EU Parliament votes to scrap CBAM emergency brake, setting up clash with member states

The European Parliament voted to remove the emergency brake in the EU's Carbon Border Adjustment Mechanism, the clause that would let the bloc suspend CBAM payments if imports got sharply more expensive. Lawmakers want to use CBAM revenue to compensate industries instead. That puts Parliament on a collision course with EU member states, which want a suspension option when a product's price jumps more than 50% in six months. The vote also tightens aluminium coverage. The threshold for aluminium shipments drops from 50 metric tonnes to 5 metric tonnes, which would capture high value, low weight components used in cars, doors and solar panels. Lawmakers also backed extending CBAM to post-consumer aluminium scrap, closing a gap where foreign suppliers could use more scrap to avoid the fee. The final rules still need negotiations between Parliament and member states. The outcome will also extend CBAM to new products like washing machines and car parts. For companies importing into the EU, the main question is whether the compensation mechanism is practical and fast enough to matter.