The principle of equality and the scope

The principle of equality seeks to ensure that competitors are treated similarly within the internal market. The difficulty arises when extending the scope of the EU ETS could cover some industries while leaving competitors outside. When those extensions are made by the Community legislator, the right to legislate step-by-step and the margin of discretion afforded by the European courts suggest that a breach of the principle of equality is unlikely. The French Council of State has raised a preliminary question with the ECJ on this issue in relation to the French NAP for the first trading period. The Council of State expressed doubts as to whether including the steel sector while leaving out the aluminium and plastic industries is in line with the principle of equal treatment, since they produce products which compete in the internal market.103 In a similar case, the Belgian Arbitration Court ruled that the Walloon NAP did not breach the principle of equality.104

Moreover, complete harmonization cannot ensure equal treatment in relation to small installations, because rules to determine the coverage may actually lead to differential treatment of competitors. Hence in the latter case there is no clear advantage in introducing complete harmonization of the coverage.

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