Russia request WTO panel to adjudicate carbon border adjustment mechanism dispute with EU
MOSCOW. July 16 (Interfax) - Russia has asked for a World Trade Organization to adjudicate on a dispute with the European Union regarding the carbon border adjustment mechanism (CBAM), the Russian Economic Development Ministry said.
The WTO's Dispute Settlement Board will review the matter on July 24.
Russia requested WTO dispute consultations with the EU regarding the CBAM last year - such requests formally initiate a dispute in the WTO. The EU declined the request in May 2026. The EU said that in view of the Ukraine conflict it was "of the view that the consultations requested by the Russian Federation cannot be fruitful and cannot lead to a mutually satisfactory solution of matter at hand." Russia's request for an adjudication panel is the next step in the process. The panel will assess CBAM conformity with WTO rules.
The Econ Ministry said Russia considers the CBAM to be "a discriminatory tool that the EU uses to unlawfully restrict access to its market for competitive import goods." Russia also views the CBAM as an example of the EU's abuse of the "green agenda" to create artificial competitive advantages for EU producers.
The EU previously declared its intention to ease the CBAM and its potentially adverse consequences for foreign manufacturers. But the Russian ministry said the acts adopted in late 2025 and early 2026 amending the EU's basic CBAM regulation "not only failed to eliminate the EU's significant violations of its international obligations, but also, in a number of respects, made the conflict between its regulation and WTO law more pronounced."
Russia believes the CBAM violates several basic rules of the WTO General Agreement on Tariffs and Trade (GATT), including: most favored nation treatment (GATT Article I), the level of binding of customs tariffs and other charges (Article II), the prohibition on the introduction of quantitative restrictions on imports (Article XI), national treatment (Article III) and transparency (Article X), as well as agreements on import licensing procedures.
In addition, the mechanism for providing additional free emission allowances to certain EU sectors deemed by the EU to be at risk of "carbon leakage" within the EU's emissions trading system constitutes a prohibited subsidy within the meaning of the WTO Agreement on Subsidies and Countervailing Measures, the ministry said.
It also said that despite EU sanctions, the CBAM affected the interests of Russian producers, including in third-country markets, since it applied to the entire production chain for the relevant goods.
The CBAM is calls for importers of goods to pay a "carbon tax" equivalent to payments for greenhouse gas emissions by European producers of similar products. The EU started imposing duties on imports of carbon-intensive products such as cement, iron and steel, aluminum, fertilizer, electricity and hydrogen in 2026 with the list set to expand going forward.
