“It should be possible to design a Carbon Border Adjustment Mechanism (CBAM) that is World Trade Organization (WTO) compatible, but this depends upon the whole design of the regime and how it is implemented” said Chris Morgan, Head of Global Tax Policy at KPMG International.
KPMG’s Global Responsible Tax Project recently held a roundtable in collaboration with KPMG IMPACT, to look at the technical difficulties of designing a Carbon Border Adjustment Mechanism (CBAM). The first roundtable was held on 9 March 2021 with a group of experts from the World Bank, UN, IMF, OECD, the Potsdam Institute for Climate Impact Research and the University of Central Florida. The discussions were focused on a CBAM in general. They were not intended solely as a critique of any EU Commission proposals. The roundtable began with a brief overview of some key WTO provisions with which any CBAM would need to comply.
Click here to also read the briefing document sent to participants to help inform discussion at this roundtable. The note examines at a high level whether a CBAM could be compatible with World Trade Organization (WTO) rules.
Jericho Chambers has been convening and curating the Global Responsible Tax project in partnership with KPMG since 2014.