29 Amendments of Jörgen WARBORN related to 2021/0214(COD)
Amendment 96 #
Proposal for a regulation
Recital 11
Recital 11
(11) The CBAM seeks to replacestrengthen carbon leakage protection in view of higher EU climate ambitions by 2030 and thereafter replace progressively these existing mechanisms by addressing the risk of carbon leakage in a different way, namely by ensuring equivalent carbon pricing for imports and domestic products. To ensure a gradual transition from the current system of free allowances to the CBAM, the CBAM should be progressively phased in while free allowances in sectors covered by the CBAM are phased out and by ensuring that EU products exported in the global market are not replaced by more carbon intensive products, which would undermine the objective of reducing global emissions. To ensure a gradual transition from the current system of free allowances to the CBAM, free allowances should only be phased out once the CBAM regulation has proven its effectiveness in terms of protection from the risk of carbon leakage both for imports and exports, not before 2030 and only following a three years test phase running from 2026 to 2028 during which the effectiveness of the mesure will be throughly assessed by the Commission. The combined and transitional application of EU ETS allowances allocated free of charge and of the CBAM should in no case result in more favourable treatment for Union goods compared to goods imported into the customs territory of the Union.
Amendment 114 #
Proposal for a regulation
Recital 12 a (new)
Recital 12 a (new)
(12 a) While the surrenderingof CBAM certificates for EU importers addresses the risk of carbon leakage on the EU market, it is essential that the CBAM would also seek to reduce the possibility of European low-carbon exports being replaced by carbon-intensive items on third country markets or by goods that are not subject to equivalent climate policy and carbon costs, undermining the goal of lowering global emissions. It is therefore necessary to continue addressing the risk of carbon leakageassociated with European exports to third countries that have not yet limited or priced GHG emissions at the same levels as the EU.
Amendment 116 #
Proposal for a regulation
Recital 12 b (new)
Recital 12 b (new)
(12 b) This Regulation does not apply to goods exported from the EU and therefore does not address carbon leakage associated with exports. Consequently, the Commission should monitor and evaluate the mechanism’s impact on export markets and, if the assessment of the effectiveness of the CBAM in tackling carbon leakage on the EU market is positive, after the three year test period, the Commission shall present a report to the European Parliament and Council accompanied with a legislative proposal to address the carbon leakage risk on export markets while starting the free allocation phase out as set out in the ETS directive.
Amendment 119 #
Proposal for a regulation
Recital 12 c (new)
Recital 12 c (new)
(12 c) If European industries producing goods subject to the CBAM face significant difficulties as a result of its implementation, the Commission develops an in-depth assessment in close collaboration with the industrial secotrs. This assessment should be completed as soon as possible to determine whether the mechanism is effective and practible.
Amendment 122 #
Proposal for a regulation
Recital 13
Recital 13
(13) As an instrument to prevent carbon leakage and reduce GHG emissions the CBAM should ensure that imported products are subject to a regulatory system that applies carbon costs equivalent to the ones that otherwise would have been borne under the EU ETS. The CBAM is a climate measure which should prevent the risk of carbon leakage and support the Union’s increased ambition on climate mitigation, while ensuring WTO compatibility; imports and domestic production shall be treated in the same way to ensure WTO compatibility; the CBAM shall ensure a level playing field between EU domestic and foreign producers, ensure full protection against carbon leakage for European industry and avoid emission transfers to third countries; as well as the impact on exports and dependent sectors along the value chain.
Amendment 132 #
Proposal for a regulation
Recital 15
Recital 15
(15) In order to exclude from the CBAM third countries or territories fully integrated into, or linked, to the EU ETS and where the carbon cost burden is equivalent to that under the EU ETS, in the event of future agreements, the power to adopt acts in accordance with Article 290 of TFEU should be delegated to the Commission in respect of amending the list of countries in Annex II. Conversely, those third countries or territories should be excluded from the list in Annex II and be subject to CBAM whereby they do not effectively charge the ETS price on goods exported to the Union.
