CBAM Expansion and French Guiana EUDR Proposal

15 September 2026 | Market Trends for the NQC Community 

European Parliament backs broader CBAM scope and tougher anti-circumvention rules

The European Parliament has backed its negotiating position on proposed changes to the EU’s Carbon Border Adjustment Mechanism (CBAM). The vote sets out what MEPs want to take into negotiations with EU member states; it does not make the proposed changes law.

The position passed by 464 votes to 50, with 159 abstentions. If it becomes part of the final agreement, it would broaden CBAM beyond basic materials to include downstream products, including finished steel and aluminium goods such as fasteners, wire, springs and household articles. MEPs also backed an exemption for electricity flows from non-EU countries used by grid operators to maintain network stability.

The same position would tighten the rules intended to prevent circumvention. The threshold for treating small changes to a product as possible circumvention would be lowered, while the text distinguishes deliberate avoidance arrangements from ordinary business decisions to reduce costs.

MEPs also rejected a proposed safeguard that would have allowed goods to be removed from CBAM during price shocks. Instead, they supported mechanisms to redirect CBAM revenues towards affected sectors in certain circumstances.

The MEP leading Parliament’s work on the file, Mohammed Chahim, described the package as “stronger, fairer and more resilient.” The next step is negotiation with EU member states on the final legislation.

Commission proposes a French Guiana change to the EUDR territorial scope

The European Commission is proposing to remove French Guiana from the territorial scope of the EU Deforestation Regulation (EUDR). It says the change is needed because of practical enforcement constraints, including porous borders with Suriname and Brazil and significant small-scale cross-border trade. If adopted, the exclusion would mean timber and the other EUDR-covered commodities produced in French Guiana for local sale or for markets outside the EU could move without a Due Diligence Statement.

The proposed exclusion would also cover in-scope commodities grown in Suriname or Brazil and sold into French Guiana. It would not remove all EUDR obligations: goods moving into the EU market from French Guiana, or from the EU into French Guiana, would remain subject to the safeguards described in the proposal.

Imports into the Union market from French Guiana would remain subject to EUDR obligations, including customs declarations connected to a Due Diligence Statement or a simplified declaration. Exports from the EU to French Guiana would also remain subject to the regulation’s due diligence requirements under the proposal.

The proposed change must complete the standard EU legislative review process and be formally adopted by the Council of the EU before any territorial exemption takes effect. Until then, standard EUDR obligations continue to apply across all territories.