Financial Times FT.com

Carbon import tax could provoke trade war

By Alan Beattie in London

Published: January 23 2008 23:09 | Last updated: January 23 2008 23:09

Plans to force importers to pay the same greenhouse gas emission charges as domestic producers could provoke a trade war of retaliation and litigation, officials and lawyers have warned.

The plans, being considered by the US Senate and floated by the European Commission, are intended to prevent production shifting to laxer regimes abroad after countries impose carbon controls. But although supporters argue they will comply with the General Agreement on Tariffs and Trade (Gatt), the treaty that underlies the World Trade Organisation, officials and lawyers say that affected countries such as China and India are likely to resort to litigation or retaliation.

You have viewed your allowance of free articles. If you wish to view more, click the button below.

Read this