CBAM – Carbon Border Adjustment Mechanism
Regulation (EU) 2023/956 establishing a carbon border adjustment mechanism (CBAM)
Overview
The Carbon Border Adjustment Mechanism (CBAM) is an EU climate policy instrument designed to prevent carbon leakage. It prices the CO₂ emissions embedded in certain imported goods in line with the EU ETS carbon price.
Who Is Affected?
CBAM primarily affects:
- EU importers of cement, iron/steel, aluminium, fertilisers, electricity, and hydrogen
- Non-EU manufacturers who must provide emissions data for their products
- Indirectly: downstream industries processing these raw materials
Core Obligations
- Quarterly reports: Quarterly CBAM reports on imported quantities and emissions (transitional phase)
- CBAM certificates: From 2026, purchase of certificates corresponding to embedded emissions
- Verification: Verification of emissions data by accredited verifiers
- Emissions data: Recording actual emissions at the producer (or use of default values)
- CBAM declarant: Registration as an authorised CBAM declarant with the national authority
National Transposition
As an EU regulation, CBAM applies directly:
- Germany: German Emissions Trading Authority (DEHSt) at the Federal Environment Agency as the competent authority
- Austria: Competent national authority for CBAM declarant administration
- Switzerland: Not directly affected (non-EU member); own ETS linked to the EU ETS
Legal Sources
Frequently Asked Questions
Which goods fall under CBAM?
Cement, iron and steel, aluminium, fertilisers, electricity, and hydrogen. The list may be expanded in the future.
How does CBAM work?
EU importers must purchase CBAM certificates at a price reflecting the EU ETS carbon price. Carbon costs already paid in the country of production are deducted.
When do CBAM certificates have to be purchased?
A transitional phase with reporting obligations has been in effect since October 2023. Full application with certificate requirements begins on 1 January 2026.