Governments are increasingly introducing measures that condition market access on information about carbon emissions generated during production. Border carbon adjustments, mandatory product labelling and other environmental performance initiatives all set such requirements, and many are enforced at the border, creating new interactions with customs procedures and potentially adding administrative friction and compliance costs to trade. While international discussions have focused largely on the regulatory and methodological foundations of these measures, this paper takes a novel perspective by examining how carbon-intensity requirements can be enforced effectively at the point of border clearance.
This paper focuses on the technical interoperability challenges and trade facilitation implications arising from the enforcement of carbon-intensity requirements at the border. First, it examines how data elements, documents and exchange systems enable actors and digital platforms to share, process and verify compliance information. Second, it maps the ecosystem of public and private actors upon which compliance depends. Finally, the paper also sets out the key operational steps for enforcing carbon-intensity requirements at the border, from informing traders of the requirements, to taking enforcement action where necessary. It draws on a mapping of twelve regulations and policy proposals across ten economies, supported by stakeholder interviews.
The regulatory landscape is expanding but remains fragmented and operationally underspecified. The regulations examined differ markedly in product scope, emissions coverage, applicable thresholds and implementation status. Guidance on border-related implementation is uneven and often limited: around half of the measures provide direction on the role of customs and border agencies, 38% specify guidance on data requirements, while 19% address further trade facilitation aspects such as risk management.
Carbon-intensity requirements can create challenges at the border. These requirements demand complex data and documents, not only on verified embedded emissions, but also customs data, authorisations and various certificates, raising the volume, frequency and granularity of data required by customs systems, environmental registries and verification bodies. This report identifies several pressure points. Customs’ IT systems are typically not built to readily integrate carbon data or verification references, such as unique identifiers linking a consignment to an emissions declaration or an accredited verifier’s report. Risk profiles do not yet capture circumvention strategies specific to environmental regulations such as rerouting through third countries, shipment splitting to stay below de minimis thresholds, or “place-of-origin washing” through minor processing. Specific cases also remain difficult to handle in practice, including goods placed under inward and outward processing, those moved using indirect customs representation, and non-physical goods such as electricity that do not move as discrete consignments.
However, practical solutions lie in gradually stepping up and adapting trade facilitation tools. Many of these frictions can be addressed by leveraging three areas in particular: (i) automated and digital customs clearance; (ii) customs risk management; and (iii) border agency co-operation. Single Window environments can accommodate and connect additional data flows between customs, environmental registries and verification bodies. Machine-readable condition codes and regulatory identifiers, already used for a range of different technical requirements across economies, could confirm compliance status without the need to reassess substantive emissions data at clearance. Risk management systems could be updated with new criteria, indicators and pattern analysis across traders and shipments to detect circumvention, and Authorised Economic Operator (certified trader) programmes recalibrated to recognise carbon-intensity compliance. Border agency co-operation could be strengthened through standing or ad-hoc inter-agency working groups, joint guidance and training for officials, and coordinated approaches to risk management, particularly for complex cases that no single authority can resolve alone.
Implementation readiness is uneven across actors, sectors and economies, with small firms and developing economies facing the greatest constraints. Large firms with established environmental reporting tools are better placed than SMEs, for which internal accounting and reporting absorb a higher share of revenues. Customs administrations also face limits in adapting legacy IT systems, updating risk modules and training officials on new data elements and verification references, while environmental, tax and verification authorities must develop new mandates, registries and accreditation frameworks largely from scratch. Sectoral specificities also matter: electricity, natural gas, crude petroleum and fluorinated gases move through pipelines or transmission lines rather than as discrete consignments, requiring system-level data and close co-operation with grid and market authorities. Exporters in developing economies face particular constraints, including limited access to emissions data, accredited verifiers and digital infrastructure.
This paper provides a practical framework for policymakers and relevant implementing authorities, comprising 47 checklist questions across 22 areas and five key dimensions: scope and applicability; border control processes; data and technical systems; integration with trade facilitation tools; and governance and capacity. It provides concrete insights into four policy priorities:
Integrating carbon-intensity requirements into existing border processes and specifying operational enforcement steps.
Prioritising and leveraging trade facilitation tools in the areas of automation, risk management and border agency co-operation.
Considering and evaluating implementation readiness in relation to capacity constraints across actors, sectors and economies, with particular attention to SMEs and developing countries.
Strengthening international co-operation on elements of technical interoperability, such as required data, documents and systems for data transmission.