Takeaways
- 50 tonne threshold introduced, but electricity and hydrogen remain fully covered.
- Annual reporting deadline set for 30 September of the following year.
- Carbon costs abroad recognised with reductions in certificates.
- Certificates for 2026 imports available in 2027, tied to EU ETS prices.
- Penalties strengthened with lighter fines for minor breaches.
- Some goods excluded, but electricity stays in scope.
- Businesses must prepare now by mapping supply chains, gathering data, and planning budgets.
The European Union’s Carbon Border Adjustment Mechanism (CBAM) is undergoing important updates in 2025, aimed at simplifying compliance, reducing burdens on businesses, and strengthening the EU’s climate objectives. These revisions follow the amendment to Regulation (EU) 2023/956, recently approved by the EU Council.
For companies importing carbon-intensive goods such as steel, aluminium, cement, fertilisers, electricity and hydrogen into the EU, the new rules are highly relevant. Below, Bernard Business Consulting provides an overview of what has changed, what remains, and how businesses should prepare.
Table of Contents
Background: Understanding CBAM
- The original Regulation (EU) 2023/956 introduced CBAM to ensure that imported goods reflect a fair carbon cost, aligning with the EU’s domestic climate policies.
- CBAM is linked to the EU Emissions Trading System (ETS). As free allowances under ETS are phased out, importers will increasingly bear costs through CBAM.
- Since October 2023, CBAM has been in a transitional phase, requiring reporting of embedded emissions without financial obligations.
- From January 2026, full implementation begins, requiring importers to purchase and surrender CBAM certificates for emissions embedded in imported goods.
The 2025 amendments refine the system to maintain environmental integrity while reducing unnecessary complexity.
Click here to learn more about CBAM.
Key Changes Under the 2025 Amendment
1. De Minimis Exemption
- A 50 tonne annual threshold applies across all CBAM goods. Importers below this threshold are exempt.
- If the threshold is exceeded, all imports for that year are subject to CBAM obligations.
Electricity and hydrogen are not included in this exemption and remain fully covered by CBAM.
2. Simplified Reporting and Compliance
- Importers may delegate CBAM declaration submissions to third parties, although they remain legally responsible.
- Annual CBAM declarations must be submitted by 30 September of the following year, providing businesses with more time for compliance.
3. Recognition of Carbon Prices Paid Abroad
- Importers can reduce their CBAM obligations if carbon prices were already paid in the exporting country.
- Reductions can be claimed using verified actual values or recognised default values, subject to independent verification.
4. Stronger Monitoring and Penalties
- The Commission and Member States will monitor compliance using customs data and the CBAM registry.
- Penalties apply to importers who exceed thresholds without authorisation, although reduced penalties apply to minor or unintentional breaches.
5. Default Emissions Values and Exclusions
- Default values for embedded emissions will be updated regularly and can be adapted regionally.
- Emissions from input materials already covered under the EU ETS or equivalent schemes will be excluded to avoid double-counting.
6. Accredited Verifiers and Registry Management
- Verifiers must be accredited and registered in the CBAM system.
Operators in third countries may register their facilities and share verified emissions data directly with EU importers.
7. CBAM Certificates and Timing
- Certificates for 2026 imports will be available in 2027 and priced in line with EU ETS allowances.
- Certificates not used by 1 November of the second year after purchase will be cancelled without refund.
8. Administrative and Financial Adjustments
- Fees paid by CBAM declarants will support the central platform for certificate management.
- The Commission may adjust fees and thresholds through delegated acts.
9. Exclusions and Simplifications
- Non-calcined kaolinic clays are excluded from CBAM.
- For electricity imports, only direct emissions will be considered.
What Businesses Should Watch
- The core purpose of CBAM remains to prevent carbon leakage and ensure fair competition.
- The Council expects that 99 per cent of emissions from CBAM-covered goods will still be captured under the revised framework.
- A review of CBAM is due in late 2025, which may expand its scope to additional sectors and products.
- Importers should monitor further legislative adjustments, especially those made through delegated acts by the Commission.
Strategic Recommendations for Importers
- Assess CBAM exposure: Map your imports of CBAM goods and determine if you are near or above the 50 tonne threshold.
- Collect emissions data early: Engage suppliers to provide actual emissions data or prepare to use default values.
- Plan financially: Factor in the cost of CBAM certificates based on EU ETS prices.
- Ensure verification readiness: Work only with accredited verifiers and register facilities where appropriate.
- Stay updated: Track the 2025 review and future delegated acts for scope expansions and updated rules.
The 2025 amendments to Regulation (EU) 2023/956 simplify CBAM while maintaining its environmental effectiveness. The introduction of a 50 tonne exemption, simplified reporting, and recognition of carbon pricing abroad reduces administrative burdens without undermining climate ambition.
For businesses exporting carbon-intensive goods to the EU, now is the time to act. Contact us to support your CBAM journey with tailored compliance strategies, accurate emissions data management, and expert sustainability advisory services.
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