Key data
| Regulation | Decision No. 1/2026 of the EU-Switzerland Joint Committee (CELEX:22026D1993) |
|---|---|
| Publication | 4 September 2026 |
| Entry into force | 9 June 2026 |
| Affected parties | Companies subject to ETS with activity in the EU and in Switzerland |
| Category | Energy / Carbon market |
| Year | 2026 |
| Sectoral scope | Industry, energy and aviation with cross-border EU-Switzerland activity |
| Official reference | CELEX:22026D1993 — Amendment to Annex I of the EU-Switzerland ETS Linking Agreement |
Companies with installations subject to the emissions trading scheme in the EU and in Switzerland have new technical rules to review. The Decision 1/2026 of the EU-Switzerland Joint Committee (CELEX:22026D1993), adopted on 9 June 2026, updates the Annex I of the Linking Agreement between the EU ETS and the equivalent Swiss system, modifying the parameters that ensure interoperability between both carbon markets.
The change is not cosmetic: it directly affects the technical and operational rules that allow emission allowances issued in one system to be recognized and used in the other. For compliance officers, CFOs and sustainability directors of companies with cross-border activity, ignoring this update can result in reporting breaches or inefficient management of the emission allowance portfolio.
What does this regulation establish?
The Linking Agreement between the EU and Switzerland allows both emissions trading systems (ETS) to function in an interconnected manner: companies can use allowances from one system to meet obligations in the other. This agreement is articulated through a Joint Committee that can modify its technical annexes through decisions such as the one we are now addressing.
The Decision 1/2026 specifically updates Annex I of the agreement, which contains the technical and operational rules of the linking. According to the regulation, the aspects that may be modified are:
- Accounting of emission allowances: new parameters that may alter how allowances are recorded and transferred between the two systems.
- Reference prices: possible adjustments in the mechanisms that determine the equivalence of value between EU ETS allowances and Swiss allowances.
- Equivalence mechanisms: rules that ensure that an allowance issued in Switzerland has the same recognition as one issued in the EU, and vice versa.
- Reporting and delivery obligations: compliance procedures may be affected by the new parameters of the amended annex.
To understand the exact scope of each modification, it is essential to consult the full text of the amended Annex I on EUR-Lex, as the decision does not publish a summary of changes but the complete updated version of the annex.
Economic and operational impact
The impact of this decision materializes in three operational areas for affected companies:
- Management of the allowance portfolio: if equivalence mechanisms or reference prices change, the strategy for purchasing, selling and using emission allowances must be recalibrated. A company that has planned its carbon position for 2026 with the previous parameters may find itself with deviations.
- Reporting obligations: changes in accounting may affect annual verification reports. An error in reporting can result in sanctions from the competent authorities in each jurisdiction.
- Internal adaptation costs: updating emissions tracking systems, reviewing contracts with Swiss or European counterparties and training compliance teams represents an operational cost that must be budgeted.
The interoperability between the EU ETS and the Swiss system is one of the most advanced carbon market linking agreements in the world. Any modification of its technical parameters has a direct effect on the financial planning of companies operating in both jurisdictions.
Who does it affect?
- Industrial companies with installations subject to EU ETS in EU countries and at the same time with regulated activity in Switzerland.
- Energy sector companies (generation, distribution, marketing) with presence in both jurisdictions.
- Aviation operators with routes between the EU and Switzerland included in the scope of ETS.
- CFOs and sustainability managers of multinational groups with subsidiaries or installations in Switzerland and in the EU.
- Carbon management advisors and consultants who manage emission allowance portfolios for clients with cross-border exposure.
- Regulatory compliance departments of companies that must ensure the correct delivery of allowances at the end of each compliance period.
Practical example
Imagine a Spanish cement company with an installation in Catalonia subject to EU ETS and a plant in the canton of Zurich regulated by the Swiss emissions system. Until now, this company managed its carbon position jointly, transferring allowances between both installations thanks to the equivalence mechanisms of Annex I of the linking agreement.
With the entry into force of Decision 1/2026 on 9 June 2026, the technical parameters of that Annex I have changed. The sustainability manager of this company must:
- Review whether the allowances already acquired remain valid under the new equivalence parameters.
- Verify that internal emissions accounting systems correctly reflect the new rules.
- Confirm with its accredited verifier that the reporting reports for the 2026 fiscal year comply with the new requirements of the amended annex.
If this review is not carried out before the end of the compliance period, the company may face an undetected allowance deficit or a verification report rejected by the competent authorities.
What should companies do now?
- Download and review the amended Annex I: access the full text of Decision 1/2026 on EUR-Lex (CELEX:22026D1993) and identify which specific parameters have changed compared to the previous version of Annex I.
- Evaluate the impact on the allowance portfolio: analyze whether the emission allowances held (EU ETS and Swiss) remain equivalent under the new rules and whether it is necessary to adjust the carbon position for the 2026 compliance period.
- Update accounting systems: ensure that internal emissions tracking and recording tools reflect the new accounting parameters of the amended annex.
- Coordinate with the accredited verifier: inform the verifier of regulatory changes so that verification reports for the 2026 fiscal year are prepared in accordance with the new requirements.
- Review contracts with counterparties: if there are contracts for the purchase and sale of emission allowances with Swiss or European companies, verify whether the new equivalence mechanisms affect the agreed conditions.
- Consult with a carbon management expert: given that the text of Annex I is of a technical nature, support from a specialist in carbon markets is recommended to interpret the specific impact on the company's emissions management strategy.
Frequently asked questions
Which companies must review their obligations following Decision 1/2026 of the EU-Switzerland Joint Committee?
Industrial, energy and aviation companies with cross-border activity between the EU and Switzerland that are subject to the emissions trading scheme (ETS) in either jurisdiction. They are directly affected by the new parameters of the amended Annex I.
When does the update to Annex I of the EU-Switzerland ETS linking agreement enter into force?
Decision 1/2026 entered into force on 9 June 2026, although it was officially published on 4 September 2026. Affected companies should consider that the regulation is already applicable from the date of adoption by the Joint Committee.
What specific aspects may be affected in my company's operations?
According to the regulation, the change may involve adjustments in the accounting of emission allowances, reference prices and equivalence mechanisms between EU ETS and the Swiss system. It is necessary to review the full text of the amended Annex I to identify the specific impact in each case.
What should I do if my company operates in the aviation sector with routes between the EU and Switzerland?
Aviation companies with cross-border EU-Switzerland activity are among the most directly affected. They must review the new parameters of Annex I to ensure compliance with their reporting and emission allowance delivery obligations under the linked EU ETS-Switzerland regime.
Where can I consult the official text of Decision 1/2026 of the EU-Switzerland ETS Joint Committee?
The official text is available on EUR-Lex with the reference CELEX:22026D1993. It is the primary source for identifying the exact changes introduced in Annex I of the linking agreement.
Official source
Consult complete regulation in official source
Disclaimer: This article is for informational purposes only and does not constitute legal advice. For specific decisions, consult a qualified professional. Source: https://eur-lex.europa.eu/./legal-content/AUTO/?uri=CELEX:22026D1993
