A Guide for the Concerned: Guidance on the Elaboration and Implementation of Border Carbon Adjustment

Entwined Policy Report No. 03

22 Pages Posted: 21 Nov 2012

See all articles by Aaron Cosbey

Aaron Cosbey

International Institute for Sustainable Development (IISD)

Susanne Droege

Stiftung Wissenschaft und Politik

Carolyn Fischer

Resources for the Future

Julia Reinaud

affiliation not provided to SSRN

John Stephenson

New Zealand Institute of Economic Research (Inc) (NZIER)

Lutz Weischer

affiliation not provided to SSRN

Peter Wooders

International Institute for Sustainable Development

Date Written: November 20, 2012

Abstract

When governments take strong unilateral action on climate change they will always consider border carbon adjustment (BCA) as a means to deal with competitiveness and leakage issues. But while this tool appears straightforward, it is plagued by deeply complex problems in practice, including trade law considerations, methodological challenges and consistency with principles such as common but differentiated responsibility. This guidance is the product of a seven-person international expert drafting group that wrestled with those issues and others for over two years. It goes into rare depth on all the issues that policy makers would need to consider in building and implementing a regime of BCA. It also serves as a benchmark by which targeted exporters can assess such schemes.

Keywords: BCA, BTA, border measures, trade, climate change, adjustment, competitiveness, WTO

JEL Classification: F19, K33, Q38

Suggested Citation

Cosbey, Aaron and Droege, Susanne and Fischer, Carolyn and Reinaud, Julia and Stephenson, John and Weischer, Lutz and Wooders, Peter, A Guide for the Concerned: Guidance on the Elaboration and Implementation of Border Carbon Adjustment (November 20, 2012). Entwined Policy Report No. 03, Available at SSRN: https://ssrn.com/abstract=2178312 or http://dx.doi.org/10.2139/ssrn.2178312

Aaron Cosbey (Contact Author)

International Institute for Sustainable Development (IISD) ( email )

161 Portage Avenue East, 6th Floor
Winnipeg
Manitoba, R3B 0Y4, Manitoba
Canada

Susanne Droege

Stiftung Wissenschaft und Politik ( email )

10719 Berlin
Germany

Carolyn Fischer

Resources for the Future ( email )

1616 P Street, NW
Washington, DC 20036
United States
202-328-5012 (Phone)
202-939-3460 (Fax)

HOME PAGE: http://www.rff.org/~fischer

Julia Reinaud

affiliation not provided to SSRN ( email )

John Stephenson

New Zealand Institute of Economic Research (Inc) (NZIER) ( email )

Wellington
New Zealand

Lutz Weischer

affiliation not provided to SSRN ( email )

Peter Wooders

International Institute for Sustainable Development ( email )

161 Portage Avenue East, 6th Floor
Winnipeg
Manitoba, R3B 0Y4, Manitoba
United States

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