As noted in earlier posts, beginning January 1, 2012, the European Union ("EU") plans to include the aviation sector as the second largest industry in its carbon Emissions Trading System ("ETS"). The plan requires all airlines, including airlines operated out of non-EU countries, to use emissions allowances for flights to or from European airports. The international community has spoken out against this measure, with more than 20 countries, including the United States, China, India, Japan, and Russia, signing a declaration vowing to challenge the EU's plan. The Air Transport Association of America, American Airlines, Continental Airlines, and United Airlines took further steps, filing an action in the High Court of Justice of England and Wales arguing that inclusion in the ETS would place them under U.K. authority. Air Transport Ass'n of America v. Secretary of State for Energy and Climate Change, EU Court of Justice, No. C-366/10. The High Court referred the case to the EU Court of Justice for an interpretation of EU law.

On Thursday, October 6, 2011, Advocate General Juliane Kokott wrote an advisory opinion on behalf of the EU Court of Justice finding that the EU's inclusion of the entire airline sector does not infringe on the sovereignty of other states or international agreements, including the U.S.-EU Open Skies Agreement, the Kyoto Protocol, or the Chicago Convention on International Aviation.  Although the opinion is non-binding, the advocate general's opinion normally predicts the final judgment of the case, which is expected n early 2012. For more details, please see the BNA Daily Reporter article or LAW360 article. As this issue progresses, please check back to this blog for future posts.