§ 1037.701 General provisions.

(a) You may average, bank, and trade credits as described in 49 CFR part 535. Participation in this program is voluntary. (b) The definitions of subpart I of this part apply to this subpart in addition to the following definitions: (1) Actual credits means credits you have generated that we have verified by reviewing your final report. (2) Averaging set means a set of vehicles in which credits may be exchanged. Note that an averaging set may comprise more than one regulatory subcategory. See § 1037.740. (3) Broker means any entity that facilitates a trade of credits between a buyer and seller. (4) Buyer means the entity that receives credits as a result of a trade. (5) Reserved credits means credits you have generated that we have not yet verified by reviewing your final report. (6) Seller means the entity that provides credits during a trade. (7) Standard means the standard that applies under subpart B of this part for vehicles not participating in the ABT program of this subpart. (8) Trade means to exchange credits, either as a buyer or seller. (c) Credits may be exchanged only within an averaging set, except as specified in § 1037.740. (d) You may not use credits generated under this subpart to offset any emissions that exceed an FEL or standard. (e) You may use either of the following approaches to retire or forego credits: (1) You may trade credits generated from any number of your vehicles to the vehicle purchasers or other parties to retire the credits. Identify any such credits in the reports described in § 1037.730. Vehicles must comply with the applicable FELs even if you donate or sell the corresponding credits under this paragraph (e). Those credits may no longer be used by anyone to demonstrate compliance with any standards. (2) You may certify a family using an FEL below the standard as described in this part and choose not to generate credits for that family. If you do this, you do not need to calculate credits for those families and you do not need to submit or keep the associated records described in this subpart for that family. (f) Credits may be used in the model year they are generated. Where allowed, surplus credits may be banked for future model years. Surplus credits may sometimes be used for past model years, as described in § 1037.745. You may not apply banked or traded credits in a given model year until you have used all available credits through averaging to resolve credit balances for that model year. (g) You may increase or decrease an FEL during the model year by amending your application for certification under § 1037.225. The new FEL may apply only to vehicles you have not already introduced into commerce.