CBAM — Carbon Border Adjustment Mechanism

The Carbon Border Adjustment Mechanism (CBAM) (Regulation (EU) 2023/956) is a landmark instrument in EU climate policy aimed at preventing so-called carbon leakage — the relocation of carbon-intensive production to countries with less stringent climate regulations. The CBAM complements the EU Emissions Trading System (EU ETS) by ensuring that imported goods carry the same carbon price as products manufactured in the EU.

At its core, EU importers of CBAM goods must purchase CBAM certificates priced at the current carbon price under the EU ETS. The certificates cover the emissions embedded in the imported goods. Any carbon price already paid in the country of origin is credited to avoid double charging.

The CBAM is a globally unique instrument and is considered a milestone in international climate policy, as it directly links trade and climate policy for the first time and aims to safeguard the competitiveness of EU industry while advancing climate protection.

The European Commission presented the CBAM proposal on 14 July 2021 as part of the 'Fit for 55' package. The Council of the EU agreed on its position in March 2022, and the European Parliament adopted its position in June 2022. Trilogue negotiations began on 11 July 2022, and a provisional political agreement was reached on 12 December 2022.

Regulation (EU) 2023/956 was formally adopted on 10 May 2023 and published in the Official Journal of the EU on 16 May 2023; it entered into force on 17 May 2023. The transitional phase started on 1 October 2023 and runs until 31 December 2025, during which only reporting obligations apply. The definitive phase requiring the purchase and surrender of CBAM certificates begins on 1 January 2026, while sales of CBAM certificates start only on 1 February 2027. Regulation (EU) 2025/2083 simplified the CBAM rules for the compliance phase in October 2025: it introduced a de-minimis exemption for importers with a total annual import of CBAM goods of up to 50 tonnes, exempting roughly 90% of importers while still covering ~99% of embedded emissions (replacing the earlier EUR 150 per-consignment de-minimis), and postponed the start of certificate sales from 1 January 2026 to 1 February 2027.

The CBAM covers imports of certain carbon-intensive goods into the EU:

• Covered sectors: Cement, iron and steel, aluminium, fertilisers, electricity, and hydrogen — as well as selected precursors in these sectors.
• Affected actors: EU importers (authorised CBAM declarants) who import CBAM goods into the customs territory of the EU.
• De-minimis exemption (from 2026): Importers with a total annual import of CBAM goods of up to 50 tonnes are exempt from reporting, declaration, and certificate obligations (Regulation (EU) 2025/2083); this exempts ~90% of importers while still covering ~99% of embedded emissions, replacing the earlier EUR 150 per-consignment de-minimis threshold.
• Geographic scope: All third countries unless they participate in the EU ETS or have a linked emissions trading system (currently Iceland, Liechtenstein, Norway, and Switzerland are exempt).
• Emissions coverage: Direct emissions from production; for certain goods (e.g. cement, fertilisers) also indirect emissions from electricity consumption during production.

• CBAM declarant status: Importers must register as authorised CBAM declarants with the competent national authority before importing CBAM goods (from 2026).
• De-minimis exemption (from 2026): Importers with a total annual import of CBAM goods of up to 50 tonnes are exempt from reporting, declaration, and certificate obligations (Regulation (EU) 2025/2083); this exempts ~90% of importers while still covering ~99% of embedded emissions, replacing the earlier EUR 150 per-consignment de-minimis threshold.
• Quarterly reports (transitional phase): During the transitional phase (2023–2025), importers must submit quarterly reports on the embedded emissions of their imported CBAM goods via the CBAM Transitional Registry.
• CBAM certificates (sales from February 2027): From 1 February 2027, importers must purchase CBAM certificates at the EU ETS-linked price, covering the embedded emissions of goods imported from 2026 onward (sales start postponed from 1 January 2026 by Regulation (EU) 2025/2083).
• Annual CBAM declaration: From 2027, annual declaration of CBAM goods imported in the previous year, embedded emissions, and certificates to be surrendered — deadline 30 September.
• Verification: Declared embedded emissions must be verified by accredited verifiers.
• Crediting of foreign carbon prices: Carbon prices already paid in the country of origin are credited when calculating the certificates to be surrendered.

history and key_requirements state certificate purchase begins 'from 2026'. Regulation (EU) 2025/2083 postponed sales to 1 February 2027. The dataset's own key_dates entry ('2027-02-01') already reflects this, contradicting history/key_requirements.

The most significant 2025 CBAM development — the 50-tonne-per-importer-per-year de-minimis threshold introduced by Regulation (EU) 2025/2083 — is missing. It exempts roughly 90% of importers (mostly SMEs) while still covering ~99% of embedded emissions, replacing the earlier EUR 150 per-consignment de-minimis.

CBAM had no connections. Linked to EU Taxonomy as sustainability framework.