Signal EU CBAM enters definitive implementation phase on 1 January 2026

Summary

The EU Carbon Border Adjustment Mechanism entered its definitive implementation phase on 1 January 2026, obliging importers to purchase and surrender CBAM certificates, following a transitional period that ran from 2023 to 2025. The mechanism initially covers six sectors: cement, iron and steel, aluminium, fertilisers, electricity and hydrogen. Importers face three main obligations: authorisation requirements, reporting obligations, and the purchase and surrender of certificates corresponding to the embedded carbon emissions of imported goods. Certificate prices are calculated based on EU Emissions Trading System (EU ETS) allowance auction prices, and a dedicated CBAM Registry manages declarations, certificate administration and compliance monitoring by competent authorities. It is the first operational border carbon levy.