The Carbon Border Adjustment Mechanism (CBAM) is here​
CBAM changes what it costs to bring carbon-intensive goods into the European Union and the United Kingdom.​
CBAM
What is it
A carbon price at the border​
A carbon price on imported goods, matching what
producers inside the market already pay.​
Where it applies
The EU and the UK​​
Two separate regimes, each with its own rules,
registration and deadlines.​
Who it affects
The whole import chain​
Importers, traders and customs agents, and the
producers who supply them.​
Scope
Carbon-intensive goods​
Cement, steel, aluminium, fertilisers, electricity
and hydrogen.​
Peterson supports you all the way
Navigate safely through the regulations
Carbon Border Adjustment Mechanisms (CBAM)
Carbon Border Adjustment Mechanisms (CBAMs) are emerging as an important policy tool for addressing carbon leakage and aligning the carbon costs of imported and domestically produced goods.​
The principle is straightforward: where producers in one market face a carbon price on emissions from their production, imported products with embedded emissions may also be subject to a fair carbon cost when entering that market. This is intended to reduce the risk of production and emissions shifting to jurisdictions with less stringent carbon pricing or climate policies.​
It covers the full journey of the emissions in a product, from how they are produced at the installation, to how they are reported and paid for at the border. The mechanism incentivises cleaner industrial production globally.​
CBAMs therefore sit at the intersection of climate policy, international trade and industrial competitiveness. They can affect not only importers, but also manufacturers, exporters and supply chains that need to measure, report and verify the emissions embedded in traded goods.
From EU policy to a global trend
The European Union was the first jurisdiction to introduce a comprehensive CBAM system, known as the EU CBAM. It was first introduced in 2023, and its in 1 January 2026 where the financial obligation of the CBAM enters into play. The EU CBAM currently covers selected goods from the cement, iron and steel, aluminium, fertilisers, electricity and hydrogen sectors.​
The United Kingdom will introduce its own UK CBAM from 1 January 2027, initially covering selected goods from the aluminium, cement, fertiliser, hydrogen, and iron and steel sectors.​
Beyond the EU and UK, carbon border adjustments are increasingly being discussed alongside the expansion of carbon pricing systems around the world. Countries including Canada, Australia, India and others are exploring different approaches to carbon pricing, carbon leakage and border measures, although these initiatives vary significantly in their design and stage of development.​
This means CBAM is becoming more than an EU compliance requirement. For companies operating across international supply chains, carbon-related trade requirements are becoming an increasingly relevant business consideration.
What does CBAM mean for business?​
For companies importing or exporting carbon-intensive products, CBAM creates new requirements around:​
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Carbon data
understanding and calculating the embedded emissions of products.​
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Supply-chain engagement
obtaining reliable emissions information from producers and suppliers.​
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Verification and assurance
preparing emissions data calculations and supporting documentation (MMD) for verification.
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Financial exposure & reporting
understanding the current and future carbon cost associated with imports, and who will be preparing and submitting the CBAM reports.
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Strategic planning
anticipating how evolving carbon pricing and border measures may affect sourcing, production and competitiveness.
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Understanding the changing policy landscape
early can help impacted companies identify their exposure, strengthen data and supply-chain processes, and gain a competitive advantage in a market where carbon emissions have become a strategic trading commodity.
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Your emissions data drives your cost​
The obligation sits with the importer, but the figures come from the production site. Where actual emissions cannot be evidenced, default values apply, and they are set conservatively.​
Explore the key CBAM frameworks
EU CBAM​
Understand the EU CBAM requirements, including scope, emissions calculations, reporting, verification and certificate obligations.​
UK CBAM​
Understand the UK CBAM framework, including scope, emissions calculations, and reporting requirements.​
What is CBAM?​
The Carbon Border Adjustment Mechanism, known as CBAM, is a pioneering regulation aimed at addressing carbon leakage. By imposing a fair carbon price on carbon-intensive imports, CBAM aligns the carbon costs of imported goods with those of equivalents produced inside the market.
It covers the full journey of the emissions in a product, from how they are produced at the installation, to how they are reported and paid for at the border. The mechanism incentivises cleaner industrial production globally. The EU introduced CBAM first, and the United Kingdom is introducing its own, run separately.​​
A fair carbon price on embedded emissions​
Neither regime applies a rate to the customs value of your goods. What you pay follows the emissions embedded in what you import, so better data means a lower cost.​
Your emissions data drives your cost​
The obligation sits with the importer, but the figures come from the production site. Where actual emissions cannot be evidenced, default values apply, and they are set conservatively.​
The same principle, two separate regimes​
In the EU you surrender CBAM certificates. In the United Kingdom it is a tax, collected by HM Revenue and Customs. Businesses trading into both markets are working to two sets of rules.​
Who is affected?
CBAM reaches the whole import chain, from the installation that produces the goods to the business that brings them in​
| Sector | Goods you might recognise |
|---|---|
| Iron and steel | Bolts, screws, washers, car fasteners, tubes and pipes, structural sections, wire, sheet |
| Aluminium | Bars, rods, extruded profiles, foil, tubes, structural components |
| Cement | Clinker, Portland cement, aluminous cement |
| Fertilisers | Urea, ammonia, nitric acid, ammonium nitrate, NPK compounds |
| Hydrogen | Hydrogen |
| Electricity | Imported electricity |
Scope is set by commodity code rather than by product name, and it differs slightly between the two markets. Each market page sets out what is covered there.​
The roles CBAM touches
Who carry the obligation, the cost and the deadlines.
Including direct and indirect customs representatives.​
Who carry no direct obligation, but whose data shapes their customer’s cost.​
Who do not import directly, but are already asked for CBAM-aligned data.​
Emission calculation​
Prevent CO2 leakage from the EU with the CBAM-certificates
Carbon Boarder Adjustment Mechanism – an explanatory document for businesses operating within the European union
Download CBAM guide
Our CBAM related services and support
From 2026, importers will be mandated to pay for embedded emissions in their goods and offset the CO2 generated during their production, through CBAM-certificates. Their aim is to include all EU Emissions Trading System (ETS) sectors under CBAM regulations by 2030 and have the CBAM fully in place in 2034.
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Guidance on registering your legal entity in the CBAM transitional registry
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Confirmation of goods affected by CBAM regulation
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Active support on the implementation of upstream carbon accounting methodologies according to CBAM requirements
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Simplification of emissions data and efficient communication to enhance transparency
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Reporting support, hands-on guidance, and preparation of reporting obligations on a quarterly basis for each EU member state and relevant CBAM reporting entity
The clock is ticking…
At Peterson we are committed to supporting a shift towards a more sustainable and environmentally conscious future. Recognizing the urgency of worldwide sustainability, we aim to make a positive impact on climate responsibility. Our services are designed to assist clients in navigating the evolving environmental landscape. Our specialists in environmental management and CO2 emission reporting collaborate with our custom and logistic experts to support you across the supply chain, from importers to operations of installations to adhere to CBAM requirements. Please download our flyer.
CBAM flyer
Achieving goals together matters
the CBAM regulation imposes significant reporting obligations on EU importers. These reporting requirements contribute to the EU’s broader goal of fostering a more sustainable and environmentally conscious global trade system. As businesses adapt to these new regulations, the hope is for a collective effort towards a greener future and a more resilient global economy. We encourage you to get in touch with our Peterson experts and see where we can support you in the transition to a more sustainable future.
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Please contact us so we can help you with your sustainable challenges or certification implementation. Or do you have other questions? We will be glad to help.
