Page 125 - Research on Financial Development Mechanism and Path of Forestry Carbon Sequestration in Developing Countries under Double Carbon Targets

Chapter 3 Low-carbon and Economical E-commerce

policy tool for imported products. In addition, the implementation of the CBAM mech-
anism will bring the EU 4-15 billion euros (approximately 5-18 billion US dollars) of
capital revenue each year.
The essence of “CBAM” is to level the carbon costs of domestic and foreign en-
terprises through the power of carbon tariffs. With the gradual withdrawal of the EU-
ETS free quota, CBAM is a new mechanism to prevent carbon leakage. As long as the
carbon price at the place of production (which may be a carbon tax, a carbon fee or the
carbon price of a recognized carbon trading system) is lower than the EU carbon price,
once imported into the EU customs zone, CBAM certificates must be purchased to
make up the difference. This makes non-EU enterprises have to bear the same cost of
carbon reduction as EU enterprises. Therefore, enterprises that are not active in carbon
reduction have a stronger incentive to reduce carbon.
2) Legislative procedures: following the “ordinary legislative procedures”, the Eu-
ropean Commission proposed a draft, which was considered jointly by the European
Parliament and the Council of the European Union
The EU’s carbon tariff policy began in December 2019, when the new president of
the European Commission proposed to include CBAM in the EU’s Green New Deal. In
March 2021, the European Parliament passed a preliminary resolution on the establish-
ment of the CBAM, and the CBAM entered the legislative process. In July 2021, the
European Commission announced the “Fit for 55” climate change response package,
which aims to reduce emissions by 55% by 2030 from 1990 levels. It covers policy
revisions in various areas, including energy, industry, transportation, construction and
carbon trading systems. Among them, the European Commission has submitted the
CBAM legislative proposal, which marks the start of the CBAM legislative process and
is the first carbon border tax policy in the world.
In December 2022, the European Parliament and the European Council reached an
interim agreement to formally establish the CBAM mechanism. In February this year,
the Environment, Public Health and Food Safety Committee (ENVI) of the European
Parliament passed the EU’s carbon border regulation mechanism. In March this year,
CBAM was passed at the meeting of the Economic and Financial Affairs Committee of
the European Council. In April this year, the European Parliament and the Council of
the European Union voted successively to pass the CBAM plan, formally completing
the legislative process, and the bill came into force on May 17.
3) Implementation stage: two-stage implementation, after 2025, the free quota will
be completely cancelled.

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