Linkages between Article 9.5 and Articles 13 and/or 14 PA

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Date produced: 18/01/2018

Can you suggest options for a detailed ex post assessment of finance flows under Art.9.5 PA through linking Art.9.5 to the transparency framework and global stocktake of the Paris Agreement?

Advice:

A              Introduction

In our view, Article 9.5 relates solely to the provision of ex ante information and so does not provide a mechanism for ex post assessment of finance flows whether on its own, or in conjunction with Articles 13 and 14, PA. However, Article 9.7, along with Articles 13 and 14, obliges developed country parties to provide detailed ex post information in relation to finance flows, which may serve to put pressure on developed countries to commit resources to assisting developing countries in their adaptation and mitigation efforts in the future. In addition, Articles 13 and 14 potentially provide mechanisms for developing country parties to raise their concerns regarding developed countries failure to provide quantitative ex ante information regarding finance flows.

We set out below a high-level analysis of the following issues:

  • The interpretation of Articles 9.5 and 9.7.
  • Whether developed country parties’ obligations under Articles 9.5 and 9.7 could be linked to Articles 13 and 14.
  • Options arising from the interrelationship of the above articles to put pressure on developed country parties to provide ex ante and ex post information regarding finance flows to developing country parties, and to commit resources to assist those parties in their adaptation and mitigation efforts.

B               The Interpretation of Articles 9.5 and 9.7

(i)             Article 9.5

Article 9.5, PA provides as follows:

Developed country Parties shall biennially communicate indicative quantitative and qualitative information related to paragraphs 1 and 3 of this Article, as applicable, including, as available, projected levels of public financial resources to be provided to developing country Parties. Other Parties providing resources are encouraged to communicate biennially such information on a voluntary basis.

Under Article 31(1) of the Vienna Convention on the Law of Treaties, a treaty is to be interpreted “in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and purpose”. Under the ordinary meaning of the above provision, the obligation of developed country parties is to provide ex ante information regarding finance flows, rather than any ex post assessment of such flows. This is demonstrated by the word “indicative”, which suggests that parties are to give an indication of what resources will be provided, and the fact that the information relates to resources “to be provided” (emphasis added), i.e. provided in the future, as opposed to resources that have already been provided.

In terms of the nature of the information to be provided, there is an express obligation to provide both qualitative and quantitative information. However, commentators have noted that the provision of quantitative information is likely to be difficult. For example, in a recent report, the Organisation for Economic Co-operation and Development (“OECD”) stated that “there are fundamental challenges associated with providing such information, such as internal budgetary processes that limit the availability of disaggregated, forward-looking information.”[1] This may also explain why the obligation to provide information is biennial; most countries set their budgets either annually or biennially, and so the provision of information more frequently than biennially would likely be problematic.[2]

Commentators have also suggested, based on the words “as available”, that the obligation is only to provide information which already exists, rather than creating new information. However, this interpretation does not appear persuasive, as the words “as available” only appear to refer to “projected levels of public financial resources” and not to the provision of other forms of quantitative and qualitative information under Article 9.5.

While the precise nature of the information to be provided under Article 9.5 is open to debate, the provision is, in our view, clearly forward looking in nature and so would be unsuitable for achieving the type of ex post assessment envisaged in the query above.

(ii)            Article 9.7

Article 9.7 imposes an obligation on developed country parties to provide:

transparent and consistent information on support for developing country Parties provided and mobilized through public interventions biennially in accordance with the modalities, procedures and guidelines to be adopted by the Conference of the Parties serving as the meeting of the Parties to this Agreement, at its first session, as stipulated in Article 13, paragraph 13. Other Parties are encouraged to do so.

By contrast to Article 9.5, this obligation appears to concern ex post reporting, since it uses the past tense to describe information “provided and mobilized”. It is therefore relevant to developing country parties’ consideration of how to apply pressure on developed country parties to meet their financing obligations under the Paris Agreement through ex post assessment. Article 9.7 also expressly refers to the transparency mechanism under Article 13. We discuss the link between these two provisions in further detail in the next section.

C               Whether Developed Country Parties’ Obligations under Articles 9.5 and 9.7 could be linked to Articles 13 and 14

As discussed in further detail below, parties’ obligations under Article 9 are linked to Articles 13 and 14, which set out the transparency framework and global stocktake framework, respectively. Articles 13 and 14 therefore provide a useful vehicle for the discussion of the information provided by parties under Article 9. This is true both in relation to ex ante information provided under Article 9.5 and ex post information provided under Article 9.7.

