Chinese airlines to sue EU over carbon price

Sounds like the EU had better not expect any more Airbus orders from China unless they change their tune. Could be good for Boeing

Air China and three other major Chinese carriers are planning to jointly sue the European Union for its plan to charge airlines for carbon emissions, a senior official with the country's industry group said yesterday.

Under the EU's proposals to put a price on pollution, airlines will have to buy permits to help offset greenhouse emissions from jetliners operating in, to and from Europe.

"It's unfair. We are buying Airbus planes. If anyone is to blame for the emission problem, it should be the manufacturer not the customers," Cai Haibo, deputy secretary general of the China Air Transportation Association, said.

China Eastern Airlines, China Southern Airlines and Hainan Airlines, are also part of the planned legal action, Cai said.

In protest against the EU law, due to take effect on January 1, the Air Transport Association of America, American Airlines and United Continental took their case to the High Court in London, which referred it to the European Court of Justice (ECJ) last year.

In October, the advocate general in a preliminary opinion said the EU was acting within the law. Her opinion is not binding, but is a good gauge of the ECJ's final ruling expected early next year.

Last week, the UN's International Civil Aviation Organization adopted a working paper from the United States, China and two dozen other nations urging the EU not to include non-EU carriers in its plan.

The Republican-led US House of Representatives voted last month to ban US airline compliance with the scheme, raising the prospect that flights could be disrupted. It remained unclear if the Democratic-controlled Senate would back the move, which the EU has criticised as an attack on its laws.

Opposing nations say the plan would infringe a "cardinal principle of state sovereignty" by basing its charges on the distance flown by each flight, which means calculations would include foreign airspace, in violation of a 1944 pact that gives each country exclusive authority over its skies.

It would also discriminate against nations located furthest away from Europe.

China is a major market for Airbus, which aims to supply at least half of the more than 4000 commercial jets the country is expected to need over the next 20 years.


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