EU tightens rules on suspending carbon border fee to protect low-carbon investments

EU countries agreed to restrict when the bloc can suspend its carbon emissions fee on imports, a move aimed at giving more certainty to low-carbon investments. The carbon border levy applies to goods like steel, cement, and fertilisers, and is designed to protect European industries from cheaper, more polluting imports. Under the new rules, the fee can only be suspended if a product's price rises more than 50% over six months compared to the 10-year average. The agreement, backed by EU economy ministers, rejects the original proposal that allowed suspension in vague 'serious and unforeseen circumstances.' Critics said that created uncertainty for investments that rely on the fee to stay competitive. France, which had pushed for a suspension on fertilisers after the Iran war, supported the deal after getting concessions for its overseas territories. The final rules will be negotiated with EU lawmakers, who may further limit or remove the suspension clause. The policy also expands the list of covered goods to include washing machines and car parts. This update reinforces the EU's approach to linking import costs to carbon emissions, a key part of its broader climate strategy.