This is a publication that is part of RSM’s the Voice of SCM. On a monthly basis, RSM issues the Voice of Supply Chain Management (SCM). Our SCM consultants constantly follow global SCM developments in an ever-changing society and translate their impact into practical considerations for internationally active companies. 

Imports covered by the EU’s definitive Carbon Border Adjustment Mechanism (CBAM) have been creating a financial obligation linked to their embedded emissions since the regime began on 1 January 2026. Certificates will only be sold from February 2027, but the customs, emissions and supplier data needed to calculate that obligation are being generated now. Companies that wait until 2027 may struggle to reconstruct the required information.

Further changes are under discussion. EU legislators are negotiating a downstream expansion for 2028, and the European Commission has proposed a slower phase-out of free allocation under the EU Emissions Trading System (EU ETS). The UK will introduce its own CBAM in 2027. Businesses need to distinguish binding requirements from proposals that belong in scenario planning.

This article was written by Bart Ladru (bladru@rsmnl.nl) and Kirill van der Velde (kvandervelde@rsmnl.nl). Bart and Kirill are consultants with RSM Netherlands with a focus on ESG and supply chain management.  

Which imports are covered by CBAM

CBAM currently applies to selected Combined Nomenclature (CN) codes in cement, iron and steel, aluminium, fertilisers, electricity and hydrogen. The CN code determines whether a product is covered, so commercially similar imports can receive different treatment. For cement, iron and steel, aluminium and fertilisers, a cumulative 50-tonne threshold applies per importer and calendar year. Electricity and hydrogen are not covered by this mass-based exemption. If the threshold is exceeded, the obligations apply to the relevant imports for the entire year, including quantities imported before the threshold was crossed.

An importer that expects to exceed the threshold must normally hold authorised CBAM declarant status or use an indirect customs representative that assumes this role. The declarant remains responsible for the annual declaration and surrender, even where suppliers or advisers provide the underlying information. Since 1 January 2026, CBAM has also had potential consequences for customs continuity, financial provisions and purchasing decisions, alongside emissions reporting.

Key CBAM dates 

Calculating and paying CBAM costs for 2026

CBAM certificate prices for 2026

The Commission has already published the first certificate prices: €75.36 per tCO₂ for Q1 2026 and €75.28 for Q2. Four quarterly prices apply to 2026 imports. From 2027, prices will be published weekly. The first annual declaration for 2026 and the corresponding surrender are due by 30 September 2027. From 2027, declarants must also hold at least 50% of the required certificates at the end of each quarter, based on their cumulative imports and taking the free-allocation adjustment into account. This creates a timing difference. Imports made in 2026 require an accrual and data process now, while the cash purchase follows in 2027. The quarterly balance requirement will then create a more regular working-capital need.

The published certificate price should not simply be multiplied by a supplier’s total emissions. The surrender quantity is reduced by the free-allocation adjustment that reflects the treatment of an equivalent EU producer. A qualifying carbon price paid in the country of production may also reduce the obligation if the required evidence is available.

Default values or actual emissions data?

Companies can use Commission default values or verified actual emissions data. Default values are expected to remain a practical compliance route for many importers, particularly where suppliers cannot provide suitable installation-level data or verification would be disproportionate to the expected savings. Default values include a mark-up. In general, this increases from 10% in 2026 to 20% in 2027 and 30% from 2028. The mark-up makes actual data more attractive where a supplier’s emissions are lower than the applicable default value.

Actual data require supplier cooperation, suitable emissions calculations and independent verification. They will not necessarily be the most economical option for every product or supplier.

We recommend using default values as the starting point for estimating exposure, then comparing them with plausible actual emissions for the largest import flows or more efficient suppliers. As the mark-up and the share of emissions subject to CBAM increase, obtaining verified actual data may become more worthwhile. Where actual data are used, an independent CBAM verifier accredited by an EU national accreditation body must verify them. A product carbon footprint or supplier spreadsheet does not automatically meet the CBAM verification requirements.

What CBAM changes are proposed for 2028?

On September 1, 2026, the Commission published an update on accreditation, bringing verification closer to practical implementation. The first CBAM verifiers are expected to receive accreditation around September 2026, with the first verification reports expected from January 2027. Companies considering actual values should identify the relevant production installations and compare potential certificate savings with the additional data and verification costs. Where the savings justify the work, companies should secure verifier capacity and supplier cooperation in time for the first declaration.

On September 15, 2026, the European Parliament adopted its negotiating position on proposed changes to CBAM. It proposes lowering the annual exemption threshold for aluminium goods from 50 tonnes to 5 tonnes, alongside stronger measures against circumvention. Parliament’s position has not changed current law and will be negotiated with the Council. It also calls for a wider expansion to downstream goods from 2028.

