EU Exemptions for CBAM
- GMCCTradeteam
- Jul 14
- 1 min read
Updated: Jul 15
EU Set to Exempt Heavy Industry Exports from Carbon Border Levy
The European Commission has confirmed plans to exempt EU exports of steel, aluminium, and cement from its upcoming Carbon Border Adjustment Mechanism (CBAM), aiming to protect key industrial sectors from competitive disadvantage in non-EU markets.
CBAM, set to take full effect in 2026, is designed to impose a carbon price on imports of certain high-emission goods, mirroring the EU’s internal Emissions Trading System (ETS). While this helps prevent “carbon leakage” from non-EU producers, it has raised concerns among EU manufacturers about losing competitiveness abroad.
To address this, the Commission intends to use revenue generated from CBAM to support EU exporters affected by carbon pricing. The proposed exemption would ensure that carbon costs are not applied to goods leaving the EU for markets where no comparable climate measures exist.
The move is expected to be welcomed by EU-based producers, though it has also drawn criticism from climate policy experts, who warn that exemptions may weaken the overall ambition of the EU’s decarbonisation targets.
Further details on the implementation and structure of the export exemption are due later this year, ahead of the full CBAM rollout.
Source: Financial Times
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