What is CBAM?
The Carbon Border Adjustment Mechanism (CBAM) is the EU's tool to address carbon leakage. It puts a price on the greenhouse gas emissions embedded in certain goods imported into the EU, such as steel, aluminium and cement, so that their carbon price is equivalent to the carbon price paid by producers in the EU under the EU Emissions Trading System (EU ETS).
Importers pay this price by buying and surrendering CBAM certificates for the emissions embedded in their goods. The number of certificates is reduced to reflect the free allocation EU producers still receive under the EU ETS and the carbon price paid in the country of production.
CBAM aims to prevent carbon leakage, which happens when production moves to countries with less stringent climate policies, or when EU products are replaced by more carbon-intensive imports. It also encourages cleaner industrial production outside the EU. CBAM is established by Regulation (EU) 2023/956.
Which goods does CBAM cover?
CBAM covers goods in six sectors: cement, iron and steel, aluminium, fertilisers, hydrogen and electricity. The goods are listed by CN code in Annex I of the regulation, which also takes in some products made from them, such as screws, bolts and other articles of iron, steel and aluminium.
The CN/TARIC code list shows every code in scope with its sector and the EU's default values.
Does CBAM apply to me?
CBAM applies to you if you import CBAM goods into the EU and their net mass in a calendar year is more than 50 tonnes. The threshold counts all your CBAM goods together, whatever their CN code. Below it you are exempt, and you state the exemption in the customs declaration.
Once you pass 50 tonnes in a year, the obligations cover everything you imported that year, including the first 50 tonnes. The threshold does not apply to electricity or hydrogen: importing either is covered whatever the quantity. The Commission reviews the threshold every year.
An indirect customs representative can act as the authorised CBAM declarant for an importer that appoints it, and must do so if the importer is not established in the EU.
What changed in 2026?
On 1 January 2026, CBAM moved from reporting to paying. From October 2023 to the end of 2025, importers only reported the emissions in their goods every quarter. Since 2026, importers need an authorisation, and the emissions in their imports are paid for through CBAM certificates.
Regulation (EU) 2025/2083 simplified the rules before that change: it introduced the 50-tonne threshold, set one annual declaration due by 30 September, and put the start of certificate sales at 1 February 2027.
What does an importer have to do?
An importer above the threshold needs an authorisation, a record of the emissions in each import, and enough certificates to cover them:
- Check whether your imports this year will pass 50 tonnes.
- Apply for the status of authorised CBAM declarant before you import, or as soon as you expect your imports to pass 50 tonnes. See how to become an authorised CBAM declarant.
- Record the embedded emissions of each import, from the EU's default values or the producer's verified actual emissions. See default values or actual emissions.
- Buy CBAM certificates, which go on sale on 1 February 2027. From 2027, at the end of each quarter you must hold certificates covering at least 50% of the emissions in that year's imports so far.
- By 30 September each year, submit the CBAM declaration for the previous year in the CBAM Registry and surrender the certificates. The first is due by 30 September 2027, for imports in 2026.
The dates for each year are on the CBAM deadlines page.
How much will it cost?
The cost depends on the emissions in your goods, whether they are actual emissions or default values with a mark-up, the free allocation EU producers of the same goods still receive, the carbon price paid in the country of production, and the certificate price, which follows the EU ETS auction price. How the cost of CBAM certificates is worked out explains each step, and the CBAM calculator gives an estimate for a good.