CBAM is currently operational. An instruction manual for businesses on how to comply

Being a Carbon Border Adjustment Mechanism provide Agile Advisors, a crucial policy tool, is designed to mitigate the risk of carbon leakage under the EU ETS. This scheme, the largest global carbon pricing initiative, is responsible for nearly 40% of the EU's emissions. The term' carbon leakage' refers to the scenario where domestic manufacturers, bound by stringent regulations, struggle to compete with overseas producers operating under less environmentally friendly but cheaper conditions. This policy is a significant step towards preventing businesses from relocating to nations with less stringent environmental regulations. If climate policy does not control carbon leakage, manufacturers producing high emissions may decide to relocate overseas. Instead of being reduced, emissions would be exported, and the home economy would suffer. Regulated enterprises under the EU ETS currently receive emission allowances free of charge, based on their emission intensity relative to a sectoral benchmark and their exposure to the risk of carbon leakage.