EU Reforms Carbon Import Rules

In a significant move, the European Parliament and the Council have agreed to simplify the EU’s carbon border adjustment mechanism (CBAM). The new agreement, reached under the “Omnibus I” simplification package, introduces a de minimis mass threshold of 50 tonnes per importer per year. This change exempts 90% of importers, largely small and medium-sized enterprises, from CBAM rules while maintaining coverage of 99% of CO2 emissions from key imports.

The CBAM is designed to prevent carbon leakage and protect European industries such as cement, iron, steel, aluminum, and fertilisers. The simplification efforts aim to reduce the administrative burden on small importers while keeping the EU’s climate objectives intact. The reform package includes streamlined procedures for authorisation, emissions calculation, and verification, alongside strengthened anti-abuse measures.

Antonio Decaro, the rapporteur for the agreement, emphasized the balance between economic competitiveness and environmental ambition. “We have maintained the EU’s environmental ambitions and remain fully committed to a just transition and achieving climate neutrality by 2050,” Decaro stated.

The agreement is pending endorsement from both Parliament and Council and will take effect three days after its publication in the EU Official Journal. This reform is part of broader efforts to align the EU’s carbon policies with global climate goals while supporting domestic industries.