The European Union's Carbon Border Adjustment Mechanism (CBAM) is entering a critical phase. After a transitional period that began in October 2023, the definitive CBAM regime is set to take effect on January 1, 2026. For importers of CBAM-covered goods into the EU, this means moving from reporting-only obligations to full financial obligations.
What Is Changing?
During the transitional period, importers were required to submit quarterly CBAM reports detailing the embedded emissions in their imports. No financial payments were required, the goal was to allow importers and authorities to prepare for the definitive phase.
Starting in 2026, the rules change significantly:
- Importers must be authorized CBAM declarants, registered with their national competent authority.
- CBAM certificates must be purchased to cover the embedded emissions in imported goods.
- The price of CBAM certificates is linked to the EU Emissions Trading System (ETS) carbon price.
- Annual CBAM declarations must be submitted by May 31 each year, covering the prior calendar year.
- Actual (verified) emission data from suppliers can reduce the number of certificates required compared to using default values.
Which Goods Are Covered?
CBAM applies to imports of goods in the following sectors: cement, iron and steel, aluminium, fertilizers, electricity, and hydrogen. These sectors were chosen because they are both carbon-intensive and at risk of carbon leakage, meaning production could shift to countries with less stringent climate policies.
What Importers Need to Do Now
With the definitive phase approaching, importers should take several steps to prepare:
- Register as an authorized CBAM declarant with the relevant national authority.
- Map your supply chain to identify which imports fall under CBAM and their country of origin.
- Engage with suppliers to collect actual emission data, as this can significantly reduce your CBAM costs compared to default values.
- Implement a compliance system capable of calculating embedded emissions, tracking CBAM certificates, and generating the required XML reports.
- Budget for CBAM certificate costs, which will fluctuate with the EU ETS carbon price.
How CBAM Desk Helps
CBAM Desk is designed to make this transition as smooth as possible. Our platform automates the calculation of embedded emissions, maintains an up-to-date database of default emission values across all countries, and generates submission-ready reports in the official EU XML schema.
Whether you're importing steel from Turkey, aluminium from China, or fertilizers from Russia, CBAM Desk provides the tools to manage your compliance obligations efficiently and accurately. With the definitive phase just around the corner, now is the time to get prepared.