(i)             Article 9.5 and Articles 13 and 14

There is no express link in Article 9.5 to either Articles 13 or 14. However, there are a number of ways in which Article 9.5 could be interpreted as being linked to Articles 13 and 14.

Commentators appear to be united in agreeing that Article 9.5 is linked to Article 13. Van Asselt, Weikmans, Roberts and Abeysinghe note that “Article 9.5 can be considered as one of the cornerstones of the Paris package on transparency”.[3] The links between Articles 9.5 and 13 manifest themselves in various ways. For example, developed country parties’ obligation under Article 9.5 to provide ex ante  information in relation to finance flows has been interpreted as complementary to the obligation under Article 13.9 to provide information on financial, technology transfer and capacity-building support provided to developing country Parties under Articles 9, 10 and 11.[4]

Article 13.11 also provides that information provided by developed country parties under Article 9 shall be subject to a “technical expert review”. Although the language used in Article 13.12 suggests that the technical review will be limited to information submitted under Article 9.7 (“The technical expert review under this paragraph shall consist of a consideration of the Party’s support provided, as relevant, and its implementation and achievement of its nationally determined contribution” (emphasis added)), parties could decide that such a review will take into account whether developed country parties are complying with the obligation to provide both qualitative and quantitative information under Article 9.5 of the Paris Agreement.

Article 13.11 further provides that parties are to “participate in a facilitative, multilateral consideration of progress with respect to efforts under Article 9”. Given that this provision refers to the entirety of Article 9, the facilitative, multilateral consideration it envisages arguably includes a consideration of whether or not developed country parties are complying with their obligations under Article 9.5.

There are also various ways in which Article 9.5 could be linked to the global stocktake envisaged under Article 14. For example, Article 9.6 provides that “[t]he global stocktake referred to in Article 14 shall take into account the relevant information provided by developed country Parties and/or Agreement bodies on efforts related to climate finance.” Article 9.6 does not specify whether the “relevant information” to which it refers is ex ante information (under Article 9.5), or ex post information (under Article 9.7). It has therefore been suggested that Article 9.6 would allow developed country parties’ compliance with Article 9.5 to be included in the global stocktake under Article 14, which is aimed to “assess the collective progress towards achieving the purpose of this Agreement and its long-term goals.”[5]

The scope of the global stocktake under Article 14 also appears potentially broad enough to encompass whether or not parties are complying with Article 9.5, since it refers to “the collective progress towards achieving the purpose of this Agreement and its long-term goals.”[6] Developing country parties could argue that the failure of developed countries to provide quantitative information under Article 9.5 is impeding the progress towards achieving the goals of the agreement, since it is making it difficult for developing countries to plan their adaptation and mitigation efforts.

(ii)            Article 9.7 and Articles 13 and 14

Unlike Article 9.5, Article 9.7 is explicitly linked to Articles 13 and 14. For example, Article 9.7 expressly refers to the transparency framework under Article 13, stating that the provision of information under Article 9.7 shall be “in accordance with the modalities, procedures and guidelines to be adopted by the Conference of the Parties serving as the meeting of the Parties to this Agreement, at its first session, as stipulated in Article 13, paragraph 13.”

Like Article 9.5, information provided under Article 9.7 could also arguably be made subject to technical expert review pursuant to Article 13.11.

Article 13.9 imposes additional obligations on developed countries to provide ex post information on finance flows, since it provides that: “  Developed country Parties shall, and other Parties that provide support should, provide information on financial, technology transfer and capacity-building support provided to developing country Parties under Articles 9, 10 and 11.” (emphasis added).

Commentators have noted that Article 9.7 should be read in conjunction with Article 13.10, which provides that “Developing country Parties should provide information on financial, technology transfer and capacity-building support needed and received under Articles 9, 10 and 11.”[7] Thus, the obligation of developed country parties to provide ex post information regarding financial support provided and mobilised to developing country parties under Article 9.7 comes with a corresponding “soft” obligation on developing country parties to provide information about the resources received and required under Article 13.10. This could prove a useful channel for developing country parties to exert pressure on developed countries to commit further resources in pursuance of their finance obligations under Article 9. It should be noted, however, that such obligations are not fixed or quantified under Article 9,[8] and although developed country parties have set a goal of providing USD 100 billion annually by 2020 for mitigation and adaptation, this target is aspirational rather than binding.[9]

In relation to Article 14, information provided under Article 9.7 could arguably form part of the global stocktake under Article 14 on the same basis as discussed in relation to Article 9.5 above.

