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Carbon Border Adjustment Mechanism (CBAM)
September 07,2026
Carbon border tax (also known as Carbon Border Adjustment Mechanism or carbon tariff) is an extra fee charged on imported high-carbon products, designed to prevent domestic companies from facing unfair competition and "carbon leakage" due to strict carbon reduction
Key Concepts and Operation
Definition:A tariff imposed on imported goods from countries with lax carbon emission regulations or no carbon pricing, ensuring the cost aligns with domestic standards.
Objectives:To protect local manufacturers, promote global carbon reduction, and prevent carbon leakage (industrial offshoring).
Offsetting Mechanism:If a legitimate carbon price (such as a carbon tax or carbon fee) has already been paid in the country of origin, the importer may apply for a corresponding deduction upon import. [1, 2, 3, 4]
Major international policy developments
EU CBAM: The world's first carbon border mechanism to be implemented, initially covering steel, aluminum, cement, fertilizers, electricity, and hydrogen. The official reporting and certificate purchasing mechanisms continue to move forward.
UK: Scheduled to launch in 2027, with multiple overseas carbon pricing mechanisms already announced as eligible for relief.
United States: Proposed legislation under consideration includes the Clean Competition Act (CCA) and the Foreign Pollution Fee Act (FPFA).
Taiwan's Response and Impact
Carbon Fee Alignment: Taiwan has implemented a carbon fee system, and the Ministry of Environment has confirmed that our carbon fee qualifies as an effective carbon pricing mechanism recognized by international carbon border adjustment mechanisms, allowing related fees to be offset upon export.
Corporate response: Export enterprises must accelerate the improvement of greenhouse gas inventories, calculate product carbon footprints, and implement low-carbon transformation.
Key Concepts and Operation
Definition:A tariff imposed on imported goods from countries with lax carbon emission regulations or no carbon pricing, ensuring the cost aligns with domestic standards.
Objectives:To protect local manufacturers, promote global carbon reduction, and prevent carbon leakage (industrial offshoring).
Offsetting Mechanism:If a legitimate carbon price (such as a carbon tax or carbon fee) has already been paid in the country of origin, the importer may apply for a corresponding deduction upon import. [1, 2, 3, 4]
Major international policy developments
EU CBAM: The world's first carbon border mechanism to be implemented, initially covering steel, aluminum, cement, fertilizers, electricity, and hydrogen. The official reporting and certificate purchasing mechanisms continue to move forward.
UK: Scheduled to launch in 2027, with multiple overseas carbon pricing mechanisms already announced as eligible for relief.
United States: Proposed legislation under consideration includes the Clean Competition Act (CCA) and the Foreign Pollution Fee Act (FPFA).
Taiwan's Response and Impact
Carbon Fee Alignment: Taiwan has implemented a carbon fee system, and the Ministry of Environment has confirmed that our carbon fee qualifies as an effective carbon pricing mechanism recognized by international carbon border adjustment mechanisms, allowing related fees to be offset upon export.
Corporate response: Export enterprises must accelerate the improvement of greenhouse gas inventories, calculate product carbon footprints, and implement low-carbon transformation.
