CBAM: Parliament Backs a Tougher, Broader Regime

Research evidence excerpt

CBAM: Parliament Backs a Tougher, Broader Regime

Update

July 7, 2026 07:15 AM GMT

Morgan Stanley & Co. International plc+MMetals & Mining | Europe Alain Gabriel, CFA

Equity Analyst

CBAM: Parliament Backs a Alain.Gabriel@MorganStanley.comIoannis Masvoulas, CFA +44 20 7425-8959

Ioannis.Masvoulas@morganstanley.com +44 20 7425-0427

Tougher, Broader Regime Adahna Ekoku

Adahna.Ekoku@morganstanley.com +44 20 7425-0578

Parliament’s stance reinforces the Commission’s proposal to Ferdinand Huber

broaden CBAM downstream, while calling for stronger anti- ResearchFerdinand.Huber@morganstanley.comAssociate +44 20 7677-2702

circumvention measures and country-of-origin values. It also

Metals & Mining

calls for deleting the Article 27a price-shock safeguard. Steel and Europe

aluminium policy continues to improve. Industry View In-Line

CBAM mechanism reinforced by Parliament position. Following the Council’s

general approach, the European Parliament’s Environment Committee has backed

the same core direction, which includes extending CBAM to downstream steel and

aluminium goods and tightening loopholes. The key change vs the Commission’s

proposal is about enforcement: Members of the European Parliament want more

transparent quantitative methodologies for product inclusion, stronger anti-

circumvention tools, application of true country-of-origin default values where

circumvention is detected, and deletion of the Commission’s proposed price-shock

safeguard (Article 27A). This is also the main delta versus the Council draft, which

retained a temporary exemption mechanism if import prices rise 50% versus their

10-year average for at least six months (see CBAM Expansion: Raising the Import

Cost Floor for European Steel & Aluminium).

Strengthening the policy floor.