As set out above, it is therefore possible to link both Articles 9.5 and 9.7 to the transparency framework under Article 13 and the global stocktake under Article 14.

D              Practical Options Regarding the Provision of ex ante and ex post Information under Articles 13 and 14

It should be noted that there has been relatively little commentary on the practical implementation of Articles 13 and 14, and how they link to developed countries’ obligations under Articles 9.5 and 9.7. However, from what we have seen, there are certain practical options for developing country parties seeking to put pressure on developed countries to comply with their obligations to provide ex ante and ex post information, and to increase their financial commitments. We summarise these below. Such options could be pursued in parallel with the process of identifying information to be provided by developed country parties by the Subsidiary Body for Implementation (“SBI”) of the Paris Agreement, as requested by the Conference of the Parties (“COP”) at its 23rd session.[10] The fact that the SBI has been requested to do this perhaps indicates that the parties to the Paris Agreement will be receptive to improving the flow of information under Articles 9.5 and 9.7 using Articles 13 and 14.

(i)             Options using Article 13

In relation to ex post information provided under Article 9.7, the COP has requested that the Subsidiary Body for Scientific and Technological Advice (“SBSTA”) develop rules for accounting of financial resources provided and mobilised through public interventions to recommend to COP24.[11] Once these rules have been implemented, it should be easier for developing country parties to assess the level of financial support provided under Article 9 and  to assess any further support needed pursuant to Article 13.10.

As noted above, information provided under Article 9 (arguably including both Articles 9.5 and 9.7), is to undergo a technical review pursuant to Articles 13.11 and 13.12. The precise details for this review have yet to be established, but Decision 1/CP21 suggests that such a review take place every two years and follow a two-phase approach, comprising assessment and analysis followed by review and consultation.[12] The expert review could provide detailed information about the provision of support by developed country parties, and this information could be used by developing country parties to highlight where contributions are not sufficient, thereby putting pressure on developed country parties to increase their commitments. Commentators also suggest that the outputs from such a review process could provide a useful opportunity to raise areas of concern with the compliance and implementation committee established under Article 15.[13]

Developing country parties could seek for the “multilateral consideration of progress” under Article 13.11 to include assessment of the information provided by developed country parties in relation to finance provided and mobilised under Articles 9.5 and 9.7.

Regarding the modalities, procedures and guidelines under Article 13.13, as expressly referred to in Article 9.7, the Ad Hoc Working Group on the Paris Agreement (“APA”) has been mandated to make recommendations with regards to the modalities, procedures and guidelines for the transparency framework to the CMA.[14] A progress report dated 12 October 2017 states that negotiations are continuing at the APA.[15] Developing country parties could work to make a detailed recommendation to the APA to include guidelines for the provision of information under Articles 9.5 and 9.7 in the process of developing the modalities and guidelines under Article 13.13. This recommendation could expressly include the need for developed states to outline in quantitative and qualitative terms the support to be provided and mobilised for mitigation and adaptation.

(ii)            Options using Article 14

In relation to Article 14, parties could propose that the support provided and mobilised by developed countries for developing countries be included in the biennial assessments of the Standing Committee on Finance (“SCF”), which was established pursuant to Decision 2 CP.17.[16] It has been suggested by commentators that this would be a “beneficial” and even “necessary” way to “mak[e] finance flows consistent with low emissions development and climate resilient development” as part of the global stocktake.”[17] Parties could also seek to enlarge the mandate of the Technology Executive Committee (“TEC”), which is currently mandated to make recommendations regarding technology development and transfer, to include the assessment of existing finance flows.

As noted above, pursuant to Article 9.6, the information provided by developed country parties under Articles 9.5 and 9.7 arguably forms part of the information to be taken into account during the global stocktake. Developing country parties could therefore seek for the discussion of information provided under these articles to be included in discussions forming part of the global stocktake under Article 14, which is to take place in 2023.[18] In this regard, commentators have noted that the information to be taken into account during the global stocktake pursuant to Article 9.6 should include “as a minimum, the communications and reports referred to in Articles 9.5 and 9.7”, and so there is support for this proposition.[19] The inclusion of such information in the global stocktake could increase the pressure on developed country parties to increase their financing commitments following the stocktake, in the event that the parties determine that the overall goals of the Paris Agreement are not being progressed sufficiently.

