Select committee: Environmental Audit Committee
Recommendation 8
Fifth Report - Greening imports: a UK carbon border approach
Published 4 Apr 2022
Paragraph 54
Environmental Audit Committee Carbon border adjustment mechanisms All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗
Recommendation (the committee's words)
Our recommendations to Government on the design of the carbon border approach are as follows: a) to ensure, from the outset, that the carbon border approach is designed to adhere to the principles of common but differentiated responsibilities and respective capabilities set out in the Paris Agreement and Glasgow Climate Pact in respect of low- and middle-income country trading partners. This might be through the CBAM design itself, or through a complementary policy in parallel to the CBAM; b) to ensure that the UK CBAM is designed in accordance with WTO rules; c) to establish forums to enable inclusive engagement with trading partners on the design and implementation of the carbon border approach. These should include forums specifically for engagement with low- and middle-income country trading partners; and d) to conduct analysis to understand how the carbon border approach might interact with free trade agreements.
From: Environmental Audit Committee, Fifth Report - Greening imports: a UK carbon border approach (HC 737), paragraph 54, 4 April 2022
Government response
The government responded to the whole report on 21 June 2022 (deadline 4 June 2022).
Summary written by Accountability Index from the government's response. It is not the government's own words.The government says it agrees that multilateral solutions are needed and that "the risk of carbon leakage is real", and intends to consult later in 2022 on carbon leakage mitigation options, including whether a CBAM "could be appropriate", without committing to any course of action.
- The government agrees that "we need multilateral solutions" and says it is "committed to building on our COP26 climate leadership" by working with international partners towards a common global approach to carbon pricing and leakage.
- It intends to consult "later in the year" on carbon leakage mitigation options, including "whether measures such as product standards and a CBAM could be appropriate tools". It states the announcement "does not commit the Government to any course of action down the line".
- On alignment with wider policy, it "agrees with the importance" of aligning its approach with environmental, trade, development and fiscal policy, and will continue to engage the relevant Cabinet Committees.
- On linking the UK and EU emissions trading schemes, the government is "open to linking the UK ETS internationally in principle" and "is considering a range of options", with "no decision on any preferred linking partners" made.