Starting from January 1, 2026, the European Union's Carbon Border Adjustment Mechanism (CBAM) officially entered its implementation phase, marking the full rollout of the world's first cross-border carbon tariff system. According to the mechanism's requirements, companies exporting specific high-energy-consumption, high-emission products such as steel, aluminum, cement, fertilizers, electricity, and hydrogen to the EU must now purchase corresponding CBAM certificates for the embedded carbon emissions of their products. Carbon costs will be directly integrated into the international trade accounting system.

Q&A with the Spokesperson of the Ministry of Commerce on the EU's Carbon Border Adjustment Mechanism (CBAM)

Q: The EU's Carbon Border Adjustment Mechanism (CBAM) officially came into effect on January 1, 2026. The EU has recently released a series of legislative proposals and implementation rules related to CBAM. What is the Ministry of Commerce's comment on this?

A: China has noted that the EU has recently released a series of legislative proposals and implementation rules related to CBAM, including setting default values for carbon emission intensity and planning to expand the scope of covered products. Among these, the EU, disregarding China's significant achievements in green and low-carbon development, has set a significantly higher baseline default value for the carbon emission intensity of Chinese products, which will be increased annually over the next three years. This does not align with China's current actual levels and future development trends and constitutes unfair and discriminatory treatment toward China. The EU's approach not only potentially violates WTO principles such as "most-favored-nation treatment" and "national treatment" but also contradicts the principle of "common but differentiated responsibilities" established under the United Nations Framework Convention on Climate Change.

The EU has also proposed a legislative draft planning to expand the scope of CBAM from 2028 to include approximately 180 types of steel- and aluminum-intensive downstream products, such as machinery and equipment, automobiles and their parts, and household appliances. These rule designs go beyond the scope of addressing climate change and carry clear unilateralist and trade protectionist undertones. China expresses serious concern and firm opposition to this.

China has also noted that the EU recently revised its 2035 ban on new internal combustion engine vehicles, relaxing green regulations within the bloc. On the one hand, the EU engages in protectionism under the guise of green policies externally, while on the other hand, it relaxes internal regulations and lowers emission reduction requirements. This contradictory approach is a typical example of double standards.

The EU, ignoring historical emission responsibilities, national development stages, and technological levels, is promoting new trade protectionism under the climate pretext of preventing "carbon leakage." It imposes its own carbon standards on developing countries, causing conflicts between climate and trade governance rules, increasing the cost of climate action for developing countries, and severely undermining international mutual trust. This runs counter to the efforts of all parties to cooperate in addressing climate change and advancing sustainable development.

We hope the EU will adhere to international rules on climate and trade, abandon unilateralism and protectionism, maintain market openness, and promote the liberalization and facilitation of trade and investment in the green sector based on principles of fairness, science, and non-discrimination. China is willing to work with the EU to jointly address the challenges of global climate change. However, China will resolutely take all necessary measures to respond to any unfair trade restrictions, safeguard its own development interests, the legitimate rights and interests of Chinese enterprises, and the stability of the global industrial and supply chains.