Europe's top court on Wednesday threw out a US-led challenge to new charges for carbon emissions across EU airspace, opening up fears of a possible trade war which could also draw in China.
The EU will go ahead with its hotly contested plan to charge airlines for carbon emissions despite US threats of reprisal, should it win the backing of the European Court of Justice, EU sources said Tuesday.
Australia passed its controversial pollution tax Tuesday in a sweeping and historic reform aimed at lowering carbon emissions blamed for climate change, after years of fierce debate.
The European Union refused Thursday to drop plans to charge all airlines for carbon emissions when flying to and from Europe despite opposition from the UN's civil aviation body.
Australia's lower house on Wednesday passed a contentious new tax on carbon pollution to combat climate change which has angered many voters and threatens Prime Minister Julia Gillard's hold on power.
An EU decision to force foreign airlines to buy carbon permits "is compatible with international law," the advocate general of the European Union Court of Justice said Thursday.
Airlines denounced on Tuesday an EU plan to charge them for carbon emissions, warning it would cost the industry 17.5 billion euros ($23.8 billion) over eight years.
Cheers erupted in Australia's Parliament House after Prime Minister Julia Gillard presented her bill for a new pollution tax she hopes will help counter climate change.
China will introduce a pilot scheme for carbon emissions trading and gradually develop a national market as the world's largest polluter seeks to reduce emissions and save energy, state media said.
Australia Sunday announced plans to tax carbon pollution at Aus$23 (US$24.74) per tonne to help battle climate change, as it moves towards an emissions trading scheme similar to that of Europe.