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Joint NGO statement on the Carbon Border Adjustment Mechanism

Societies and businesses face increasing uncertainty due to more frequent and intense extreme weather events, instability in global energy and commodity markets, and unclear climate commitments by key international partners.

The European Green Deal potentially provides a broad and strong suite of policy tools that have the power to create the necessary stability and certainty to succeed in the transition to climate neutrality, if high ambition levels are maintained and if contentious policies, such as the Carbon Border Adjustment, Mechanism (CBAM) are addressed with sensitive and sensible climate diplomacy.

These are our top five recommendations for a fair and effective CBAM:

1. The CBAM should remain an alternative to the EU Emission Trading System’s (ETS) carbon leakage framework and, therefore, it should be introduced in combination with the full and immediate phase-out of free allowances.

2. The CBAM’s scope should be extended to address other bulk chemicals, namely plastics, and should also address indirect emissions as well as direct emissions from the start.

3. Least developed countries and small islands should be given special consideration including by facilitating technology transfer of know-how and independent consultation, to support the rapid decarbonisation of carbon intensive sectors.

4. CBAM revenues should be channelled to support climate action outside the EU, providing an intentional, structured and consistent contribution from the EU to the most vulnerable countries in the form of international climate finance.

5. Do not include export rebates, which have not been included in the European Commission’s proposal. Offering EU industry such rebates would create perverse incentives for European producers to export more polluting products, which is in direct conflict with one of the CBAM’s main objectives of driving international climate ambition to remain within the 1.5°C temperature rise limit.

The statement is a result of an ongoing collaboration between the signatory organisations: Carbon Market Watch, Climate Action Network Europe, E3G, the European Environmental Bureau and the WWF European Policy Office, and the hundreds of member organisations of the mentioned federations.


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