E               Conclusion

The operation of Article 9.5 appears to be restricted to ex ante information regarding finance flows to developing countries. Article 9.7 sets out developing country parties’ obligations in terms of providing ex post information regarding this issue. In our view, based on the interpretation of the relevant provisions, both Article 9.5 and Article 9.7 could be used in conjunction with the transparency framework under Article 13 and the global stock-take under Article 14 to place pressure on developed country parties to provide adequate information in compliance with their obligations under Articles 9.5 and 9.7, and to increase their commitments if current finance flows are deemed to be inadequate. There is little commentary in terms of practical options for how this process might work, but there are a number of options which could be pursued under both Article 13 and Article 14. These options would largely use the existing framework and organisations established under the auspices of the Paris Agreement, such as the SCF, TEC and APA. These organisations could provide useful channels of communication and fora for the discussion of these issues, and, ultimately, pressurise developed country parties into complying with the letter and spirit of their obligations under Articles 9.5 and 9.7.

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[1] OECD Climate Change Expert Group, Unpacking Provisions Related to Transparency of Mitigation and Support in the Paris Agreement, p. 30.
[2] Gastelumendi and Gnittke, Climate Finance (Article 9), in Klein and others, The Paris Agreement on Climate Change Analysis and Commentary, p. 248.
[3] Van Asselt, Weikmans, Roberts and Abeysinghe, Transparency of Action and Support under the Paris Agreement, European Capacity Building initiative. This articles can be accessed at: http://www.eurocapacity.org/downloads/Transparency_in_Paris_Agreement.pdf
[4] Dagnet and Levin, Transparency (Article 13), in in Klein and others, The Paris Agreement on Climate Change Analysis and Commentary, p. 310.
[5] Gastelumendi and Gnittke, Climate Finance (Article 9), in Klein and others, The Paris Agreement on Climate Change Analysis and Commentary, p. 250.
[6] Paris Agreement, Article 14.1.
[7] Gastelumendi and Gnittke, Climate Finance (Article 9), in Klein and others, The Paris Agreement on Climate Change Analysis and Commentary, p. 248.
[8] See Paris Agreement, Article 9.1, which provides that 1. Developed country Parties shall provide financial resources to assist developing country Parties with respect to both mitigation and adaptation in continuation of their existing obligations under the Convention.
[9] CP 21, ¶ 114.
[10] At its 23rd session, the COP adopted a decision requesting the SBI to consider “identification of the information to be provided by the Parties” in accordance with Article 9.5. The SBI will begin this work at its 48th session in April – May 2018 with a view to forwarding the outcome to COP24 in December 2018. (see, Decision CP.23 on the Process to identify the information to be provided by the Parties in accordance with Article 9, paragraph 5, of the Paris Agreement, paragraph 5).  This should result in practical recommendations regarding the type of information to be submitted under ex ante reporting pursuant to Article 9.5.
[11] Paragraph 57 of Decision 1/CP.21.
[12] Paragraph 92(e) of Decision 1/CP.21.
[13] Friedrich, Global Stocktake (Article 14), in Klein and others, The Paris Agreement on Climate Change Analysis and Commentary (“Friedrich”), pp. 310-311.
[14] Decision 1/CP.21, ¶¶ 92-98;
[15] An informal note from the APA’s session in Bonn contains an annex listing the issues being discussed in relation to the modalities, procedures and guidelines. APA, Third part of the first session, Bonn, 8-18 May 2017, Agenda Item 5 – Modalities, procedures and guidelines for the transparency framework for action and support referred to in Article 13 of the Paris Agreement.
[16] Decision 2 CP.17, ¶ 121(f).
[17] Friedrich, Global Stocktake (Article 14), in Klein and others, The Paris Agreement on Climate Change Analysis and Commentary (“Friedrich”), p. 335.
[18] Paris Agreement, Article 14.2
[19] Gastelumendi and Gnittke, Climate Finance (Article 9), in Klein and others, The Paris Agreement on Climate Change Analysis and Commentary, p. 250.