Amendment 143 #
Proposal for a regulation
Recital 19
Recital 19
(19) However, while the EU ETS sets an absolute cap on the GHG emissions from the activities under its scope and allows tradability of allowances (so called ‘cap and trade system’), the CBAM shouldall not establish or lead to quantitative limits to import, so as to ensure that trade flows are not restricted or constrain trade flows. Moreover, while the EU ETS applies to installations based in the Union, the CBAM should initially be applied to certaina limited scope of goods imporlisted into the customs territory of the Union Annex I, after close review, the scope should be extended to also include finished goods.
Amendment 148 #
Proposal for a regulation
Recital 20
Recital 20
(20) The CBAM system has some specific features compared with the EU ETS, including on the calculation of the price of CBAM certificates, on the possibilities to trade certificates and on their validity over time. These are due to the need to preserve the effectiveness of the CBAM as a measure preventing carbon leakage over time and to ensure that the managemadministrative burdent of the system is not excessively burdensomekept to a minimum in terms of obligations imposed on the operators and of resources for the administration, while at the same time preserving an equivalent level of flexibility available to operators under the EU ETS.
Amendment 151 #
Proposal for a regulation
Recital 21
Recital 21
(21) In order to preserve its effectiveness as a carbon leakage measure, the CBAM needs to reflect closely the EU ETS price. While on the EU ETS market the price of allowances is determined through auctions, the price of CBAM certificates should reasonably reflect the price of such auctions through averages calculated on a weekly basis. Such weekly average prices reflect closely the price fluctuations of the EU ETS and allow a reasonable margin for importers to take advantage of the price changes of the EU ETS while at the same ensuring that the system remains manageable for the administrative authoritystem at the same time needs to consider the costs and administrative burden impacting EU downstream industries.
Amendment 152 #
Proposal for a regulation
Recital 21 a (new)
Recital 21 a (new)
(21 a) In order to keep any additional burden to an absolute minimum the CBAM should be easy to administer and not place an undue burden on enterprises, especially small and medium- sized enterprises (SMEs).
Amendment 154 #
Proposal for a regulation
Recital 23
Recital 23
(23) Given that the CBAM applies to imports of goods into the customs territory of the Union rather than to installations, certain adaptations and simplifications would also need to apply in the CBAM regime. One of those simplifications should consist in a declarative system where importers should report the total verified GHG emissions embedded in goods imported in a given calendar year. A different timing compared to the compliance cycle of the EU ETS should also be applied to avoid any potential bottleneck resulting from obligations for accredited verifiers under this Regulation and the EU ETS. The transition period should be of adequate timeframe to allow European companies to adjust and focus on low carbon investments.
Amendment 163 #
Proposal for a regulation
Recital 29
Recital 29
(29) The goods under this Regulation should be selected after a careful analysis of their relevance in terms of cumulated GHG emissions and risk of carbon leakage in the corresponding EU ETS sectors while limiting complexity and administrative burden. In particular, the actual selection should take into account basic materials and basic products covered by the EU ETS with the objective of ensuring that imports of energy intensive products into the Union are on equal footing with EU products in terms of EU ETS carbon pricing, and to mitigate risks of carbon leakage. A mechanism centred solely on basic materials could lead to a shift in imports towards intermediate and final products not covered by the mechanism, thereby affecting the EU industry and increasing the risk of carbon leakage; A thorough, proper and comprehensive impact assessments should be done after the transition period also aimed to identify measures for sectors where the risk of carbon leakage is highest, while taking into consideration the sector’s competitiveness; This requires transparency throughout of the process leading to the CBAM, as well as engagement with the EU’s trading partners and to avoid any possible retaliations. Other relevant criteria to narrow the selection should be: firstly, relevance of sectors in terms of emissions, namely whether the sector is one of the largest aggregate emitters of GHG emissions; secondly, sector’s exposure to significant risk of carbon leakage, as defined pursuant to Directive 2003/87/EC; thirdly, the need to balance broad coverage in terms of GHG emissions while limiting complexity and administrative effort.
Amendment 184 #
Proposal for a regulation
Recital 38
Recital 38
(38) As importers of goods covered by this Regulation should not have to fulfil their CBAM obligations under this Regulation at the time of importation, specificonly necessary administrative measures should be applied to ensure that the obligations are fulfilled at a later stage. Therefore, importers should only be entitled to import CBAM goods after they have been granted an authorisation by competent authorities responsible for the application of this Regulation.
