On behalf of Hyundai Oilbank Co. Ltd. (“Client”), Kim & Chang’s Environment Practice successfully secured a cancellation of the Ministry of Environment’s (the “MOE”) refusal to allocate greenhouse gas (“GHG”) emission permits from its appeal with the Central Administrative Appeals Commission. Despite a limited number of precedents where a plaintiff obtained a favorable decision in administrative appeals in connection with GHG emission permits, we were able to promptly resolve this dispute, thereby securing additional allocation of emission permits for our client.
In applying for allocation of emission permits for the Third Planning Period (2021-2025) of the GHG Emission Trading System, the Client requested allocation of additional emission permits to accommodate emissions from “expansion of follow-up processes.” However, the MOE notified that additional emission permits may not be allocated as it cannot acknowledge the expansion of the relevant processes. Thus, re-confirming that the expansion of follow-up processes was indeed completed, the Client submitted to the MOE a request to reconsider its notice of allocation. Although the Client explained the expansion of the relevant processes in great detail and faithfully submitted supporting materials as requested by the MOE, the MOE ultimately dismissed the Client’s request (i.e., refused to allocate the requested emission permits), finding that the Client should have explained this at the time of application for allocation.
Shortly thereafter, the Client filed an administrative appeal with the Central Administrative Appeals Commission, seeking cancellation of the MOE’s refusal to allocate the requested emission permits. In this appeal, the MOE argued that the Client’s application for allocation was based on “expansion of follow-up processes” not “expansion of the relevant process itself,” and the Client did not submit any supporting materials related to the expansion. For those reasons, the MOE contended that its notice of allocation was valid under the-then applicable standards. Moreover, the MOE noted that the Client’s submission of materials related to the “expansion of relevant processes” after it submitted the request for reconsideration must be considered a new application for allocation, not a part of the initial application for allocation.
In response, Kim & Chang highlighted that (i) although the Client might have described the expansion rather unclearly and failed to submit relevant materials, given the legislative intent and relevant precedents, whether the MOE’s notice of allocation was valid must be determined by taking into account the-then applicable factual circumstances, including materials submitted after the request for reconsideration was submitted. Further, (ii) as the Client submitted the initial application for allocation under the assumption that its emission is expected to increase due to the expansion, and clarified the basis for the requested additional emission permits (i.e., the expansion of the relevant processes”) at a later time along with supporting materials, this must not be considered a new application for allocation.
Following oral presentations on this matter, the Central Administrative Appeals Commission ultimately accepted all of the Client’s arguments, canceling the MOE’s refusal to allocate emission permits. In this case, Kim & Chang’s Environment Practice successfully secured a cancellation of the MOE’s disposition via administrative appeal based on its strategic analyses in the field of GHG emission permit allocation, which is known to be highly technical in nature. Given prompt resolution of the dispute and securement of additional emission permits, this case resulted in a successful outcome for the Client.
