Europe's right to tackle carbon emissions from all airlines using its airports does not breach international law, an adviser at the European Court of Justice declared today.
A group of American and Canadian-based airlines and airline associations is challenging an EU emissions trading scheme which includes even non-EU aircraft in rules designed to curb aviation pollution.
They took their case to the High Court in London to oppose UK measures to implement the EU move.
Now the issue has been passed to European judges, who are expected to deliver the final verdict early next year.
Today's preliminary legal "opinion" rejects their claim that, by including international aviation - and transatlantic aviation in particular - in the scheme, the EU is violating principles of "customary international law" including "the freedom to fly over the high seas".
The court's Advocate-General, whose "opinion" is followed in about 80% of cases at the Luxembourg court, declared: "EU legislation does not infringe the sovereignty of other States or the freedom of the high seas guaranteed under international law, and is compatible with the relevant international agreements."
The Advocate-General went on: "Furthermore, the inclusion in the EU emissions trading scheme of flights of all airlines from and to European airports is compatible with the principle of fair and equal opportunity laid down in the Open Skies Agreement.
"Indeed it is precisely that inclusion that establishes equality of opportunity in competition, as airlines holding the nationality of a third country would otherwise obtain an unjustified competitive advantage over their European competitors if the EU legislature had excluded them from the EU emissions trading scheme."
UK energy and climate change minister Greg Barker welcomed the opinion, saying: "The UK and the EU will continue to robustly defend our policy to bring aviation into the EU's emissions trading system and believe it is consistent with international law."
The EU introduced its first scheme for greenhouse gas emission allowance trading in 2003 as a key part of Europe's climate change policy. Aircraft emissions were not originally included, but under updated rules they will be in the system from the start of next year.
That means all airlines, from inside and outside the EU, will have to acquire and surrender emission allowances for their flights to and from European airports.
Mr Barker said the aviation industry had to play its part in reducing emissions just like other industrial sectors, adding: "The aviation industry, in the same way as other industries, needs to play its part in reducing emissions and we are pleased that the EU is fully prepared for aviation to join the emissions trading system from January 2012."
He added: "We are determined to make this work and the UK and EU are engaging with governments and aircraft operators around the world to make this happen."
The Advocate-General called the airlines' challenges "unconvincing", "untenable", "erroneous" and based on a "highly superficial reading" of the EU's Aviation Directive - the world's only mandatory policy addressing emissions from aviation.
Keith Allott, head of climate change at WWF-UK, said: "We are pleased that this advice will send a message that the emissions trading system is entirely consistent with international law.
"In the absence of a global deal, the system is a positive first step towards bringing runaway aviation emissions under control."
Tim Johnson, director of the Aviation Environment Federation, said: "The Advocate-General's report is a positive step towards ensuring that airlines operating from European airports will become accountable for their carbon emissions from 1 January 2012 as the world's first regional initiative to limit greenhouse gas emissions from the aviation sector comes into effect."
Bill Hemmings, programme manager of Transport & Environment, said: "The international community, aided and abetted by the airlines, has failed to make any progress on cutting aviation emissions in fourteen years despite innumerable meetings and negotiating sessions.
"So the airlines cannot be serious when they call for international action instead of European leadership. That so many major airlines have jumped on the bandwagon of criticising the EU-ETS, an extremely modest measure equivalent to one cent a litre on (untaxed) kerosene, is just opportunistic and irresponsible. The aviation industry should be tackling climate change with engineers, not lawyers."
Aviation is one of the fastest-growing sources of greenhouse gas emissions, rising 3% to 4% per year. Until now, the sector has escaped regulations that would require emissions reductions.
Friends of the Earth's transport campaigner Richard Dyer said: "Airline pollution must be tackled if we are to prevent runaway climate change - including it in the EU emissions trading scheme is a small but significant step in the right direction.
"The aviation industry has consistently opposed measures to protect our economy and our environment from global warming - the EU must stand firm and force the sector to play its part."
He added: "Governments must also take action to make alternatives to short-haul flights, such as making long-distance rail travel cheaper and easier to use."