The Commission’s proposal would add 180 downstream products from 1 January 2028. Parliament supports the expansion but proposes a wider list of 457 products. The final scope remains subject to negotiation. Both lists include industrial goods such as base-metal mountings, industrial radiators and casting machinery, as well as selected household goods such as washing machines. Around 94% of the products in the Commission’s proposed expansion are used in industrial supply chains. Parliament’s amendments would also include goods such as cranes, forklift trucks and household dishwashers.

Importers of finished products should pay attention: the proposed scope extends beyond basic metals to components, machinery and some consumer goods. Companies should compare both proposed CN-code lists with their customs data when planning for 2028, while keeping goods covered under current law in a separate register. Negotiations will also address measures against product modifications and unreliable emissions reporting used to avoid CBAM.

A slower free-allocation phase-out remains a proposal

Under current law, the CBAM factor falls from 97.5% in 2026 and 95% in 2027 to 90% in 2028, reaching zero in 2034. As the factor falls, importers generally need more CBAM certificates.  On 17 July 2026, the Commission proposed a slower phase-out. The proposed factor remains unchanged for 2026 and 2027, falls to 91.5% in 2028, and then declines more gradually. It would remain at 15% from 2034 through 2037 and reach zero in 2038. If adopted, the proposal would reduce forecast CBAM costs compared with current law from 2028 onwards. However, it remains a proposal. Companies should therefore use current law as their base case and model the slower phase-out as a separate scenario.

The UK CBAM will start on 1 January 2027 for specified aluminium, cement, fertiliser, hydrogen, iron and steel goods. The UK system will operate as a tax rather than a certificate mechanism. Registration is required when the value of covered goods reaches £50,000 under the relevant test. Indirect emissions will not be included when the system starts. The first accounting period covers the 2027 calendar year, with the first return and payment due by 31 May 2028. Supplier data may support both the EU and UK regimes, but the calculations cannot simply be reused. The systems have different product scopes, thresholds, emissions coverage and financial mechanisms.

How businesses can prepare for CBAM costs and compliance

The 2026 obligation is already building. Its final cost will depend on the goods’ embedded emissions, source country, certificate prices and any qualifying carbon-price deduction. Proposed changes to the free-allocation phase-out and product scope could alter costs in later years. Businesses importing into the UK will also need to assess its separate CBAM rules.

For companies trading in affected goods, CBAM costs will influence product margins and sourcing choices. A reliable estimate of current exposure, supported by future scenarios, will help businesses decide how to price products and where to buy them. The practical steps are:

  • Map the import base. Reconcile customs and purchasing data by importer, CN code, net mass, origin and supplier. Monitor imports against the 50-tonne threshold throughout the year.  
  • Estimate the 2026 liability. Combine import data with the applicable default or actual emissions values, certificate prices, the free-allocation adjustment and any qualifying carbon-price deduction. Show the estimated liability by product, its effect on gross margins and when certificates will need to be purchased.
  • Test future scenarios. Forecast costs under current law, then separately model different carbon prices, the proposed slower phase-out, alternative sourcing arrangements and the possible inclusion of downstream goods from 2028. This shows which decisions depend on proposals that have yet to be adopted.  
  • Assess whether actual values are worthwhile. Compare potential certificate savings, now and in later years, with the costs of obtaining emissions data and verification. If the case is positive, identify the suppliers and import flows where actual values would make the most sense.  
  • Use the results in commercial decisions. Assess whether costs should be absorbed, reflected in customer prices or addressed through contract terms, supplier negotiations or different sourcing arrangements. Include the expected certificate purchases in working-capital planning.  
  • Maintain a clear audit trail. Link customs data, emissions information, calculation assumptions and finance records to support the annual declaration.

The immediate priority is a defensible estimate of 2026 CBAM exposure, prepared with input from customs, finance, procurement and sustainability teams. This will show whether margin forecasts and plans for certificate purchases account for costs that have not yet been quantified.

Companies can refine the estimate as supplier data improve and the legal proposals develop, and use it in their next pricing and purchasing decisions.

RSM is a thought leader in the field of supply chain management including ESG. We provide frequent insights through training and thought leadership, based on detailed knowledge of industry developments and practical application gained from working with our clients. RSM helps companies connect individual geopolitical and regulatory developments to the broader changes affecting their supply chains. By doing so, we support businesses in distinguishing short-term disruption from structural change and translating that assessment into coordinated decisions on sourcing, origin, landed cost, logistics and supply chain design. If you would like to discuss what these connected developments mean for your business, please contact one of our consultants.

 

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