EMA Climate Change Conference

1. EMA Climate Change Conference Title: “Integration of international civil aviation into the EU Emissions Trading System and developing countries” Author: LAM Van Trien, LL.M “ European Practice of Law ”

2. Outline • Incidence of international civil aviation on climate change • Integration of international civil aviation into the EU Emissions Trading System • Strong opposition from developing countries • Exclusion of unilaterality in international law • Principle of « common but differentiated responsibilities » • Propositions from developing countries • Reinforcement of negotiation on the principle of mutual agreement through the International Civil Aviation Organization • Consideration of principle of "common but differentiated responsibilities" in the EU ETS

3. Incidence of international civil aviation on climate change ( Source: Communication of European Commission on 27 September 2005 on “Reducing the Climate Change Impact of Aviation” ) • The impact of aviation on the climate increases considerably. • While the EU's total greenhouse gas emissions fell by 5,5 % from 1990 to 2003, its greenhouse gas emissions from international aviation increased by 73% from 1990 to 2003. • Emissions of international flights from EU airports will by 2012 increase by 150 % since 1990. • This growth in aviation emissions would offset more than a quarter of the reductions required by the European Community’s target under the Kyoto Protocol.

4. Integration of international civil aviation into the EU Emissions Trading System • Emissions from international aviation are not covered by national targets under the Kyoto Protocol. • European Commission proposes inclusion of international civil aviation into EU ETS to reduce aviation's climate impact in a cost-effective and economically efficient manner. • Directive 2008/101/EC of the European Parliament and of the Council of 19 November 2008 amending Directive 2003/87/EC so as to include aviation activities in EU ETS. • This directive was published in the EU Official Journal on 13 January 2009.

5. Integration of international civil aviation into the EU Emissions Trading System • The system will cover all flights arriving at or departing from an airport in the European Community as of 1 January 2012. • Aircraft operators will be allocated a number of emission allowances. • Allowances can be traded. • In complying with the principle of non-discrimination under the Chicago Convention, EU ETS will apply for all airlines, whatever their nationality.

6. Strong opposition from developing countries Legal basis : • Exclusion of unilaterality in international law • Principle of "common but differentiated responsibilities"

7. Exclusion of unilaterality in international law • Principle 24 of Stockholm Declaration 1972 on Environment : « International matters concerning the protection and improvement of the environment should be handled in a cooperative spirit by all countries, big and small, on an equal footing. Cooperation through multilateral or bilateral arrangements or other appropriate means is essential to effectively control, prevent, reduce and eliminate adverse environmental effects resulting from activities conducted in all spheres, in such a way that due account is taken of the sovereignty and interests of all States. »

8. Exclusion of unilaterality in international law • Principle 12 of Rio Declaration 1992 on Environment and Development : « Unilateral actions to deal with environmental challenges outside the jurisdiction of the importing country should be avoided. Environmental measures addressing transboundary or global environmental problems should, as far as possible, be based on an international consensus. »  • Working paper n° A36-WP/198-P/16presented by Portugal on behalf of the European Community and its member states at the 36th Session of ICAO Assembly: “while the EU and its Member States are intent on taking action on aviation emissions, they are firm believers in international cooperation (notably in the context of ICAO) and will continue to participate fully in global and bilateral dialogue on this issue in the years to come.”

9. Principle of "common but differentiated responsibilities" • Article 3.1 of UNFCCC : « The Parties should protect the climate system for the benefit of present and future generations of humankind, on the basis of equity and in accordance with their common but differentiated responsibilities and respective capabilities. Accordingly, the developed country Parties should take the lead in combating climate change and the adverse effects thereof. » • Article 3.2 of UNFCCC : « The specific needs and special circumstances of developing country Parties, especially those that are particularly vulnerable to the adverse effects of climate change, and of those Parties, especially developing country Parties, that would have to bear a disproportionate or abnormal burden under the Convention, should be given full consideration. »

10. Principle of "common but differentiated responsibilities" • Kyoto protocol didn’t impose any binding emissions reduction targets on developing countries. • Inclusion of airlines of developing countries into EU ETS is contrary to the principle of "common but differentiated responsibilities" of UNFCCC and Kyoto protocol.

11. Principle of "common but differentiated responsibilities" • Working paper n° A36-WP/251-EX/82presented by Nigeria on behalf of African States at the 36th Session of ICAO Assembly : « since Kyoto Protocol does not set emission targets for developing countries, inclusion of airlines from developing countries in the EU ETS would amount to setting for them emission targets through the back door »

12. Principle of "common but differentiated responsibilities" • Working paper n° A36-WP/235-EX/76presented by China at the 36th Session of ICAO Assembly : « According to UNFCCC and its Kyoto Protocol, emissions trading can be only applied to UNFCCC Annex I countries. In addition, such “cap and trading” mechanism is unfair to developing countries’ air transport industries which are still undergoing the growing period. Therefore, the Parties not included in Annex I should not be imposed such coercive duty on emissions trading » • In its working paper n° A36-WP/88-EX/36presented at the 36th Session of ICAO Assembly, Egypt worries about adverse effect of inclusion of international civil aviation into EU ETS on the competitiveness of the airlines of developing countries.

13. Propositions from developing countries • Reinforcement of negotiation on the principle of mutual agreement through the International Civil Aviation Organization • Consideration of principle of "common but differentiated responsibilities" in the EU ETS

14. Reinforcement of negotiation on the principle of mutual agreement through the ICAO • Article 2.2 of Kyoto protocol : «  The Parties included in Annex I shall pursue limitation or reduction of emissions of greenhouse gases […] from aviation […], working through the International Civil Aviation Organization […], respectively. » • Working paper n° A36-WP/251-EX/82 presented by Nigeria on behalf of African States at the 36th Session of ICAO Assembly: « theydo not support unilateral inclusion of third party airlines in the Emission Trading Scheme (ETS) of European Union (EU) without their mutual consent, […], inclusion of aviation emissions in Emission Trading Scheme (ETS) should follow ICAO guidelines based on mutual agreement of States and airlines involved; »

15. Reinforcement of negotiation on the principle of mutual agreement through the ICAO • Working paper n° A36-WP/88-EX/36 presented by Egypt at the 36th Session of ICAO Assembly: «  no decision concerning emissions trading for aviation, should be taken unilaterally by a State or group of States that might have adverse economical effect on other ICAO Contracting States, and on developing and poor countries in particular. » • Working paper n° A36-WP/285-EX/92presented by Chile at the 36th Session of ICAO Assembly : «  Consensus is fundamental to the establishment of new obligations. It would be acceptable to implement the emissions trading system for international civil aviation only through agreements between States. This excludes unilateral measures. Consensual obligations between States are rooted in sovereignty and are always based on consent and free will. »

16. Reinforcement of negotiation on the principle of mutual agreement through the ICAO • Working paper n° A36-WP/39-EX/10presented by the Council of ICAO at the 36th Session of ICAO Assembly :  « a majority of States represented on the ICAO Council indicated that any approach for the inclusion of international civil aviation in emissions trading schemes should respect the sovereignty of Contracting States and be on the basis of mutual agreement. » • The role of ICAO for negotiation concerning inclusion of international aviation into ETS for the post-Kyoto period cannot be ignored by European Community.

17. Consideration of principle of "common but differentiated responsibilities" in the EU ETS • Inclusion of airlines of developing countries into EU ETS is contrary to the principle of "common but differentiated responsibilities" of UNFCCC and Kyoto protocol. • Principle of non-discrimination under article 11 of Chicago Convention on International Civil Aviation : « […] the laws and regulations of a contracting State relating to the admission to or departure from its territory of aircraft engaged in international air navigation, or to the operation and navigation of such aircraft while within its territory, shall be applied to the aircraft of all contracting States without distinction as to nationality, […] »

18. Consideration of principle of "common but differentiated responsibilities" in the EU ETS • Exemption of airlines of developing countries can violate the principle of non-discrimination. • Inclusion of airlines of developing countries can violate the principle of « common but differentiated responsibilities » . • Is there a conflict between the principle of non-discrimination and the principle of « common but differentiated responsibilities » ?

19. Consideration of principle of "common but differentiated responsibilities" in the EU ETS • In practice, ICAO recognizes both 2 principles. • With the respect of these 2 principles, ICAO approves inclusion of international aviation into voluntary ETS. • A voluntary ETS can weaken the efficiency of the system and cannot respond to the urgency of reduction of aviation’s climate impact. • European Community prefers a compulsory ETS.

20. Consideration of principle of "common but differentiated responsibilities" in the EU ETS • In order to respond to the urgency of reduction of aviation’s climate impact, EU can apply a compulsory ETS for international civil aviation • In complying with the principle of « common but differentiated responsibilities », EU should exempt airlines of developing countries from EU ETS • This exemption is not contrary to the principle of non-discrimination.

21. Consideration of principle of "common but differentiated responsibilities" in the EU ETS • The principle of « common but differentiated responsibilities » is not contrary but complementary to the principle of non-discrimination. • EU can encourage airlines of the developing countries to participate on the voluntary basis to the EU ETS. • It is the « harmonization of interest » approach. • This approach takes into account the interest of EU in the reduction of aviation’s climate impact as well as the interest of developing countries in the promotion of sustainable development.