Amendment 202 #
Proposal for a regulation
Recital 52
Recital 52
(52) The Commission should evaluate the application of this Regulation before the end of the transitional period and report to the European Parliament and the Council. The report of the Commission should in particular focus on possibilities to enhance climate actions towards the objective of a climate neutral Union by 2050. The Commission should, as part of that evaluation, initiate collection of information necessary to prevent distortion of competition in the EU and in global markets and possibly extend the scope to indirect emissions, as well as to other goods and services at risk of carbon leakage, and to develop methods of calculating embedded emissions based on the environmental footprint methods47 . With regard to indirect emissions, the evaluation shall take into account the exposure of EU producers to carbon costs passed on in electricity prices due to the functioning of the EU energy market. _________________ 47 Commission Recommendation 2013/179/EU of 9 April 2013 on the use of common methods to measure and communicate the life cycle environmental performance of products and organisations (OJ L 124, 4.5.2013, p. 1).
Amendment 204 #
Proposal for a regulation
Recital 52
Recital 52
(52) The Commission should evaluate the application of this Regulation before the end of the transitional period and report to the European Parliament and the Council. The report of the Commission should in particular focus on possibilities to enhance climate actions towards the objective of a climate neutral Union by 2050, without hindering the efficiency of trade with goods covered by the CBAM. The Commission should, as part of that evaluation, initiate collection of information necessary to possibly extend the scope to indirect emissions, as well as to other goods and services at risk of carbon leakage, and to develop methods of calculating embedded emissions based on the environmental footprint methods47 . _________________ 47 Commission Recommendation 2013/179/EU of 9 April 2013 on the use of common methods to measure and communicate the life cycle environmental performance of products and organisations (OJ L 124, 4.5.2013, p. 1).
Amendment 216 #
Proposal for a regulation
Recital 54
Recital 54
(54) The Commission should strive to engage in an even handed manner and in line with the international obligations of the EU, with the third countries whose trade to the EU is affected by this Regulation, to explore possibilities for dialogue and cooperation with regard to the implementation of specific elements of the Mechanism set out this Regulation and related implementing acts. It should also explore possibilities for concluding agreements to take into account their carbon pricing mechanism, provided that they deliver equivalent GHG emissions reductions and carbon costs constraints.
Amendment 217 #
Proposal for a regulation
Recital 54
Recital 54
(54) The Commission should strive to engage in an even handed manner and in line with the international obligations of the EU, with the third countries whose trade to the EU is affected by this Regulation, to explore possibilities fornsure dialogue and enhance cooperation with regard to the implementation of specific elements of the Mechanism set out this Regulation and related implementing acts. It should also explore possibilities for concluding agreements to take into account their carbon pricing mechanism.
Amendment 232 #
Proposal for a regulation
Article 1 – paragraph 1
Article 1 – paragraph 1
1. This Regulation establishes a carbon border adjustment mechanism (the ‘CBAM’) for addressing greenhouse gas emissions embedded in the goods referred to in Annex I, upon their importation into the customs territory of the Union, in order to prevent the risk of carbon leakage from the EU and contribute to the reduction of global carbon emissions.
Amendment 235 #
Proposal for a regulation
Article 1 – paragraph 3
Article 1 – paragraph 3
3. The mechanism willshould progressively become an alternative to the mechanisms established under Directive 2003/87/EC to prevent the risk of carbon leakage, notably the allocation of allowances free of charge in accordance with Article 10a of that Directive, if it has been proven to be effective in preventing carbon leakage both for imports into and exports from the Union’s custom territory, and without prejudice to maintaining EU ETS allowances free of charge at benchmark level until a test period with actual surrendering obligation by declarants running until 2030 has proven such effectiveness.
Amendment 262 #
Proposal for a regulation
Article 2 – paragraph 12
Article 2 – paragraph 12
12. The Union, may conclude agreements with third countries with a view to take account of carbon pricing mechanisms in these countries in the application of Article 9. These agreements shall not lead to undue preferential treatment of imports from third countries as regards the CBAM certificates to be surrendered and they must not take into account any carbon pricing mechanisms that are considered to be circumvention practices under Article 27.
