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The Inclusion of Aviation in the EU ETS: WTO Law Considerations

Lorand Bartels

University of Cambridge - Faculty of Law

April 30, 2012

ICTSD Trade and Sustainable Energy Series No. 6

The aviation industry will be included in the EU’s emissions trading system (ETS) from 1 January 2012. Airlines will have to acquire and ‘surrender’ allowances for the carbon emissions produced by their flights. The scheme is comprehensive: it applies to EU and non-EU airlines (subject to a potential exemption), to passenger and cargo flights, and to flights between EU airports and between EU and non-EU airports. An airline that fails to surrender allowances is fined €100 per allowance and must make up the shortfall the following year.

The EU’s scheme has already given rise to legal action in connection with the EU’s international civil aviation obligations. But, due to its impacts on trade in goods and services, the scheme also has implications for the EU’s obligations under the WTO law: specifically, under the General Agreement on Tariffs and Trade (GATT) and the General Agreement on Trade in Services (GATS). In particular, this raises the question of the scope of application of the GATS Annex on Air Transport Services. As this article shows, it is challenging to design a carbon scheme that is both administratively feasible and justifiable under WTO law.

Number of Pages in PDF File: 55

Keywords: EU ETS, GATT, GATS, WTO, Annex on Air Transport Services, aviation, emissions trading system

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Date posted: November 16, 2011 ; Last revised: May 19, 2012

Suggested Citation

Bartels, Lorand, The Inclusion of Aviation in the EU ETS: WTO Law Considerations (April 30, 2012). ICTSD Trade and Sustainable Energy Series No. 6. Available at SSRN: http://ssrn.com/abstract=1959981 or http://dx.doi.org/10.2139/ssrn.1959981

Contact Information

Lorand Bartels (Contact Author)
University of Cambridge - Faculty of Law ( email )
10 West Road
Cambridge, CB3 9DZ
United Kingdom

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