It is increasingly evident, and policy-relevant, that the implications of EU low-carbon strategies are reaching ever further beyond the Union's borders. Three developments deserve substantial scrutiny in the context of ongoing policy reviews and expected policy proposals across late 2026 and 2027.
First, the EU has reopened the door to a limited use of high-integrity international carbon credits towards its 2040 climate target, beginning with a pilot phase from 2031 to 2035. Anticipated EU demand is likely to reinvigorate a global carbon credit market that is currently evolving in different ways compared to previous expectations, with Article 6, potential interoperability, and intersections between Article 6 and compliance markets as pivotal policy areas. Second, the Carbon Border Adjustment Mechanism (CBAM) is phasing in a carbon border levy on imports of carbon-intensive goods. Since CBAM discounts carbon prices paid in the country of origin, it bears directly on the Union's trading partners and has already indirectly induced several of them to develop domestic carbon pricing instruments. Third, the EU's engagement in the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), together with the proposed limited extension of the EU Emissions Trading System (EU ETS) to certain departing international flights, will condition the future governance of international aviation emissions in the near future.
Considered jointly, these developments confirm a policy orientation no longer confined to domestic abatement but increasingly directed towards the configuration of global clean value chains and the promotion of decarbonisation in third countries. This offers scope for the consolidation of new alliances, while carrying corresponding risks of political and economic friction in times of growing geopolitical confrontation.
Engagement with third countries constitutes the common thread across the three sessions of this High-Level Policy Dialogue. On international credits, the HLPD will examine how the pilot phase should be designed: its architecture and potential linkage to the development of carbon pricing pilots will establish the precedents, partnerships, and integrity benchmarks on which any subsequent, larger-scale European use of credits will rest. On CBAM, the discussion will consider the extent to which greater flexibility in recognising third countries' national circumstances can be reconciled with effective carbon leakage protection for EU producers, and the impacts this discussion might generate across key partner capitals. On aviation, it will address the prospective relationship between CORSIA and the EU ETS considering the evolving political debate in Brussels, also building on experiences from other jurisdictions, to answer a largely unresolved question: how to make sure that the growing emissions from the aviation sector are effectively tackled through effective climate policies, in Europe and globally?
Attendance at this event is by invitation only and all deliberations will take place under the Chatham House rule (no views or positions may be attributed publicly to any participant). Following the recommendations that come out of the discussion, the organisers will publish a policy brief as part of their public mission.