25 March 2012

EU Aviation scheme as a countermeasure against other ICAO member states?

The New York Times recently reported that China, the United States and two dozen other countries are looking at coordinated countermeasures against Europe — including putting pressure on European airlines and other industries — if the EU tries to enforce the EU Aviation Directive, that requires airlines to pay for their greenhouse gas emissions.

Much has been said on the legality of the Aviation Directive. Joshua Melzer just published a good analysis of the Directive and its WTO compatibility in the Journal of International Economic Law. In the ATA case, the ECJ considered its compatibility with customary international law (the principles of territoriality and of sovereignty), the Chicago Convention, and the Open Skies Convention, and eventually upheld the legality of the Directive (case C-366/10, Judgment of 21 December 2011).

One question that appears so far to have received very little attention is whether, even if the Directive would violate international law, it could not be justified as a response to the collective failure of the third states for setting standards for the airline industry.

The European measures are in part a response to the failure of the International Civil Aviation Organization (ICAO) to move quickly enough to establish standards and goals for greenhouse gases from aviation, as required under the Kyoto Protocol. Article 2(2) of the Kyoto Protocol stipulates that Annex I parties ‘shall pursue limitation or reduction of emissions of greenhouse gases not controlled by the Montreal Protocol from aviation and marine bunker fuels, working through the International Civil Aviation Organization and the International Maritime Organization, respectively.’

Attempt to realize such limitations have come to nothing. It is true that the obligation is not formulated in very hard terms (‘shall pursue limitation’), and in the ATA Case the Court found that this provision ‘as regards its content, cannot in any event be considered to be unconditional and sufficiently precise so as to confer on individuals the right to rely on it in legal proceedings in order to contest the validity of Directive 2008/101’ (para 77). However, the fact that a provision does not meet the high criteria for direct effect of EU legislation does not mean that States cannot breach the obligation vis-à-vis each other. At one point, the lack of will and effort to adopt reductions in the framework of ICAO may suggest that states do not pursue such reductions.

Already in the Sixth Community Environment Action Programme (Decision No 1600/2002/EC), it was provided that the Community would identify and undertake specific actions to reduce greenhouse gas emissions from aviation if no such action were agreed within the ICAO by 2002. The EU Member States have consistently strived in the ICAO framework for global regulations — to no avail. Regional action now surely has a political legitimacy. Even if it would be in violation of other state’s rights (a proposition that was questioned by the ECJ) there is some ground in the argument that this is a timely response to a shared responsibility of the defaulting third states, intended to spur these states to action.

It might be argued that this construction encounters the problem that the obligation that would be breached, and that would legitimize the Aviation Directive, is the Kyoto Protocol, yet the intended action eventually would have to come from ICAO, which obviously is not a party to that Protocol. However, we could construe the measures as targeted at the states that are both party to Kyoto and ICAO, and that should fulfill their obligation under Kyoto by taking action in the framework of ICAO.

The construction nonetheless is not entirely without obstacles. One is that the EU measures appear to apply to all states, irrespective of their particular obligations under the Kyoto Protocol, and notably also irrespective of the principle of common and differentiated responsibilities — which may make the proportionality argument more difficult.

Another issue to be considered is whether the EU and its member states are actually injured by the lack of willingness of other states to perform the obligation under article 2(2), in a way that would entitle them to take counter-measures, However, it should be taken into account that the failure by the ICAO member states to adopt necessary measures that complied with article 2(2), in effect made it difficult for the EU member states to comply with their obligations under Kyoto. This point, made by AG Kokott (para 186 of her opinion) opens the door to an argument based on the exception of non-performance.  Whatever the status of this exception as an independent defense to wrongfulness (the ILC eventually left it aside), it does straddle into and support an argument based on countermeasures.

It may well be that eventually the EU has to bend for economic pressure from target states, that may hit European industries hard. But on its face, the EU measure has not only the moral but also the legal high ground.

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