The World Trade Organization's dispute settlement body has agreed to Russia's request for a panel to examine the European Union's Carbon Border Adjustment Mechanism (CBAM). Russia argues the levy, which charges a carbon price on certain imports, is discriminatory and protectionist. A first request in July failed, but the second attempt was accepted on Friday. The EU maintains CBAM is WTO-compatible and will defend it in proceedings. The dispute is significant beyond Russia. Brazil, India, and South Africa have also criticized CBAM for penalizing developing economies. Russia's additional claim that EU emissions trading system allowances amount to an export subsidy could set a precedent for how carbon pricing interacts with international trade rules. The panel's findings may influence how other countries design carbon border measures and affect global carbon market confidence.
