For the second time, the World Trade Organization's dispute resolution body has established a commission at Russia's request to assess whether the EU's carbon adjustment mechanism and proposed export subsidies under the emissions trading system comply with the bloc's WTO obligations.
The European Union had previously objected to Moscow's first request at a meeting of the dispute resolution body in July.
Russia believes that the CBAM package creates significant trade barriers for goods covered by it and supplied to the EU. Moscow also argues that the benefits provided by the EU to individual companies under the emissions trading system are in fact an export subsidy that increases the competitiveness of a number of industries within the union.
In response, the EU stated that Russia's request arose in an emergency situation: Moscow is accused of trying to assess the compliance of EU norms with international law at the request of a member state that is waging war against another member state in violation of international law. Brussels also called the war an existential challenge for the European Union and stressed that as long as it continues, Russia cannot count on improving access for its exports to the EU market through WTO rules.
At the same time, the EU noted that they will participate in the work of the commission not because they recognize Russia's actions as legitimate, but because of its commitment to a rules-based multilateral trading system.
The European Union is confident that the carbon adjustment mechanism and the free allocation of quotas in the emissions trading system comply with WTO requirements. For this reason, the block is interested in an objective assessment of the dispute by the commission in accordance with the rules of the DSU.
Brussels added that they would only interact with the commission, and not directly with the Russian Federation.
Russia first requested consultations with the EU on this issue in May 2025.