By Barbara Lewis
BRUSSELS (Reuters) - The European Union on Wednesday revived a proposal to charge foreign airlines for emissions over European airspace, drawing the ire of airline groups who say it goes against spirit of a recent global aviation deal and could reignite trade tensions.
The proposal from the European Commission to cover the 2014-2020 period represents a retreat from an existing, though frozen, EU law that would require all planes using EU airports to pay for emissions for the full duration of their flights through an Emissions Trading Scheme (ETS).
But airline groups said it threatened to unravel a fragile agreement cobbled together during two weeks of tough negotiations at the United Nations' International Civil Aviation Organization (ICAO) in Montreal, which ended this month.
EU Climate Commissioner Connie Hedegaard said the bloc was within its rights to regulate aircraft emissions within its own airspace.
"It is a sovereign right to regulate aviation in and around our own EU airspace," Hedegaard told reporters. "I very much hope our partners will see this in the spirit in which it is being presented."
The International Air Transport Association (IATA), which represents some 240 global airlines, issued a statement expressing "concern and surprise" at the proposal from the EU executive.
"The Commission is now recommending a course of action that has the potential to undermine the goodwill that has brought us to this point," IATA Director General and CEO Tony Tyler said.
U.S. airline lobby group Airlines for America said requiring foreign carriers to participate in the EU trading scheme without the agreement of the airlines' country of registry "flies in the face" of the ICAO agreement.
"As this proposal is only an initial draft, we urge the European Council and Parliament to use their deliberative process to revise the proposal in line with the global agreement," said spokeswoman Katie Connell.
Speaking in Brussels last week, one of the ICAO negotiators warned that any charges on non-EU airlines would be a problem.
"If the EU decides, and I hope they do not, they will nevertheless want to capture emissions of non-European airlines, then we will be back to trade wars," said Abdul Wahab Teffaha, secretary general of the Arab Air Carriers Organization.
NO ONE SATISFIED
The latest EU proposal marks a retreat from earlier legislation imposing a levy on the full length of flights in and out of the EU. The European Commission decided to review its law after the ICAO agreement reached in Montreal.
Non-EU nations, led by India, China and the United States had complained that the EU legislation was breaching national sovereignty and forced the bloc to freeze it for a year to give the ICAO the chance to deliver a global alternative.
India, together with China, had refused to comply with the EU law and haggled in Montreal for a further dilution of the accord. China blocked delivery of European Airbus jets in protest at the EU law.
For their part, members of the European Parliament, which together with the EU's 28 member states would have to approve the Commission proposal, have raised objections to the Montreal agreement, describing it as empty.
Unless the European Parliament approves the Commission's proposal quickly - ahead of parliamentary elections and a change-over of commissioners in 2014 - the existing EU aviation law will resume effect.
Countries at the ICAO assembly agreed to work to design a global market-based mechanism to help neutralize the aviation industry's emissions after 2020. But it would only vote to approve it at the next general assembly of ICAO in 2016.
Peter Liese, a German Christian Democrat who steered the original EU law through the European Parliament and led the debate on the "stop the clock" one-year suspension, said he was disappointed with the Montreal deal.
"The European Parliament will thoroughly examine the proposal and amend our regulation if need be," he said.
"If the European Parliament does not agree with the Council (of member states) on a new legislative text by April, legislation as originally planned will come into force for intercontinental flights taking off and landing in Europe. This pressure medium remains."
He said it was indispensable to include all flights using EU airports for the part they travel in European airspace to be fair to European airlines.
Environmental campaigners strongly criticized the ICAO deal and were also unhappy on Wednesday, saying the Commission proposal would cover only 35 percent of aviation emissions compared with the original EU law.
"It is disgraceful that foreign and industry pressure has obliged Europe to shrink its own aviation emissions law to the bare minimum," Bill Hemmings, aviation manager at Transport & Environment campaign group, said.
"This is a grey day for the climate and for those that are serious about tackling aviation's fast-growing warming impact."
(Additional reporting by Michael Szabo and Ben Garside in London, Karen Jacobs in Atlanta and Valerie Volcovici in Washington; Editing by Adrian Croft, William Hardy and David Brunnstrom)