WTO to examine Russia case against EU carbon levy

The World Trade Organization will appoint experts to examine Russia's complaint against the European Union's carbon border levy, a Geneva-based trade official said Friday after a meeting of the WTO Dispute Settlement Body.

Russia argues that the Carbon Border Adjustment Mechanism, or CBAM, breaches global trade rules. The EU says the measure is a climate policy intended to make foreign producers pay a carbon cost similar to that paid by European companies under the bloc's emissions trading system.

CBAM requires importers of carbon-heavy goods such as steel, aluminium and fertiliser to declare the CO2 emissions embedded in their products and pay a levy if they exceed EU standards.

Russia filed its initial complaint in May 2025, requesting consultations with the EU and its member states over CBAM and the EU Emissions Trading System. Brussels rejected the consultation request, citing circumstances created by Russia's full-scale invasion of Ukraine in February 2022.

Moscow asked the WTO on July 10 to establish a panel of experts, but the EU blocked the first request. The Dispute Settlement Body granted Russia's second request on Friday. Under WTO rules, parties can block a first request for a dispute panel, but a second request is all but guaranteed to go through.

In a communication to the WTO this week, the EU called Russia's renewed request an extraordinary situation. Brussels said it would participate because of its support for the rules-based multilateral trading system, but would engage only with the panel and not directly with Russia.