Europe’s highest court gave unreserved backing on Wednesday to an EU law charging airlines for carbon emissions on flights to and from Europe, a decision likely to escalate tension with trading partners, especially the United States.
The court ruled against a group of U.S. and Canadian airlines that had challenged a law requiring that all airlines flying to and from European Union airports will have to buy permits under the EU’s emissions trading scheme from Jan. 1. The initial cost is expected to be minimal but would rise to an estimated €9-billion ($12.1-billion) by the end of 2020.
“Application of the emissions trading scheme to aviation infringes neither the principles of customary international law at issue, nor the open-skies agreement,” the European Court of Justice (ECJ) said.
Wednesday’s ruling was expected after a senior adviser to the court issued a preliminary opinion in October that found the EU legislation did not infringe other states’ sovereignty and was compatible with international accords.
The lawsuit was brought by U.S. and Canadian airlines acting through the industry trade organization Airlines for America, but the protest was supported by China, India and other countries with international carriers.
The carbon trading program, due to go into effect Jan. 1, is one of the widest-reaching measures adopted by any country or regional bloc to regulate emissions of greenhouse gases blamed for climate change. It aims to make airlines accountable for their carbon emissions, which contribute to global warming.
The U.S. trade group said its members would comply with the EU directive “under protest,” while reviewing legal options to fight the Emissions Trading Scheme (ETS).
In Ottawa, the National Airlines Council of Canada said it was disappointed. “Over the last several months, most of the world’s major non-EU aviation powers including the U.S., China, Russia, Japan and Canada, have clearly expressed their objections to having their respective sovereignties infringed and the ETS imposed on their airline industries without their consent,” said council president George Petsikas.
EU climate commissioner Connie Hedegaard, for whom the carbon trading scheme is one of the main weapons to combat climate change, was among the first to welcome the decision.
“After a crystal-clear ruling today, the EU now expects U.S. airlines to respect EU law as the EU respects U.S. law,” she said in a Twitter posting.
“We reaffirm our wish to engage constructively with everyone during the implementation of our legislation,” she added in a statement.
The U.S. government, which has warned it could take “appropriate action” if the EU didn’t reconsider this aspect of the ETS, said it was dismayed by the ruling, and reiterated that it wanted the issue addressed by the International Civil Aviation Organization (ICAO).
“We continue to have strong legal and policy objections to the inclusion of flights by non-EU air carriers in the EU ETS,” Krishna R. Urs, deputy assistant secretary for transportation affairs at the U.S. Department of State, said in a statement.
In a statement, Airlines for America called on the EU “to come back to the table to consider a global sectoral approach.”
A case against the EU was initially brought to the London High Court of Justice by the Air Transport Association of America, American Airlines and United Continental UAL-N, but the London court referred it to the ECJ in Luxembourg.
Critics of the EU rules, agreed to in June 2008, have argued that under the 1997 Kyoto climate pact, countries pledged to address aviation emissions jointly through the U.N.’s aviation body, the ICAO.
More than a decade on, talks at ICAO have not yielded significant progress, and the ECJ said the EU was within its rights to take unilateral action.
But the United States, where environmental legislation has become a focus of disagreement between Democrats and Republicans, has angrily rejected the EU plan.
