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European Court of First Instance to Hear Important Emissions Trading Cases

DATE: 09 Feb 2009

On Tuesday and Wednesday this week the Second Chamber and Seventh Chambers of the European Court of First Instance is to hear Article 230 challenges brought by Poland (T/183/07) and Estonia (T-263/07) seeking to annul decisions by the European Commission to reject the Phase II National Allocation Plans of those Member States submitted under Directive 2003/87/EC the EU Emissions Trading Scheme (EU ETS) Directive.

The EU ETS is the key policy introduced to help reduce greenhouse gas emissions from within the EU. It is the largest multi-country, multi-sector greenhouse gas emission trading scheme world-wide. In total approximately 11,500 installations are covered by the EU ETS and it accounts for nearly 45% of total CO2 emissions, and about 30% of all greenhouse gases in the EU.

The UK has intervened to support the European Commission because it is concerned that were the challenges to succeed and Poland and Estonia to obtain the additional allocation of allowances sought there would be as happened in Phase I a sharp downward correction in prices (see the globally acclaimed Stern review) which would undermine the efficacy of the EU ETS as a mechanism to reduce CO2 emissions.

Similar challenges have been brought by Bulgaria, the Czech Republic, Hungary, Latvia and Romania.

James Maurici is appearing for the UK Government in the Polish and Estonian cases.