Compliance with CBAM is mandatory for the ‘Authorised CBAM Declarant’ (importer of record for CBAM goods imported into the EU Customs Union) and indirect customs representatives.
EU importers of goods covered by CBAM (such as steel, aluminium, electricity, fertiliser and cement) will register with national authorities where they can buy CBAM certificates. EU importers will declare the emissions embedded in their imports and surrender the corresponding number of certificates each year.
CBAM will mandatorily apply to EU customers, so you will have to shift away from non-cooperative suppliers (to minimise the financial and non-financial burdens of non-compliance with CBAM). If an importer can prove that a carbon price has already been paid during the production of the imported goods the corresponding amount can be deducted.
Failure to fulfil CBAM reporting obligations and inaccurately disclosing embedded emissions can lead to a financial penalty ranging from €10-€50 for each tonne of unreported embedded emissions. Higher penalties will be applied where the duration of failure exceeds 6 months. The accuracy of CBAM reports will be reliant upon supplier-provided data. To mitigate risk, importers should impose contractual conditions, holding suppliers accountable for the accuracy of CBAM data.
Customs Wise has a CBAM reporting service.
