THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article 192(1) thereof,

Having regard to the proposal from the European Commission,

After transmission of the draft legislative act to the national parliaments,

Having regard to the opinion of the European Economic and Social Committee [OJ C 424, 26.11.2014, p. 46.],

After consulting the Committee of the Regions,

Acting in accordance with the ordinary legislative procedure [Position of the European Parliament of 8 July 2015 (not yet published in the Official Journal) and decision of the Council of 18 September 2015.],

Whereas:

(1) Directive 2003/87/EC of the European Parliament and of the Council establishes a system for greenhouse gas emission allowance trading within the Union ('EU ETS') in order to promote reductions of greenhouse gas emissions in a cost-effective and economically efficient manner.

(2) According to the European Council conclusions of 23 and 24 October 2014 on the 2030 climate and energy policy framework, a well-functioning, reformed EU ETS with an instrument to stabilise the market will be the main European instrument to achieve the Union's greenhouse gas emissions reduction target.

(3) Article 10(5) of Directive 2003/87/EC provides that each year the Commission is to submit a report to the European Parliament and to the Council on the functioning of the European carbon market.