Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Directive 2003/87/EC to continue current limitations of scope for aviation activities and to prepare to implement a global market-based measure from 2021
Date: 2017-02-03
Institutions: Directorate-General for Climate Action, European Commission
Subjects: EU Emissions Trading Scheme, EU emission allowance, air transport, greenhouse gas, international transport, pollution control measures, reduction of gas emissions

EN 

   EN 

   EUROPEAN COMMISSION  Brussels, 3.2.2017  COM(2017) 54 final 2017/0017 (COD)   Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Directive 2003/87/EC to continue current limitations of scope for aviation activities and to prepare to implement a global market-based measure from 2021 (Text with EEA relevance) {SWD(2017) 30 final} {SWD(2017) 31 final}  
 
EXPLANATORY MEMORANDUM 

1. 

• 

CONTEXT OF THE PROPOSAL 

Reasons for and objectives of the proposal 

Greenhouse gas emissions from aviation activities are increasing significantly. In the absence 
of further measures, carbon dioxide (CO2) emissions from international aviation are estimated 
to  almost  quadruple  by  2050  compared  to  2010.  Several  studies  demonstrate  that  technical 
and  operational  measures  alone,  including  CO2  standards  for  aircrafts  or  the  deployment  of 
sustainable biofuels, are insufficient to curb aviation emissions, thus the need to use market-
based  measures  to  address  their  growth.  The  strong  growth  in  GHG  emissions  from  the 
aviation  sector  risks  undermining  the  EU's  and  global  efforts  to  effectively  tackle  climate 
change.  

Back in 2008, the EU led the way in addressing GHG emissions from aviation by including 
flights  between  aerodromes  within  the  European  Economic  Area  (hereafter  "intra-EEA 
flights")  and  flights  between  aerodromes  in  the  European  Economic  Area  (EEA)  and 
aerodromes  in  third  countries  ("extra-EEA  flights")  in  the  EU  Emissions  Trading  System. 
This was instrumental in getting agreement in International Civil Aviation Organisation for a 
process  towards  a  global  market  based  measure  to  address  international  aviation,  which 
started  in  2013.  It  also  allowed  for  aviation  to  contribute  to  the  EU  climate  objective  of 
emission  reduction  of  20%  by  2020  compared  to  1990  levels.  Pending agreement  in  ICAO, 
and  to  promote  the  development  of  a  global  measure  to  regulate  international  aviation 
emissions in ICAO, the EU temporarily reduced the scope of the EU ETS to intra-EEA flights 
until  2016,  waiting  for  the  outcome  of  ICAO  to  review  its  scope  in  relation  to  extra-EEA 
flights.  In  the  absence  of  any  amendments  to  the  EU  ETS  Directive,  the  EU  ETS  will 
automatically revert back to its full-scope application from 2017.  

The  European  Council  agreed  in  October  2014  the  2030  policy  framework  for  climate  and 
energy.  A  centrepiece  of  the  2030  framework  is  the  binding  target  to  reduce  overall  EU 
greenhouse  gas  emissions  by  at  least  40%  domestically  below  1990  levels  by  2030.  To 
achieve  this  target  cost-effectively, the  sectors  covered  by  the  EU  emissions  trading  system 
(EU  ETS)  will  have  to  reduce  their  emissions  by  43%  compared  to  2005,  while  non-ETS 
sectors will have to reduce their emissions by 30% compared to 2005. This allowed the EU to 
submit  its  contribution  under  the  Paris  Agreement,  qualifying  as  an  economy  wide 
commitment,  including  aviation  emissions.  The  EU  is  committed  to  duly  contribute  to  the 
climate  goal  under  the  Paris  Agreement  of  keeping  global  warming  well  below  2  degrees 
Celsius  above  pre-industrial  levels  and  pursue  efforts  to  limit  temperature  increase  to  1.5 
degrees  Celsius,  as  well  as  the  aspirational  goal  set  by  the  International  Civil  Aviation 
Organisation  that  global  net  CO2  emissions  from  international  aviation  should  not  exceed 
2020 levels ('carbon neutral growth' or CNG 2020).  
In October 2016, ICAO agreed at its 39th Assembly on a Resolution for a global market-based 
measure  (GMBM)  to  address  the  growth  in  international  aviation  emissions  globally  from 
2021  through  an  offsetting  system,  aimed  at  enabling  the  aspiration  goal  of  stabilising 
international aviation emissions at 2020 levels. During the GMBM's first phase (2021-2026), 
participation in the GMBM is explicitly voluntary. All major aviation countries should apply 
the  GMBM  from  the  start  of  its  second  phase  in  2027.  The  EU  and  its  Member  States 
expressed  their  intention  to  apply  the  GMBM  during  its  voluntary  phase.  While  the 
aspirational  goal  and  the  basic  nature  of  the  GMBM  as  offsetting  are  agreed,  a  number  of 
important features of the GMBM, key for its effectiveness and environmental integrity from a 
climate perspective, still need to be developed and agreed in ICAO before the GMBM can be 

