C-127/07 Société Arcelor Atlantique et Lorraine and Others v Premier ministre, Ministre de l’Écologie et du Développement durable, Ministre de l’Économie, des Finances et de l’Industrie, judgment of 16 December 2008

The Court confirmed the validity of the directive on the scheme for greenhouse
gas emission allowance trading with regard to the principle of equal treatment
Directive 2003/87/EC establishes a scheme for greenhouse gas emission allowance
trading within the Community with the aim of contributing to compliance with the overall
commitment entered into under the Kyoto Protocol to reduce overall emissions of six
greenhouse gases by 8% as compared with the emission levels recorded in 1990.
Arcelor brought an action before the Conseil d'État [Council of State] for the annulment
of the Decree of 15 April 2004 which transposes that directive in France. The applicant
relied, inter alia, on the infringement of the constitutional principle of equal treatment,
since the Directive provides for a difference in treatment between installations in the
steel sector, which are subject to the allowance trading scheme, and the aluminium and
plastic industries, which, even though they also emit greenhouse gases, are not subject
to that scheme. The Conseil d'État asked the Court of Justice whether the Community
legislature breached the principle of equal treatment by applying unjustifiable different
treatment to comparable situations.
The Court pointed out first of all that the general principle of equal treatment requires
that comparable situations must not be treated differently and different situations must
not be treated in the same way unless such treatment is objectively justified. It held
that the steel, chemical and non-ferrous metal sectors are in fact in a comparable
situation as far as the objective of the directive in question is concerned, even though
they are treated differently.
The Court then considered whether the difference in treatment between these sectors
introduced by the directive at issue can be justified by objective reasons. In this regard,
the Court recalled that the Community legislature has a broad discretion where its action
involves political, economic and social choices and where it is called on to undertake
complex assessments and evaluations. However, it remains obliged to base its choice on
objective criteria appropriate to the aim pursued by the legislation in question.
In this case, the Court took the view, first, that the allowance trading scheme introduced
by Directive 2003/87/EC is a novel and complex scheme whose implementation and
functioning could have been disturbed by the involvement of too great a number of
participants and, second, that the original definition of the scope of the directive was
dictated by the objective of attaining a critical mass of emissions covered by the
scheme.
In this context, the exclusion of the chemical sector, which has a number of particularly
significant installations, from the scope of the Directive can be justified by reason of the
desire to avoid making the allowance trading scheme more difficult and increasing the
administrative burden, and thus to ensure that its functioning is not disturbed. Similarly,
the exclusion of the non-ferrous metal sector is permissible in view of the difference in
its level of emissions as compared with the other sectors covered.
The Court concluded that the Community legislature did not infringe the principle of
equal treatment by excluding the chemical and non-ferrous metal sectors from the
scope of Directive 2003/87/EC.

Source: http://ec.europa.eu/dgs/legal_service/arrets/07c127_en.pdf