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EU shrugs off China carbon stance

China tells airlines not to pay EU carbon charge
China tells airlines not to pay EU carbon charge

The EU is confident Chinese airlines will comply with its law forcing them to pay for carbon emissions on flights in and out of EU airports, a Commission spokesman said today.

China earlier said it was barring its airlines from participating in the EU's carbon scheme.

"The Commission of course remains confident the Chinese airlines will comply with our legislation when they are operating through EU airports," Isaac Valero-Ladron, EU spokesman for climate action, told reporters in Brussels.

He added that the Chinese airlines had already taken steps to comply with the scheme and had applied for free carbon allowances to which they are entitled.

China earlier said it had banned its airlines from complying with the EU scheme, which is opposed by more than two dozen countries including India, Russia and the US.

Beijing has said repeatedly that it opposes the new EU plan, which was imposed with effect from January 1, and which Chinese state media have warned would lead to a "trade war" in the sector.

A statement on the website of China's State Council also said airlines were barred from using the EU's emissions trading scheme (ETS) to increase fares or other passenger charges.

"The Civil Aviation Administration of China recently issued a directive to Chinese airlines that without the approval of relevant government departments, all transport airlines in China are prohibited from participating in the EU ETS," the statement said.

China has said it fears its aviation sector will have to pay an additional 800 million yuan ($125m) a year on flights originating or landing in Europe, and that the cost could be almost four times higher by 2020.

The European Commission argues that the cost for airlines is manageable, estimating that the scheme could prompt carriers to add between €4 and €24 to the price of a two-way long-haul flight.

Nonetheless, some airlines have announced new ticket fees since the EU's rules came into force. US carrier Delta Air Lines, one of the world's biggest airlines, added a $6 surcharge for two-way flights between the US and Europe.

Germany's Lufthansa indicated it would raise its fuel surcharge, a move taken by Belgian carrier Brussels Airlines, which increased it by €10 to €135 for international flights and by €3 to €39 for EU routes.

Airlines have denounced the system as a new tax and warn that it would cost the industry €17.5 billion over eight years. The system went ahead despite a plea by US Secretary of State Hillary Clinton for the EU to halt or delay its application.

The Airlines for America association grudgingly indicated that its members would abide by the EU law, but "under protest" while pursuing legal options.

The China Air Transport Association, which represents the country's airlines, said last month the government was considering "countermeasures" against the EU scheme, without giving any details. It has said the charge would affect all of China's major airlines, including Air China, China Eastern and China Southern.

The European Union launched the ETS in 2005 in a bid to reduce carbon emissions of power stations and industrial plants. It decided to include airlines, responsible for 3% of global emissions, in the system in the absence of a global agreement to cap aviation emissions.

Airlines that refuse to comply could be fined and denied the right to land in the 27-nation EU in extreme cases, the bloc has said.