The European Parliament has approved its position on the negotiations on amendments to the EU Border Carbon Adjustment Mechanism (CBAM) and approved its extension to finished steel and aluminum products. 464 deputies voted for the decision, 50 opposed it, and 159 abstained.
Parliament supported the proposal to extend CBAM beyond basic materials and include finished products such as fasteners, wire, springs, and household items. At the same time, the deputies called for expanding the list of goods more widely than the European Commission had proposed.
The document also includes an exception for electricity flows from countries outside the EU that are used by grid operators to maintain the stability of the energy system.
Measures against circumvention of CBAM
The European Parliament has proposed to tighten the rules aimed at preventing circumvention of CBAM. In particular, the deputies called for lowering the threshold at which minor changes in products can be considered an attempt to evade obligations under the mechanism.
According to the Parliament's plan, the measures should only apply to those practices that are specifically designed to circumvent CBAM, and not affect ordinary business decisions related to cost reduction.
In addition, the parliamentarians proposed to allow the European Commission to apply standard emission values based on the actual country of origin of the goods, if a specific bypass scheme is identified.
A proposal for a safeguard measure that would allow individual products to be temporarily excluded from CBAM during price shocks was rejected. Instead, Parliament called for a portion of CBAM revenue to be directed to sectors affected by rising prices for related products.
The document also includes a simplified reporting system and a technical assistance mechanism for least developed countries. The provision allowing carbon credits to be deducted from CBAM obligations under article 6 of the Paris Agreement has been deleted from the text.
Temporary Decarbonization Fund
The European Parliament also approved its position on the draft Temporary Decarbonization Fund, which should support EU producers operating in export markets. This decision was supported by 433 deputies, 97 voted against, 146 abstained.
The parliamentarians insist that financial support from the fund be available throughout the entire period of 2027-2029, and not begin only later.
It is also proposed to grant the right to support all processing companies that use CBAM-compliant products in their production. Instead of returning unused revenues to the member states, the Parliament proposed that these funds be used to fulfill the EU's international obligations on climate change.
