In March 2026, the EU has officially amended the European Climate Law to include a new binding 2040 climate target, which is a legally binding target to reduce net GHG emissions by 90% by 2040 compared to 1990 levels. It also specifies that member states may use high-quality international carbon credits to meet up to 5% of 1990 net emissions. The law highlights the need for EU-based permanent carbon removals to offset had-to-abate emissions, and aims to enhance flexibility within and across sectors and instruments. It shifts the start date for the EU ETS for road transport and buildings (ETS 2) from 2027 to 2028.