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France: Constitutional Council Invalidates Carbon Tax

(Jan. 5, 2010) On December 29, 2009, France's Constitutional Council, which ensures the constitutionality of laws prior to their promulgation by the President of the Republic, invalidated the carbon tax set forth in article 7 of the draft 2010 Finance Law. The tax on carbon-emitting products was scheduled to take effect on January 1, 2010, and was set at €17 (about US$24) per ton of carbon dioxide emissions. (CC Decision 2009-599DC of Dec. 29, 2009, Constitutional Council website, available at

The Council noted that the draft Law included too many exemptions and reliefs. The Law, for example, exempted 1,018 of the sites of the worst polluters, including refineries, certain types of chemical plants, air transport, the double-use items industry, and cement plants. It also provided for reduced rates for farming and fishing activities (id). As a result, the Council found, “93 percent of carbon dioxide emissions of industrial origin, other than fuel, will be totally exempt from the carbon tax.” The Decision also stated that “the exemptions included in the carbon tax run counter to the aim of fighting climate change and create inequalities with respect to public charges.” (Id.) The Council, therefore, found that article 7 of the draft 2010 Finance Law violated the principle of equality before the tax system (id.).

Prime Minister Francois Fillon stated that he would present a new law to the Council of Ministers in January that would take into account the concerns of the Constitutional Council. (Nicolas Sarkozy reste “très déterminé” après l'annulation de la contribution carbonne, LEMONDE.FR, Dec. 29, 2009, available at
.) (See also Wendy Zeldin, Carbon Tax Plan, GLOBAL LEGAL MONITOR, Sept. 21, 2009, available at