BCSDA to make submission on EU Carbon Border Adjustment Mechanism consultation

Sydney, 16 September 2025 - The Business Council for Sustainable Development Australia (BCSDA) will lodge a submission to the European Commission’s consultation on the EU Carbon Border Adjustment Mechanism (CBAM), underscoring the urgent implications for Australian businesses as the regime enters its definitive phase on 1 January 2026.

The CBAM is designed to level the playing field between EU producers subject to the EU Emissions Trading System (ETS) and imports from countries without comparable carbon pricing. The consultation seeks views on emissions calculation methodologies, adjustments for EU ETS free allocations, and recognition of third-country carbon prices. These technical rules will shape trade competitiveness, determine compliance costs, and influence market access for non-EU exporters.

For Australia, this is a critical issue. In 2023, the EU imported more than AUD 4.2 billion of CBAM-covered goods from Australia, including over 35% of aluminium exports and 20% of steel exports. Without recognition of equivalent carbon measures, Australian exporters could face material cost disadvantages in key sectors.

As the Australian partner of the World Business Council for Sustainable Development (WBCSD), BCSDA brings a business-driven and globally aligned sustainability lens to this debate. Our focus is ensuring Australia’s export sectors can remain competitive while accelerating decarbonisation and aligning with international climate policy.

Key considerations for Australian business:

• Rising cost pressures: CBAM certificate obligations could add €75–90 per tCO₂e by 2026, directly impacting product prices.

• Market scrutiny: In H1 2025, 16% of non-carbon-priced iron and steel shipments into the EU were flagged for compliance review.

• Sector exposure: Aluminium, steel and fertiliser exporters face heightened risk without clarity on methodologies or recognition of third-country efforts.

BCSDA’s submission will highlight the need for:

• Transparent and internationally consistent emissions methodologies,

• Fair recognition of credible third-country carbon prices, and

• Frameworks that balance trade competitiveness with the global transition to net zero.

These priorities align with BCSDA’s mission of Ambition, Action, Accountability, ensuring Australia’s sustainable business community has a strong voice in shaping rules that will influence market access and investment flows.

We thank our members and partners who are providing critical insights into sector-specific risks and opportunities under CBAM. Their input will inform our submission and reinforce the importance of collective action to navigate this structural trade challenge.

BCSDA will finalise its submission ahead of the 25 September 2025 deadline and continue engaging government and industry in shaping Australia’s response to CBAM. This includes ongoing policy advocacy, roundtables, and collaboration with international partners to secure fair outcomes for Australian exporters.

About BCSD Australia 

The Business Council for Sustainable Development Australia is a non-profit organisation dedicated to operationalising sustainable development practices among Australian businesses.  BCSD Australia was established in Australia in 1991 and works with over 70 leading global businesses and other organisations to drive systemic transformation in key sectors, advocating for sustainable leadership and rewarding action through education, partnerships, and policy influence.

In 2014 the organisation was appointed Australia’s Network Partner for World Business Council for Sustainable Development (WBCSD).

BCSD Australia’s members believe that by integrating social and environmental impacts with financial results, business lowers its risk profile, makes better decisions and creates the solutions needed to meet the Sustainable Development Goals.

BCSD Australia’s members include leading Australian businesses, from all sectors, who share a commitment to economic, environmental and social development. It represents member companies, public sector enterprises and institutions, BINGOs and community organisations, which in turn represent 120,000 + Australian employees. www.bcsda.org.au.

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For further information contact: Andrew Petersen, CEO, Business Council for Sustainable Development Australia, +61 412 545 994