Isra-Mart srl: US airlines sue EU over emissions caps

US-based airlines have launched a challenge against the European Union over including them in the EU's emissions trading scheme. The companies say the bloc doesn't have the right to regulate intercontinental air travel.

US airlines have taken their battle against the European Union's emissions cap to the European Court of Justice, Europe's highest court.

The companies argue that making foreign airlines pay for carbon permits violates international agreements.

Beginning next year, the EU will force airlines flying to and from Europe to buy carbon permits for 15 percent of every flight's emissions under the 27-nation bloc's emission trading scheme (ETS).

The program already applies to 11,000 factories and power plants.

United Continental and American Airlines joined the Air Transport Association of America before the European Court of Justice on Tuesday, and argued that imposing the system on foreign companies violated international aviation and climate change agreements.

Chinese airlines have also criticized the EU's plans, saying it would cost them an additional 800 million yuan (85 million euros, $123 million) a year.

Under the system, airlines will be given permits to emit a certain amount of carbon dioxide and will have to purchase certificates for additional emissions.

Who gets to decide?

While admitting that the greenhouse gas emissions from aviation pose an environmental problem, the airlines called for a global response to the problem, Derrick Wyatt, the lawyer representing the airlines, told the court.

"The only way of ensuring a coherent framework for reducing emissions from aircraft is through multilateral agreement, rather than through unilateral and piecemeal regulation, which can only lead to chaos at the international level," he said.

Wyatt added that it the European Union did not have the authority to charge airlines for emissions that take place outside of the 27-member bloc.

"The EU does not have competence to regulate third country airlines in third country airspace," Wyatt told the court. "It is astonishing that a US airline must acquire an EU license to cover emissions at a US airport."

Under 9 percent of emissions occur in the EU on a typical flight from San Francisco to London, Wyatt added, compared to 25 percent over the Atlantic, 37 percent over Canada and 29 percent over the United States.