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Marjan Peeters and Huizhen Chen

This chapter aims to further the debate regarding the role of law for establishing an adequate enforcement strategy for an emissions trading scheme. We focus on sanction regimes within the EU ETS and the Chinese emissions trading pilot projects. Section 2 sets the scene by pointing at the need of an adequate enforcement approach and related legal scholarship. Section three presents the specific case of the EU ETS, established by Directive 2003/87/EC from 2003, while section 4 turns to the recently developed greenhouse gas emissions trading pilot projects in China. In particular, sections 3 and 4 focus on sanctions for excess emissions, discussing recent case law regarding penalties for emissions trading within the EU and specific enforcement approaches in the emerging emissions trading regimes in China. Section 5 concludes, highlighting that proper evaluation of compliance with emissions trading regimes is a challenge in itself, not only for governments, but also for academics who want to gain further insights into how emissions trading regimes work in the practice of different legal systems. In conclusion, access to information regarding compliance and enforcement with an emissions trading regime needs to be further explored, not only for China but also for the EU.