The Coming ‘Air War’ in Europe - US airlines battle EU carbon cap

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The European Union's plan to bring all non-EU airlines flying into or out of the bloc under its Emissions Trading System (ETS) is being challenged by the US airline industry.

Appearing before the European Court of Justice (ECJ) this week, the Air Transport Association of America (ATA) argued that aviation greenhouse gas emissions should be regulated globally, not on a regional basis.

It argued that unilateral action by any country or group of countries violates international law and the Convention on International Civil Aviation (known as the Chicago Convention), which 'dictates that countries have sovereignty over the airlines in their own airspace'.

According to the ATA, it is the International Civil Aviation Organization (ICAO) - not the EU - that has the authority to establish greenhouse gas policy for international aviation.

ATA told the ECJ that under the new rules, a flight by one of its members from San Francisco to London Heathrow would produce 'only 9% of its emissions in EU airspace. Yet the ETS will impose a levy on this carrier, and may also impose an excess emissions penalty, based on emissions for the entire flight from start to finish'.

Other airline groups have warned of a possible 'air war' if the legal basis for the EU plan is not clarified soon.

'If this is not sorted out in the next six months we run the risk of a trade conflict between the EU and third countries,' said Ulrich Schulte-Strathaus, secretary general of the Association of European Airlines (AEA) speaking recently at the annual meeting of the International Air Transport Association in Singapore.

Said Schulte-Strathaus, some airlines could be forced to cede routes to non-EU carriers because they would not be able to pass extra costs on to passengers. Non-EU carriers, by contrast, will be able to offset the higher costs as the rest of their network will not fly via the EU.

That concern has been echoed by the Montreal-based International Air Transport Association (IATA) that warns the ETS would increase annual salary costs for Europe's airline industry making it completely uncompetitive.

Nicholas Calio, ATA chief , said 'The legal case is important as a means of addressing what is wrong with the European scheme, but also as an opportunity for us to continue to pursue an approach that is appropriate for this global industry.'

Six EU countries, France, Spain, Sweden, Poland and Denmark, led by the UK, defended the decision to include aviation emissions in the ETS and, according to the environmental organizations backing them, 'strongly rejected' ATA's case.

The ECJ's advocate general will deliver her opinion on the case on 6 October, which will be followed by a final judgment by the court at a later date.

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