EN 

2 

   EN 

implemented  in  2021.  Any  delays  in  agreeing  on  these  elements  risk  delaying  the 
operationalization of the GMBM. This would also risk delaying implementation by States in 
domestic legislation which is crucial since the concrete operationalization of the GMBM rests 
on such national and regional action. 
The  existing  legislation  requires  the  Commission  to  assess  the  outcome  of  the  39th  ICAO 
Assembly  and,  in  that  light,  to  review  the  scope  of  the  EU  ETS  for  flights  to  and  from  the 
EEA. In the absence of amendment to the existing legislation, the initial scope of the ETS (ie 
including extra EEA flights) would apply again.  In view of the agreement on the GMBM at 
ICAO,  the  EU  support  towards  its  completion  and  timely  operationalization,  and  the  EU's 
intended implementation of the GMBM from 2021 onwards, it is deemed necessary to review 
the EU ETS legislation. 

To  provide  further  momentum  to  international  discussions  on  the  remaining  rules  and 
governance  necessary  for  the  implementation  of  the  GMBM  it  is  proposed  to  continue  the 
reduced scope application of the EU ETS (i.e. to flights between aerodromes located within 
the  EEA,  as  set  out  in  Regulation  No  421/2014)  beyond  2016.  Once  there  is  more  clarity 
about the nature and content of the legal instruments adopted by ICAO for the implementation 
of  the  GMBM  as  well  as  about  the  intentions  of  our  international  partners  regarding  the 
implementation of the GMBM, a further assessment and review the EU ETS for the post-2020 
period will be carried out. This will also take due account of the necessary consistency with 
the  economy  wide  commitment  taken  by  the  EU  under  the  Paris  Agreement  and  its  agreed 
objective  of  reducing  GHG  emissions  domestically  by  40  %  by  2030  compared  to  1990 
levels. 

To  provide  legal  certainty  for  compliance  with  the  ETS  in  2017,  it  is  important  that  this 
proposal is agreed  between  the European Parliament and Council  swiftly  and ideally by the 
end of 2017.  

• 

Consistency with existing policy provisions in the policy area 

This proposal, in general, continues the approach of existing policy provisions for ETS sectors 
laid down in the EU ETS Directive while taking due account of new and further developments 
in ICAO and notably the agreement reached on the GMBM. The European Council explicitly 
called  for  the  continuation  of  the  current  policy  architecture  for  the  EU  ETS  and  gave 
guidance  on  specific  issues  to  be  addressed  for  the  period  2021  to  2030.  In  line  with  the 
guidance received, the European Commission proposed in July 2015 a legislative proposal to 
revise the EU ETS for stationary installations for the period after 2020. That proposal did not 
address  issues  relating  to  the  coverage  of  aviation  in  the  EU  ETS,  as  it  was  considered 
inappropriate  to  do  so  in  advance  of  the  39th  ICAO  Assembly  in  October  2016.  Now, 
consistent with the European Council conclusions, this proposal addressing aviation emissions 
continues  the  approach  to  emissions  from  intra-European  flights  under  the  EU  ETS.  The 
present proposal is complementary to the broader ETS review as proposed by the Commission 
in July 2015 and presently in the co-decision process. 

• 

Consistency with other Union policies 

The  proposal  provides  for  implementation  of  part  of  the  2030  climate  and  energy  policy 
framework as a key element in the context of building a resilient Energy Union with forward-
looking climate policy. Complementary legislative proposals have already been made to help 
to  achieve  the  different  targets  agreed  by  the  European  Council.  These  proposals  should 
facilitate  the  achievement  of  the  ETS  and  non-ETS  climate  targets.  In  addition,  the 

EN 

3 

   EN 

Commission  aviation  strategy  and  the  Strategy  on  low  emissions  mobility  address  action  to 
further  reduce  GHG  emissions  in  transport,  as  part  of  broader  decarbonisation  efforts 
undertaken and committed by the EU, including for the 2030 horizon. 

