The EU Carbon Border Adjustment Mechanism (CBAM) is set to kick in on October 1, 2023, and aims to tackle carbon leakage by imposing a carbon price on certain carbon-heavy goods imported into the EU. The CBAM costing mechanism will gradually phase out free emissions allowances for EU businesses under the EU Emissions Trading System, marking a fundamental shift in the way carbon emissions are accounted for and managed within the EU. The scope of CBAM covers a range of carbon-intensive products, including iron and steel, aluminium, cement, fertilisers, electricity, and hydrogen. To ensure compliance with CBAM, importers of these goods or their indirect customs representatives will be required to report specific information. The first reporting period will be Q4 2023, and businesses involved in international trade within the EU should stay informed about these compliance obligations to avoid potential penalties.
Source: marosavat.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
