On 25 September 2026, the World Trade Organization (WTO) advised that, at its meeting, its Dispute Settlement Body (DSB) had agreed to a request from the Russian Federation (Russia) for the establishment of a panel to review the European Union (EU) Carbon Border Adjustment Mechanism (CBAM) Package and alleged export subsidy under the EU scheme for trading greenhouse gas emission allowances.
DS639: EU and its member states - CBAM
Russia submitted its second request to establish a dispute panel to determine whether the European Union (EU) CBAM and alleged export subsidy under the EU scheme for trading greenhouse gas emission allowances are consistent with the EU’s WTO commitments. The EU had objected to Russia’s first request for a panel at a DSB meeting on 24 July 2026.
Russia said the CBAM package created significant trade barriers for covered goods imported into the EU. Russia added that the EU’s allocation of allowances to certain companies under the Emissions Trading System (ETS) amounted to an export subsidy intended to strengthen the competitiveness of certain domestic industries.
The EU said it was extraordinary that Russia - which the EU said continued to “wage its war of aggression against Ukraine” - was seeking to rely on international law to improve access for exports into the EU market. The EU said it would take part in the proceedings, not to legitimise Russia’s actions, but to reaffirm the EU’s strong support for the rules-based multilateral trading system. It also said it was confident that both the CBAM and the ETS were consistent with WTO rules.
The DSB agreed to the establishment of the panel
Argentina, Brazil, Canada, the People’s Republic of China (China), India, Indonesia, Japan, the Kingdom of Saudi Arabia, the Republic of Korea (South Korea), Malaysia, Norway, Paraguay, Singapore, Switzerland, Chinese Taipei, Thailand, the United Kingdom (UK) and the United States of America (US) reserved their third-party rights to participate in the proceedings.
The documentation is accessible at:
https://www.wto.org/english/tratop_e/dispu_e/cases_e/ds639_e.htm