Why CBAM’s scrap loophole is a data and enforcement crisis waiting to erupt
For all its ambition, the European Union’s Carbon Border Adjustment Mechanism (CBAM) suffers from a problem not uncommon in modern climate regulation: data complexity outpacing policy design. In our previous editorial derived from the same study by European Aluminium, we have explored how aluminium scrap has become a billion-euro backdoor for foreign producers to undercut CBAM fees and outprice European producers. But underneath the circumvention tactics lies an even bigger story, one of missing traceability, legal grey zones, and statistical blind spots that could seriously undermine CBAM’s integrity over the next decade.
This time, we delve deeper into why CBAM’s loophole isn’t just about policy, it’s about enforcement infrastructure, legal classification, and the technical debt of global trade accounting.
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