2. 

• 

LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY 

Legal basis 

Articles 191 to 193 of the Treaty of the Functioning of the European Union (TFEU) confirm 
and specify EU competences in the area of climate change. The legal basis for this proposal is 
Article 192 TFEU. 

• 

Subsidiarity (for non-exclusive competence)  

The  EU  ETS  Directive  is  an  existing  EU  policy  instrument  that  continues  after  2020.  In 
accordance  with  the  principle  of  subsidiarity  set  out  in  Article  5  of  the  Treaty  of  the 
Functioning of the European Union, the objectives of the proposal amending this instrument 
can only be achieved through a proposal from the Commission at EU level. 

Acting  at  EU  level,  and  where  possible  at  global  level,  is  more  efficient  than  acting  at  the 
Member  State  level,  due  to  the  trans-boundary  effects  of  climate  change  and  the  largely 
transnational  nature  of  aviation.  Action  at  EU  level  will  most  effectively  deliver  the  EU's 
domestic and international climate targets and ensure the harmonized implementation of the 
GMBM  in  the  EU.  By  doing  so,  the  aviation  sector's  adequate  contribution  to  reducing  the 
impacts  from  climate  change  can  be  safeguarded,  while  preserving  the  EU  aviation  sector's 
international  competitiveness  and  maintaining  a  level-playing  field  in  the  EU's  internal 
market. 

• 

Proportionality 

The proposal complies with the proportionality principle because it does not go beyond what 
is  necessary  in  order  to  achieve  the  objectives  of  implementing  the  EU's  GHG  reduction 
targets  for  2020  and  2030  in  a  cost-effective  manner,  while  at  the  same  time  ensuring  the 
proper  functioning  of  the  internal  market  and  facilitating  the  completion  of  rules  for  the 
implementation of the GMBM.  

• 

Choice of the instrument 

This  proposal  for  a  Regulation  follows  on  from  Regulation  (EU)  No  421/2014,  which  was 
adopted  following  the  2013  ICAO  Assembly.  As  with  Regulation  (EU)  No  421/2014,  it  is 
important that this proposal is agreed swiftly between the European Parliament and Council, 
so as to be in place for when the next compliance obligations under the EU ETS are due in 
March  and  April  2018.  In  the  absence  of  a  revision,  the  ETS  reverts  to  its  original  scope. 
Consequently, this proposal should be adopted by the European Parliament and Council and 
enter into force no later than early 2018, so as to provide legal certainty and clarity for aircraft 
operators who would otherwise  have to  surrender allowances  for their full emissions  to  and 
from third countries by 30 April 2018, as referred to in Directive 2003/87/EC. 

EN 

4 

   EN 

In  view  of  the  limited  time  available,  it  is  considered  that  the  present  proposal  can  best  be 
pursued  through  a  Regulation.  Regulations  are directly  applicable  in  all  Member  States  and 
binding  in  their  entirety  and  are  thus  the  best  means  to  achieve  a  timely  and  uniform 
implementation  of  the  amendments  ahead  of  the  compliance  deadlines  for  the  year  2017  in 
March and April 2018. 

3. 

• 

RESULTS 
CONSULTATIONS AND IMPACT ASSESSMENTS 

EX-POST 

EVALUATIONS, 

OF 

STAKEHOLDER 

Ex-post evaluations/fitness checks of existing legislation 

In the context of the review of the EU ETS for 2021-2030, an evaluation of the existing ETS 
Directive  was  part  of  the  impact  assessment  work  and  has  fed  into  the  assessment  of  the 
policy options. There was no ex-post evaluation or fitness check specifically related to the EU 
ETS for aviation because the EU ETS for aviation has never been applied in its full scope as 
initially  designed.  Amendments  to  the  scope  of  the  EU  ETS  for  aviation  were  done  on  the 
basis of extensive assessments to address the concerns and take into account opposition raised 
in  relation  to  the  measure  as  initially  designed  while  maintaining  equal  treatment  of  all 
operators on the same routes. The 2013 Impact Assessment1 accompanying the proposal for 
Regulation (EU) No 421/2014, as well as the Impact Assessment accompanying this proposal 
together  with  the  Carbon  Market  Reports  prepared  by  the  Commission  and  the  EU's  ICAO 
Action Plans submitted by the Commission to ICAO are effectively evaluating and assessing 
the effectiveness and functioning of the EU ETS Directive for aviation, which is considered 
adequate  in  terms  of  retrospective  evaluation  report  and  fitness  check  of  the  EU  ETS 
Directive for aviation.    

• 

Stakeholder consultations 

With  a  view  to  address  a  review  of  the  EU  ETS  following  the  2016  ICAO  Assembly,  an 
online public consultation was held for 12 weeks between 7 March and 30 May 2016. Overall, 
most  stakeholder  groups  agreed  that  ambitious  targets  for  emissions  reductions  in 
international  aviation  should  be  agreed  and  that  MBMs  are  appropriate  tools  to  reduce 
emissions from international aviation. However, there were different views in relation to the 
desirable  level  of  ambition  and  the  specific  mechanisms  to  reduce  emissions.  While  some 
stakeholders  consider  that  the  EU  ETS  should  continue  under  the  current  intra-EEA  scope 
after 2017, some were of the view that it should revert back to its full-scope (including flights 
to and from third countries). Beyond 2020, many respondents noted that options for the EU 
ETS  should  depend  on 
level  of  ambition,  nature,  scope  and  environmental 
integrity/effectiveness  of  the  agreement  reached  at  the  2016  ICAO  Assembly.  The 
Commission  will  continue  to  engage  in  constructive  bilateral  and  multilateral  contacts  with 
stakeholders and third countries. 

the 

1 

SWD(2013) 430 final 

EN 

5 

   EN 

                                                 
• 

Collection and use of expertise 

As regards overall, global GHG emission projections, the impact assessment used the United 
Nations  Enironmental  Programme’s  Emission  Gap  Report  2015  and  the  fifth  Assessment 
Report by the Intergovernmental Panel on Climate Change (IPCC). In relation to overall EU 
GHG projections, reports from the European Environmental Agency were used as a basis. The 
study  relied  on  relevant  data  from  the  ICAO  Environmental  Reports,  notably  in  relation  to 
emissions and emission forecasts for international aviation, as well as the emission reduction 
potentitial for internatioanl aviation from technical and operational measures. The forecasted 
growth data of the aviation sector set out in the ICAO Environmental Report was used in the 
underlying econometric modelling and analysis. 

• 

Impact assessment 

The  Impact  Assessment  analyses  different  options  both  for  the  period  pre-2020  and  for  the 
period  from  2021.  Before  2020,  the  continuation  of  the  intra-EEA  scope  and  an  alternative 
covering all flights departing from the EEA are assessed and compared with the baseline (full-
scope). After 2020, all options consider that the GMBM will cover flights to and from third 
countries. One option also considers that intra-EEA emissions are offset through the GMBM, 
while another one keeps the EU ETS obligations for intra-EEA flights. Intermediate options 
consider changes to the EU ETS for intra-EEA flights to either seek some alignment with the 
GMBM (with the EU ETS working under an offsetting approach) or to combine both systems 
(with the EU ETS covering emissions not addressed by the GMBM).  

The Impact Assessment has shown that a continuation of the current intra-EEA scope of the 
EU  ETS  would  be  the  most  suitable  option  to  address  the  period  2017-2020  and  bring  the 
expected contribution from aviation to the 2020 climate objective. It would also be welcomed 
by  third  countries  and  provide  momentum  for  ICAO  to  finalize  the  necessary  outstanding 
rules  for  the  implementation  of  the  GMBM;  and  this  would  be  feasible  at  a  very  low 
administrative  cost  since  the  system  is  in  place  and  very  well  complied  with  by  all.  Global 
mitigation  action  on  the  sector's  emissions  would  be  maximized  by  facilitating  the  actual 
implementation of the GMBM from 2021, as expected.  

The impact assessment has also analysed different options for a post-2020 scenario, showing 
whether  and  how  they  would  contribute  to  meet  the  EU's  2030  climate  targets.  However, 
given  the  uncertainties  still  affecting  the  concrete  implementation  of  the  GMBM  it  is 
considered premature to take a decision on the post-2020 regime at this stage, while standing 
ready to review the situation in due time before the GMBM is expected to start operating.  

• 

Regulatory fitness and simplification 

In order to lighten administrative tasks for the smallest aircraft operators, the exemption for 
non-commercial  aircraft  operators  emitting  less  than  1000  tonnes  CO2  per  annum  should 
continue to apply for another ten years. 

