AFEP position on a possible European border carbon adjustment mechanism

In the context of the Commission work on a possible Border Carbon Adjustment mechanism, AFEP stresses its interest for an impact assessment on such a mechanism for certain particularly sensitive sectors, at a time when climate-related obligations are very different between the EU and other regions of the world.  

 AFEP also raises the main following issues: 

  • Put the maintaining of the competitiveness of industrial installations located in the EU, which are exposed to the international competition and have the best carbon efficiency ratios, on an equal footing with the enhancement of the EU contribution to the global effort of emission reductions.  
  • Include indirect emissions in the design of the mechanism. 
  • Consider in the scope of the impact assessment the existing tools to fight carbon leakage (free allowances, indirect emission compensations) and identify how to avoid adverse effects on downstream sectors. 
  • Assess the conditions governing the compatibility of the evaluated tools with WTO rules, as well as the other international law provisions, including in the field of climate change. 
  • Analyse in the impact assessment the effects of retaliation measures and include in the scope trade policy measures coming from national policies or bilateral/multilateral agreements.