CBAM Verification

CBAM

About CBAM

The Carbon Border Adjustment Mechanism (CBAM) is the EU's tool to put a fair price on carbon emitted during the production of carbon-intensive goods entering the EU, encouraging cleaner industrial production in non-EU countries.

The European Climate Law makes the EU target of reducing greenhouse gas emissions by at least 55% by 2030 legally binding. To achieve this and reach climate neutrality by 2050, the EU introduced several complementary mechanisms.

EU Emissions Trading System (EU ETS)

The EU ETS is the internal carbon market where domestic EU producers pay for their carbon emissions. It serves as the benchmark carbon price inside the European Union.

Carbon Border Adjustment Mechanism (CBAM)

CBAM applies a carbon price to imported goods based on embedded CO₂ emissions, ensuring imported goods face the same carbon costs as EU-produced goods.

Scope

Industries Covered

Cement

Iron & Steel

Aluminium

Fertilisers

Electricity

Hydrogen

The 2025 CBAM Package expands CBAM to downstream finished and semi-finished steel and aluminium products.

Implementation

CBAM Periods

Period 1

Transitional Phase (1 October 2023 – 31 December 2025)

On 1 October 2023, the CBAM entered into application in its transitional phase, with the first reporting period for importers ending 31 January 2024. The gradual phasing in of CBAM allows for a careful, predictable and proportionate transition for EU and non-EU businesses, as well as for public authorities.

From 1 October 2023 to 31 December 2025, CBAM operated as a transitional reporting system. Importers of covered goods are required to submit quarterly emissions reports via the CBAM Transitional Registry, with no financial obligations or certificates required.

Key features:

Quarterly reports must be submitted no later than one month after the end of each quarter.

Between October 2023 and June 2024, companies could rely fully on default values. From July 2024 onwards, reporting is expected to be based on actual emissions data where available, while default values remain permitted under certain conditions and subject to increasing limitations.

No independent verification is required during this phase. The reported data (direct and indirect emissions) is used solely for reporting purposes.

The CBAM definitive period will start on 1 January 2026.

Period 2

Definitive / Compliance Phase (1 January 2026 – ongoing)

From 1 January 2026, CBAM enters its definitive phase, introducing full financial and compliance obligations.

Key changes:

Importers must purchase and surrender CBAM certificates annually based on reported embedded emissions. Reporting becomes annual and fully compliance-driven before 30 September.

A structured Carbon Emissions Tracking & Reporting Framework is required, defining how emissions data is generated, controlled, and validated within the organization.

Roadmap