Twenty Six Governments Expected To File Formal Protests

The European Union may see a concerted international push-back against its proposed carbon trading scheme Wednesday, as 26 individual nations are expected to file formal protests against the EU's carbon tax.

Beginning January 1st, any flight operating in European airspace will be required to purchase carbon permits to offset emissions, and the amount will be based on overall flight length, not just the amount of time the airplane spends in European airspace. The Emissions Trading Scheme (ETS) has caused a great deal of concern in the airline industry, and last week, the U.S. House of Representatives passed a bill that would make it illegal for a U.S. flagged airline to pay the European carbon tax, though there is no companion bill in the U.S. Senate. The ICAO is expected to take a stand against the EU this week at a meeting Wednesday. A draft of the ICAO white paper says that the EUs scheme presents "major challenges and risks for aircraft operators."

Reuters reports that the EU says it's scheme is legal under international law, and that any ICAO measure would be non-binding.

The EC has estimated that the carbon credit purchase would cost the airlines between 2 and 10 Euros per passenger, depending on how much the carriers decide to pass along to their customers. The fine for non-compliance would range to 100 Euros per passenger.

Airline analyst Gabriel Sanchez, an adjunct professor of law at the International Aviation Law Institute, Chicago, said that the ETS is the first step in a potential trade war between the EU and the U.S. He said if American-flagged carriers are prohibited by U.S. law from compliance with the EU law, the Union might be forced to ban all U.S. flights to EU destinations.

FMI: www.icao.int, http://europa.eu