Access to Justice for the Private Sector in Joint Implementation Projects under the Kyoto Protocol: A Brief Study of Possible Disputes and Remedies Available to Private Participants in International Carbon Emission Reduction Projects

The Kyoto Protocol has not only created carbon emission reduction obligations for industrialized
countries, but also opportunities for the private sector to participate in its “flexible mechanisms”. One
of these mechanisms is Joint Implementation, which allows private legal entities to engage in
international emission reduction projects that generate tradable emission rights. Private parties can act
as verifiers of the emission reductions achieved by such projects, or as buyers of the generated
emission rights (which can be used, e.g., for compliance under the European Union Emissions Trading
Scheme). During the Joint Implementation project cycle, these private parties can become involved in
several types of disputes with various counterparties. This paper explores the legal remedies available
to such private parties. Long-term private sector investment and contribution to the objectives of the
Kyoto Protocol are more likely to occur in a stable regulatory environment, which requires a certain
degree of legal protection. This includes proper access to justice in case disputes arise.