US Cos. Must Prepare For EU Carbon Tax On Imports

Law360 (February 18, 2021, 5:29 PM EST) -- As a facet of the so-called European Green Deal,[1] the European Union is currently contemplating instituting a carbon border adjustment mechanism, or CBAM. A formal proposal from the European Commission is expected as early as the end of this year, with the objective of implementing a CBAM by the end of 2022.

The mechanism would impose a tax, or duty, on goods imported into the 27 member states of the EU, which would reflect the amount of carbon emissions attributed to their manufacture and inputs. 

Companies that export U.S.-manufactured goods to EU countries are likely to be significantly affected by the...

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