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S&Ds: The polluter pays, no matter where they pollute – a Carbon Border Adjustment Mechanism Fit for 55


21 Jun 2022


Climate & Environment

Thanks to the S&D Group’s relentless efforts, the European Parliament is set to approve tomorrow the Carbon Border Adjustment Mechanism (CBAM). This will come across as a crucial tool to reduce greenhouse-gas emissions by at least 55% by 2030 - compared to 1990 levels - as set out in the Fit for 55 package, in compliance with the European Climate Law’s aim of making Europe the first carbon-neutral continent by 2050.

After the troublesome vote in the previous plenary session in Strasbourg, we managed to reach an important agreement within the European parliament that includes our major priorities: we have extended the scope to chemicals, hydrogen and polymers. CBAM will go into force in 2027 and there will be a full phase-out of the CBAM sectors in 2032.

This agreement will ensure stability and transparency to all producers worldwide: if you want to sell your products in the EU, you need to pay for your pollution.

S&D vice-president and rapporteur for CBAM, Mohammed Chahim MEP, said:

“Tomorrow, the European Parliament is set to endorse the Carbon Border Adjustment Mechanism (CBAM), the only tool within the Fit for 55 package that can incentivise our trading partners to decarbonise. We took an important step to consolidate the European Parliament’s position on a future-proof CBAM.

“The simple, but powerful, principle that has inspired our hard work is: it doesn’t matter where the carbon is produced, the polluter must pay. Paying for CO2 emissions will now become a condition for entering your products in the European single market.

“Therefore, thanks to CBAM, the EU will finally have a tool to incentivise clean production worldwide. This will also level the playing field and apply the same CO2 price on imported products as we do for our own European producers, preventing unfair competition between EU and non-EU industries. We are glad the EU Parliament finally agreed to kick off CBAM in 2027 and phase out free allowances by 2032.

“This will allow us to finally apply a full carbon price signal, which makes our Emissions Trading System (ETS) fit for frontrunners. We need to start producing in a clean and sustainable way - in Europe and elsewhere.

“Now the battle moves on to the negotiations with the Council. We’ll continue the fight to make CBAM, and the whole Fit for 55 package, live up to our climate ambitions.”




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