• 

Fundamental rights 

The  proposal  respects  the  fundamental  rights  and  observes  the  principles  recognised  in 
particular  by  the  Charter  of  Fundamental  Rights  of  the  European  Union.  In  particular,  it 
contributes to the objective of a high level of environmental protection in accordance with the 

EN 

6 

   EN 

principle of sustainable development as laid down in Article 37 of the Charter of Fundamental 
Rights of the European Union. 

4. 

BUDGETARY IMPLICATIONS 

The proposal has no implication for the Community budget.  

5. 

OTHER ELEMENTS 

Detailed explanation of the specific provisions of the proposal 

• 
In  response  to  the  progress  achieved  by  the  39th  ICAO  Assembly  and  to  promote  further 
momentum  towards  the  successful  implementation  of  a  GMBM  to  address  international 
aviation  emissions  from  2021,  it  is  proposed  to  make  amendments  to  the  aviation  activities 
covered by the EU ETS. It is proposed to extend the current approach to application of the EU 
ETS as set out in Regulation No. 421/2014 beyond 2016 until there will be sufficient clarity 
about the nature and content of the legal instruments adopted by ICAO for the implementation 
of the GMBM to allow the European Commission to carry out further assessments and review 
the  EU  ETS  for  the  post-2020  period.  Consequent  with  this  approach,  allocation  to  aircraft 
operators from 2017 should be the same as in 2016. These arrangements are expected to apply 
already to the 2017 allocation. Thus, the implementation of the EU ETS in that year, pending 
the entry into force of the amendment, should be, as far as possible, consistent with it and in 
line with the expected final outcome of the co-decision process.   

This proposal aims at continuing the current highly positive environmental impact of the EU 
ETS, which contributes to around 17 million tonnes of CO2 emission reductions per year. This 
means  that  aviation,  within  the  European  Economic  Area,  contributes  to  the  domestic 
emission  reductions  efforts  as  any  other  economic  sector.  While  ensuring  that  the  EU  will 
continue  to  achieve  substantial  emission  reductions  from  aviation  through  the  EU  ETS, 
consistent with EU climate objectives, it maintains the impetus to the work in ICAO on the 
actual  operationalization  of  the  GMBM  to  maximise  the  global  mitigation  outcome.  The 
review clause provides a positive signal on the EU's intention to apply the GMBM. 

• 

Article 1 amending Directive 2003/87/EC 

The proposal amends Article 28a of the Directive, adds two more articles (28b and 28c) and 
modifies its Annex I. 

Article 28a 

Amendments are made to article 28a of the EU ETS Directive on the derogations applicable 
in  advance  of  the  implementation  of  an  international  agreement  applying  a  single  global 
market-based measure. Following the same approach as under Regulation (EU) No 421/2014 
for  the  2013-2016  period,  the  application  of  the  EU  ETS  Directive  to  flights  to  and  from 
outermost  regions  and  third  countries  is  derogated  from  after  2016,  while  flights  between 
aerodromes  in  the  EEA  remain  fully  covered.  Given  that  the  scope  remains  as  in  2016,  the 
amount  of  free  allocation  received  by  aircraft  operators  will  continue  to  be  the  same  as  in 
2016 so, proportional to the intra-EEA activity, and the linear reduction factor applicable to 
all  sectors  under  the  EU  ETS  Directive  will  apply  but  only  from  2021  onwards.  Allocation 
from the special reserve should be treated equally and thus its issuance must be adjusted to the 
intra-EEA  scope.  The  amounts  to  be  auctioned  should  also  continue  being  the  same  as  in 
2016. The system will apply to flights with countries with whom a bilateral agreement to link 
cap and trade systems is reached in only in line with the terms of such agreement. 

Article 28b 

EN 

7 

   EN 

A new article 28b in the EU ETS Directive is introduced to prepare for the implementation of 
a  global  market-based  measure  from  2021.  It  requires  the  Commission  to  report  to  the 
European  Parliament  and  the  Council  on  international  developments  of  relevance  for  the 
implementation of the GMBM, as well as on the actions taken by third countries to implement 
the GMBM. Thereby, the Commission is to consider ways to implement the relevant ICAO 
instruments  in  Union  law  through  a  revision  of  the  EU  ETS  Directive.  This  may  be 
accompanied with legislative proposals as appropriate.  

