Joint NGO statement on the Carbon Border Adjustment Mechanism

A joint NGO statement arguing that the EU's Carbon Border Adjustment Mechanism (CBAM) must remove the overlap with free ETS allowances, expand its sectoral scope, provide special considerations for vulnerable nations, and redirect all revenues to international climate finance to avoid being a 'protectionist' measure.

• The overlap between the CBAM and the free allocation of emission allowances is counterproductive and unnecessary. The NGOs argue that continuing free allowances until 2035, as proposed by the Commission, delays the 'polluter pays principle' and reduces the incentive for EU industry to decarbonise. According to the European Commission's own impact assessment, removing free allowances in target sectors results in significant additional emission reductions without substantial carbon leakage risk.
• The CBAM's scope should be expanded to include all highly-emitting industrial sectors, specifically adding bulk chemicals and plastics. Furthermore, the mechanism should cover 'scope 2' indirect emissions from electricity used in manufacturing to encourage the adoption of renewable energy and cleaner production processes.
• The EU should provide special treatment for Least Developed Countries (LDCs) and Small Island Developing States (SIDS) to recognize the principle of 'common but differentiated responsibilities'. This could include 'de facto' exemptions from the CBAM or a structured action plan for technology transfer and financial support to manage economic risks and facilitate decarbonisation.
• All revenues generated from CBAM certificates should be earmarked for climate action outside the EU and recycled into international climate finance for developing countries. The NGOs oppose the European Commission's proposal to use these funds as 'own resources' to repay debt from the EU Covid-19 recovery package, arguing this would be perceived as a protectionist fiscal measure.
• The CBAM must exclude export rebates for European companies. The NGOs argue that such rebates would be incompatible with World Trade Organisation (WTO) rules and create 'perverse incentives' by encouraging the redirection of carbon-intensive production toward export markets.

APA

Carbon Market Watch (n.d.). Joint NGO statement on the Carbon Border Adjustment Mechanism. https://carbonmarketwatch.org/wp-content/uploads/2021/12/Joint-NGO-statement-on-CBAM-proposal-final.pdf

Chicago

Carbon Market Watch. Joint NGO statement on the Carbon Border Adjustment Mechanism. n.d. https://carbonmarketwatch.org/wp-content/uploads/2021/12/Joint-NGO-statement-on-CBAM-proposal-final.pdf.

Wikipedia

{{cite press release |author=Carbon Market Watch |title=Joint NGO statement on the Carbon Border Adjustment Mechanism |url=https://carbonmarketwatch.org/wp-content/uploads/2021/12/Joint-NGO-statement-on-CBAM-proposal-final.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@misc{carbonmarketwatchndjoint, author = {{Carbon Market Watch}}, title = {{Joint NGO statement on the Carbon Border Adjustment Mechanism}}, publisher = {Carbon Market Watch}, url = {https://carbonmarketwatch.org/wp-content/uploads/2021/12/Joint-NGO-statement-on-CBAM-proposal-final.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }