Border Carbon Adjustment Measures Of WTO Compliance Analysis And Countermeasures In China

With the issue of “global climate change”becoming more and more important,the concept of “sustainable development” has been introduced to the multilateraltrading system. As the negotiation in the global climate summit has been halted for along time, developed countries turns to the unilateral Border Carbon Adjustments.Although “Carbon Tariff” is well known in the world, it is not a rigorous concept. Theso-called Border Cardon Adjustments means that the country who has implement thenational climate change policy takes some trade measures in order to protect thecompetitive power in the relative enterprise and to prevent the “CarbonLeakage”.Border Carbon Adjustments generalizes some border measures that basedon the reduction in the domestic industries. However, this concept brought about lotsof debates. The party who supports the Border Carbon Adjustments believes that, onthe one hand, it can protect the competitive power in the relative industries andprevent the “Carbon Leakage”. On the other hand, it can push forward the countrieswho has not reduced emissions substantively to undertake some more real andeffective duties. The party who opposes the Border Carbon Adjustments believes thatit is trade banner essentially. The protection of environment is just a slogan. It mustcomply with the international trade rules as a trade measure. However the legality ofBorder Carbon Adjustments is in doubt under WTO. When the Border CarbonAdjustments puts into effect, the relative products will be influenced certainly. China has called on to abandon the unappropriate measures, but the effects is not obvious.We should resort to transnational cooperation or the legal method to try to resolve theproblem. When the cooperations become failed, the issues will be submitted to DSB.Therefore it is very important to find whether Border Carbon Adjustments complywith WTO regime. In my opinion, Border Carbon Adjustments would be affirmedviolating Principle of Non-discrimination under WTO/GATT regime. Inevitably, thecountries would quote GATT article20-“exception principle” to protect. But even so,it is also hard to pass article20. Of course, we know whether Border CarbonAdjustments can pass the test under WTO/GATT regime until the BCA carry outsubstantively. However, as the typical developed country, EU and US will put BorderCarbon Adjustments into effect in the future without doubt. China, as a typicaldeveloping country, have adequate reasons to believe that Border Carbon Adjustmentswill bring about a huge harm to their economy, it will compress their space in theinternational trade. What we need to do now is take advantage of multilateral tradesystem and the new round of negotiation in trade system. We use this opportunity todemonstrate that Border Carbon Adjustments would bring about lots of damages tothe free trade system. On the same time, we should promote to update the domesticindustry under the external pressure of reduction of carbon emissions and BorderCarbon Adjustments. We should launch carbon tax and carbon emission tradingsystem as soon as possible. In short, the “low-carbon economy” has become thedriving force of economic development in developed countries. Our country, as a bigand responsible nation, should adopt a positive attitude to seize to change the modelof economic growth and to promote the updating of all industries, rather than to denythe effect of Border Carbon Adjustments.