Carbon-Related Border Adjustment Measures: Towards Multilaterally Agreed Rules of Application

Carbon-related border adjustment measures (BAMs) are nowadays viewed by developedcountries as a means to address competitiveness and carbon leakage concerns associated witha cap-and-trade or any other emission reduction system which imposes additional costs ondomestic producers. Without sharing a burden of curbing emissions with foreign competitorsit seems inconceivable to gain support from business and society for climate changemitigation actions. Furthermore, it is argued that BAMs can be used as a stick to induce thirdcountries, including leading developing ones, to get onboard international emission reductionsystem and take comparable actions to combat climate change.