Norwegian Wins Oslo Court Case on EU ETS Obligations

The Oslo District Court has ruled in favor of Norwegian Air, stating the airline was not required to fulfill its European Union Emissions Trading System (EU ETS) obligations for 2020 during its restructuring amid the pandemic. The court also deemed it unlawful for Norway’s government to fine the airline NOK399.7 million (USD35.1 million) for not meeting climate quota payments.

In a stock exchange filing, Norwegian Air confirmed the court recognized its right to meet EU ETS obligations for 2020 through “offering a dividend corresponding to the allowance obligations.” Norwegian CEO Geir Karlsen welcomed the decision, highlighting the court’s acknowledgment of the airline’s unique circumstances during reconstruction and its focus on reducing its climate impact.

The case follows an August ruling by the European Free Trade Association (EFTA) court, which found that the penalty could not be resolved via a dividend. Norway’s Ministry of Climate and Environment retains the right to appeal the ruling.

The fine stemmed from Norway’s failure to transfer 372,818 emissions quotas to the settlement account in the EU ETS climate register. Norwegian Air argued that fulfilling these obligations during restructuring would have led to criminal liability. While restructuring operations in Ireland, Norwegian’s defunct subsidiary faced no such penalties from Irish authorities.

Norwegian had initially paid the fee in 2023 but sought legal clarification and reimbursement with interest, pending a final resolution of the matter. This ruling allows the airline to fully focus on its operational and sustainability goals.

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Sources: AirGuide Business airguide.info, bing.com, ch-aviation.com