Mastering CBAM Compliance in 2026: Latest Updates and How Companies Should Prepare

While payments will occur from 2027, CBAM becomes financially binding for imports made from January 1, 2026, and companies that delay preparation risk significant operational and financial disruption.

In this blog, we outline the latest CBAM regulation updates, explain how CBAM certificate costs are calculated, and show how digital workflows support efficient data collection, supplier engagement, and EU CBAM reporting.

What is CBAM?

The Carbon Border Adjustment Mechanism (CBAM) is an EU regulation designed to prevent carbon leakage by placing a carbon price on certain imported goods. It aligns the carbon cost of imports with the EU Emissions Trading System (EU ETS), ensuring equal treatment between EU and non-EU producers.

CBAM currently applies to high-emission goods such as:

• Cement
• Iron and steel
• Aluminum
• Fertilizers
• Electricity
• Hydrogen

Importers must report the embedded greenhouse gas emissions of these products and, for imports made from 2026 onwards, purchase CBAM certificates to cover those emissions.

CBAM Regulation in 2026: What has changed?

The CBAM Omnibus Regulation, adopted in 2025 and now in force, together with the implementing acts published on December 17, 2025, introduces binding simplifications and operational clarity ahead of the definitive phase.

Key CBAM regulation updates:

1. Binding de minimis exemption (50 tons/year):
   A legally binding exemption now applies: importers with total annual net imports below 50 tons of CBAM-relevant goods are fully excluded from CBAM obligations, including reporting, authorization, and certificate purchases. This replaces the former €150 consignment value exemption.
2. Updated timeline — no certificates purchases in 2026
   CBAM’s timeline is now legally clarified:
   • The annual CBAM declaration and certificate surrender deadline is 30 September
   • CBAM certificates go on sale from February 2027
   • No certificates are purchased in 2026, even though imports made in 2026 generate financial liability.
3. Clarified emissions data and verification rules: The December 17, 2025, implementing acts provide clarity on emissions reporting:
   • Importers may use actual embedded emissions or default values
   • Default values are intentionally conservative and penalizing, often resulting in materially higher CBAM costs than verified supplier data
   • Third-party verification is mandatory when using actual emissions
   • Reporting can be delegated to an authorized representative, supporting complex supply chain structures.

CBAM Timeline: From Transitional Reporting to Financial Compliance

Understanding the long-term timeline is essential for planning data readiness and budget exposure.

Recap: Transitional phase

The CBAM transitional phase, which ran from October 2023 to January 2026, focused on learning and data collection and did not involve any financial payments.

• The Commission has completed its review of the transitional phase
• The last transitional quarterly report is due by January 31, 2026.

Where we are now: Definitive phase

For imports made from January 1, 2026, the definitive phase applies.

• Importers above the 50-ton threshold must hold Authorized CBAM Declarant status
• Under the Omnibus Regulation, importers may continue importing while authorization is pending, provided the application is submitted by the prescribed deadline, i.e. March 31, 2026.

Financial phase (from 2027)

• CBAM certificates go on sale: February 2027
• First annual CBAM declaration and certificate surrender: 30 September 2027 (for 2026 imports)
• CBAM adjustment reaches full coverage by 2034

In December 2025, the Commission also submitted a legislative proposal to extend CBAM by 2028 to selected downstream products. This proposal has not yet been adopted and remains subject to legislative negotiation.

CBAM Certificate Costs: How are they Calculated?

At a high level, CBAM costs are straightforward:

CBAM cost = (number of CBAM certificates) × (EU carbon price)

The EU carbon price refers to the weekly average price of EU ETS allowances. The complexity lies in determining how many certificates you need — and several variables are still being finalized.

What drives the number of certificates?

1. Embedded emissions
   You can use:
   • Default values
   • Actual values from suppliers
2. CBAM Free Allocation Adjustment defines how CBAM obligations are reduced to reflect the free allocation of allowances in the EU ETS.  
3. CBAM Phase-in Factor: This ramps up the share of emissions covered each year, starting low and reaching 100% by 2034.
4. Carbon price paid in the country of production: Companies can deduct eligible carbon prices already paid — but the recognition rules and eligible schemes are still being clarified.
5. Import volumes: Because volumes fluctuate, quarterly monitoring remains essential — even if reporting becomes annual.

Practical recommendation:
Treat CBAM cost forecasts as scenario-based estimates rather than a single fixed number. Use the recently defined default values and benchmark mechanics as a baseline, update projections regularly as EU ETS prices evolve, and refine assumptions where product-specific benchmarks, carbon price recognition rules, or supply chain data change over time.

How Buying CBAM Certificates Will Work

From February 2027, importers must purchase certificates for embedded emissions — and manage them actively throughout the year.

• Importers must ensure their CBAM certificate holdings cover at least 50% of required certificates on a quarterly basis.
• That means quarterly tracking remains crucial for compliance — even though reporting becomes annual.

The annual cycle then looks like this:

1. Purchase certificates (starting Feb 2027)
2. Monitor imports + certificate holdings throughout the year
3. Submit one annual CBAM report
4. Surrender certificates matching reported emissions
5. If you over-purchased, you may return certificates within a defined window (limited extent)

Certificates are purchased via the CBAM registry, from the member state where you are registered. Limited returns of surplus certificates are permitted within defined time windows.

In its current version, inputs are manual, but we have planned future iterations to automatically incorporate the customer customs data that has been uploaded and supplier-submitted emissions data to improve projections and reduce manual work.

Disclaimer: All projections are indicative and will be updated regularly .

What Companies Should Do Now

If you are affected by CBAM, 2026 is the year to act, here are the most practical next steps:

• If you import >50 tons/year, start preparing your Authorized CBAM Declarant application early (authorization can take months).
• Build cross-functional processes across sustainability, procurement, finance, and customs — with clearly assigned roles.
• Identify high-emissions hotspots in your imported product portfolio and supplier base.
• Start forecasting costs now using the best available data — and update scenarios as rules are finalized.
• Invest in supplier onboarding and capacity building, especially for non-EU suppliers unfamiliar with CBAM and emissions calculation.
• Decide, product-by-product, when to prioritize verified supplier emissions vs default values, balancing accuracy and cost implications.
• Stay informed: delegated acts will add technical detail and may materially affect your reporting and cost assumptions.

Key Takeaways

CBAM readiness isn’t a one-time compliance project, it’s an operating capability. With the Omnibus changes in force and operational rules published, CBAM is now a financial mechanism for 2026 imports.

With the CBAM transition period complete, compliance has moved from learning to execution. Companies that used the transition phase to establish robust data management, supplier engagement, and cost-forecasting capabilities are now best positioned to manage CBAM’s financial impact for 2026 imports, as certificate purchasing and surrender begin in 2027. For others, CBAM readiness is no longer optional, it is now an operational and financial imperative