The legislative measures adopted by the European Union (EU) under the 'Climate Action and Renewable Energy' package have required, or are leading to, the adoption of grading systems or classification of fuels, biofuels, and bioliquids based on their carbon footprints or production methods, which are not without consequences for international trade. This article focuses on two legislative initiatives: the possible impacts of EU measures aimed at 'grading' fuels used in transportation according to their carbon footprint, required under the Fuel Quality Directive, and the sustainability criteria for biofuels and bioliquids established by the Renewable Energy Directive and the Fuel Quality Directive. Both instruments may result in the placing of trade restrictions on fuels, biofuels, and bioliquids into the EU and in trade discrimination, in possible contrast with the rules of the World Trade Organization (WTO). The article argues that these measures should not neglect the commercial implications that they have on third countries' (and traders') interests and be consistent with the rules of the WTO in order to avoid that environmental policies result in instances of 'green protectionism'. Multilateral solutions to address global problems having an impact on trade are clearly to be preferred. Traders should be heard in this debate, remain vigilant, and work with their governments and trade associations to ensure that no discrimination is 'camouflaged' under green policies.
Global Trade and Customs Journal