Suspension of accreditation
If, as a result of a review, the Executive Board determines that a designated operational entity no longer meets the accreditation standards, it may recommend to the COP/MOP to suspend or withdraw the entity's designation:
The Executive Board may recommend to the COP/MOP to suspend or withdraw the designation of a designated operational entity if it has carried out a review and found that the entity no longer meets the accreditation standards or applicable provisions in decisions of the COP/MOP. The Executive Board may recommend the suspension or withdrawal of designation only after the designated operational entity has had the possibility of a hearing. The suspension or withdrawal is with immediate effect, on a provisional basis, once the Executive Board has made a recommendation, and remains in effect pending a final decision by the COP/MOP. The affected entity shall be notified, immediately and in writing, once the Executive Board has recommended its suspension or withdrawal. The recommendation by the Executive Board and the decision by the COP/MOP on such a case shall be made public (3/CMP.1, Annex, paragraph 21).
The procedure for the suspension of the accreditation status of a DOE is found in EB 56, Annex 2, B.12:
- Prior to any decision on suspension is taken, the DOE is provided an opportunity for a hearing. To facilitate the hearing, the DOE is provided with all relevant information that has led the Board/CDM-AP to consider the suspension of the accreditation.
- If the Executive Board decides to suspend totally or partially the accreditation of a DOE, it informs the DOE of the modalities for lifting such a suspension, including:
- The non-conformities that must be addressed;
- The deadline for implementing corrective actions, not exceeding 12 months;
- The nature of assessments to be carried out to check the implementation of the identified corrective actions including, site visits at the central office and any other sites where the DOE has allocated CDM functions, site visit(s) to a project activity(ies) site(s) and/or a document review;
- The treatment of the projects under validation/verification by the DOE and projects for which the DOE has submitted requests for registration/issuance.
- After receiving confirmation and evidence from the DOE that all corrective actions have been implemented, the CDM-AT verifies their implementation in accordance with the directions given by the Executive Board.
- If no confirmation of completion of implementation of corrective actions is received from the DOE within the defined deadline, the CDM-AP will either recommend to the Board that the accreditation status of the DOE be withdrawn or its scope of accreditation be reduced.
- After verification, the CDM-AT prepares the draft final assessment report within 3 days.
- The secretariat submits the draft final report to the DOE for comments. The DOE has 6 days to provide comments on the draft final assessment report.
- The CDM-AT has 3 days to complete the final assessment report and submit it to the secretariat.
- The CDM-AP will consider the final assessment report of the CDM-AT and submit one of the following recommendations to the Executive Board:
- Revoke the suspension of accreditation of the DOE;
- Revoke the suspension of accreditation of the DOE and request additional performance assessments or follow-up assessments to be performed to ensure that corrective actions implemented by the DOE have addressed all issues identified;
- Maintain the suspension and allow the DOE to implement further corrective actions within a specified timeframe;
- Withdraw the accreditation of the DOE (EB 56, Annex 2, paragraph 161).
- The recommendation of the CDM-AP and the final assessment report are forwarded to the DOE. If the recommendation is to withdraw the accreditation, the DOE will have an opportunity for a hearing at the Board meeting before any decision is made by the Board.
- The Board decides, based on the recommendation of the CDM-AP and, if applicable, the information provided during the hearing by the DOE, to:
- Revoke the suspension of accreditation of the DOE;
- Revoke the suspension of accreditation of the DOE and request additional assessment activities to be performed (follow-up visit; performance assessments, early surveillance);
- Maintain the suspension and allow the DOE to implement further corrective actions within a specified deadline;
- Withdraw the accreditation of the DOE on a provisional basis, pending the final decision by the CMP (EB 56, Annex 2, paragraph 163).
Effect of suspension or withdrawal on registered project activities
Upon withdrawal or expiration of accreditation of an entity, the entity shall not continue any work on any CDM project activities, whether its accreditation expired or was withdrawn. The DOE shall inform any affected clients of the withdrawal or expiration of its accreditation status (EB 56, Annex 2, paragraphs 166 and 167).
Expiration or withdrawal of accreditation of a DOE shall not free the DOE from its contractual arrangements with its clients or with the UNFCCC secretariat including costs related to assessments conducted before expiration or withdrawal of accreditation of the DOE (EB 56, Annex 2, paragraph 168).
Registered project activities are not affected by the suspension or withdrawal of a DOE's designation, unless significant deficiencies are identified in the relevant validation or verification and certification report for which that DOE was responsible (3/CMP.1, Annex, paragraph 22). If significant deficiencies are identified:
- the Executive Board may appoint another DOE to review and correct them, and if excess CERs have been issued, the DOE must replace them (3/CMP.1, Annex, paragraph 22); and
- the costs of the review will be paid by the DOE whose designation has been withdrawn or suspended (3/CMP.1, Annex, paragraph 24):
Registered project activities shall not be affected by the suspension or withdrawal of designation of a designated operational entity unless significant deficiencies are identified in the relevant validation, verification or certification report for which the entity was responsible. In this case, the Executive Board shall decide whether a different designated operational entity shall be appointed to review, and where appropriate correct, such deficiencies. If such a review reveals that excess CERs were issued, the designated operational entity whose accreditation has been withdrawn or suspended shall acquire and transfer, within 30 days of the end of review, an amount of reduced tonnes of carbon dioxide equivalent equal to the excess CERs issued, as determined by the Executive Board, to a cancellation account maintained in the CDM registry by the Executive Board (3/CMP.1, Annex, paragraph 22).
Any costs relating to the review referred to in paragraph 22 above shall be borne by the designated operational entity whose designation has been withdrawn or suspended (3/CMP.1, Annex, paragraph 24).
Replacement credits provided by a DOE after suspension or withdrawal will be transferred to a cancellation account:
Where the accreditation of a designated operational entity has been withdrawn or suspended, ERUs, CERs, AAUs and/or RMUs equal to the excess CERs issued, as determined by the Executive Board, shall be transferred to a cancellation account in the CDM registry. Such ERUs, CERs, AAUs and RMUs may not be further transferred or used for the purpose of demonstrating the compliance of a Party with its commitment under Article 3, paragraph 1 (3/CMP.1, Annex, Appendix D, paragraph 8).
Project participants in affected projects have the opportunity for a hearing before the Executive Board makes recommendations on the suspension or withdrawal of a DOE's designation:
Any suspension or withdrawal of a designated operational entity that adversely affects registered project activities shall be recommended by the Executive Board only after the affected project participants have had the possibility of a hearing (3/CMP.1, Annex, paragraph 23).
Project participant initiated withdrawal
If a project participant has withdrawn prior to registration, the DOE must provide a letter and address this issue in the validation report.
The Board agreed that where a project participant listed in the PDD published at validation is not included in the PDD submitted for registration, the DOE shall provide a letter from the withdrawn project participant confirming its voluntary withdrawal from the proposed project activity, and address this issue in its validation report (EB 30, paragraph 41).