CBAM Countdown Navigating Duties & Business Impact
CBAM (Carbon Border Adjustment Mechanism) – what is it?
EU mechanism to prevent carbon leakage by applying CO₂ pricing to imports of carbon-intensive goods, with the following timeline:
Transition phase incl. Omnibus simplifications (2023-2025)
Reporting obligations in force since October 2023; quarterly reports on imports, emissions, and CO₂ prices that are due in a third country.
Fines for non-compliance; de-minimis threshold exempts imports ≤50 tons/year.
Definitive period (starting January 2026)
Only approved CBAM declarants may import CBAM goods (if de-minimis rule is not applicable).
Annual declarations due by September 30, of the following year; independent third-party validation of declared values required.
Adjustments and expansion (2027–2030)
Certificate purchase for 2026 CBAM imports starts February 2027.
CBAM scope may expand to chemicals/polymers by 2030; free allowances under EU Emission Trading System (ETS) phase out by 2034.
Why act now?
Authorized CBAM declarant: status mandatory from 2026 for importation
Registration open since March 2025 via the EU’s Authorization Management Module (AMM).
Requires i.a., EORI number, portal access, supporting docs; approval may take up to 180 days.
Failure to register will block imports of covered goods starting January 2026.
Consider costs for certificates in financial planning as they will impact EBITDA
Companies must budget for CBAM certificates in 2026, even though the issuance begins in February 2027 (retroactive for imports from January 2026).
CO₂ taxes or carbon pricing mechanisms paid in the country of origin can be deducted from liabilities under CBAM regulation.
Sanctions and Compliance Risks
Up to €100 per undeclared ton of CO₂ for non-compliance.
Repeated breaches may result in the loss of CBAM declarant status, effectively halting imports.
Companies must ensure accurate reporting and timely submission of CBAM declarations to avoid penalties.
How A&M Can Help:
At A&M, we integrate strategic consulting with specialized tax and customs expertise to provide comprehensive CBAM compliance solutions. From declarant registration to automating emissions tracking and managing CO₂ certificates through forecasting and budgeting, we ensure compliance, cost optimization, and supply chain efficiency.
Sources:
Regulation (EU) 2023/995
Regulation (EU) 2023/956 in the version in force at the time of publication of this information
A&M Experts:
CBAM is not just a regulatory framework; it is a transformative tool designed to level the playing field by pricing carbon emissions embedded in imports.
Anastasia Buettner
Managing Director
There's an opportunity to leverage CBAM as a catalyst for innovation and sustainability. The time to act is now—prepare, adapt, and lead in the era of carbon accountability
Olaf Beckmann
Senior Director
Discover German Tax Services:
A&M’s Tax Germany Team is on hand to provide a full range of tax services to create value and reduce risk. Our team of highly qualified and senior-led tax professionals have deep tax and industry experience offering exceptional knowledge and expertise from the beginning of the engagement right up until the end of the process.
