Business does not support the draft law on the national emissions trading system

04/ 08/ 2026

Member companies of the Industrial Ecology and Sustainable Development Committee of the European Business Association support the timely and phased introduction of Ukraines National Emissions Trading System (ETS) in line with the countrys European integration commitments. At the same time, the Committees experts believe that Draft Law No. 15386, in its current version, contains a number of provisions that could negatively affect regulatory predictability, investment attractiveness, and the competitiveness of Ukrainian industry. In particular, the business community notes that the draft law differs significantly from the version developed by the Ministry of Economy, Environment and Agriculture of Ukraine, which had been reviewed by the European Commission and received comments from both the Commission and business representatives. Among the Committees key concerns are the absence of legally defined benchmarks for determining the carbon allowance price, the accelerated phase-out of free allocation of allowances, the narrowing of decarbonisation support mechanisms, and reduced financial support for investment projects. In addition, the draft law proposes allocating ETS revenues to the existing state fund instead of establishing a dedicated Ukraine Modernisation Fund. It also concentrates both regulatory and financial management functions within a single authority, which, in the business communitys view, could undermine the transparency and effectiveness of the system. Businesses are also concerned about the proposed provisions introducing a mandatory carbon price for exporters of goods to the EU. According to industry representatives, these provisions require further legal assessment to ensure compliance with EU legislation and WTO rules, and they do not guarantee the avoidance of double financial burden under the Carbon Border Adjustment Mechanism (CBAM). In light of these concerns, the Association does not support Draft Law No. 15386 in its current form. At the same time, the business community considers it essential to continue refining the legislative framework for the National Emissions Trading System, taking into account the comments of the business community, the recommendations of the European Commission, and the approaches reflected in the draft prepared by the Ministry of Economy, Environment and Agriculture of Ukraine.

Member companies of the Industrial Ecology and Sustainable Development Committee of the European Business Association support the timely and phased introduction of Ukraine’s National Emissions Trading System (ETS) in line with the country’s European integration commitments. At the same time, the Committee’s experts believe that Draft Law No. 15386, in its current version, contains a number of provisions that could negatively affect regulatory predictability, investment attractiveness, and the competitiveness of Ukrainian industry.

In particular, the business community notes that the draft law differs significantly from the version developed by the Ministry of Economy, Environment and Agriculture of Ukraine, which had been reviewed by the European Commission and received comments from both the Commission and business representatives.

Among the Committee’s key concerns are the absence of legally defined benchmarks for determining the carbon allowance price, the accelerated phase-out of free allocation of allowances, the narrowing of decarbonisation support mechanisms, and reduced financial support for investment projects. In addition, the draft law proposes allocating ETS revenues to the existing state fund instead of establishing a dedicated Ukraine Modernisation Fund. It also concentrates both regulatory and financial management functions within a single authority, which, in the business community’s view, could undermine the transparency and effectiveness of the system.

Businesses are also concerned about the proposed provisions introducing a mandatory carbon price for exporters of goods to the EU. According to industry representatives, these provisions require further legal assessment to ensure compliance with EU legislation and WTO rules, and they do not guarantee the avoidance of double financial burden under the Carbon Border Adjustment Mechanism (CBAM).

In light of these concerns, the Association does not support Draft Law No. 15386 in its current form. At the same time, the business community considers it essential to continue refining the legislative framework for the National Emissions Trading System, taking into account the comments of the business community, the recommendations of the European Commission, and the approaches reflected in the draft prepared by the Ministry of Economy, Environment and Agriculture of Ukraine.