Advocate’s opinion emphatically rejects airlines’ ETS complaints

October 26, 2011

Attempts by several airlines to be excluded from the EU’s aviation Emissions Trading Scheme (ETS) when it begins in January have suffered a major setback. The advocate general of the European Court of Justice has delivered her opinion on the case, and it rejects all the airlines’ complaints. Although the advocate general’s opinion is not binding on the final ruling, the Court seldom deviates substantially from an advocate general’s view, and this view is very clear.

From 1 January, airlines operating flights that arrive or depart at EU airports must surrender permits corresponding to the carbon dioxide emitted on those routes. Under a compromise agreed when the introduction of aviation in the ETS was decided in 2008, 85% of the permits covering historical emissions will be given away free, with the remaining 15% auctioned. Estimates suggest the impact will be equivalent to one cent on the price of a litre of aviation fuel.

A group of three US airlines challenged the legality of the EU subjecting them to emissions trading, saying it contravened the Chicago Convention, the Kyoto Protocol and the EU-US ‘Open Skies’ agreement, as well as a customary principle of international law. The airlines’ legal action was contested by EU member states, supported by a coalition of six NGOs, three from America and three from Europe (including T&E), who have the status of ‘intervenor defendants’ in the case. The ECJ will rule early next year, by which time aviation will already be subject to emissions trading.

In her preliminary opinion, the ECJ’s advocate general for the case Juliane Kokott rejected all the claims submitted by the airlines. She said the suggestion that aviation in the ETS contravenes the 1944 Chicago Convention was incorrect, as the convention merely prohibits discrimination against airlines on the grounds of nationality and does not prohibit fees or charges for using another country’s airspace. In addition, the EU is not a party to the Chicago Convention – only member states are – so it is not bound by it.

Kokott also says subjecting aviation to emissions trading does not amount to a charge or tax. She said: ‘It would be unusual, to put it mildly, to describe as a charge or tax the purchase price paid for an emission allowance which is based on supply and demand according to free market forces.’ She also rejected the idea that any action to tackle aviation’s environmental impact that was not done through the International Civil Aviation Organisation contravened the Kyoto Protocol. ‘There is no reference to any kind of exclusivity in the actual wording of the protocol,’ she says.

And she rejected the claim that emissions trading for aviation violated a principle of international law relating to the rights of countries whose airspace is used by aircraft. She said this claim was based on ‘an erroneous and highly superficial reading of the directive’, and that there is insufficient evidence that the principle of law cited by the airlines exists.

T&E’s aviation programme officer Bill Hemmings said: ‘This is a very encouraging development, and one that I hope will act as a wake-up call to the aviation industry. This industry has failed to make any progress on international measures to cut aviation emissions in the 14 years since Kyoto, and now this opportunistic and irresponsible attempt to hide behind legal arguments instead of tackling the problem looks set to end in failure. It’s now time for the aviation industry to start tackling climate change with engineers, not lawyers.’

Although the opinion is a powerful boost to efforts to tackle the climate impact of air travel, the airlines’ legal action is not the only battleground on this issue. Some developing nations have threatened retaliation if aviation is subjected to emissions trading, irrespective of the legality of it. Earlier this month, the EU climate commissioner Connie Hedegaard said she was keen to ‘engage constructively’ with concerned countries and discuss the appropriateness of ‘equivalent measures’. This refers to the scope within the ETS directive for the EU to take account of efforts to reduce emissions affecting incoming flights.

To read the EJC advocate general’s opinion.

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