Global cement company Cemex (CX) has filed a legal case against the European Commission over a cap on carbon dioxide emissions for its U.K. operations, a court official said Wednesday.
The case, filed at the European Court of First Instance on January 12, is the first challenge in a European Union court involving the bloc’s emissions trading system.
In response, Cemex denied it was suing the commission and said it "fully respects the amount of CO2 allowances allocated to the U.K. by the European Commission."
"Cemex’s complaint is that the allowances allocated to the cement sector by the U.K. government have been unfairly divided, so that Cemex has received fewer allowances, whilst other cement operators have seen their allocations increase," the company said in statement emailed to Dow Jones Newswires.
"Cemex is taking legal action in the European Court of First Instance to have these allowances more fairly divided," it said.
A court official said Cemex wants the Luxembourg court to force the Commission into a partial annulment of its Nov. 29 decision on emissions caps for the U.K. The company hopes a positive outcome will reverse a U.K. decision to cut its carbon dioxide allowances by hundreds of thousands of credits.
The suit could herald a flurry of complaints in the coming days. The commission set strict CO2 emissions limits in late November for 10 E.U. countries, and the deadline for challenging these runs out next week. It reveals how Europe’s carbon trading scheme is creating intense rivalry among industry.
Cemex U.K. filed its case two days after a U.K. court threw out the company’s claim that the U.K. government had gone too far in cutting its emissions allowance at its cement plant in southern England.
The European Commission sets national emissions allowances. National governments must then distribute those allowances among industry.
The court is expected to rule on the issue in the coming months.