The European Commission Plans New Measures to Prevent Evasion of Cross-Border CO₂ Tax.
The European Commission is expected to propose measures by the end of the year aimed at preventing companies exporting goods to the European Union from circumventing the cross-border carbon tax.
Brussels is concerned that exporters from third countries could send their low-emission goods to the EU, while continuing to sell high-emission products to other markets—resulting in no real reduction in their overall carbon footprint, according to a report by Reuters.
The Carbon Border Adjustment Mechanism (CBAM), set to enter into force on January 1, 2026, will impose a levy on CO₂ emissions embedded in goods imported into the EU from countries that do not have equivalent carbon pricing mechanisms. The tax will initially apply to cement, iron and steel, aluminum, fertilizers, electricity, and hydrogen.
The CBAM is expected to have a significant impact on the EU’s neighboring countries, including those in the Western Balkans.
- Possibel CBAM Expansion to Additional Products.
The European Commission has expressed concern that foreign companies might attempt to bypass CBAM by diverting their low-carbon products to the European market, while continuing to produce and export high-emission goods to other regions. Such behavior would undermine the core objective of CBAM, as it would not lead to an actual reduction in total emissions.
To address this issue, the Commission intends to propose an expansion of CBAM to additional product categories, according to a spokesperson.
- Fixed Emissions Values Could Be Assigned Per Country or Company.
The Commission is also considering a system under which imported goods would be assigned a fixed CO₂ emissions value based on the exporting country or company, rather than calculating emissions on a shipment-by-shipment basis, the agency reported, citing a senior EU official.
The official also suggested that Chinese exporters may potentially seek to circumvent CBAM using this approach.
Exporters from third countries, particularly in the electricity sector, are reportedly struggling to adapt to the new system and have requested a postponement of the CBAM implementation.
However, the Brussels administration is not prepared to consider delaying the enforcement date.
Source: Balkan Green Energy News