Carbon Trading in Commercial Aviation

Abstract

The air transport product permeates national boundaries and therefore makes it impossible for one to localize aircraft engine emissions in terms of calculating the quantum of air pollution by an international flight over the territorial boundary of a nation State. To make matters more complicated, there has been no attempt so far by the international aviation community at reaching a global regulatory system by way of an international treaty that could bind nations of the world to a uniform set of rules applicable to financial instruments that would ensure an equitable and just ‘polluter pays’ system. The furthest we have come is the work carried out so far on emissions trading as a market-based option by the International Civil Aviation Organization (ICAO), which has been working, with a view to evaluating possible ways and means to achieve a global consensus. This article contains a discussion of carbon trading, its consequences, and the legal issues that have emerged as a result of unilateral action in the introduction of an emissions trading scheme. The discussions are presented against the backdrop of the work of ICAO.