Friday, December 23, 2011

Initial Reaction to the CJEU Opinion

Yesterday's opinion by the Court of Justice for the European Union (CJEU) [which was abbreviated in yesterday's post using the former acronym ECJ] affirmed Advocate General Kokott's advisory opinion with regard to the substantive legal questions at issue in the case. Consequently, our analysis of the Court's opinion remains consistent with our earlier posts in response to the October advisory opinion. Nonetheless, we offer a few brief observations:

  • The CJEU was more clear and forceful than the Advocate General in its pronouncement that the EU is not bound by the Chicago Convention. While the Advocate General also concluded that the Chicago Convention does not bind the EU, she acknowledged that the participation of all EU Member States in the Convention merited at least some consideration, stating that "[The Chicago Convention] must nevertheless be taken into account when interpreting provisions of secondary EU law. As a consequence, the Advocate General went on to analyze the compatibility of the ETS with a number of relevant Convention Articles. The CJEU, by contrast, spent little time discussing the Convention, instead focusing almost exclusively on customary international law principles and the US/EU Open Skies Agreement. Anyone who is of the belief that the Chicago Convention should retain some legal significance within the EU would have to be even more disheartened by the CJEU's opinion than by that of the Advocate General. 
  • The Court was apparently unimpressed by the arguments that the proposed application of the ETS would violate other States' sovereignty over their airspace or prohibitions against extraterritorial regulations. In the Court's view the regulations clearly only affect aircraft that are properly within the EU's territorial jurisdiction. The opinion included only one sentence on the question of whether that regulation had improper extraterritorial effects.
  • Judging by the amount of attention devoted to each legal question and the clarity with which the question was answered, the Court appeared least sure of itself when addressing the question of whether the required surrendering of emissions allowances constituted an improper fuel tax. The Court concluded that the indirectness of the market-based mechanism by which the aircraft operators are charged saved the ETS from qualifying as a fuel tax, but it was much less dismissive than it had been with the other arguments.

Blog authors Brian F. Havel and John Q. Mulligan will provide an expanded analysis of the CJEU and Advocate General opinions in an article for the Spring 2012 issue of Air and Space Law. Details about the article will be forthcoming.

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