Amendment 317 #
Proposal for a regulation
Article 10 – paragraph 6
Article 10 – paragraph 6
6. The records referred to in paragraph 5, point (c), shall be sufficiently detailed to enable the verification in accordance with paragraph 5, point (b), and to enable any competent authority to verify and to review, in accordance with Article 19(1), the CBAM declaration made by an authorised declarant to whom the relevant information was disclosed in accordance with paragraph 8.
Amendment 355 #
Proposal for a regulation
Article 15 – paragraph 3
Article 15 – paragraph 3
3. If irregularities are identified as a result of the controls carried out under paragraph 2, the Commission shall inform the Member State or Member States concerned for further investigation in order to correct the identified irregularities. Identified irregularities shall be corrected as soon as possible from their identification and, where appropriate, penalties pursuant to article 27 shall apply.
Amendment 417 #
Proposal for a regulation
Article 27 – paragraph 2
Article 27 – paragraph 2
2. Practices of circumvention include situations where a change in the pattern of trade in relation to goods included in the scope of this Regulation whether slightly modified or not, stems from a practice, process or work, has insufficient due cause or economic justification other than avoiding obligations as laid down in this Regulation and consist in replacing those goods with slightly modified products, which are not included in the list of goods in Annex I but belong to a sector included in the scope of this Regulation.
Amendment 419 #
2 a. The practice, process or work referred to in the first subparagraph include, inter alia: (a) the slight modification of the product concerned to make it fall under customs codes which are normally not subject to the obligations of this Regulation, provided that the modification does not alter its essential characteristics; (b) false declarations as to the identity of the producer of the product concerned or of the nature of the product concerned or the production process involved in making it; (c) the consignement of the product concerned via third countries to which no or more favourable obligations apply; (d) the reorganisation by exporters or producers of their patterns and channels of sales in order to eventually avoid obligations as laid down in this Regulation,or undermine their effects, including on overall GHG emissions and on prices of the like products, for instance via practices of resource shuffling;For thepurpose of this point, resource shuffling shall be defined as any practice, process or work that have insufficient due cause or economic justification other than avoiding obligations as laid down in this Regulation, or undermining their effects, without delivering environmental benefits on global GHGemissions; (e) any other measure to eventually avoid or evade obligations as laid down in this Regulation, or undermine their effects, including onoverall GHG;
Amendment 434 #
Proposal for a regulation
Article 27 – paragraph 3 a (new)
Article 27 – paragraph 3 a (new)
3 a. Following a notification from a Member State, an interested party or on its own initiative, the Commission may decide, following an investigation, to extend obligations laid down in this regulation, in whatever way is necessary to prevent future circumvention of the mechanism, when circumvention of the measures in force is taking place.
Amendment 449 #
Proposal for a regulation
Article 27 – paragraph 5 c (new)
Article 27 – paragraph 5 c (new)
5 c. Investigations shall be carried out by the Commission. The Commission may be assisted by customs authorities and the investigation shall be concluded in due time.
Amendment 451 #
Proposal for a regulation
Article 27 – paragraph 5 d (new)
Article 27 – paragraph 5 d (new)
5 d. The Commission Decision finding circumvention shall impose a penalty pursuant to article 26 on an Authorised Declarant involved in the circumvention and, if appropriate, the operator of the installation located in the third country that is linked to the Authorised Declarant. Where appropriate, the penalty shall also entail the withdrawal of import authorisation and be extended to the operator.
Amendment 461 #
1. The Commission shall be assisted by the CBAM Committee. The committee shall be a committee within the meaning of Regulation (EU) No 182/2011. The CBAM committee should include representatives from enterprises affected by the Regulation to ensure transparency, as well as mitigate risk of litigation and possible trade disputes.
Amendment 480 #
Proposal for a regulation
Article 30 – paragraph 2
Article 30 – paragraph 2
2. Before the end of the transitional period, the Commission shall present a report to the European Parliament and the Council on the application of this Regulation. The report shall contain, in particular, the assessment of the possibilities to further extend the scope of embedded emissions to indirect emissions and to other goods at risk of carbon leakage than those already covered by this Regulation, as well as an assessment of the governance system as well as an assessment of the impact on competitiveness of the EU downstream industry. It shall also contain the assessment of the possibility to further extend the scope to embedded emissions of transportation services as well as to goods further down the value chain and services that may be subject to the risk of carbon leakage in the future.