The European Union is committed to minimizing the challenges its exporters face due to the implementation of the Carbon Border Adjustment Mechanism (CBAM), according to Gerassimos Thomas, Director General for Tax. Speaking at the COP29 climate conference in Baku, Thomas highlighted that the European Commission is advancing its review of CBAM regulations to 2024, with a plan to propose targeted adjustments by 2026. The measure aims to prevent industries like steel and aluminum from relocating to evade stringent EU climate policies. However, exporters within the bloc have raised concerns over increased costs and reduced competitiveness as they begin to pay higher emissions-related expenses.

To address these challenges, the Commission plans to explore solutions that include simplifying compliance for small and medium-sized enterprises (SMEs) by reducing administrative burdens. Additionally, broader initiatives to support domestic industries during the energy transition are under consideration. These efforts align with EU President Ursula von der Leyen’s priority of ensuring industrial competitiveness while achieving net-zero targets. While past mechanisms for assisting EU exporters faced potential conflicts with World Trade Organization rules, Thomas emphasized the Commission’s commitment to finding legally viable ways to balance environmental goals with economic stability.

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