Monday, November 7, 2011

Quotes from EU Committee Chairman on ETS Standoff

Blog readers interested in the latest on the ETS controversy should read today's article at Air Transport World. See Karen Walker, EU MP: Europe Will Not Back Down on ETS, Air Transport World, Nov. 7, 2011 (available here). The story quotes European Parliament Transport Committee chairman Brian Simpson, speaking at the 55th annual meeting of the Association of Asia Pacific Airlines, who makes three provocative assertions. First, he states that many EU governments view the ETS as a potential revenue source, which would belie Advocate General Juliane Kokott's characterization of the regulation as distinct from a tax, and would strengthen ETS opponents' argument that the ETS violates the Chicago Convention. Second, Simpson says that he has suggested a compromise limiting application of the emissions regulation to only the portion of flights by non-EU carriers that is conducted in EU airspace. The proposed compromise would be effective for two years while ICAO worked to facilitate a global emissions agreement. This compromise would put the ETS on much sounder legal footing by limiting regulation to EU airspace where the EU's authority to regulate is much clearer. Though, if what Simpson says about the ETS as a revenue-generating mechanism is true, even applied just to EU airspace the ETS could presumably be considered a tax in violation of Article 15 of the Chicago Convention. Finally, according to Simpson, his compromise has been rejected by EU leaders because they anticipate that other nations, aside from the U.S., will capitulate and comply with the ETS when it enters effect January 1. This suggests that EU leaders are willing to undertake a trade war if the U.S. is the only holdout.

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