• The Ministry of Industry, Trade and Energy stresses minimizing stress from CBAM
    2021-12-22 hit 1319

    The Ministry of Industry, Trade and Energy stressed,“CBAM should be implemented in a manner of minimizing administrative burden for exporting companies”

    The Ministry hosted the “EU CBAM info session”


    Sanghyeong Yoon, the Director of Trade Legal Affairs and Public Relations at the Ministry of Industry, Trade and Energy announced that the Ministry and the European Commission co-hosted the “EU CBAM info session” in a virtual conference format on December 16th. The result of the info session supported the analysis that the EU’s Carbon Border Adjustment Mechanism (CBAM) should not be a new trade barrier and the administrative burden arising from the implementation of CBAM should be kept at a minimal level for Korean exporting companies.


    More than ten officers in charge of CBAM from the Taxation and Customs Union, Directorate-General of Climate and Directorate-General of Trade under the European Commission participated in the info session and delivered presentations on key points of CBAM and how it works. CBAM is a scheme that imposes tax on imported products to the EU, which produce more greenhouse gases compared to emission level of the same type of products produced in the EU. Director Yoon emphasized the Korean government’s stance on CBAM by pointing out that the scheme should not act as a new trade barrier, should be in line with WTO standards and minimize additional layers of administrative procedures for Korean exporting companies.


    Director Yoon particularly stressed that Korea’s carbon reduction policies, including Emissions Trading System (ETS) ? a scheme Korea has implemented since 2015, must be reflected during the process of designing and operating CBAM. Participating companies also raised concern regarding the ambiguity of CBAM legislative proposal and an inevitable rise in administrative expenses. They called for these issues to be resolved during the consultation process of CBAM legislative proposal within the EU. Steel producers, including POSCO, insisted CBAM should not be applied to exporting companies in a detrimental fashion and proposed the EU to engage in sufficient discussions with key trading partners, including Korea, during legislative proceedings.


    Korea International Trade Association (KITA) highlighted specific means of enforcing CBAM should be arranged in accordance with legislative proposal related to CBAM implementation, and advised the EU to engage in dialogue with the Korean government and Korean companies to ensure the introduction and implementation of measures are performed in a transparent manner. Korea Iron & Steel Organization requested the EU to disclose laws related to CBAM implementation at the earliest day possible and stressed sufficient buffer period is needed for Korean exporting companies to be prepared for complying with declaration duties. The organization also requested the EU to reconsider the current schedule of CBAM implementation. The European Commission responded it will fully review opinions and concerns on CBAM implementation raised by the Korean government and Korean companies. The Ministry of Industry, Trade and Energy said it will monitor the movement by the EU on CBAM legislation and support relevant business sectors to properly respond to CBAM by maintaining close cooperation with the European Commission.


    [This news is provided by Newsis]

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