Carbon Border Adjustment Mechanism: What importers need to know for 2026

From 1 January 2026, the EU’s Carbon Border Adjustment Mechanism (CBAM) will fully apply to imports of certain carbon-intensive goods, including cement, steel, aluminium, fertilisers, hydrogen and electricity. CBAM is designed to align the carbon cost of these imports with EU producers under the Emissions Trading System, reducing the risk of carbon leakage and encouraging cleaner production globally. See link to earlier articles which sets out CBAM in more detail: Overview of CBAM, Omnibus Amendments.

Businesses importing these goods from outside the EU will face new compliance obligations. Importers must register as authorised CBAM declarants, report embedded emissions annually, and purchase CBAM certificates to cover those emissions (adjusted for any carbon price paid abroad). Accurate emissions data from suppliers will be essential, and failure to comply may result in customs delays or penalties. From 1 January 2026, only importers that obtain authorisation as “authorised declarants” will be able to import CBAM goods exceeding the single mass-based threshold of 50 tonnes.

Practical steps for businesses include:

• identify affected goods in your supply chain using the CBAM product list
• engage with suppliers early to obtain verified emissions data
• register as an authorised CBAM declarant before exceeding the 50-tonne annual threshold
• prepare internal systems for emissions reporting and certificate management
• budget for certificate costs, which will reflect EU ETS carbon prices

Early preparation will help avoid disruption and ensure compliance when the regime takes effect in January 2026.

Our team is available to advise on CBAM compliance, assist with registration, and help you develop a strategy to manage these new obligations.

Please contact Alan Roberts, Alison Fanagan, Brendan Curran or your usual ALG Environmental & Planning contact to find out more.

Date published: 23 December 2025