Article 28c 

Also to prepare for the implementation of the GMBM the Commission is empowered to adopt 
delegated  acts  to  provide  for  the  appropriate  monitoring,  reporting  and  verification  of 
emissions applicable to aircraft operators for the purpose of implementing the global market-
based measure being elaborated in ICAO. 

Annex I 

Annex I to Directive 2003/87/EC is amended by extending the exemption for non-commercial 
aircraft operators emitting less than 1 000 tonnes CO2 per annum from 2020 until 2030. This 
has  proven  to  be  an  effective  measure,  considerably  reducing  the  administrative  effort 
required  to  implement  the  EU  ETS,  while  continuing  to  achieve  substantial  emission 
reductions  through  the  EU  ETS.  The  exemption  reduced  the  number  of  aircraft  operators 
regulated by Member States by around 2200 representing only 0.2% of emissions. 

EN 

8 

   EN 

2017/0017 (COD) 

Proposal for a 

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

amending Directive 2003/87/EC to continue current limitations of scope for aviation 
activities and to prepare to implement a global market-based measure from 2021 

(Text with EEA relevance) 

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Article 192(1) thereof, 

Having regard to the proposal from the European Commission, 

After transmission of the draft legislative act to the national parliaments, 
Having regard to the opinion of the European Economic and Social Committee2,  
Having regard to the opinion of the Committee of the Regions3,  

Acting in accordance with the ordinary legislative procedure, 

Whereas: 

(1) 

(2) 

(3) 

At the 21st Conference of the Parties to the United Nations Framework Convention on 
Climate  Change  (UNFCCC)  which  took  place  in  Paris  from  30  November  to  12 
December  2015,  an  international  agreement  was  adopted  to  strengthen  the  global 
response to climate change. The Paris Agreement, inter alia, sets out a long-term goal 
in  line  with  the  objective  to  keep  the  global  temperature  increase  well  below  2°C 
above  pre-industrial  levels  and  to  pursue  efforts  to  keep  it  to  1,5°C  above  pre-
industrial  levels.  The  Paris  Agreement  was  approved  on  behalf  of  the  Union  by 
Council  Decision  (EU)  2016/1841.  The  Paris  Agreement  entered  into  force  on  4th 
November  2016.  In  order  to  achieve  the  goal  of  the  Paris  Agreement,  parties  will 
prepare, communicate and maintain successive nationally determined contributions. 

The environmental objectives of the Union as referred to in Article 191 of the Treaty, 
are  preserving,  protecting  and  improving  the  quality  of  the  environment;  protecting 
human health; and promoting measures at international level to deal with regional or 
worldwide environmental problems, and in particular combating climate change. 

A  binding  target  of  at  least  a  40%  domestic  reduction  in  economy-wide  greenhouse 
gas emissions by 2030 compared to 1990 was set by the European Council of 23-24 
October  2014.  The  Council  meeting  on  6  March  2015  formally  approved  this 
contribution  of  the  Union  and  its  Member  States  as  their  Intended  Nationally 
Determined  Contribution  under  the  Paris  Agreement.  The  European  Council 
conclusions  of  October  2014  foresaw  that  the  target  should  be  delivered  collectively 

2 
3 

OJ C , , p. . 
OJ C , , p. . 

EN 

9 

   EN 

                                                 
(4) 

(5) 

(6) 

by  the  Union  in  the  most  cost-effective  manner  possible,  with  the  reductions  in  the 
Emissions Trading System (ETS) and non-ETS sectors amounting to 43% and 30% by 
2030 compared to 2005 respectively. All sectors of the economy should contribute to 
achieving these emission reductions.  

