The EU Carbon Border Adjustment Mechanism (EU CBAM) has now entered its definitive implementation phase. Following a fourteen-month transitional period, financial obligations apply to 2026 emissions, with mandatory reporting and certificate surrender requirements.
Businesses importing CBAM-in-scope goods into the EU must act now to avoid penalties and disruption.
The EU CBAM Regulation will obligate any businesses importing CBAM goods into the EU.
The industries considered ‘in-scope’ are importers of cement, iron, steel, aluminium, fertilisers, electricity, and hydrogen. For instance, this could include raw materials like iron ore or finished goods like steel beams.
Key milestones under EU CBAM include:
EU importers should prepare by:
Meeting EU CBAM requirements is essential before the 31 March 2026 registration deadline. Valpak provides an end-to-end EU CBAM compliance service designed to reduce risk and administrative burden.
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Navigating the EU Carbon Border Adjustment Mechanism (CBAM) can be complex, but we offer a comprehensive, hands-on approach to ensure full compliance. Unlike some other providers that focus solely on carbon footprint calculations, we go further, handling the entire submission process on your behalf.
Our service includes:
Let us simplify CBAM compliance so you can focus on what matters most, growing your business. Get in touch today to see how we can help.
The EU CBAM impacts any businesses that import CBAM goods into the EU. The reporting obligation will stand if the UK business acts as an importer in its name in the EU.
The EU CBAM applies to imports of goods in the following sectors:
These sectors were initially chosen due to their high risk of carbon leakage.
The EU CBAM Regulation targets cement, iron/steel, aluminium, fertilisers, hydrogen, and electricity imports based on their CN (Combined Nomenclature) codes. The list of goods that must be reported can be found here or in Annex I of the CBAM Regulation.
The EU CBAM threshold is based on import weight, unlike the UK threshold which is based on import value. The EU threshold is set at 50 tonnes of imported goods. A business will face a EU CBAM obligation if it imports over 50 tonnes of flagged goods.
Reporting of embedded emissions in CBAM goods is mandatory. Reporting declarants may face penalties ranging between EUR 10 and EUR 50 per tonne of unreported emissions, underscoring the seriousness of non-compliance.
In the case of missing, incorrect, or incomplete CBAM reports, the National Competent Authority (NCA) may initiate a correction procedure, granting reporting declarants the possibility to rectify potential errors. If the reporting declarant does not take action, penalties will follow.
Importers continuing to import CBAM-obligated goods into the EU without meeting Authorised Declarant status requirements will also face penalties.
Authorised Declarant status means a business has officially been recognised by its EU member state as a CBAM importer and added to the CBAM registry.
Obligated businesses must apply for Authorised Declarant status by the end of March to continue importing CBAM goods into the EU. Failure to submit an application will result in goods being blocked at the border.
The European Commission has made a list of default values available to be used by businesses to determine their embedded emissions for CBAM-obligated goods. These values are to be used as a last resort when actual data cannot be obtained from suppliers.
Default values are designed to be more comprehensive than the average actual value, creating an inventive for declarants to use actual data from their suppliers.
No, the EU CBAM (Carbon Border Adjustment Mechanism) does not currently cover finished goods. It only applies to certain basic materials and basic material goods that have high carbon emissions in their production. Precursor materials such as aluminium sheets or stainless steel are covered but finished goods including automobiles, packaged consumer electronics, cookware, and machinery are exempt.
That being said, the European Commission may extend CBAM to cover finished products in later phases.
The de-minimis exemption for the EU CBAM is set at 50 tonnes of flagged goods. If a company imports under 50 tonnes of flagged goods, they do not face a CBAM obligation.
Yes, there are some notable differences between the UK and EU CBAM regulations, although these may change as the UK and EU link their Carbon Schemes as part of their new collaborative deal. As the regulations stand, the notable differences between the UK and the EU are the following:
Let us simplify EU CBAM compliance so you can meet deadlines with confidence and avoid penalties. Contact us today to discuss EU CBAM support.
Valpak has proven to be an invaluable partner in helping us negotiate the complexities of CBAM (Carbon Border Adjustment Mechanism) reporting. Navigating the complicated requirements of CBAM was a daunting task, but Valpak’s expertise made the process seamless and efficient. Their team were able to remove the burden of an intricate reporting process by completing it on our behalf and ensuring our compliance with the regulations.