The Carbon Border Adjustment Mechanism (CBAM) is set to become operational on 1 January 2026. CBAM is an EU policy designed to prevent carbon leakage by imposing a carbon price on imports of certain goods from outside the EU, ensuring that imported products face similar carbon costs as those produced within the EU. This mechanism targets sectors with high carbon emissions, such as cement, steel, aluminum, fertilizers, and electricity generation. CBAM readiness involves exporters and importers preparing to comply with the new requirements, including reporting the embedded carbon emissions in their products and purchasing CBAM certificates corresponding to the carbon price. Companies must start gathering accurate emissions data, adjust their supply chains, and understand the administrative procedures well ahead of the go-live date. The European Commission encourages businesses to engage with CBAM guidance and support tools now to ensure a smooth transition. Early preparation will help avoid disruptions, ensure compliance, and maintain market access to the EU. Stakeholders should monitor updates, participate in training sessions, and align their carbon accounting systems with CBAM requirements before 2026.

Published on: 2025-12-24 at 00:15:02