Since 2012, greenhouse gas emissions from all flights operating
in the European Economic Area ("EEA") (domestic and
international) have been subject to EU rules. Under the EU
Emissions Trading System ("EU ETS"), airlines are
required to monitor, report and verify their emissions and to
surrender allowances against those emissions. Airlines receive
annual tradable allowances covering a certain level of emissions.
Any shortfall between the allocated sum of free emissions
allowances and their actual emissions require the purchase of
additional allowances.
In order to support the development of a global Carbon
Offsetting and Reduction Scheme for International Aviation
("CORSIA") by the International Civil Aviation
Organisation ("ICAO"), however, the EU has since limited
the scope of EU ETS to flights within the EEA only until 2023.
