Bangkok: Thailand is preparing to implement CBAM (Community-Based Asset Management) measures to maintain the competitiveness of businesses.
According to Thai News Agency, the Department of Climate Change Mitigation disclosed that Thailand is progressing with measures for cross-border carbon pricing (CBAM) to prevent carbon leakage and sustain the competitiveness of domestic businesses in alignment with new environmentally conscious trading regulations. This initiative is part of the draft Climate Change Mitigation Act, which has already received Cabinet approval.
The Department of Climate Change and Environment has reported that Thailand is gearing up to enforce Cross-Border Carbon Pricing (CBAM) measures to avert carbon leakage and uphold the competitiveness of Thai enterprises. The CBAM is defined as a mandatory mechanism under the draft Climate Change Act, marking the nation's first comprehensive climate legislation.
The draft Climate Change Mitigation Act, which received approval in principle from the Cabinet on December 2, 2025, is currently undergoing legal procedures. It is anticipated to be presented to Parliament for consideration and approval by the end of 2026. This draft legislation establishes a structured framework for managing climate change, addressing both the reduction of greenhouse gases and adaptation to the impacts of natural disasters. The goal is to steer Thailand towards a low-carbon economy and achieve net-zero greenhouse gas emissions by 2050.
Central to the draft Climate Change Act is the establishment of a Carbon Pricing Mechanism (CBAM), comprising several mandatory tools. Thailand's CBAM is specifically outlined in this draft legislation to prevent "carbon leakage" from the relocation of high-greenhouse gas emission production facilities to the country and to foster fair competition between domestically produced goods and imports, which may incur differing greenhouse gas emission costs.
Moreover, CBAM measures are designed as a crucial tool for readying Thailand for more stringent environmental and international trade regulations, particularly trade rules that connect production costs with greenhouse gas emissions in the global supply chain.
The draft Climate Change Act also mandates the operation of carbon pricing mechanisms, including an Emissions Trading System (ETS), to set emission caps and allow for the trading of carbon tax benefits for producers and importers of greenhouse gas-emitting goods. This aims to create a transparent price signal to encourage businesses to adapt, reduce emissions, and invest in clean technologies.
Following the draft bill's review process by the Council of State, supporting legislation will be concurrently developed. This includes guidelines for reporting greenhouse gas emissions by legal entities and the operational structure of the carbon pricing mechanism, ensuring effective enforcement and enhancing the competitiveness of Thai businesses while addressing long-term climate challenges.