Local time, November 19 – The European Parliament passed the revised bill of the Carbon Border Adjustment Mechanism (CBAM, also known as “carbon tariff”) with an overwhelming advantage of 617 votes in favor, 18 against, and 19 abstentions. The core of this new policy is to simplify operational procedures and set a new minimum threshold, excluding enterprises with annual imports of no more than 50 tons from the carbon tariff rules. This adjustment will exempt 90% of importers, mainly small and medium-sized enterprises (SMEs) and individual importers. Notably, while simplifying procedures, the EU remains firm in its climate goals: the revised bill ensures that 99% of imported carbon emissions in key industries such as steel, aluminum, cement, and chemical fertilizers are still subject to supervision.
The carbon tariff is an important tool for the EU to achieve its “2050 climate neutrality” goal. Its core logic is to impose a carbon tax on imported goods to prevent EU enterprises from losing competitiveness due to strict domestic carbon emission policies and avoid the phenomenon of “carbon leakage.” This revision is part of the EU’s “Omnibus I” simplification plan, which was proposed on February 26, 2025, aiming to simplify existing legislation in the fields of sustainable development and investment. The revised bill not only adjusts the exemption threshold but also simplifies the authorization process, carbon emission calculation, verification rules, and the financial responsibilities of declarants, significantly reducing the administrative burden on enterprises.
Antonio De Caro, the rapporteur of the bill, stated: “The original intention of the carbon tariff is to protect EU industries such as cement, steel, and aluminum. We have responded to the demands of enterprises by simplifying procedures and exempting small and medium-sized importers to help enterprises enhance their competitiveness. At the same time, the 99% carbon emission coverage ratio ensures that the EU’s climate ambition remains unaffected, and we will continue to commit to a just transition and the realization of the 2050 carbon neutrality goal.” Currently, the revised bill still needs official approval from the EU Council and will take effect three days after its publication in the EU Official Journal. For global trade, the adjustment of the EU carbon tariff will change the cost structure of international trade, especially having a profound impact on export enterprises in developing countries. Relevant enterprises need to accelerate green transformation and adapt to the EU’s carbon regulatory system in advance.