The  Union  and  its  Member  States  have  been  endeavouring  to  advance  international 
agreement to reduce greenhouse gas impacts from aviation since 1997 and they have 
legislation  in  place  since  2008  to  limit  the  climate  change  impacts  from  aviation 
activities through the EU emissions trading system (EU ETS) that has been operating 
since  2005.  In  order  to  advance  progress  at  the  International  Civil  Aviation 
Organization (ICAO), the Union has twice adopted time-bound derogations to the EU 
ETS  so  as  to  limit  compliance  obligations  to  emissions  from  flights  between 
aerodromes situated in the European Economic Area (EEA), with equal  treatment on 
routes of aircraft operators wherever they are based. The most recent derogation from 
the  EU  ETS,  Regulation  (EU)  No  421/2014  of  the  European  Parliament  and  of  the 
Council, limited compliance obligations to intra-EEA flights between 2013 and 2016, 
and envisaged potential changes to the scope of the system as regards activity to and 
from aerodromes situated outside the EEA from 1 January 2017 onwards following the 
review set out in that Regulation. 
In the light of the resolution adopted at ICAO's 39th Assembly in October 2016 on the 
implementation  of  a  global  market-based  measure  from  2021  to  offset  international 
aviation  emissions  above  2020  levels,  it  is  considered  appropriate  to  continue  the 
existing  derogation  pending  further  progress  on  the  design  elements  and  the 
implementation  of  the  global  market-based  measure.  In  this  regard,  the  adoption  of 
Standards and Recommended Practices by ICAO to complement that Resolution and 
implement 
its  concrete 
operationalisation  will  require  action  by  ICAO  parties  at  domestic  level.  Also, 
governance arrangements must be developed by ICAO, including a registry system. In 
this context, the current derogation of the EU ETS obligations for flights to and from 
third countries should be extended, subject to the review on implementing the ICAO 
scheme, in order to promote momentum in ICAO and facilitate the operationalisation 
of  the  ICAO  scheme.  As  a  result  of  the  extension  of  the  derogation,  the  amount  of 
allowances  to  be  auctioned  and  issued  for  free,  including  from  the  special  reserve, 
should  be  the  same  as  would  correspond  to  2016,  and  should  be  proportional  to  the 
reduction of the surrender obligation. 

is  planned  for  2018.  However, 

the  global  system 

Given that key features of the global market-based measure have yet to be developed 
and that its implementation depends on domestic legislation by States and regions, it is 
considered appropriate for a review to take place once there is clarity about the nature 
and  content  and  of  these  legal  instruments  in  advance  of  the  start  of  ICAO's  global 
market-based  measure,  and  a  report  submitted  to  the  European  Parliament  and 
Council.  That  report  should  consider  any  standards  or  other  instruments  adopted 
through  ICAO,  the  actions  taken  by  third  countries  to  implement  the  global  market-
based  measure  to  apply  to  emissions  from  2021  and  other  relevant  international 
developments (e.g. rules under UNFCCC and the Paris Agreement on carbon markets 
and  accounting).  That  report  should  consider  how  to  implement  these  instruments  in 
Union  law  through  a  revision  of  the  EU  ETS.  It  should  also  consider  the  rules 
applicable to intra-EEA flights as appropriate. That report should be accompanied by a 
proposal  as  appropriate  to  the  European  Parliament  and  the  Council  consistent  with 
ensuring  the  contribution  of  aviation  to  the  Union's  2030  economy-wide  greenhouse 
gas reduction commitment.  

EN 

10 

   EN 

(7) 

(8) 

(9) 

In  order  to  adopt  non-legislative  acts  of  general  application  to  supplement  or  amend 
certain  non-essential  elements  of  a  legislative  act,  the  power  to  adopt  acts  in 
accordance with Article 290 of the Treaty should be delegated to the Commission to 
adopt measures for the monitoring, reporting and verification of emissions applicable 
to  aircraft  operators  for  the  purpose  of  the  global  market-based  measure  being 
elaborated  in  ICAO.  It  is  of  particular  importance  that  the  Commission  carries  out 
appropriate  consultations  during  its  preparatory  work,  including  at  expert  level,  and 
that those consultations be conducted in  accordance with the principles laid  down in 
the  Interinstitutional  Agreement  on  Better  Law-Making  of  13  April  2016.  In 
particular,  to  ensure  equal  participation  in  the  preparation  of  delegated  acts,  the 
European  Parliament  and  the  Council  receive  all  documents  at  the  same  time  as 
Member  States'  experts,  and  their  experts  systematically  have  access  to  meetings  of 
Commission expert groups dealing with the preparation of delegated acts. 

As a simplification and in order to lighten administrative tasks for the smallest aircraft 
operators,  non-commercial  aircraft  operators  emitting less  than  1000  tonnes  CO2  per 
annum  should  continue  to  be  considered  as  meeting  the  requirements  of  Directive 
2003/87/EC for another ten years, during which measures should be elaborated so that 
in future all operators contribute to emission reductions. 

