CBAM

What is CBAM and how do you comply?

CBAM puts a price on the embedded emissions of carbon-intensive goods imported into the EU. The definitive period began on 1 January 2026, and actual installation data can remove the cost gap created by default values.

Last reviewed 7 Oct 2026 Reading time 5 min

The Carbon Border Adjustment Mechanism (CBAM) aligns the carbon cost of carbon-intensive goods imported into the EU with the carbon price they would have paid had they been produced inside the EU. For non-EU producers of steel, aluminium, cement or fertilisers, and for the EU importers buying from them, it is a direct price item.

Market access versus cost

The DPP is a market access issue: no record, no sale. CBAM is a cost issue: you can sell, but at a higher cost, and how much depends on the quality of your data.

Which goods are covered?

Regulation 2023/956 covers six groups of goods:

Iron and steel
Aluminium
Cement
Fertilisers
Electricity
Hydrogen

Scope is defined at CN code level: being in a covered sector is not enough, the specific product must have a listed CN code. Many producers find that some products are in scope and others are not.

Who is obliged: the importer or the producer?

Legally, the EU importer: it files the declaration, surrenders certificates and pays any penalties. But the data comes from the producer, because only the installation knows the embedded emissions. That shapes the commercial outcome:

With actual installation data, the importer declares the actual value.
Without it, default values apply. They are set conservatively, which penalises efficient producers.
The gap becomes a negotiating item: the importer deducts it from the price or switches to a supplier with better data.

Timeline

1 October 2023: transitional period began: quarterly reporting only, no financial liability.
1 January 2026: definitive period began: importers must surrender CBAM certificates.
1 February 2027 (indicative): certificate sales for 2026 obligations open, priced on the weekly average EU ETS price.
30 September 2027 (indicative): first annual CBAM declaration, covering 2026.

Simplification package and shifting dates

The Omnibus I package adopted in 2025 introduced an annual threshold of 50 tonnes per importer, below which importers are exempt, and moved the first declaration from 31 May 2027 (original regulation) to 30 September 2027. Both 2027 dates are indicative until confirmed by implementing acts: leave a buffer and confirm with your customs representative.

How is the obligation calculated?

Imported quantity is multiplied by the goods’ embedded emission intensity. Deducted from the result: the share matching free allocation to EU producers, and any documented carbon price actually paid in the country of origin. Certificates are surrendered for the remaining net emissions.

The only variable the producer controls is emission intensity: actual measurement or default value.

Embedded emissions: direct and indirect

Direct emissions: released in your own production process.
Indirect emissions: from generating the electricity you consume. Depending on the electricity mix in the country of production, this item can be decisive, especially for aluminium and electric arc furnace steel.
Embedded emissions of precursors: carried by the semi-finished inputs you buy. Even a perfectly measured installation cannot close its calculation without data from its own suppliers.

Actual data versus default values

The only honest way to size the difference is with your own figures. The example below shows the method; the figures are illustrative.

Illustrative structure. Real calculations depend on the implementing acts in force, the current certificate price and the free allocation ratio.
Item	Default value	Actual installation data
Annual exports to the EU	10,000 t	10,000 t
Embedded emission intensity	2.50 tCO₂e/t	1.82 tCO₂e/t
Total embedded emissions	25,000 tCO₂e	18,200 tCO₂e
Certificate price (assumed)	€70/t	€70/t
Annual difference	–	€476,000

The real message

The difference does not come from how cleanly you produce, but from whether you can prove how cleanly you produce. An efficient installation that cannot document its data is priced the same as an inefficient one.

What compliance requires

STEP 01

Scope check

Screen products at CN code level.

STEP 02

Installation boundaries

Draw system boundaries by the rules for each product group; wrong boundaries invalidate the calculation.

STEP 03

Measure direct and indirect emissions

Link fuel, electricity, process emissions and output to traceable records.

STEP 04

Collect precursor data

Obtain input emissions from suppliers. Usually the longest step.

STEP 05

Hand over to the importer

Deliver a versioned dataset with source documents, not a spreadsheet passed around by email.

How Provscope helps

Provscope collects installation and supplier data through single-purpose links, ties every value to its evidence and flags inconsistencies. Producers get a documented dataset for their EU importers; importers get data they can defend. The same data feeds the Digital Product Passport. See how it works.

Frequently asked questions

01Do small volumes fall outside CBAM?

The 50-tonne threshold applies per importer, not per producer. If you also sell to a large importer, the data request still reaches you.

02Is providing actual data mandatory?

No. Without it, default values apply. That is not non-compliance, just more expensive.

03Does the data need to be verified?

In the definitive period, embedded emissions data is expected to be verified by an accredited verifier. Data collected in traceable form, linked to source documents, is faster and cheaper to verify.

To size the gap between default values and your actual data, contact us with your tonnage and measurement data.

Related

Find out in 30 minutes which obligations apply to you.

Tell us about your product groups and EU markets. We will map which dates apply and where the data has to come from.

Request a demo See the regulatory timeline

Obligations list for your product group
Supplier data collection plan
Default vs actual estimate for CBAM