Court Ruling: Part Of Taxonomy Criteria Found Unlawful – But Polluting Planes And Ships Still Slipping Through The Net

Yesterday, the General Court in Luxembourg issued its judgment on the EU Commission's Taxonomy Regulations for 'green' investments in aviation and shipping. The court's ruling welcomes the finding that part of the shipping taxonomy criteria is unlawful. The decision marks a significant victory for the coalition of NGOs and legal experts who challenged the EU Commission's approach to the Taxonomy criteria.

The court confirmed that the Commission's discretion is not unlimited and is bound by the strict rules set by the Taxonomy Regulation. Specifically, the court found that the Commission had not set a threshold or limit for methane slippage emissions from polluting ships under the Taxonomy criteria. This ruling means that the European Commission must now determine a quantifiable limit for methane emissions, sending a strong message that gas is not a clean transition fuel.

However, the judgment does not reject any of the aviation criteria, leaving the Commission with wide discretion to set the criteria as it sees fit. This ruling leaves the core concern unresolved: fossil-fuelled aircraft and ships should not be labeled as sustainable investments when financing them will damage the climate, undermine EU climate obligations, and create risks of greenwashing and lock-in of fossil assets.

Despite the partial victory, the coalition of NGOs plans to carefully study the judgment before deciding whether to appeal the aspects that left critical loopholes open. Legal Director David Kay of Opportunity Green emphasized that while the court's ruling is a positive step, fossil-fuelled aircraft and ships should not be labeled as sustainable investments due to the significant climate damages and costs they impose on society.