European Union lawmakers on Thursday voted to simplify the bloc’s carbon-pricing system for the import of high-emission products.

They said that under the pricing system, companies importing goods such as iron, steel, aluminium, cement or fertilisers have to pay the difference between the carbon price paid in the country of production and the carbon price in the EU.

Introduced in 2023, the carbon border adjustment mechanism (CBAM) was intended to tackle so-called carbon leakage, when CO2-intensive industries move production elsewhere due to strict climate laws.

It was swiftly criticised as an administrative burden on businesses.

In a larger effort to cut red tape in the EU, the European Commission proposed in February to restrict CBAM to businesses that import more than 50 metric tonnes of listed goods annually.

This means that 90 per cent of EU importers, namely small companies and individuals, would be exempt from the CO2 pricing system, which would still cover 99 per cent of emissions, the commission said at the time.

EU lawmakers had gathered in Brussels to back the proposal with 564 members of parliament voting in favour, 20 votes against and 12 abstentions.

The parliament said that under the proposed changes, CBAM would still be able to achieve its environmental objectives as almost all emissions from CO2-intensive imports would still be covered.

“The CBAM is a crucial instrument to help the EU prevent carbon leakage and incentivise climate action outside the EU,” said Italian lawmaker Antonio Decaro in charge of the file.

As a next step the EU Parliament will start negotiations with member states on the details of the reform.

(dpa/NAN)