is calculated as 200% of the amount by which the quota was exceeded.
Q16. Are licences transferable between importers? If so, are any limitations or conditions attached to such transfer?
According to Article 21 of the F-gas Regulation bulk quota allocated to an undertaking on the basis of a reference value can be transferred/or authorised to other reference value holders, only via the F-gas Portal. Only importers and producers that have received a reference value can transfer or authorise the use of their quota. This is to prevent declarations for quota with the sole purpose of selling the quota. In addition, penalties for exceeding the quota are laid down in the legislation of the EU Member States in accordance with Article 31.