Trade facilitation implications of carbon‑intensity requirements

3. Mapping the emerging landscape of carbon-intensity requirements

As discussed in Section 2, governments are exploring or implementing measures that establish requirements related to carbon-intensity information, which may have implications for market access, including border carbon adjustments and other product-based requirements. These developments span a wide range of jurisdictions and policy approaches, with some regulations already in force, others under development, and several still at the consultation or legislative proposal stage.

The mapping of this regulatory landscape is challenging due to the heterogeneity and evolving nature of the measures. Regulations differ substantially in scope, legal design, and implementation timelines. In many cases, detailed information on how compliance is operationalised at the border remains limited or under development. This is particularly the case for procedural aspects, data requirements, and the role of border authorities, which are often addressed in secondary legislation or operational guidance that may not yet be available.

Recent efforts to compile inventories of trade-related environmental policies undertaken in multilateral fora such as the WTO’s Trade and Environmental Sustainability Structured Discussions (TESSD) offer overviews of policy instruments, objectives, and sectoral coverage1 (WTO, 2025[22]). However, these exercises typically do not provide details on how such measures are implemented through border procedures or integrated into customs and trade facilitation frameworks.

This report undertakes a more granular mapping of carbon-intensity requirements to better understand technical interoperability challenges and the role of trade facilitation in implementation at the border. Based on a set of identified regulations in force and policy proposals, it examines how carbon-intensity requirements translate into concrete obligations for traders and authorities, and where potential implementation gaps or frictions may arise.

Table 1 provides a summary of the mapping of identified regulations in force and policy proposals. While only a limited number of instruments are currently in force, a growing group of economies are actively developing or considering border measures targeting carbon-intensive products. Existing and proposed measures differ markedly in terms of product and emissions coverage, the use of thresholds, and their legal and operational design, ranging from tax-based approaches and import levies to regulatory schemes linked to domestic carbon pricing systems. Across cases, most initiatives focus initially on a narrow set of energy-intensive sectors and on direct production emissions, although several frameworks envisage broader product and emissions scopes or lifecycle-based approaches over time. Taken together, this mapping points to a broader uptake of requirements based on carbon-intensity metrics in trade-related contexts, alongside substantial variation in implementation choices and levels of regulatory maturity, with important implications for border authorities and traders operating across multiple jurisdictions.

Table 1. Mapping of identified regulations in force and policy proposals

Economy	Measure	Status	Product coverage	Emissions coverage	Threshold	Framework
Australia	Border carbon measure	Under consideration	Cement, clinker (possible extension to steel, glass, fertilisers, lime)	Scope 1	Likely aligned with United Kingdom approach	No formal framework yet
Canada	Border carbon adjustment	Under consideration	Not specified	Not specified	Not specified	No formal framework yet
European Union	Carbon Border Adjustment Mechanism (CBAM)	In force (full implementation since 2026)	Aluminium, cement, fertilisers, hydrogen, iron and steel, electricity	Scope 1; Scope 2 (some); upstream Scope 3 for precursors	50 tonnes imports/year (excl. hydrogen and electricity)	CBAM certificates linked to EU ETS; adjustment for carbon price paid overseas
European Union	Ecodesign for Sustainable Products Regulation	In force since 2024 (product specific Delegated Acts in development)	Priority sectors: Iron and steel, textiles, tyres, furniture, aluminium, mattresses	Not specified	Not specified	Mandates Digital Product Passports which may include carbon footprint information for EU market access
Japan	Carbon levy on fossil fuel imports	Planned for 2028, linked to the Green Transformation (GX) Policy	Fossil fuels (power, gas, oil)	Not specified	Not specified	No formal framework yet
Norway	Carbon Border Adjustment Mechanism (CBAM)	Preparing implementation in 2027	Same as EU CBAM	Same as EU CBAM	Same as EU CBAM	Aligned with EU CBAM
Serbia	Tax on imports of carbon-intensive products	In force since 2026	Aluminium, cement, fertilisers, iron and steel	Direct production emissions	5 tonnes imports/year	Linked to national GHG tax
Türkiye	Border carbon adjustment	Possible introduction included in the 2025 Climate Law	Not specified	Not specified	Not specified	No formal framework yet
United Kingdom	Carbon Border Adjustment Mechanism (CBAM)	Preparing entry into force January 2027	Aluminium, cement, fertiliser, hydrogen, iron and steel	Scope 1; indirect emissions possible from 2029	Registration threshold GBP 50 000 imports/year	Tax-based; rate linked to UK ETS; adjustment for carbon price paid overseas
United States	Foreign Pollution Fee Act	Legislative proposal (2025)	Aluminium, cement, iron and steel, fertiliser, glass, hydrogen, solar products, battery inputs	Scope 1‑3	Not specified	No formal framework yet

