FEPORT Proposes Cargo-Based Maritime ETS to Protect Ports

FEPORT, the federation of private port and terminal operators in Europe, argued that the review of the maritime emissions trading system (ETS) should be based on the destination of the goods in order to protect ports from carbon leakage, rather than granting advantages based on distance traveled or the European terminal chosen. The organization is thus putting forward a response to an issue that links climate policy with logistics competition: how to maintain transshipment in the European Union without weakening the economic signal that drives shipping lines to reduce emissions.

According to FEPORT, European policymakers are currently discussing three alternatives to combat evasion: a progressive reduction in emission allowances based on the distance between the European port and the port of origin in a third country; an ETS exemption for certain EU ports depending on their exposure to international competition; and a cargo-based mechanism that offers discounts based on the proportion of discharged transshipment containers not destined for the EU market. The federation's Secretary General, Lamia Kerdjoudj, stated that she was not convinced by the first two proposals.

FEPORT warned that the distance-based discount could create an unintended effect: if arriving in Europe from a more distant non-EU port grants a larger reduction, shipping lines would have an incentive to eliminate intermediate calls from their rotations, exactly the opposite of what the measure seeks to prevent. Regarding port-based exemptions, the federation argued that they would favor certain hubs over others within the internal market, undermining the level playing field between terminals subject to the same EU framework, while also reducing revenue for the EU and member states and weakening shipping lines' incentive to decarbonize.

In contrast to these two options, FEPORT backed the cargo-based measure, which it places under Article 12.3-g of the proposal under review, arguing that by focusing on the destination of the goods, it does not create preferential treatment based on routes or calls and directly targets the most exposed volumes: containers that were never intended for the EU market in the first place. The federation also called for strengthening this mechanism by extending it to inbound voyages as well, and urged institutional stakeholders to support it rather than pursue new proposals that, it warned, are neither solid in substance nor certain in their actual impact.

FEPORT recalled that the extension of emissions trading to international voyages was first proposed in the summer of 2021, and that the sector's warnings about the risk of evasion were only partially addressed, with the inclusion in the text that entered into force in May 2023 of a list of neighboring transshipment ports excluded from the definition of a port call. The federation also stressed that maintaining strong transshipment hubs in Europe is not only key to port competitiveness but also contributes to energy supply security, military mobility, and control over international logistics chains, in a context where the maritime ETS, in force since January 2024, requires the surrender of allowances covering 70% of 2025 emissions in 2026, a percentage that will reach 100% for 2026 emissions.