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The European Union plans to relax emissions-reduction rules for companies, revising its carbon market ahead of a summit. The overhaul aims to ease industry costs while maintaining climate targets, with details expected in Q3 2026.

The revision comes as the bloc reassesses its climate strategy amid rising competition from China and geopolitical pressures. The EU seeks to manage the supply of allowances to stabilize prices and consider extending free CO2 permits to prevent carbon leakage. The current market, established in 2005, needs adjustments to align with the EU's 2040 climate goals.