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Can Emissions Trading Schemes be Coupled with Border Tax Adjustments? An Analysis vis-à-vis WTO Law

Authors


  • Javier de Cendra is a junior researcher at the Maastricht European Institute for Transnational Legal Research (METRO). His Ph.D. research focuses on climate change policy. The author would like to thank Prof. Geert Van Calster and Prof. Dr Michael Faure for valuable comments on earlier versions of this article.

Abstract

This article examines concerns created by the implementation of the emissions trading scheme (EU ETS) within the EU upon the international competitiveness of EU-based industry. It analyses current discussions on whether it would be feasible to couple the EU ETS with border tax adjustments (BTA) in order to address those competitiveness concerns. The (il)legality of introducing BTA vis-à-vis relevant World Trade Organization (WTO) agreements is discussed (in particular the General Agreement on Tariffs and Trade and the Subsidies and Countervailing Measures Agreement), and different opinions are reviewed. In the light of that discussion, some suggestions that come from the literature on how to reconcile BTA in connection with the EU ETS and WTO relevant law are presented.

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