Bangkok--6 Aug--Centre for Asia Pacific Aviation Temperatures are rising as US Deputy Assistant Secretary of State John Byerly this weekend fired a warning shot at the European Union (EU), threatening a "bitter dispute" over the EU's unilateral action to impose unilaterally its carbon dioxide trading emissions scheme. The EU last year issued a proposal to include air carriers in its broader carbon dioxide emissions trading scheme. The proposal affects more severely those carriers serving longer routes, for example Asian airlines, than on shorter ones. Noting that the EU has made little progress in improving the chaotic European ATC system (where the most significant emission savings could be achieved), a senior State Department transportation policy official, Megan Walklet-Tighe, explicitly rejected the “ European one-size-fits-all solution”. IATA says that fixing the European ATC problems alone would produce $4.5 billion in savings and reduce emissions by 12%. On implementation of an emissions trading scheme for international aviation, the two sides “are still very far apart". Ms Walklet-Tighe stated that the United States specifically disagrees with the unilateral nature of the EU’s proposed legislation, and argues that it is unlawful, on competition grounds. According to Ms Walklet-Tighe, The U.S. administration is focused on trying to reach an agreement on the issue in ICAO. The triennial ICAO Assembly in September should finalize guidance for states on a variety of environmental measures and principles, including how best to address aviation greenhouse gas emissions. ICAO Secretary-General Taieb Cherif said that countries should be free to select such measures they consider most cost-effective. But, by unilaterally including foreign airlines serving European destinations, the EU created a controversy that threatens to slow down collaborative international efforts on the issue, according to the US. There are precedents for diplomatic and legal battles on aviation issues between the US and the European Union. In the 1990s, the US confronted the EU on airline noise regulation and won a victory in the courts to prevent the EU rules applying. A Jun-07 study commissioned by airlines and aircraft manufacturers estimates that compliance with the EU regulation would cost airlines USD60 billion-USD90 billion between 2011 and 2022 and reduce their profits by USD55 billion in the same period.Note to editors:About Centre for Asia Pacific Aviation The Centre for Asia Pacific Aviation (CAPA) was founded in 1990 and has since built an international reputation as the leading specialist aviation consultancy in the Asia Pacific, the Indian Subcontinent and Middle East regions. CAPA Consulting’s strategic advisory services are supported by the extensive information and data services provided by the Centre’s Market Research Unit to aviation industry leaders every day. The Centre also holds regular Aviation Leadership Summits, which provide unique opportunities for the exchange of ideas and experiences. Head Office, Sydney: Derek Sadubin, Chief Operating Officer Aurora Place, Level 36, 88 Phillip St Sydney PO Box N777, Grosvenor Place Sydney, NSW Australia 2000 Email: [email protected] Southeast Asia Regional Office: Richard Pinkham, Regional Director, Southeast Asia Email: [email protected] Indian Subcontinent and Middle East Office: Kapil Kaul, CEO Indian Subcontinent & Middle East Email: [email protected] UK/Europe Office: David Bentley, UK Associate Email: [email protected] North America Regional Office: Martti Raito, Regional Director, North America Email: [email protected] North Asia Representatives: Korea: Kyung-sup Lee. Email: [email protected] Japan: Reiko Sonoyama. Email: [email protected] More information is available on the Centre’s website: www.centreforaviation.com