On November 27, 2012—without the fanfare of a Rose Garden ceremony—President Obama signed into law a bill that forbids United States airlines from participating in the European Union Emissions Trading Scheme (“EU ETS”). Environmental organizations bemoaned the President’s decision after having urged him to veto the bill. Supporters of the law hailed the passage as a win for American sovereignty, preventing an illegitimate and disingenuous environmental tax on U.S. carriers and passengers. This article addresses the aviation industry’s role in global climate change, and offers an in-depth analysis of the EU ETS and the European Commission’s decision to include international aviation in the ETS. It also discusses the legal implications of the EU’s Aviation Directive and the legal challenge before the European Court of Justice. Finally, this article discusses the aforementioned legislation and exposes the pitfalls of the EU’s unilateral action.



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