The European Union has launched the first phase of its Carbon Border Adjustment Mechanism (CBAM), which will impose CO2 emissions tariffs on imported cement, iron, steel, aluminium, fertilisers, electricity and hydrogen, in order to prevent polluting foreign products from undermining the union’s green transition.
For this first transitional phase, EU member states will have to report on the volume of their imports of the above-mentioned goods, as well as the greenhouse gas (GHG) emissions embedded during their production. At this stage, they will not yet need to pay any financial adjustment. While importers are asked to collect data for the fourth quarter of 2023, their first report will only have to be submitted by 31 January 2024.
This transitional phase will serve as a learning period for importers, producers and authorities, and will allow the European Commission to collect information on embedded emissions in order to refine the methodology for the definitive period, which will start in 2026.
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