Lawyers set to clash over contention that proposed European environmental charges would be illegal

Europe’s plans to extend its carbon dioxide emissions trading scheme (ETS) into all aviation could fall foul of international law if it applies to non-European Union carriers, US representatives have warned.

The European Commission announced in September that it plans to include aviation in the existing EU ETS and is finalising details of a working group to define the mechanism. Current EU thinking is that by defining any levy as a charge rather than a tax, it would be legal to apply the scheme to flights to points outside the EU and even to non-EU airlines, says Elliot Morley, climate change minister within the UK’s environment ministry. However, Carl Burleson, environment and energy director for the US Federal Aviation Administration, says the US view is that any extension would be challenged by lawyers in the USA and other jurisdictions with stricter interpretations on the Chicago Convention’s ban on taxing aviation fuel or emissions. “The EU should be like a laboratory, with emissions trading restricted to its borders. That way it can be used as a case study for the International Civil Aviation Organisation if the rest of the world later adopts a scheme,” he says.

The working group, whose composition is undecided, but likely to include airlines, industry groups and governments, will meet this month to hammer out details such as the actual impact of aviation, the scope of any new rules, calculating emissions from aircraft, how to monitor emissions and administration and enforcement of the inclusion. Burleson says calculating how much CO2 was emitted within the EU airspace sector of a transatlantic flight and enforcing collection in a jurisdiction that does not recognise the scheme will be problematic. International Air Transport Association chief economist Brian Pearce adds that the exact cost of the pollution is an unknown factor, with studies placing the cost from $25 a tonne to $120 a tonne.

However, Mike Crompton, policy advisor at the EC’s directorate general for transport, says the EC is pressing on with plans because voluntary schemes would prove “impossible to get the levels of reduction required without enforcement measures”. He says it would be legal to impose a charge on foreign carriers, proceeds of which would go to aviation, but not a tax, which goes into fiscal funds. The EU council of ministers, both environment and transport, is expected to approve aviation’s inclusion into ETS by early December, followed by the European Parliament. Next year technical details would be agreed and the legislative process would start.


Source: Flight International