🔊CBAM

Carbon Border Adjustment Mechanism (CBAM)

The Carbon Border Adjustment Mechanism (CBAM) is a form of trade tariff that the European Union (EU) aims to introduce to address the issue of carbon leakage – the migration of carbon emissions from countries with stringent emission reduction regulations to those with less strict regulations. CBAM is designed to prevent this phenomenon by imposing carbon-related costs on imported goods from countries with weaker emission reduction regulations, thereby leveling the playing field and incentivizing global efforts to reduce carbon emissions.