With the Carbon Border Adjustment Mechanism, CBAM for short, the EU aims to prevent emission-intensive production from moving to countries with less stringent climate requirements. Anyone importing certain goods into the EU is to pay a carbon price for the emissions generated in their production comparable to that paid by a producer in the EU. After a transitional period with reporting obligations only, the definitive period has applied since 1 January 2026.
Which goods are covered
CBAM currently covers six groups of goods, each with precisely defined CN codes:
- iron and steel, including many products such as screws, tubes and sheets,
- aluminium and aluminium products,
- cement,
- fertilisers,
- hydrogen,
- electricity.
Whether goods are covered is determined solely by their CN code. Incorrect tariff classification is therefore no longer just a customs issue, but a CBAM issue as well.
Who needs authorisation
CBAM goods may only be imported by an authorised CBAM declarant. Importers whose imports remain below an annual quantity threshold are exempt; the threshold is 50 tonnes per year and importer for the groups of goods other than electricity and hydrogen. Anyone likely to exceed the threshold must apply for authorisation in good time. In Germany, the German Emissions Trading Authority (Deutsche Emissionshandelsstelle, DEHSt) is responsible; the application is made via the EU CBAM Registry.
Customs checks at import whether the declarant is authorised. Without authorisation, the goods will not be released for free circulation, and substantial penalties may apply to quantities already imported.
What needs to be done
- Record quantities: all CBAM goods imported in the calendar year, by type of goods and origin.
- Determine emissions: the “embedded” emissions generated during production – where possible on the basis of actual data from the producer, verified by an accredited verifier. Otherwise default values apply, which are usually less favourable.
- Submit the CBAM declaration: once a year for the previous year, by 30 September in each case. The first declaration, for 2026, is due by 30 September 2027. The quarterly reports from the 2023 to 2025 transitional period no longer apply.
- Surrender certificates: CBAM certificates corresponding to the declared emissions. Their price is based on the EU Emissions Trading System. A carbon price already paid in the country of origin can be deducted.
- Hold certificates during the year: certificates will only be sold from 1 February 2027; for imports in 2026 they are therefore purchased retrospectively. From 2027, at the end of each quarter, certificates covering at least half of the emissions embedded in the goods imported since the beginning of the year must be held in the account. So there is also work to do during the year.
Where practice runs into difficulty
The legal obligations are manageable. The data are the difficult part. Only the producer knows the emissions, often a supplier of one's own supplier in China, India or Turkey. Many producers do not provide the data, provide incomplete data, or provide them in a form that does not withstand verification. Those who then have to fall back on default values pay more.
In addition, there are interfaces within the company: purchasing, customs, sustainability and finance must work together, because CBAM affects supplier selection, the customs declaration, climate reporting and pricing at the same time.
What you should do now
- Check on the basis of your CN codes which of your imports fall under CBAM and whether you exceed the quantity threshold.
- Apply for authorisation in good time if necessary – or clarify whether your customs representative can act as declarant.
- Include emissions data and their verification in your supply contracts.
- Factor the cost of certificates into your purchase prices.
- Determine who in the company is responsible for CBAM.
The rules are being refined continuously, and the EU plans to extend the scope to downstream products. We keep you up to date and link CBAM with what is reviewed anyway: tariff classification, origin and customs value.