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I. INTRODUCTION 434 II. THE DBCFT--MAIN FEATURES 438 A. The DBCFT As Part of Tax law 440 B. The DBCFT As Seen by WTO Law 442 1. The DBCFT, Existing [...], The idea that corporations should be taxed in the jurisdiction where they make their sales or provide their services is getting more and more attention in the policy debate on international taxation. In 2016, U.S. House Speaker Paul Ryan proposed to introduce a destination-based cashflow tax (DBCFT) in order to reform the United States' corporate income tax (CIT). Moreover, in the last few years, more and more countries have considered the adoption of new rules to tax the digital economy in the country where the users and/or the consumers are located. These proposals differ from traditional direct taxes imposed on corporations. They borrow from the tax design of indirect taxes, such as sales taxes or value added taxes. Consequently, it is difficult to predict whether these sui generis destination-based taxes will fit in with superior legal provisions, in particular international tax and trade law. One recurring legal argument against destination-based taxes is that they are likely to violate the law of the World Trade Organization (WTO). Using the DBCFT as a case study, this Article will assess the different conflicts that could arise between new types of destination-based taxes and international trade law. Based on a critical approach informed by the analysis of the history and case law surrounding destination-based taxes, this Article concludes that the likelihood that a DBCFT would be found incompatible with international trade law is much lower than past legal scholars have concluded. WTO law does not in itself prevent countries from adopting such taxes. Since this conclusion could be extended by analogy to other, new types of destination-based taxes, this Article could have important implications for policymakers who are willing to move towards taxation in the country of destination.

Carbon leakage – the increase of greenhouse gas emissions in foreign jurisdictions following the introduction of domestic or regional climate mitigation measures – raises key questions in the climate change debate. This includes whether carbon leakage constitutes a threat to the environmental integrity of climate policies and, if so, how this could be mitigated. Through the use of four hypothetical models of international climate change regime, this article argues that international climate change law is a key factor in answering this two-part question. Firstly, the article demonstrates that the architecture of international climate change law affects whether carbon leakage can be considered as undermining the mitigation objective of climate policies. Secondly, it draws attention to the interaction – and potential tension – between carbon leakage prevention measures and international climate change law. [ABSTRACT FROM AUTHOR]

To reach climate neutrality, carbon emissions from the production of basic materials need to be curtailed. When governments encourage this transition by adopting support measures, the measures must comply with the Agreement on Subsidies and Countervailing Measures. This article analyzes three selected support schemes under the Agreement on Subsidies and Countervailing Measures: (i) free allocation under emissions trading systems to operators of installations at risk of carbon leakage; (ii) the combination of a charge on carbon-intensive materials with free allocation; and (iii) carbon contracts for difference, under which governments cover the incremental costs of climate-neutral production processes relative to conventional processes. The analysis reveals that the current regime of free allocation is vulnerable to challenges under the Agreement on Subsidies and Countervailing Measures. By contrast, the combination of free allocation and a charge on carbon-intensive materials would ensure consistent carbon pricing and thus would not amount to a subsidy under the Agreement on Subsidies and Countervailing Measures. In a similar vein, the carbon contracts for difference could be designed so that they would not confer a benefit and hence not constitute a subsidy. [ABSTRACT FROM AUTHOR]

Carbon border adjustment measures (CBAMs) are instruments that can be used to mitigate climate change, but also have a positive impact on trade, climate leadership and even public finance. In this article, I challenge the view that they can serve as straightforward multi-purpose instruments. In a first step, I analyse each of the purposes that can be achieved through CBAMs and explain their underlying differences. In a second step, I discuss their legal design and explain how CBAMs' design features affect the types of purposes that they can achieve. I apply this two-step analytical framework to the European Union context, where a proposal for a regulation establishing a CBAM has been published by the European Commission in July 2021. I demonstrate that the design of the EU CBAM is inconsistent with the Commission's main objectives of promoting fair competition and climate mitigation in line with the Paris Agreement. The EU CBAM proposal is primarily an instrument of climate leadership. [ABSTRACT FROM AUTHOR]

By setting near‐zero‐emission requirements for the production of certain products to be sold on the European single market (product carbon requirements, PCRs), the European Union could accelerate the phase‐out of carbon‐intensive production processes. The announcement of such requirements would send a signal to producers, financing institutions and other relevant stakeholders, thus incentivizing them to prepare for the shift to a carbon‐neutral society. This article analyses several European environmental standards and technical regulations to offer insights into the political, legal and technical background for the adoption of PCRs. It shows that PCRs would constitute a new development in technical regulations. Given the relevance of World Trade Organization law for the adoption of standards and technical regulations on products, the article analyses in further detail the compatibility of PCRs under WTO law, and argues that PCRs can be designed in line with the provisions of the General Agreement on Tariffs and Trade and the Agreement on Technical Barriers to Trade. [ABSTRACT FROM AUTHOR]

Arguments in support of carbon border adjustment measures are often based on considerations of justice. Implementing carbon border adjustment measures would be necessary to, first, promote fair competition between corporations and, second, make carbon pricing instruments more effective and thus prevent the harms of dangerous climate change. Yet, both arguments tend to obscure considerations of distributive justice relative to the burdens of climate policies and the benefits of economic cooperation. In this article, we first explain why the case for carbon border adjustment measures based on the ideal of fair competition between corporations is flawed. Second, if the priority of harm avoidance over fair burden-sharing can justify carbon border adjustment measures, we argue that it does not justify all kinds of carbon border adjustment measures. On the contrary, it puts significant constraints on their design. We contend that just carbon border adjustment measures should include design features that allow for some form of carbon leakage risk, either via country-differentiated prices or via country-specific exemptions. [ABSTRACT FROM AUTHOR]