Navigating EU Carbon Border Adjustment Mechanism (CBAM) Compliance
As the EU implements the Carbon Border Adjustment Mechanism (CBAM), UK exporters selling on a Delivered Duty Paid (DDP) basis to European buyers must prepare for significant changes during the transition period.
CBAM initially targets specific sectors that are energy-intensive and at high risk of carbon leakage, such as steel, cement, aluminium, fertilizers, and electricity generation. Over time, it may expand to include other industries.
CBAM is being phased in gradually, with a transitional period during which reporting obligations are introduced before full implementation.
A nine-quarter transition period, from Q4 2023 to Q4 2025, allows for the optimisation of quarterly declarations. During this period, default carbon values can be used; however, this will change starting in Q3 2024.
From Q3 2024 onwards, reporting based on default reference values will no longer be valid, with exceptions for complex goods in specific circumstances. To meet the new requirements, you will need additional information to comply with the guidelines for the reports and declarations due from October 2024 onwards.
Furthermore, starting in January 2026, the annual payment of carbon taxes via “CBAM certificates” will be required. Compliance will become more stringent, with accurate emission values necessary for all declarations.
Simarco is ready to guide you through this complex process, ensuring compliance and accuracy in your CBAM reporting. We provide support in data collection, declaration submissions, and technical guidance to help you navigate these new regulations.
For more information: CBAM-Compliance.pdf
Contact: CBAM@Simarco.com