Does International Trade Law Permit Border Carbon Adjustment Schemes If the Trump Administration Withdraws from the Paris Agreement?

Abstract

The thesis of this paper is that international trade law will permit border carbon adjustments on products from the US if the Trump Administration withdraws from the Paris Agreement, if such schemes are well-designed to avoid the World Trade Organization prohibitions on arbitrary or unjustified discrimination and on disguised protectionism. To illustrate this thesis, the paper proposes a multilateral border carbon adjustment scheme that other countries could agree to impose on the US. It then examines the compatibility of this scheme with international trade law, before going on to examine the policy implications of the trade-legality of border carbon adjustments for US policymakers and the rest of the world.