1. 1 Andrew Howard UNFCCC secretariat www.unfccc.int ahoward@unfccc.int Checks to be performed by the international transaction log Consultations on registry systems prior to SBSTA 22 Bonn 13-14 May 2005

2. 2 Establishing the basis for transactions Reporting, review and compliance Project cycles for the CDM and JI Verifying the validity of transactions Checks performed by the ITL Reconciliation between the ITL and registries Transaction ‘storylines’ Issuance, conversion and retirement Emissions trading between registries Required transactions with notifications Overview

3. 3 Registry systems are integrated in the Kyoto processes to monitor and assess compliance of Annex B emissions targets Context Reference data Registry transactions Reporting, review, compliance Party reporting Reporting, review, compliance CDM and JI procedures Reference data

4. 4 Processes before registry transactions

5. 5 Reporting, review, compliance Reporting on emissions and assigned amounts Article 8 review Pre-commitment period reporting (Article 7.4) Initial review Annual supplementary information (Article 7.1) Annual review Periodic supplementary information (Article 7.2) Periodic review True-up period information (Article 7.4) Annual review Review reports may highlight problems as questions of implementation Compliance Committee may decide to ‘correct’ the assigned amount information of a Party before it is recorded as official data

6. 6 Official information used in transactions Official information given to ITL from compilation and accounting database Relevant transaction Assigned amount (under Article 3.7/8)Issuance of AAUs Commitment period reserve (CPR)External transfers Net LULUCF removals (Article 3.3/4)Issuance of RMUs Net LULUCF emissions (Article 3.3/4)Cancellation (net source) Mechanisms eligibility External transfers and acquisitions Retirement of CERs, tCERs, lCERs Units available for carry-overCarry-over

7. 7 CDM project cycle Project participantsDesign Operational entity Executive board Validation and registration Project participants Monitoring Operational entity Verification and certification Executive board CDM credits Issuance

8. 8 Project information used in transactions Project information given to ITL from CDM and JI information systems Relevant transaction CDM emission reductions or removalsIssuance of CDM credits Excess issuance of CDM creditsCancellation (excess issuance) Reversal in removals under the CDM (in relation to lCER projects) Replacement of lCERs Failure to submit certification report (in relation to lCER projects) Replacement of lCERs JI emission reductions or removalsConversion of AAUs/RMUs to ERUs

9. 9 Registry transactions

10. 10 Registries generate a proposal message for a transaction  ITL independently checks the proposed transaction 140 checks defined Primarily technical nature to ensure standard communications  46 checks defined Primarily policy-related nature to ensure conformity to modalities, rules and limits under Kyoto  15 general checks  78 transaction-specific checks ITL checks

11. 11 ITL check categories Version and authenticationCan the ITL verify sender’s identity? Message viabilityMay the message be processed? Registry statusAre registries involved able to operate? Data integrityDoes the data makes sense? Message sequenceIs the message in the correct order? General transaction checks Does the message comply with general requirements for transactions? Transaction-specific checks Does the message comply with Kyoto requirements for the type of transaction?

12. 12 ITL response code examples Response code20175008 Check nameProject identifierAAU issuance quantity Check description CERs, tCERs, lCERs and ERUs must have a valid project identifier The quantity of AAUs issued must not exceed allowed quantity for the commitment period Check categoryData integrityTransaction-specific Transaction typeAllIssuance

13. 13 3 tier reconciliation processes allows comparison of Tier 1: Total unit holdings Tier 2: Records of serial numbers of any unit type or account type Tier 3: logs of transaction data and database changes Reconciliation identifies Specific inconsistent unit Specific instance of non-conformity with data exchange standards Manual intervention procedures to resolve the inconsistency Reconciliation

14. 14 Notifications 30 days to fulfil required actions Notification identifier is given by registries for each transaction relating to the notification ITL associates relevant transactions with identifiers  ITL assesses when required actions are completed Follow-up notifications by the ITL  to indicate when a required action is complete  to provide status updates on fulfilment Unfulfilled cancellation and replacement notifications taken into account in CPR calculations (after 30 days)

15. 15 Processes after registry transactions

16. 16 Reporting, review, compliance Reporting on emissions and assigned amounts Article 8 review Annual informationAnnual review Periodic informationPeriodic review True-up informationAnnual review Review reports may highlight problems as questions of implementation Any inconsistencies not resolved through reconciliation may be subject to a correction in the assigned amount information of a Party before it is recorded as official data