Company: MT
Filing Date: 2025-03-10
Form Type: 20-F
Source: 0001243429-25-000017
Chunk: 27

Company: ArcelorMittal
Filing Date: 2025-03-10
Form: 20-F
Chunk 27
---
ization". The new Trump administration in the United States appears unlikely to provide the support necessary for decarbonization, which may also influence adoption of such policies and support worldwide. A lack of governmental and societal support could make the Company’s targets more costly, more difficult or even impossible to achieve. If the Company is unable to make the necessary investments to decarbonize and reach its decarbonization targets due to the design of governmental policy in Europe or other jurisdictions where it operates (see “—Changes in assumptions underlying the carrying value of certain assets, including as a result of adverse market conditions, could result in the impairment of such assets, including intangible assets such as goodwill”), it may negatively affect its competitiveness, profitability, cash flows, financing costs , results of operations and financial condition, as well as harm its reputation. Laws and regulations restricting emissions of greenhouse gases could force ArcelorMittal to incur increased capital and operating costs and could have a material adverse effect on ArcelorMittal’s results of operations, financial condition and reputation. The integrated steel process involves significant carbon- footprint . Compliance with new and more stringent environmental obligations relating to GHG emissions, including as part of the EU’s “Fit for 55” package, may require additional capital expenditures or modifications in operating practices, as well as additional reporting obligations. See “Business Overview – Government Regulations—Environmental laws and regulations—Climate Change". The new laws are all interconnected, and they combine: tightening and extending the existing emission trading system ("EU-ETS"); increased use of renewable energy; greater energy efficiency; a faster roll-out of low emission transport modes and the infrastructure and fuels to support them; an alignment of taxation policies with the European Green Deal objectives; a carbon border adjustment mechanism ("CBAM") to prevent carbon leakage; and tools to preserve and grow natural carbon sinks. Of particular relevance are the amending EU-ETS directive and the CBAM regulation, which entered into force in mid-2023, and will mainly impact the carbon emissions allowances from the second trading period of Phase IV of the EU-ETS (i.e., 2026-2030) onwards. The implementation of Phase IV rules (applicable during the 2021-2030 period) has already resulted in increased EU allowances prices, which the Company expects will continue to increase, despite recent volatility. Moreover, as from 2026 free allocation of CO 2 emissions allowances will be progressively phased out (and completely phased out as from 2034). This will contribute to a very significant shortage in free allocation