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Paul Mertenskötter is an associate in the firm’s Brussels office and a member of the Public Policy and International Trade practice groups. He advises multinational companies, governments, and other clients on a range of matters related to public policy, international trade, and new technologies. Mr. Mertenskötter’s practice encompasses advising clients on the European Commission’s Digital Single Market strategy, including on the Payment Services Directive (PSD 2).

Prior to joining the firm, Mr. Mertenskötter clerked at the International Court of Justice in The Hague, and was a Fellow at the Institute for International Law and Justice at NYU Law School. His work has been published with Oxford University Press and the Cornell Law Review.

The European Commission is currently discussing a draft of a proposal for a Carbon Border Adjustment Mechanism (“CBAM”) Regulation that it is expected to present on July 14, 2021.  A CBAM was already announced in the European Commission’s Communication for a Green Deal  and is intended to protect the EU’s domestic industry that is at risk of carbon leakage—to create a level playing field—and to serve as a policy tool to encourage third countries to reduce their greenhouse gas (“GHG”) emissions.

The CBAM draft proposal is subject to intense negotiations among the different Directorates-General of the European Commission, and it is likely that it will be amended several times before the Commission finally presents it on July 14.  Nevertheless, the draft already suggests that the CBAM proposal will require importers of covered goods into the EU to purchase and surrender a number of CBAM certificates that reflect the goods’ embedded emissions.  In line with the European Parliament’s resolution, the CBAM would be linked to the EU Emissions Trading System (“EU ETS”) as the price of the CBAM certificates would reflect the average price of the ETS allowances.
Continue Reading Twelve Things to Know About the Upcoming EU Carbon Border Adjustment Mechanism

The UK Government recently announced that it is developing legislation that would make it illegal for large businesses operating in the UK to use certain commodities that have not been produced in line with local laws, and require in-scope companies to conduct due diligence to ensure that their supply chains are free from illegal deforestation

As of January 2021, many imports and exports of agricultural products covered by EU tariff quotas will be subject to the new licensing rules of Commission Delegated Regulation (EU) 2020/760 (“Delegated Regulation”) and Commission Implementing Regulation (EU) 2020/761 (“Implementing Regulation”) (together, “Licensing Regulations” or “Regulations”).  The new Regulations introduce significant changes to – and are

“Businesses that have better risk mitigation processes across their supply chains cause less harm to people… Good environmental, social, and governance practices pay off… We need to make sure that responsible business conduct and sustainable supply chains become the norm.”
EU Commissioner for Justice, Didier Reynders, April 29, 2020

On April 29, 2020, in a webinar hosted by the European Parliament’s Responsible Business Conduct Working Group, EU Commissioner for Justice Didier Reynders announced that the European Commission (the “Commission”) will move swiftly to introduce regulation on mandatory human rights and environmental due diligence for companies, with its legislative proposal to the European Parliament and Council expected in the first quarter of next year.

In this alert, we provide an overview of the comments and commitments made by Commissioner Reynders against the backdrop of the recently published Study on Due Diligence Requirements Through the Supply Chain (the “Study”), which considered possible EU-wide regulatory interventions relating to human rights and environmental due diligence, and which provides the impetus for the Commissioner’s announcement.

Consultations to inform the Commission’s legislative proposal are expected to start in the coming weeks, so we also set out some initial factors that commercial organizations operating in the European Union may want to consider as they seek to engage with this policy process.

  1. Background: the Study

Commissioner Reynders’s presentation centered around the findings of the Study, which was published in late February and conducted by an expert panel that included representatives of the British Institute of International and Comparative Law, the London School of Economics and Political Science, and Civic Consulting, a public policy consultancy.

The Study involved: (i) a detailed examination of existing regulations and proposals for supply chain due diligence requirements, as well as market practices; (ii) the development of four general options for regulatory interventions at the EU level; and (iii) an assessment of the potential impact of these four options, based also on stakeholders’ perceptions of the different regulatory interventions.

In high-level terms, the Study identified and evaluated the following four options:

Option 1—No EU level policy change: This option would not involve any harmonized EU level regulatory intervention. The Study indicates that this option would be likely to result in a “patchwork” of due diligence expectations across the EU, as there are pending proposals or campaigns for mandatory human rights and environmental due diligence laws in 13 European countries, of which 11 are EU Member States.
Continue Reading European Union Justice Commissioner Commits to Regulation on Corporate Human Rights and Environmental Due Diligence

Last week, the European Commission took a major step to implement the climate aspects of its European Green Deal.  It presented a proposal for a European Climate Law and two consultations on its announced Climate Pact and Carbon Border Adjustment Mechanism (“CBAM”).

The European Commission intends to present a proposal for a CBAM by

The European Commission has just adopted a Regulation that will lift the existing ban on imports of poultry meat from Ukraine that was triggered by the January 2020 Highly Pathogenic Avian Influenza (“HPAI”) outbreak in the western part of the country.

On January 19, 2020 the Ukrainian authorities informed the World Organization of Animal Health