World - Europe
Updated: December 13, 2022

European Union Strikes Deal On Carbon Border Tariff

By Quadri Adejumo
December 13, 2022
0

The European Union have agreed to impose a tariff on imports of polluting goods – such as iron, steel, fertilisers, aluminium and electricity.

The scheme which is the first of its kind is known as the Carbon Border Adjustment Mechanism (CBAM) and will cover industrial imports from the EU’s 27 member states.

The deal was reached on Tuesday in Brussels, and it will require companies, both domestic EU industries and overseas ones, to buy certificates to cover their embedded CO2 emissions.

Companies outside the EU are already required to buy permits from the EU carbon market when they pollute.

The test period for the agreement will begin in October 2023, during which importing companies will have to report their carbon emission obligations.

The tariff is part of a package of EU policies designed to help the world avoid disastrous climate change by cutting EU emissions 55 per cent by 2030 from 1990 levels.