The Chamber does not support the new version of the Climate Act

On 22 October, the Riigikogu's Environment Committee discussed proposed amendments to the draft Climate-Resilient Economy Act. Although the Estonian Chamber of Commerce and Industry supported an earlier version of the draft act, we are critical of the new amendments because they reduce legal certainty and do not help ensure the competitiveness of businesses. We therefore proposed that the amendments not be accepted.

Sectoral roadmaps would no longer be voluntary agreements
Under the original version of the draft act, sectoral roadmaps were to be drawn up together with stakeholders to achieve climate targets, serving as general guides. The Chamber supported this approach because sector-specific solutions can be effective only if they are developed in cooperation with businesses and take account of the sectors' actual capabilities, specific characteristics and competitive conditions.

The proposed amendments seek to change the role of the roadmaps significantly. According to the amendments, the roadmaps would have to set sector-specific greenhouse gas emission reduction targets and specify the measures to achieve them. In addition, the roadmaps would be approved by a government committee.

In the Chamber's view, such a change would reduce businesses' ability to have a say in shaping the content of the roadmaps. Although companies would be involved in drafting the roadmaps, their final approval would rest with a government committee. This means that the roadmaps could be approved even if companies in the sector do not agree with the proposed targets and measures.

New vaguely defined principles could be added
The Chamber is also concerned that the proposed amendments seek to introduce new principles and definitions of terms into the draft act which could create legal uncertainty.

For example, it is proposed to define competitiveness as the ability to ensure the maintenance and growth of productivity, added value and market position during the transition to a clean economy, while supporting the development of an environmentally responsible and resilient economy and the global trend towards clean technologies, low-emission production and more sustainable use of resources.

In the Chamber's view, such a definition could unjustifiably narrow the understanding of competitiveness and may not sufficiently take into account the actual competitive position of Estonian businesses in international markets. We also consider it important that the terms and principles used in the act be sufficiently clear for businesses to be able to foresee their potential impact on their activities.

Further information about the draft Climate-Resilient Economy Act and the proposed amendments is available on the Riigikogu's website.