Notes: See Annex A for the methodological details. The table reflects regulations and legislative proposals identified as of May 2026. Measures adopted, amended or proposed after this cu-off date are not covered. The table is intended to illustrate major regulatory initiatives relevant to the analysis rather than provide an exhaustive inventory. The policy proposals identified for Canada, Japan and Türkiye are not included in the analysis below given the limited public information available at this stage.

Source: Australia Carbon Leakage Review, EU CBAM, EU ESPR, Norway EU CBAM, Serbia Tax on Imports of Carbon-Intensive Products, UK CBAM, US Clean Competition Act of 2023, US Foreign Pollution Fee Act of 2025, (WEF, 2025[20]; IISD, 2024[23]).

The mapping of regulatory frameworks, together with the ecosystem of actors discussed in Section 2.2, provides the basis for distinguishing three analytical dimensions of border implementation: (i) the documents and data exchanged during clearance processes; (ii) the roles and responsibilities of customs and other border agencies; and (iii) the extent to which trade facilitation measures relate to the enforcement of carbon-intensity requirements (Figure 2).

Guidance on border-related implementation varies considerably across carbon-intensity regulations. Regulations and policy proposals differ in the extent to which they provide concrete guidance on their implementation at the border, sometimes merely mentioning border-related aspects while in most cases not addressing them at all. This variation reflects differences in regulatory scope, maturity, and legal design, as well as the fact that many measures are still under development or accompanied by implementation guidance that is evolving over time.

A larger share of mapped regulations and policy proposals provides guidance on data requirements (38%) and on the role of customs and other border agencies (53%). However, even within these areas, a significant share of regulations limits themselves to general references rather than detailed operational guidance, particularly with respect to the use of digital tools, technical interoperability, and the integration of new requirements into existing clearance processes.

Additional trade facilitation tools and aspects are addressed less systematically (19% of the mapped regulations provide guidance), suggesting scope for further clarification as regulations move towards implementation. Many regulations do not explicitly refer to mechanisms such as border agency co-operation, risk management, post-clearance controls, or Authorised Economic Operators (AEO) programmes. This does not necessarily imply their exclusion in practice, but it indicates that such aspects are often not articulated in the regulatory texts or available guidance. As carbon-intensity requirements become operational, clearer articulation of how they interact with existing trade facilitation frameworks may help support consistent enforcement and limit unintended disruptions at the border.

Figure 2. Information and guidance on border procedures remains limited across identified carbon-intensity requirements

Notes: Based on the mapping of identified carbon-intensity requirements in Table 1. The policy proposals identified for Canada, Japan and Türkiye are not included in the analysis below given the limited public information available at this stage. “Further trade facilitation aspects” would include, for example, AEO programmes, border agency co-operation mechanisms, risk management tools, post-clearance controls.

Note

← 1.  The WTO TESSD Informal Working Group compiled a non-binding mapping of trade-related climate policies shared by Members, organising them into six categories: carbon pricing and emissions trading systems, border carbon adjustments, taxes and incentives, regulatory measures (standards, certification, labelling and MRV), voluntary and co‑operative initiatives, and trade preferences linked to sustainability criteria, illustrated by examples across advanced and developing economies. The compilation also highlights four priorities for enhanced international co‑operation: information sharing on trade-related climate measures, convergence of carbon measurement standards, interoperability of conformity assessment and certification schemes, and strengthened technical assistance and capacity building, particularly for developing WTO Members.