Carbon Border Adjustment Mechanism (CBAM)

The EU Carbon Border Adjustment Mechanism (CBAM) requires any company importing over 50 tonnes of cement, iron and steel, aluminum, fertilizers, electricity, or hydrogen into the EU per year to register as an authorized CBAM declarant, annually report verified embedded greenhouse gas emissions, and surrender CBAM certificates priced against EU Emissions Trading System (EU ETS) allowances, with a penalty of €100 per tonne of CO₂e for authorized declarants who fail to surrender certificates on time.

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Next Deadline

September 30, 2027: authorized CBAM declarants must file the first annual CBAM declaration and surrender certificates for all covered goods imported during 2026.

The 2026 reporting year is already in progress. Authorized CBAM declarants must verify and declare embedded emissions for all goods imported between January 1 and December 31, 2026 by September 30, 2027. CBAM certificate prices for 2026 imports are set as quarterly averages of EU ETS allowance auction prices. Certificates go on sale in February 2027. Companies that have not yet obtained authorized CBAM declarant status cannot import covered goods above the 50-tonne annual threshold until the National Competent Authority (NCA) grants authorization.

Regulation timeline

1. October 2023

CBAM transitional phase begins. EU importers of covered goods must submit quarterly reports on embedded greenhouse gas emissions. No certificate purchases required during this phase.

17. October 2025

CBAM Omnibus simplification package (Regulation EU 2025/2083) published in the Official Journal of the EU. Key changes: annual declaration deadline moved from May 31 to September 30; quarterly certificate holding requirement reduced from 80% to 50% of embedded emissions; 50-tonne annual de minimis exemption made legally binding.

31. January 2026

Final transitional quarterly report due, covering Q4 2025 imports.

February 2027

CBAM certificates go on sale via the EU’s central platform for the first time, covering 2026 imports. Prices reflect the quarterly average 2026 EU ETS allowance auction price.

31. January 2024

First quarterly CBAM transitional report due, covering imports from Q4 2023.

1. January 2026

Definitive phase begins. Quarterly transitional reporting ends. Annual declaration and certificate obligations apply to all imports of covered goods above 50 tonnes per year.

31. March 2026

Deadline for submitting authorized CBAM declarant applications while continuing provisional imports. Late applicants must await NCA approval before importing above the 50-tonne threshold.

30. September 2027

First annual CBAM declaration and certificate surrender due, covering all covered goods imported during 2026.

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2023

1. October 2023
CBAM transitional phase begins. EU importers of covered goods must submit quarterly reports on embedded greenhouse gas emissions. No certificate purchases required during this phase.
2024

31. January 2024
First quarterly CBAM transitional report due, covering imports from Q4 2023.
2025

17. October 2025
CBAM Omnibus simplification package (Regulation EU 2025/2083) published in the Official Journal of the EU. Key changes: annual declaration deadline moved from May 31 to September 30; quarterly certificate holding requirement reduced from 80% to 50% of embedded emissions; 50-tonne annual de minimis exemption made legally binding.
2026

1. January 2026
Definitive phase begins. Quarterly transitional reporting ends. Annual declaration and certificate obligations apply to all imports of covered goods above 50 tonnes per year.
31. January 2026
Final transitional quarterly report due, covering Q4 2025 imports.
31. March 2026
Deadline for submitting authorized CBAM declarant applications while continuing provisional imports. Late applicants must await NCA approval before importing above the 50-tonne threshold.
2027

February 2027
CBAM certificates go on sale via the EU’s central platform for the first time, covering 2026 imports. Prices reflect the quarterly average 2026 EU ETS allowance auction price.
30. September 2027
First annual CBAM declaration and certificate surrender due, covering all covered goods imported during 2026.

What the regulation requires

The Carbon Border Adjustment Mechanism (Regulation EU 2023/956, amended by Regulation EU 2025/2083) entered its definitive phase on January 1, 2026, following a transitional reporting period from October 2023 to December 2025. It applies to EU importers and indirect customs representatives acting on their behalf, importing covered goods into the EU: cement, iron and steel, aluminum, fertilizers, electricity, and hydrogen.

Importers below 50 tonnes per year across all in-scope goods combined are exempt from CBAM obligations. Electricity and hydrogen are assessed separately and are not subject to the same threshold.

The regulation requires importers to hold authorized CBAM declarant status, report verified greenhouse gas emissions (direct and, for some sectors, indirect) embedded in imported goods, purchase CBAM certificates equivalent to those emissions, and annually surrender them. If a carbon price has already been paid in the country of origin, the declarant can deduct the corresponding amount.

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