The International Air Transport Association (IATA) called on Mar. 19 for the European Union to review its Emissions Trading System (EU ETS) to better support the competitiveness of the aviation sector as it works toward decarbonization. The association outlined several recommendations, including full implementation of the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), enabling a Sustainable Aviation Fuel (SAF) book-and-claim system, reinvesting revenues into decarbonization, and balancing climate policy with industry resilience.
This call comes amid concerns from EU leaders about the effectiveness of the EU ETS and its impact on European economic strength. IATA said that robust air connectivity is essential for Europe’s global position, especially in times of geopolitical uncertainty and supply chain disruptions.
Willie Walsh, IATA’s Director General, said: “European aviation policy must bolster competitiveness as it advances decarbonization. Reviewing the EU ETS offers a critical opportunity to refocus efforts on cost-effective emission reductions. The priority must be the full implementation of CORSIA, the reinvestment of EU ETS revenues into SAF and other credible decarbonization solutions, and the elimination of overlapping measures that add cost and complexity without environmental gain. By doing so, we will protect European air connectivity—a vital strategic asset foundational to EU integration, trade, and commerce. Amid global economic strain and geopolitical volatility, the EU ETS review must deliver a harmonized climate policy framework that balances the sector’s competitiveness with its climate ambitions.”
IATA recommends that all international flights—including those within the European Economic Area—be covered by CORSIA without additional regional requirements or overlapping measures. The association also calls for amendments to allow purchase-based claiming for SAF under EU ETS rules through a book-and-claim mechanism. This would help create a transparent market for SAF credits regardless of where fuel is physically supplied.
According to IATA, after free allowances are phased out in 2024, airlines will face higher costs under EU ETS unless more revenue is directed back into supporting sustainable fuels and emerging technologies. The current SAF Allowance scheme only covers an estimated 4-5% of total allowance needs between 2026 and 2030. Investment requirements could reach up to EUR 376 billion by 2050 to meet SAF targets in Europe.
The International Air Transport Association works to enrich the world through a safe, secure and sustainable air transport industry according to its official website. It includes about 360 member airlines accounting for over 80% of global air traffic according to its official website, seeks to represent, lead and serve airlines according to its official website, maintains offices worldwide including headquarters in Montreal as indicated on its official website, engages in global advocacy as outlined on its official website, and Willie Walsh has served as director general per its official website.
Looking ahead, IATA emphasizes that aligning policies with international standards while investing in new technologies will be key for both environmental progress and maintaining Europe’s role in global aviation.
