On 27 July 2026, the European Commission published a proposal for a Council Decision establishing the EU's position within the EEA Joint Committee to amend Protocols 10 and 31 of the EEA Agreement, requiring EEA EFTA States (Norway, Iceland, Liechtenstein) to contribute financially to the operation of Carbon Border Adjustment Mechanism (CBAM) systems across the entire European Economic Area. The amendment runs parallel to the incorporation of the CBAM Regulation (EU) 2023/956 and its amending Regulation (EU) 2025/2083 into the EEA Agreement via a separate Joint Committee decision.
The proposal, based on Article 192(1) TFEU (environment) in conjunction with Article 218(9) TFEU and Article 1(3) of Council Regulation (EC) No 2894/94, would amend Protocol 10 on simplification of inspections and formalities for carriage of goods, and Protocol 31 on cooperation outside the four freedoms. The draft Joint Committee decision attached to the Council Decision specifies the financial contribution from EEA EFTA States to operate CBAM systems across the whole EEA. The Council Decision enters into force on the date of its adoption.
The proposal has no prior coverage in the last 180 days, marking a new step in extending CBAM to the EEA. The European Parliament and Council will now consider the proposal, with the EEA Joint Committee expected to adopt the amendment subsequently. The move ensures that EEA EFTA States share the costs of implementing CBAM, which aims to prevent carbon leakage by applying a carbon price to imports of certain goods. Stakeholders affected include EEA EFTA governments, which will face new financial obligations; EU producers, who may benefit from a level playing field; importers in the EEA, who will face CBAM compliance costs; and EU taxpayers, who may see reduced burden from CBAM implementation costs shared with EFTA states.