EU Parliament Agrees to Simplify CO2 Tariffs RulesBrussels, 22 May (ONA) — European Union (EU) lawmakers today voted to
simplify the bloc’s carbon-pricing system for the import of
high-emission products.
Under the pricing system, companies importing goods like iron, steel,
aluminium, cement or fertilizers have to pay the difference between
the carbon price paid in the country of production and the carbon
price in the EU.
Introduced in 2023, the carbon border adjustment mechanism (CBAM) was
intended to tackle so-called carbon leakage, when CO2-intensive
industries move production elsewhere due to strict climate laws. But
it was swiftly criticized as an administrative burden on businesses.
In a larger effort to cut red tape in the EU, the European Commission
proposed in February 2025 to restrict CBAM to businesses that import more
than 50 metric tons of listed goods annually.
This means that 90% of EU importers, namely small companies and
individuals, would be exempt from the CO2 pricing system, which would
still cover 99% of emissions, the commission said at the time.
EU lawmakers gathered in Brussels backed the proposal with 564
members of parliament voting in favour, 20 votes against and 12
abstentions.
The parliament said that under the proposed changes, CBAM would still
be able to achieve its environmental objectives as almost all
emissions from CO2-intensive imports would still be covered.
“The CBAM is a crucial instrument to help the EU prevent carbon
leakage and incentivise climate action outside the EU,” said Italian
lawmaker Antonio Decaro in charge of the file.
As a next step, the EU Parliament will start negotiations with member
states on the details of the reform.
— Ends/Khalid