The European Union Emissions Trading Scheme Prohibition bill

 

 

In a recent article by Leroy Baker entitled: US Nearer To Forbidding Its Airlines To Comply With EU ETS is stated that in the Senate, the Commerce Committee has approved a bill that forbids US airlines to comply with the European Union’s emissions trading scheme (ETS). It followed the passage by the United States House of Representatives in October last year.

On January 1, 2012, the EU ETS has been widened to aviation activities from or to European land, to provide a solution to taxing aviation emissions which were excluded from the Kyoto Protocol. Under the ETS, airlines operating into and out of the EU are asked to immediately start purchasing emissions allowances. However, they are expected to remit the sums in 2013.

The US and 16 other non-EU countries try to avoid any conflict of sovereignty and to prevent a potential trade war. The US government would decline any unilateral EU ETS on airlines starting before 2020. The government would hope that a global proposal could be handled during the next meeting of the International Civil Aviation Organization (ICAO).

The European Union Emissions Trading Scheme Prohibition bill would stipulate that the US Secretary of Transportation and the Administrator of the Federal Aviation Administration should «use their authority to conduct international negotiations and take other actions necessary to ensure that operators of civil aircraft of the US are held harmless from any ETS unilaterally established by the EU».

Co-sponsor of the bill in the Senate, Claire McCaskill (D — Missouri), said «To subject Americans to a tax levied by the EU while they fly in US airspace is a dramatic overreach and assault on our sovereignty – especially when European countries can use that money for anything they’d like. The bottom line is that European governments have no business imposing a tax on our air travel.» 

The other co-sponsor, John Thune (R – South Dakota), added that “Congress must act to protect America’s sovereignty and ensure that US operators and passengers are not penalized by this illegitimate tax. More than USD3.1bn will be wrapped up in new taxes between 2012 and 2020 that could otherwise be invested in creating jobs and stimulating economic growth in our country.

The bill has been reported by the Commerce Committee and it will be placed on the legislative calendar, thus allowing for full Senate consideration.