Court challenge over EU emissions trading scheme

The extension of the EU emissions trading scheme to international travel is to be challenged in the European Court of Justice. A High Court judge in London has indicated that he is to refer the matter to the court in Luxembourg.

The extension of the EU emissions trading scheme to international travel is to be challenged in the European Court of Justice. A High Court judge in London has indicated that he is to refer the matter to the court in Luxembourg.

The US Air Transport Association (ATA) and three major American carriers are seeking a ruling on the validity of an EU directive introduced in 2008.

The directive widened the existing emissions trading scheme (ETS) to cover airlines from around the world engaged in international aviation activities.

ATA lawyers argue the EU is acting "contrary to international law" and imposing "an improper tax or charge".

Today Mr Justice Ouseley said all sides were agreed that a reference was necessary and he would order one as soon as the preparatory work was completed and "everything is right".

The ATA challenge is specifically to the 2009 regulations introduced by the Secretary of State for Energy and Climate Change, giving effect to the scheme in the UK.

The judge said: "In reality this case is wholly or very largely about the lawfulness of the directive."

The answers to the questions in the reference "are very likely to solve the whole of the issues underlying this challenge".

The judge gave permission for the International Air Transport Association (IATA) and National Airlines Council of Canada (NACC) to intervene, along with five environmental groups.

ATA chose London's High Court to launch its legal action as the UK was listed as the first EU country due to implement the early stages of the extended ETS.

Nancy Young, ATA vice-president, environmental affairs, said today: "The High Court decision to refer this case to the European Court of Justice is an important step, as only the ECJ has the authority to rule on the Europe-wide directive that applies the ETS to our airlines."

Young said the scheme was extended unilaterally "contrary to international law both as an extra-territorial action and an improper tax or charge".

It also "clearly stands in the way of an appropriate and effective global solution" to reducing greenhouse gas emissions.

ATA says it and its members have joined other airlines around the world in supporting a global framework for measures under the International Civil Aviation Organisation (ICAO), the United Nations body charged with establishing environmental and other standards for international aviation.

The ETS requires airlines which operate within the EU boundaries, regardless of nationality, to submit emissions reports.

Airlines which go above the limit imposed on them by the EU can buy "carbon emissions" from airlines which are below their quota.

Airlines not complying with the scheme risk penalties, including being banned from flying in the EU area.

Bodies like IATA and ICAO have expressed misgivings about the scheme.

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