EU airline carbon tax backed by European Court

EU plans to levy an emissions tax on airlines are valid, according to the European Court of Justice (ECJ). The decision means all airlines flying to and from the 27 states of the European Union will face a tax on emissions from 1 January. US, Canadian and other carriers argue the charges violate climate change and aviation pacts. Four Chinese airlines have also opposed the scheme which they say could cost them 95m euros ($124m, £79m). American carriers argue that the taxes contravene the Open Skies Agreement, which allows airlines to fly between any EU country and any point in the US. The US House of Representatives passed a measure two months ago directing the US transport secretary to prohibit US carriers from participating in the scheme if it were to come into force. On Friday, the US Secretary of State Hillary Clinton said America would respond with "appropriate action" if the scheme went ahead, although she did not elaborate on any specific measures. No delay Airlines will now be subject to the Emissions Trading System (ETS), used to charge industries such as oil refineries, power stations and steel works for CO2 emissions, as part of Europe's efforts to combat climate change. "Application of the emissions trading scheme to aviation infringes neither the principles of customary international law at issue nor the Open Skies Agreement" across the Atlantic, the court decided. "It is only if the operators of such aircraft choose to operate a commercial air route arriving at or departing from an airport situated in the EU that they are subject to the emissions trading scheme," it added. As a result of this choice, the EU system "infringes neither the principle of territoriality nor the sovereignty of third states, since the scheme is applicable to the operators only when their aircraft are physically in the territory of one of the member states of the EU". The EU has made it clear that it will not bow to US pressure following Wednesday's decision. "We will neither abandon nor delay [the Emissions Trading System]. The measure will fully enter force on 1 January 2012," said the spokesman for EU climate change commissioner, Connie Hedegaard.