It is essential to ensure legal certainty for aircraft operators and national authorities in 
view  of  the  surrender  deadline  of  30  April  2018  specified  in  Directive  2003/87/EC. 
Accordingly,  this  Regulation  should  apply  from  the  day  of  its  publication  in  the 
Official Journal of the European Union. 

(10)  Directive 2003/87/EC should therefore be amended accordingly. 

HAVE ADOPTED THIS REGULATION: 

Article 1 

Directive 2003/87/EC is amended as follows: 

(1) 

Article 28a is amended as follows: 

(a)  paragraph 1 is amended as follows: 

i. 

points (a) and (b) are replaced by the following: 

(a) 

(b) 

all  emissions  from  flights  to  and  from  aerodromes  located  in 
countries  outside  the  European  Economic  Area  (EEA)  in  each 
calendar year from 1 January 2013, subject to the review referred to 
in Article 28b". 

all  emissions  from  flights  between  an  aerodrome  located  in  an 
outermost  region  within  the  meaning  of  Article  349  of  the  Treaty 
on  the  Functioning  of  the  European  Union  (TFEU)  and  an 
aerodrome  located  in  another  region  of  the  EEA  in  each  calendar 
year  from  1  January  2013,  subject  to  the  review  referred  to  in 
Article 28b". 

ii. 

point (c) is deleted. 

(b)  paragraph 2 is amended as follows: 

i. 

the first subparagraph is replaced by the following: 

EN 

11 

   EN 

 
“From 1 January 2017, by way of derogation from Articles 3d to 3f and 
until  amendments  subsequent  to  the  review  referred  to  in  Article  28b 
have entered into force, aircraft operators shall be issued, each year, the 
number  of  allowances  that  corresponds  to  the  year  2016.  From  2021 
onwards that number of allowances shall be subject to the application of 
the linear factor in Article 9.” 

ii. 

the third subparagraph is deleted. 

(c)  paragraph 4 is replaced by the following:  

“4. By way of derogation from Article 3d(3), the number of  allowances to be 
auctioned  by  each  Member  State  from  1  January  2013  shall  be  reduced  to 
correspond to its share of attributed aviation emissions from flights which are 
not subject to the derogations provided for in points (a) and (b) of paragraph 1 
of this Article.”; 

(d)  paragraph 7 is replaced by the following: 

"Paragraph  1  shall  apply  to  countries  with  whom  an  agreement  pursuant  to 
Article  25  or  25a  has  been  reached  only  in  line  with  the  terms  of  such 
agreement". 

(2) 

The following Articles 28b and 28c are inserted: 

"Article 28b 

Reporting by the Commission on the implementation of ICAO's global market-based measure 

1. 

2. 

3. 

The  Commission  shall  report  to  the  European  Parliament  and  the  Council  on  the 
relevant ICAO standards or other legal instruments as well as on domestic measures 
taken by third countries to implement the global market-based measure to be applied 
to emissions from 2021, and on other relevant international developments.  

The report should consider ways for those ICAO instruments to be implemented in 
Union  law  through  a  revision  of  this  Directive.  The  report  shall  also  consider  the 
rules applicable in respect of flights within the European Economic Area (EEA) as 
appropriate.  

The  report  may  be  accompanied  by  proposals,  as  appropriate  to  the  European 
Parliament  and  the  Council  to  amend,  delete,  extend  or  replace  the  derogations 
provided for in Article 28a, consistent with the Union economy-wide greenhouse gas 
emission reduction commitment for 2030. 

Article 28c 

Provisions for monitoring, reporting and verification for the purpose of the global market-
based measure 

1. 

2. 

The Commission shall adopt provisions for the appropriate monitoring, reporting and 
verification  of  emissions  for  the  purpose  of  implementing  the  global  market-based 
measure  being  elaborated  in  ICAO.  Those  provisions  shall  be  based  on  the  same 
principles  as  the  Regulation  referred  to  in  Article  14  (1)  and  shall  ensure  that  the 
emissions reports submitted are verified in accordance with Article 15. 

The Commission is empowered to adopt a delegated act in accordance with Article 
[23]." 

EN 

12 

   EN 

 
(3) 

In point (k) of Annex I, the year '2020' is replaced by '2030'. 

This Regulation shall enter into force on the day of its publication in the Official Journal of 
the European Union. 

Article 2 

This Regulation shall be binding in its entirety and directly applicable in all Member States. 

Done at Brussels, 

For the European Parliament 
The President 

For the Council 
The President 

EN 

13 

   EN